GHL System Berhad Annual Report 2017

ANNUAL REPORT 2017 35 STRENGTHEN COMPOSITION (cont’d) Nomination and Remuneration Committees (cont’d) IV. Facilitate Board discussion on key management’s annual appraisal results In FY 2017, the NRC considered and recommended to the Board, the renewal of service contracts of the CEO. In facilitating this, the NRC considered the CEO’s contributions, achievements and deliverables for the past year. In accordance with its TOR, the NRC would also consider and recommend to the Board annual remuneration packages, together with the detailed fringe benefits and Executive Share Scheme (“ESS”). V. Review Board’s service contract and succession plan The Committee reviewed each Executive Director’s service contract based on the Board Charter’s guideline and their respective contributions to the Group. The tenure of each contract is for a maximum continuous period of three years, consistent with the Board Charter. The Committee also reviewed the succession plan of key management based on the individual’s willingness to continue and necessity. The Committee was satisfied with the current succession planning. VI. Review induction and training needs of Directors The Committee reviewed and recommended the necessary training suitable for individual Director based on annual assessment results, skill sets and past training record. The Committee concluded that all Directors have received sufficient and appropriate trainings during FY 2017 that is relevant and would serve to enhance their effectiveness in the Board and the Board Committees. The details of the Directors’ training are set out on page 39. VII. Review nomination and election process The Committee has reviewed the nomination and election process, and has established a clear and transparent nomination and election policy: • The Committee has an option to outsource Director candidate search to professional firms, if necessary, to ensure that a diverse range of candidates are considered; or to accept recommendations by any Board member. The Committee should not be influenced by major controlling/dominant shareholders or the CEO/ Executive Directors. • The Director candidate should be interviewed by the Board Chairman and the NRC Chairman, and should meet all Board members. • The number of Director candidates recommended by the Nominating Committee should be greater than the available board seats, where possible. • Newly appointed Directors are subject to election by shareholders at the first Annual General Meeting (“AGM”) after their appointment. • At least one-third (1/3) of the remaining Directors be subject to re-election by rotation at each AGM and all Directors shall retire from office at least once every three (3) years. The Directors retiring from office shall be eligible for re-election by the shareholders. • An Independent Director who had served on the Board for a period of nine years or more shall submit a Declaration of Independence if she or he wishes to continue to serve as an Independent Director. NRC shall consider the re-appointment based on the Declaration of Independence, assessment criteria and guidelines set out in the policy, and make the appropriate recommendation to the Board. This is also subject to re-election by shareholders in the next AGM. Board Evaluation The Board and its Committees evaluate their performance and governance processes annually to improve the collective and individual contributions and effectiveness. During FY 2017, a peer-assessment on the Board’s performance as a whole, its Committees and their individual Directors, was facilitated by the NRC and led by the Chairman of NRC. The assessment included a review of the administration and operation of the Board and its Committees, agendas, reports and information produced for consideration of the Board. The assessment results were considered by the NRC, which then made recommendations to the Board on the identified areas for improving on effectiveness of the Board. CORPORATE GOVERNANCE OVERVIEW STATEMENT CONT’D