INTRODUCTION

The basic responsibility of the Directors is to exercise their business judgment to act in what they reasonably believe to be in the best interests of the Company and its shareholders. In discharging that obligation, directors should be entitled to rely on the honesty and integrity of the Company's senior executives/management and its external advisors and auditors.

The primary objective of the Company's Board Charter is to set out the roles and responsibilities of the Board of Directors ("Board").

The Board should assume, amongst others, the following responsibilities::-

• Approve and proactively participate in strategic decisions;
• Together with senior management, promote good corporate governance culture within the company which reinforces ethical, prudent and professional behavior;
• Challenge management with questions based on informed knowledge;
• Oversee management’s plans, decisions, and actions;
• Succession planning for Board and Senior Management, including the implementation of appropriate systems for recruiting, training and determining the appropriate compensation benefits;
• Monitor management’s ethical conduct, financial reporting and regulatory compliance;
• Play a critical role in ensuring sound and prudent policies and practices of the Company;
• Be capable of effectively achieving good governance and protecting the interests of shareholders; and
• Ensure there is a sound framework for internal control and risk management; and
• Set the risk appetite within which the Board expects Management to operate and ensure that there is an appropriate risk management framework to identify, analyse, evaluate, manage and monitor significant financial and non-financial risks.

The Board will regularly review this charter and the terms of reference of Board Committees to ensure they remain consistent with the Board’s objectives and responsibilities, and relevant laws, regulations, guidelines and standards of corporate governance.

1. The Board should comprise of individuals with character, experience, integrity, competence and time to effectively discharge their role as company director. The composition and size of the Board is such that it facilitates the making of informed and critical decisions.
2. The number of directors shall not be less than three (3) and not more than eleven (11). The appointment of directors shall be recommended by the Nomination Committee and approved by the Board.
3. At any one time, at least two or one-third (1/3), whichever is higher, of the Board members are independent directors.
4. The Board may appoint a senior independent director to whom shareholders’ concerns can be conveyed if there are reasons that contact through the normal channels of the chairman or the Chief Executive Officer have failed to resolve them.

   The Board shall appoint the senior independent director as the chairman of the Nomination Committee, unless a better candidate is available.

5. The positions of chairman of the Board and Chief Executive Officer should be held by different individuals, and the chairman must be a non-executive member of the Board. The Board must comprise a majority of independent directors where the chairman of the Board is not an independent director.

   In the event that the positions of chairman of the Board and Chief Executive Officer are held by the same person or in the absence of such position, the Company shall provide explanation and justification in the Annual Report of the Company.

1. The chairman should:
1. providing leadership for the board ;
2. leading board meetings and discussions;
3. managing the interface between board and management;
4. setting the board agenda and ensuring that board members receive the necessary information in a timely manner;
5. encouraging active participation and allowing dissenting views to be freely expressed ;
6. leading the board in establishing and monitoring good corporate governance practices in the Company; and
7. ensuring appropriate steps are taken to provide effective communication with stakeholders and their views are communicated to the Board as a whole.
2. The Chairman will have no casting vote if two (2) directors form a quorum, or if there are only two (2) directors competent to vote on the question at issue.

1. The Chief Executive Officer should:
1. Be persons of high calibre, and unquestionable integrity;
2. Directly responsible for the day-to-day operations of the Company;
3. Familiar with the Company’s performance, the adequacy of internal controls, risk management and compliance with legal requirements as well as current matters and policies affecting the industry in general;
4. Devote full attention and time to their duties and responsibilities and be able to direct and supervise the Company effectively and responsibly; and
5. At all times exercise professional skill, due care and diligence when performing his functions, exercising their powers or discharging his duties.
2. As the Chief Executive Officer is directly responsible for the day-to-day operations of the Company, he must be familiar with the operations of the Company, the state of internal controls, requirements of regulations, as well as current issues and policies affecting the industry in general. He must also have the necessary knowledge and professional competence in the conduct of the Company’s business.

