UEM EDGENTA BERHAD ANNUAL REPORT 2021 1 2 3 4 5 6 7 GOVERNANCE 143 142 CORPORATE GOVERNANCE OVERVIEW STATEMENT The Non-Executive Directors are paid a fixed base fee on a quarterly basis. With the recommendation from the NRC, the Board as a whole determines the remuneration for Non-Executive Director with directors concerned abstaining from deliberation or voting on decision in respect of their remuneration. The aggregate amount of Directors’ fee to be paid to Non-Executive Directors is subject to the approval of the shareholders at general meeting. The Directors Remuneration Framework are as follows. The remuneration breakdown of individual directors which includes fees, salary, bonus, benefit in-kind and other emoluments are as set out in the CG Report under Practice 8.1. Proposed Directors’ Fee per annum (RM) Directors’ Fees Chairman Member Board 210,000 108,000 Audit Committee 50,000 30,000 Other Board Committees 25,000 15,000 The current benefits payable and accorded to the Directors are:- No. Description Directors’ benefits (a) Meeting allowance for ad-hoc or temporary Board Committees established for specific purposes. (i) Chairman of committee – RM2,000 per meeting (ii) Member of committee – RM1,000 per meeting (b) Car allowance for Chairman of UEM Edgenta RM3,400 per month (c) Medical benefits for Board members Where a Director sits on several boards within the UEM Group of Companies, he will be entitled to claim medical benefits from one (1) company only. (i) Medical coverage of RM7,000.00 per annum, inclusive of outpatient, clinical, specialist and dental; and (ii) Hospitalisation of RM100,000.00 per annum including room and board at RM500.00 per day. (d) Training and Development of Directors A training budget is allocated for Directors to attend relevant training programmes and seminars to enhance their knowledge and skills in discharging their duties. (e) Directors’ & Officers’ Liability Insurance Directors are covered by Directors’ and Officers’ Liability Insurance maintained throughout the financial year to indemnify Directors and Officers against any liability incurred by them in the discharge of their duties while holding office as Directors and Officers of the Company. (f) Subsistence allowance for business travel Peninsular & East Malaysia – RM150 per day Overseas – USD125 per day The Company would be seeking shareholders’ approval at the forthcoming Annual General Meeting for the payment of Directors’ benefits for items (a) and (b) of the above table. The Board also had on 25 February 2021 approved the Senior Management Remuneration Framework. The framework which is benchmarked against market rate, is to ensure that Senior Management is always remunerated fairly and to attract, retain and motivate individuals to give their best in serving the Company. However, due to talent retention purposes, the framework is not published on the website. The Management will reconsider the appropriateness of the publication of the framework on the Company’s website. CORPORATE GOVERNANCE OVERVIEW STATEMENT EFFECTIVE AUDIT AND RISK MANAGEMENT AUDIT COMMITTEE The Audit Committee (“AC”) led by Mr. Robert Tan Bun Poo, assists the Board in its oversight of the Company’s financial reporting, and in fulfilling its fiduciary responsibilities relating to internal controls. This includes risk management, overseeing the proper maintenance of financial and accounting records and setting policies as well as financial reporting practices of the Group. It also reviews related party transactions, conflict of interest situations that may arise within the Group and the provision of non-audit services by the External Auditors. The AC comprises of three (3) members, all of whom are Non-Executive Directors, with a majority of them being Independent Directors. Kindly refer to pages 146 to 148 for the AC’s membership and composition and the AC Report for the summary of work carried out by the AC during the financial year 2021. For the financial year under review, all AC members has attended at least one (1) training course relating to the development in accounting and auditing standards, practices and rules, save for Ms. Wong Shu Hsien who was appointed on 1 July 2021, as there was no suitable training that suited her schedule since her appointment. However, she kept herself abreast with the Environment, Social and Governance issues. The duties and responsibilities of the AC are set out in its Terms of Reference which is available at the Company’s website at www.uemedgenta.com. The Terms of Reference was revised on 25 November 2021 to update that partners of external audit firm of the Company must observe a cooling-off period of at least three (3) years before being appointed as a member of the Audit Committee. However, no members of the Board were former key audit partners of the Company. The Board, through the AC, maintains a transparent and professional relationship with the Internal and External Auditors. The AC has been explicitly accorded the authority to communicate directly with both the Internal and External Auditors. The AC meets up with the External Auditors at least twice a year in the absence of the Managing Director/Chief Executive Officer and Management. The External Auditors were also present at Board Meetings for the presentation of their reports. Currently, Messrs Ernst & Young PLT provides independent and professional external auditing services to the Group. The AC conducts yearly assessment on the suitability and independence of the External Auditors. Due to the seven (7) years rotation, En. Ismed Darwis Bahatiar is the new audit partner effective from the financial year ended 31 December 2021. For the year under review, the External Auditors have confirmed to the Board their independence in providing their services. The assessment on the External Auditors for financial year ended 31 December 2021 was facilitated by the Finance team. A set of questionnaires pertaining to the following were sent out to the AC members, relevant Finance personnel, Company Secretary, Head of Legal and Internal Audit for their feedback:- 1) Calibre of the firm 2) Quality of service 3) Audit team 4) Independence, objectivity and professional skepticism 5) Audit scope and planning 6) Audit fees/Non-audit fees 7) Audit Communications The Board is satisfied with the outcome of the assessment of the External Auditors on their suitability and independence, and recommended for their re-appointment at the forthcoming annual general meeting.
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