The Risk and Business Process Management Department is responsible for the overall coordination of risk management of DNeX Group and works closely with risk owners. The Head of Risk undertakes the coordination of the processes of assessing, monitoring and reporting the risk report to the Risk, Governance and Sustainability Committee and Board on a quarterly basis. The Risk Report presentation is a permanent agenda of the quarterly Risk, Governance and Sustainability Committee and Board meetings to facilitate deliberation on the key risks profile of DNeX Group. As communication is required for an effective risk management programme, the Risk and Business Process Management Department is responsible to lead the ERM educational programmes, continuous sharing of risks insights as well as undertake initiatives to improve DNeX Group risk management reporting. INTERNAL CONTROLS The Board and Management have established various processes for the internal controls system of DNeX Group which encompasses the structure, governance, policies, processes, tasks, behaviours and other aspects that facilitate effective and efficient operations. It enables DNeX Group to respond appropriately to significant business, operational, financial, compliance and other risks to achieving DNeX Group’s objectives. The key elements of DNeX Group’s control environment include: Group’s Organisational Structure ▪ The organisational structure is reviewed periodically to address changes in the business environment and to reflect the level of accountability and empowerment of the Management in all aspects of DNeX Group’s major business environment, operations and functions. It defines a formal line of authority and responsibility that sets out clear segregation of duties to affect a more effective control at various levels of DNeX Group. Executive Committee ▪ The establishment of Executive Committee (“EXCO”) which was formed in Quarter 4 of FY2024 serves to facilitate efficient and operational decision-making as well as an approval committee while maintaining appropriate levels of board oversight. The EXCO meets on weekly basis to enable DNeX Group top management to provide a faster turnaround time in providing the guidance and facilitating the business units in expediating the business activities to meet planned targets within the financial year. EXCO plays a crucial role in the effective functioning of DNeX Group in achieving several objectives among others, providing direction and guidance to DNeX Group business operations as well as its support services, overseeing the Group’s strategic direction ensuring the management of resources and budget allocation are in line with the strategic goals and proactively identifying and monitoring key risks that may affect the achievement of operational objectives and long-term strategic success. Competency and Talent Management ▪ The Management appoints employees with the necessary competencies to ensure that the personnel driving key operations are sufficiently skilled and exercise the required qualities of professional integrity in their conduct. Training and development programmes are identified to ensure that employees are kept abreast with the constantly changing environment and knowledge in order to be competent in line with achieving DNeX Group’s business objectives. Continuous efforts are also in place to identify and grow the talent beyond the succession pool to ensure that new hires have the right skill sets for the appropriate positions in DNeX Group. Performance monitoring is also established which serves as a tool to monitor performance against the set Key Performance Indicators (“KPIs”), covering key financial, customers, internal business process and learning and growth indicators. Delegation of Authority ▪ DNeX Group defines clear lines of role, responsibility and authority to facilitate swift response in the evolving business environment. Thus, the Board’s approving authority on certain activities are delegated to the Management through a clearly and formally defined Authority Limits (“AL”). The AL provides the primary governance framework for DNeX Group as the Board formally delegates specific oversight and supervisory functions and controls to the Management to more efficiently manage the business decision making process within DNeX Group. It defines a sound framework of authority, accountability and segregation of duties to facilitate effective decision making at the appropriate level. Nonetheless, the key matters are still reserved for the Board’s consideration and decision making. The AL is subject to reviews and enhancements to reflect continuous improvements in tandem with emerging risks and operational issues. 102 Governance DAGANG NeXCHANGE BERHAD Integrated Report 2024 STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL
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