SUSTAINABILITY STATEMENT Robust Corporate Governance (cont’d) CORPORATE GOVERNANCE AND BUSINESS ETHICS (CONT’D) The Whistleblowing Policy provides a formal channel for employees and other stakeholders to report occurrences of malpractice within the organisation. A disclosure can be made in writing, verbally or via electronic means to the Integrity Officer. In accordance with the Whistle-Blower Protection Act 2019, all reports received through the Fund’s whistleblowing channels are treated with confidentiality and impartiality, with no employee or third-party subject to consequence or retaliation for making a report in good faith. In FY2021, the Manager did not receive any whistleblowing reports. Al-`Aqar REIT is committed to conducting business in compliance with the Malaysia Anti-Corruption Act 2009. As part of this commitment, the Manager has adopted an ABAC Policy which communicates and details the Manager’s principles and guidelines on money laundering, gifts, entertainment and hospitality expenses. This policy is communicated internally via briefing and training, and externally via the corporate website. However, in this reporting period, the Fund did not conduct training related to anti-bribery and corruption due to COVID-19. In FY2021, no employees were dismissed due to noncompliance with the ABAC Policy. To further enhance the Fund’s commitment to anti-bribery and corruption, the Manager established a due diligence procedure for new tenants and conducted risk assessments on approximately 50% of internal operations in this reporting period. Operations that had undergone the assessment include procurement and outsourcing, acquisitions/divestment, recruitment and training, and valuations. The findings of the risk assessment are compiled in an Integrity Risk register and tabled to the BARC and Board Investment Committee (“BIC”). RISK MANAGEMENT Managing risks appropriately is crucial for long-term strategy planning and futureproofing the business as a REIT. Risk management within the Fund falls under the purview of the BARC which is assisted by the Enterprise Risk Management Committee (“ERMC”). These committees are mainly responsible for ensuring risk management is integrated in the Manager’s day-to-day operations, and identifying risk parameters, appetite, profiles, treatment options, action plans and indicators. As per the Enterprise-Wide Risk Management (“ERM”) Policy and Framework, the Manager reviews risks on a quarterly basis. All findings are compiled in a detailed risk register where the main risk categories are strategic, financial, operational, compliance, IT and integrity risks. In the year under review, the Manager has decided to update the ERM Policy and Framework, effective 2 December 2021. The updates have considered MCCG’s emphasis on ESGrelated risks, internal changes to the governance structure, standard operating procedures (“SOPs”), the timely execution of mitigation plans and establishment of the Three Lines of Defence model. The Manager also targets to adopt an ESG Risk Profile in the first quarter of FY2022. Risks are communicated to the employees by the risk owners. Risk owners also identify the risks to their operations and the associated mitigation plans and present them to the ERMC and/or at the weekly Management Committee meetings. Risk owners are specified at the Risk Identification stage and are responsible for reporting the progress of mitigation plans at weekly Management Committee meetings. To ensure efficient communication of risks and mitigation plans, the ERMC conducts quarterly meetings. In FY2021, the Manager conducted training on Risk Profiling in February, and held a risk refresher workshop in August. In the Three Lines of Defence models, business line management is the first line, risk management is the second and internal audits are the third. STRATEGIC PERFORMANCE GOVERNANCE STRUCTURE SUSTAINABILITY STATEMENT FINANCIAL REPORTS S B E CORPORATE OVERVIEW THE DRIVING FORCES 089
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