SUSTAINABILITY STATEMENT ROBUST CORPORATE GOVERNANCE (CONT’D) Regulatory Compliance (cont’d) It is also crucial that tenants abide by all stipulated legal requirements and agreements, such as the Uniform ByLaws 1984, the Fire Services Act 1988, and the Lease/ Tenancy Agreement. To ensure all requirements are met, the REIT conducts scheduled monitoring, and receives monthly updates from the Maintenance Manager through the Monthly Report. This report also details the licence status of each building, with the renewal of said licences under the purview of the lessee and regulated by KPJ HQ. The Board regularly receives legal and secretarial updates in order to stay updated on developments in the regulatory landscape. For this purpose, both management personnel and the Board are encouraged to attend talks and seminars whenever necessary. The Manager also receives alerts on relevant changes from Bursa Malaysia, the Securities Commission, and the Malaysian REIT Managers Association (“MRMA”). Initiatives taken to ensure compliance with applicable laws and regulations are communicated internally via management meetings, announcements, and briefings. They are conducted externally through Annual General Meetings, analyst briefings, Al-`Aqar’s corporate website, and annual reports. Any and all questions are directed via email to a designated individual. In fiscal year 2022, the Fund has not recorded any incidents of non-compliance. Corporate Governance and Business Ethics Daily processes are kept in order by internal SOPs, which take into account business development, internal controls, risk management, compliance, IT, talent management, finance, and operations. All values, principles, and expectations of professional conduct within Al-`Aqar are upheld through the Manager’s Code of Conduct and Business Ethics (the “Code”). The Code is a clearly defined guideline on how employees and associates are expected to behave, as well as detailing disciplinary actions in the event of non-compliance. This Code is supplemented by other policies, such as the Whistleblowing Policy, Anti-Bribery and Anti-Corruption Policy (“ABAC Policy”) and Manual. All these policies and procedures are communicated to employees via mail, briefings, training sessions, and posters. The Fund is dedicated to providing a secure avenue for informants to report instances of non-compliance and misbehaviour within the organisation. As such, our Whistleblowing Policy has been revised, adopting a similar policy and standard procedure to JCorp. This updated Whistleblowing Policy ensures all reports received are treated with confidentiality and impartiality, while ensuring any made with malicious intent will be dealt with accordingly. This updated policy is revised in accordance with the Whistleblowers Protection Act 2010. In FY2022, the Manager did not receive any whistleblowing reports. Al-`Aqar remains committed to ensuring all operations remain in compliance with the Malaysia Anti-Corruption Act 2009. To this end, the Manager has adopted an ABAC Policy, which clearly defines and communicates the Manager’s principles and guidelines on money laundering, gifts, entertainment, and hospitality expenses. Further supplementing this, a new No-Gift, No-Entertainment Policy was implemented. The details of these policies are disseminated internally through briefing and training, and externally through the corporate website. Anti-corruption training was provided for all employees at every position level, with a total of 96% of all employees attending the training. In FY2022, no employees were dismissed due to non-compliance with the ABAC Policy. To further improve Fund’s compliance with anti-bribery and corruption laws and ensure regulatory compliance, the Manager has introduced and implemented the following new initiatives: conducting refresher briefing and trainings to employees, and committing to due diligence through an integrity pledge by service providers or business partners. Additionally, the previously established due diligence procedure for new tenants has been retained, and risk assessments are conducted on approximately 100% of internal operations this reporting period. Operations that have undergone this risk assessment include recruitment, Business Associates & Outsourced Service Providers, Suppliers, Business Development & Investor Relations, and Operations. The risk assessment findings are compiled in an “integrity risk register” and presented to the BARC and the Board Investment Committee (“BIC”). There have been no significant risks identified in all assessed operations. In FY2022, there have been no incidents of corruption or non-compliance. Risk Management To ensure the longevity and stability of the business as a Fund, it is vital to appropriately manage all risks. The overseers of risk management are the BARC, which is assisted by the Enterprise Risk Management Committee (“ERMC”). These committees are responsible for ensuring risk management is embedded in the Manager’s daily routine, and are also charged with identifying risk parameters, appetite, profiles, treatment options, action plans and indicators. The Manager assesses risks on a quarterly basis following the Enterprise Risk Management (“ERM”) Policy and Framework, and findings are compiled into a detailed risk register into categories, which are: strategic, financial, operational, compliance, IT and integrity risks. GRI - 205-1 | 205-2 AL-`AQAR HEALTHCARE REIT ANNUAL REPORT 2022 84
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