144 YINSON HOLDINGS BERHAD | INTEGRATED ANNUAL REPORT 2023 CORPORATE GOVERNANCE OVERVIEW STATEMENT Board Evaluation Outcome The NRC conducts the Board & Directors Effectiveness Evaluation (“BDEE”) exercise on an annual basis to determine whether the Board and Board Committees are performing effectively, as well as in their capacities as individual Directors. Once every three (3) years, NRC would obtain an independent perspective on the Board’s effectiveness to gain insights on the Board’s performance against peer boards and best practices. An external firm was last engaged to conduct the Board performance evaluation in FYE 2020. In FYE 2023, the Board on the recommendation of NRC, had appointed the Institute of Corporate Directors Malaysia (“ICDM”) to facilitate a board review. The objective of the appointment was to provide the Board with an independent insight and external perspective of the effectiveness of the Board and its committees in terms of the oversight and governance processes, as well as how they are addressing the forward-looking agenda of the Company. From the observations and findings of the review process, suggestions for improvements and recommendations in accordance with best practices were put forward to further support the journey towards becoming a high-performing and value-creating Board. Board members were invited to participate in a comprehensive set of online questionnaires, followed by confidential oneon-one interviews that garnered candid insights and in-depth perspectives. The process addressed the performance of the Board and its Committees, together with an individual performance review of each Director. Based on ten fundamental board parameters, the questionnaires were designed to encourage thought-provoking and honest responses of the Board’s overall performance in their oversight role, as well as an additional emphasis on how they are integrating sustainability considerations into the Company’s corporate strategy, in line with the emphasis of the MCCG 2021. The BDEE covered the following 10 parameters: • Board Leadership • Board Composition, Skills and Development • Board Committees • Board Governance Oversight and Processes • Board Agendas, Meetings and Information • Board Dynamics and Culture • Board and Management Relationship • Board and Stakeholder Engagement • Board Sustainability Matters • Board’s Pandemic/Crisis Management Response Overall, the result of the BDEE was positive indicating that the Board, Board Committees and individual Directors were effective in discharging their roles. Strengths Improvement Some of the key findings of the BDEE FYE 2023 are as follows: • Board dynamics and culture received amongst the highest ratings, with the quality of the interaction and the openness of the team being commended. The Boardroom atmosphere was also highly rated with emphasis on honest open communication, trust, respect as well as driving the right level of accountability and integrity. • There is a high degree of respect and trust in the Group CEO. The Board also agrees that the Group CEO manages the Board relationship well, is supportive and a bridge to the Senior Management. • The Board’s effectiveness in responding swiftly and effectively to the evolving crisis was rated high. The Board has taken proactive steps to manage risks and its consequences to the business and operating environment pursuant to changing regulatory developments. The findings of the BDEE FYE 2023 have also recommended areas for continuous improvement which reinforced the continuing agenda of the Board in the following areas: • With the Board’s appetite for proactive oversight on strategic execution, some recommendations for further enhancement were received in this area, to ensure specific focus and sufficient time for its full discussion. • A structured methodology for Board Skills Matrix and Board Succession was also recommended, to identify future talent and succession required at the leadership level in advance and ensure a proper transition in membership and development of a diverse succession director talent pool for the Company. On Board membership, this is also in response to MCCG 2021’s recommendation to limit the independent directors’ tenure to nine (9) years. • A structured training and development plan has been recommended based on the feedback obtained from board skills and knowledge assessment. The plan focuses on addressing development needs in areas such as sustainability, with a particular emphasis on climate change and ESG topics, as well as emerging trends that impact the industry. Director onboarding process would be optimised, which was previously impacted by travel restrictions. The outcome of the BDEE could be used as reference in the re-appointment of the Directors, Board Committees’ membership appointment and Board/Board Committees’ restructuring, where applicable. The NRC will look into formulating action plans to address the above based on their priorities, with support from other relevant Board Committees.
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