   The Board shall link the Company's governance and management functions through the Chief Executive Officer. All Board authority conferred on Management is delegated through the Chief Executive Officer so that the authority and accountability of Management is considered to be the authority and accountability of the Chief Executive Officer so far as the Board is concerned.

In the absence of its Chief Executive Officer, the executive director who is fully acquainted with the Company’s affairs, is the person who will be directly responsible for the overall running of the Company.

3.3   INDEPENDENT DIRECTOR

An independent director should declare to the Company annually that he complies with the criteria as stated below.

1. He is independent of management and free from any business or other relationship, which could interfere with the exercise of independent judgment or the ability to act in the best interest of the Company and :-
   1. Is not an executive director of the Company or any related corporation of the Company;
   2. Has not been within the last 2 years and is not an officer (except as a non-executive director) of the Company;
   3. Is not a major shareholder of the Company;
   4. Is not a family member of any executive director, officer or major shareholder of the Company;
   5. Is not acting as a nominee or representative of any executive director or major shareholder of the Company;
   6. Has not been engaged as an adviser by the Company under such circumstances as prescribed by the Exchange or is not presently a partner, director (except as an independent director) or major shareholder, as the case may be, of a firm or corporation which provides professional advisory services to the Company under such circumstances as prescribed by the Exchange; or
   7. Has not engaged in any transaction with the said Corporation under such circumstances as prescribed by the Exchange or is not presently a partner, director or major shareholder, as the case may be, of a firm or corporation (other than subsidiaries of the applicant or the listed corporation) which has engaged in any transaction with the said Corporation under such circumstances as prescribed by the Exchange.
2. An independent director should:
   1. Provide and enhance the necessary independence and objectivity to the board;
   2. Ensure effective checks and balances on the board;
   3. To mitigate any possible conflict of interest between the policy-making process and the day-to-day management of the Company;
   4. Constructively challenge and contribute to the development of business strategy and direction of the Company; and
   5. To ensure that adequate systems and controls to safeguard the interests of the Company are in place.

3.4 INDIVIDUAL DIRECTORS

Directors are expected to observe their legal, statutory and equitable duties and obligations when discharging their responsibilities as Directors. Broadly these include:

1. Acting in good faith and in the best interests of the Company as a whole;
2. Acting with care and diligence and for proper purpose;
3. Avoiding conflicts of interest with the Company in a personal or professional capacity; and;
4. Refraining from making improper use of information gained through the position of director and from taking improper advantage of the position of director.

Directors will keep all Board information, discussions, deliberations and decisions that are not publicly known confidential and not use information gained through the Board for their interest, or their employers' interest.

The Company should ensure that the directors and the Chief Executive Officer are of high calibre, sound judgment, high integrity and credibility as they are entrusted by the shareholders to manage and perform effectively.

All nominations of candidates for the positions of directors and Chief Executive Officer must be submitted to the Nomination Committee for consideration. The Nomination Committee shall base on the “Fit and Proper” standards as detailed hereunder before recommending the candidates to the Board for approval:-

Age limit

• In accordance with the Malaysian Companies Act, 1965.

Work Experience

• 5 years or more preferably in relevant industry.
• Have been in senior management position.
• Good track record of managing a successful and profitable organisation.

Qualifications

• Degree, Professional qualification or equivalent or with the requisite years of relevant work experience

Personal Background

• A person of good character and high integrity and credibility.
• Not a bankrupt and has never been engaged in deceitful/oppressive/improper business practices.
• Has not been engaged/associated or had conducted himself in a manner which may cause doubt on his fitness, competence and soundness of judgment.
• Has not contravened any provision made by or under any written law to be designed for protecting members of the public against financial loss due to dishonesty, incompetence or malpractice.
• Have not been convicted whether within or outside Malaysia of any offence (other than traffic offence).

Competencies

• Business acumen
• Product knowledge
• Visionary
• Strategic agility
• Proven leadership ability
• Financial knowledge
• Market and global awareness
• Compliance and legal awareness
• IT awareness
• Human Resource Management skills

The directorships entitled to be held by any Board member at any one time shall not exceed five (5) in listed companies as may be determined by Bursa Malaysia Securities Berhad from time to time.

