MSM Malaysia Holdings Berhad Annual Report 2019

The Board presents this statement to provide an insight into the Corporate Governance practices of MSM Group under the leadership of the Board with reference to the following principles: (a) Board leadership and effectiveness (b) Effective audit and risk management (c) Integrity in corporate reporting and meaningful relationship with stakeholders Detailed explanation on how MSM has applied the practices are provided and described in the 2019 CG Report found on the corporate website at corporate-governance. Principle A: Board Leadership and Effectiveness Board of Directors Under the Company’s Constitution, the number of Directors shall not be less than two and not more than 12.The composition of the Board fairly reflects the interest of the significant shareholders, without compromising, is also in compliance with Paragraph 15.02 of the MMLR. As at the date of this statement, there are five members on the Board, comprising: • Two Independent Non-Executive Directors; and • Three Non-Independent Non-Executive Directors. The composition of the Board is reviewed annually by the Nomination and Remuneration Committee to ensure effective balance diversification of gender, skill-sets, experience and knowledge. The profiles of the Directors are presented on pages 63 to 65 of this Annual Report. Appointments to the Board are made via formal, rigorous and transparent process, premised on meritocracy and taking into account objective criteria such as competencies, experience, character, integrity, diversity and the ability to devote time as needed on the Board in the context of the Group’s strategic direction. The Board members ensure that high ethical standards are applied in the discharge of their responsibilities, through compliance with relevant rules and regulations, directives and guidelines in addition to adopting the best practices in the MCCG 2017 and the 3 rd CG Guide, and act in the best interest of MSM Group and its shareholders. Board members observe the Code of Ethics and Conduct (CoEC) and Code of Business Practice (CoBP) applicable to all Board of Directors. The CoEC and CoBP outline the ethical standards of behaviour and conduct expected from all Directors of MSM Group. The Board is chaired by Datuk Wira Azhar Abdul Hamid, a Non-Independent Non-Executive Director, who provides leadership for the Board so that the Board can perform its responsibilities effectively. Details of information on the Board’s roles and responsibilities together with the Board’s reserve matters can be found in the Board Charter which is made available on the Company’s corporate website at corporate-governance. The Board is supported by: • Audit Committee; • Nomination and Remuneration Committee; • Board Governance & Risk Management Committee; • Investment Committee (Disbanded on 20 November 2019). These Committees play a significant role in reviewing matters within their respective Terms of Reference (TOR), and facilitate the Board’s discharge of its duties and responsibilities. Each of the Board Committee has specific TOR, scope and authorities to review matters before tabling it to the Board Meeting for decision making as a whole. Even though there is delegation of responsibilities from the Board to the Board Committees, Group CEO, Chief Financial Officer (CFO) and Group Chief Operating Officer (Group COO), there are still a number of matters reserved solely for the Board’s undertaking. 71 CORPORATE GOVERNANCE 07