MISC Annual Report 2018

In sourcing for suitable candidates, the Company has used a variety of approaches and sources, including from Directors’ registries available under the NAM Institute for the Empowerment of Women, the Minority Shareholders Watch Group (MSWG) and LEAD Women and recommendations from existing Board members. The potential candidates to assume the role of INEDs are first tabled to the NRC for consideration and evaluated based on merit, suitability with the Company’s objectives and required mix of skills, knowledge, expertise, experience, professionalism, integrity, personal attributes and time commitment required to effectively fulfil his or her role as a Director. Diversity in terms of age, gender and ethnicity is also considered during the selection process. During the year under review, having conducted all relevant reviews and assessments, the NRC deliberated and recommended the appointment of the following Directors to the Board: • Dato’ Rozalila Abdul Rahman (appointed as INED on 1 August 2018); and • Tengku Muhammad Taufik (appointed as NINED on 15 November 2018). The NRC is also responsible for recommending to the Board, Directors who are standing for re-election at the Annual General Meeting (AGM) pursuant to Rules 21.7 and 21.8 of MISC’s Constitution. At the forthcoming 50th AGM of the Company, the following Directors will be retiring and being eligible, have offered themselves for re-appointment/ re-election: • Dato’ Rozalila Abdul Rahman (pursuant to Rule 21.7 - newly appointed Director) • Tengku Muhammad Taufik (pursuant to Rule 21.7 - newly appointed Director) • Datuk Nasarudin Md Idris (pursuant to Rule 21.8 - retirement by rotation) • Yee Yang Chien (pursuant to Rule 21.8 - retirement by rotation) In line with the MCCG 2017 and further to a recommendation by the NRC, the Board Charter was revised to include a policy which limits the tenure of Independent Directors to 9 years as well as the Board Diversity Policy. 1. Board Performance Evaluation - Board and Board Committees’ Assessment The performance of the Board and the Board Committees is tracked annually against the Board KPIs, using a Performance Evaluation Sheet (PES) as a tool. The Board KPIs focus on achievements of measurable ‘hard targets’ based on 3 criteria, i.e. Board Structure, Board Operations and Board Roles and Responsibilities. Each Director is required to give Rating ‘1’ for Best Practice, Rating ‘2’ for Meets Requirement and Rating ‘3’ for Areas of Improvement. The final ratings are then reviewed by the NRC, the Board and the Management, and consequently Action Plans are implemented by Management for the areas for improvement highlighted. For FY2018, the following areas will be assessed: Board Performance Evaluation Board Structure • Composition • Orientation, Training & Development • Board Audit and Risk Com- mittee evaluation • Nomination and Remuner- ation Committee evaluation Board Operations • Timeliness • Adequacy of Information • Access to Management Board Roles and Responsibilities • Strategic Vision • Succession Planning • Risk Management & Inter- nal Controls • Investor Relations Board Committees Performance Evaluation • Effectiveness • Discharge of functions, du- ties and responsibilities in accordance with the TOR Identification of Critical Positions (“CPs”) within the Group based on 3 criteria Identification of potential successors from pool of staff at General Manager and Senior Manager levels, nominated and assessed by the Leadership Team based on 4 criteria Formulation of an Individual Development Plan for each individual Impact on business results Sustaining the business Uniqueness of positions 1 24 Achievement Sustainability of performance Ability Competence to deliver successfully Agility Traits and values which help adaptablity Aspiration Passion, tenacity and commitment for self and the organisation Capabilities Contribution Cultural Fit 3 Deliberation and identification of successors by the MC based on 3 criteria, followed by mapping of shortlisted individuals to a maximum of 3 CPs and rating of readiness levels: R1 - Ready now R2 - Ready within 12 months R3 - Ready between 12 & 24 months R4 - Ready above 24 months NOMINATION & REMUNERATION COMMITTEE REPORT Further to the NRC’s deliberation and recommendation, the FY2018 and FY2019 Board Performance Evaluation will be based on the new and enhanced Board KPIs, which reflects the best practices and recommendations of the MCCG 2017. During the year under review, the Board approved the NRC’s recommendation to use independent consultants to assist in the FY2018 Board Performance Evaluation exercise, which will include an assessment of individual Directors. The appointment of independent consultants has been finalised and the Board and Director Effectiveness Evaluation exercise is currently being carried out. 2. Senior Management - Appointment and Succession Planning The NRC is tasked with making appropriate recommendations to the Board for the appointment or renewal of contracts of employment of the President/Group CEO and Management Committee (MC) members of the Company, taking into account diversity in addressing the MC composition. During the year under review, having conducted all relevant reviews and assessments, the NRC deliberated and recommended the appointment of the following MC members: • Hazrin Hasan (appointed as MD/CEO of MISC Maritime Services Sdn. Bhd. and MC member effective 1 April 2018); • Emran Othman (appointed as Vice President, Corporate Planning and MC member effective 1 October 2018); and • *Raja Azlan Shah Raja Azwa (appointed as Vice President, Finance (Designate) and MC member effective 1 January 2019). *Raja Azlan Shah Raja Azwa will assume the office of Vice President, Finance effective 8 April 2019 as per the Company’s Bursa Announcement dated 1 March 2019. The NRC also has the responsibility for ensuring appropriate succession planning for MC members. Following through with the MISC Group’s succession planning efforts in FY2017, the NRC continued with its focus on the MC Positions of the Company and Critical Positions within the MISC Group. Below is a brief illustration of the Succession Planning Approach and Process adopted by MISC Group: HIGHLIGHTS OF THE YEAR OUR BUSINESS OUR LEADERSHIP OUR PERFORMANCE OUR COMMITMENT TO SUSTAINABILITY OUR GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 50 TH ANNUAL GENERAL MEETING 183 MISC BERHAD ANNUAL REPORT 2018 182