Directors should notify the Chairman of the Board before accepting any new directorship, including an indication of time that will be spent on the new appointment.

All nominations of candidates for the positions of directors and Chief Executive Officer must be submitted to the Nomination Committee for consideration.

Pursuant to the Articles of Association of the Company, at least one third of all directors should retire by rotation in every year and be eligible for re-election at the annual general meeting.

All Directors are subject to retirement by rotation at least once every three (3) years and are eligible for re-election.

To enhance its effectiveness, the Board shall ensure its members have the relevant skills, experience, expertise and time commitment. Accordingly, the Nominating Committee is entrusted by the Board to appraise candidates for directorship, including those who retire and offer themselves for re-election or election, before recommending to the Board.

The tenure of an independent director should not exceed a cumulative term of nine (9) years. Upon completion of the nine (9) years, an independent director may continue to serve on the Board subject to the director's re-designation as a non-independent director. The Board, upon recommendation of the Nomination Committee, shall justify and seek shareholders' approval in the event that it desires to retain a person who has served in that capacity for more than nine (9) years as an independent director.

If the Board continues to retain the Independent Director after the twelfth (12) year, the Board shall provide justification and seek annual shareholders' approval through a two-tier voting process.

The long serving director is required to declare to the Company annually that he complies the criteria as stated in item 3.3 above.

On boardroom diversity, the Board is supportive of the gender boardroom diversity. The Board through the Nomination Committee will review the proportion of the female to male board members during the annual assessment of the Directors' performance taking into consideration the appropriate skills, experience and characteristics required of the Board Members, in the context of the needs of the Group.

5.0

BOARD/MANAGEMENT AUTHORITIES

The Board shall have the authority to approve transactions or activities which are beyond the individual discretionary powers of senior officers or management committees delegated by the Board as per the Approving Authority limits stipulated in the relevant policy manuals of respective operating units subject to the provision of the Articles of Association of the Company.

6.0

BOARD COMMITTEES

1. The Board should establish and delegate certain duties to specialised Board Committees to oversee critical or major functional areas and to address matters, which require detailed review or in-depth consideration before tabling its recommendation to the Board.
2. The Board has established the following Board Committees which operate within their specific terms of reference:-
   1. Nomination Committee

      To provide a formal and transparent procedures for the appointment of directors as well as annual assessment of effectiveness of individual directors, Board Committees and Board as a whole and key senior management officers.

   2. Remuneration Committee  

      To provide a formal and transparent procedure for developing remuneration policy for directors and key senior management officers, and ensuring that compensation is competitive and consistent with the Company’s culture, objectives and strategy.  

   3. Audit Committee

      To provide independent oversight of the Group’s financial reporting, risk management and internal control system and ensure checks and balances within the Group, and to ensure financial statements comply with applicable financial reporting standards.  

      To review and assess the suitability and independence of external auditors.  

   4. Risk Management Committee

      To oversee senior management’s activities in managing credit, market, liquidity, operational, legal and other risks, and to ensure that the risk management process is in place and functioning effectively.

Duties and functions of the above-mentioned committees are provided in their respective terms of reference.

1. The conduct of directors will be consistent with their duties and responsibilities to the Company and, indirectly, to the shareholders. The Board will always act within any limitations imposed by the provisions of relevant laws and guidelines on its activities;
2. Directors will use their best endeavours to attend Board meetings. Directors are expected to participate fully, and constructively in Board discussions and other activities and to bring the benefit of their particular knowledge, skills and abilities to the Board;
3. Directors who are not able to attend a meeting will advise the Chairman at an earlier date as possible and confirm in writing to the Secretary;
4. Board discussions will be open and constructive, recognising that genuinely held differences of opinion could bring greater clarity and lead to better decisions. The Chairman will, nevertheless, seek a consensus of the Board but may, where considered necessary, call for a vote;
5. All discussions and their record will remain confidential unless there is a specific direction from the Board to the contrary, or disclosure is required by law. Subject to legal and regulatory requirements the Board will decide the manner and timing of the publication of its decisions;
6. Directors are expected to strictly observe confidentiality of the Company’s information;

The Board shall within its terms of reference:

1. Have complete, adequate and timely information prior to Board meetings and on an ongoing basis;
2. Have the resources required to perform its duties;
3. Have full and unrestricted access to any information pertaining to the Company;
4. Have the authority to form management / sub-committee(s) if deemed necessary and fit;
5. Have the authority to delegate any of its responsibilities to any person or committee(s) that is deemed fit;
6. Have direct communication channels with employees, senior management personnel and relevant external parties; and
7. Be able to obtain independent professional or other advice.

MEETINGS & MINUTES

Subject to relevant laws and guidelines, the following should be observed by the Board:-  

1. The Board shall meet on a quarterly basis, but in any event, no less than once in every three (3) months, or whenever deemed necessary;
2. Individual directors must attend at least 50% of the Board meetings held in each financial year or such other percentage as may be prescribed by the Listing Requirements;
3. The quorum of the meetings shall be met pursuant to the Articles of Association of the Company;
4. The Board and Board Committees are also allowed to carry out the resolution by way of circulation;
5. The participation of the director can be facilitated by means of video or telephone conferencing;
6. Head of the respective division units and relevant management personnel may be invited to attend the Board meetings;
7. The Company Secretary shall be appointed as Secretary of the Board Meeting and minutes of meetings shall be taken and documented;

The Board meeting may be held and conducted through the telephone or any communication equipment which allows all persons participating in the meeting to hear each other. A person so participating shall be deemed to be present in person at the meeting and shall be entitled to vote and be counted in a quorum accordingly.

Senior management and external independent advisos may be invited to attend the Board meetings or Committees as and when the need arises.

The meeting materials are circulated in advance of the Board meeting. Urgent papers may also be presented and tabled at the meetings.

TRAINING

All Directors are required to attend the Mandatory Accreditation Program in compliance with the Listing Requirements of Bursa Malaysia Securities Berhad.

All the director shall attends such training programmes as may be prescribed by Bursa Malaysia Securities Berhad from time to time to equip themselves with knowledge to effectively discharge their duties. The Board shall assess each directors individual training needs and ensure that they have access to continuing education programs.

REMUNERATION OF DIRECTORS  

1. The Company aims to set remuneration at levels which are sufficient to attract and retain the Directors needed to run the Company successfully, taking into consideration all relevant factors including the function, workload and responsibilities involved, but without paying more than is necessary to achieve this goal.
2. The level of remuneration for the executive directors is determined by the Remuneration Committee after giving due consideration to the compensation levels for comparable positions among other similar industry.
3. Non-executive directors are entitled to participate in the Company’s Share Issuance Scheme (SIS) subject to approval at a general meeting. Non-executive directors who participated in the SIS are prohibited to sell, transfer or assign the shares within one (1) year from the date of offer of such options.
4. All the director shall have a service contract with the Company.
5. A formal independent review of the directors’ remuneration is undertaken no less frequently than once every three (3) years.

DECLARATION OF INTEREST/CONFLICT OF INTEREST

The Directors are required to inform the Board of conflicts or potential conflict of interest that may have in relation to particular items of business, arrangement or transaction. Subject to provisions of relevant laws and guidelines, these Directors shall abstain from deliberation and determination of those matters.

INDEPENDENT ADVICE

The Board and Directors shall have access to management and, as and when required. At the request of the Board, Management is obliged to supply in a timely manner, all relevant information to enable director to make sound business judgments and discharge their duties more effectively.

A director of the Company is entitled to seek independent professional advice at the Company's expense on any matter connected with the discharge of their responsibilities. Individual Directors may also obtain independent professional or other advice in furtherance of their duties, subject to approval by the Chairman or the Board, depending on the quantum of the fees involved.

14.0

BENEFICIAL INFLUENCE ON COMMUNITY

The Board has a continuing responsibility to the community to ensure that the Company's activities are conducive towards promoting the economic well-being of its community and are in line with government's economic objectives.

This Board Charter was reviewed by the Board on 28 August 2017.