Al-`Aqar Healthcare REIT Annual Report 2020

Sustainability Statement 71 Sustainability Statement GOVERNANCE Standard Operating Procedures The Manager has in place Standard Operating Procedures (“SOPs”) to govern the day-to-day processes to implement the best management practices for the REIT. The SOPs shall be reviewed at least annually or when necessary. Enterprise-wide Risk Management (“ERM”) On an annual basis, the Manager regularly reviews the risks that are significant to the operations and takes the necessary actions to mitigate the risks as part of the ERM exercise. In 2020, the Manager has revised the ERM Policy & Framework to ensure risk management principle, framework and processes are in line with the ISO 31000:2018 Risk Management Guidelines and engaged with an external consultant to improve Risk Profile by reviewing risks identified, along with their categories, impact and mitigations. Whistleblowing Management The Manager established a Whistleblowing policy for any stakeholders to raise their concerns for any inappropriate matters through the Manager’s existing whistleblowing channel. To date, there were no whistleblowing incidents reported through the available channels to the Manager. Anti-Bribery and Corruption Management The Manager is committed to prevent corruption and to build a culture of integrity. In 2020, the Manager adopted the Anti-Bribery and Corruption Policy and Manual that were approved by the Board of Directors. The policy and manual aim to help implementing, maintaining and improving anti-bribery and corruption management systems. It has the potential to positively impact business operations, investment, finance and value added to the organization as well as to help ensure organizational sustainability and support the vision and mission of REIT Manager and The Fund as a whole. With the policy and manual, the Manager reiterates its commitment to complying with the Malaysia Anti-Corruption Commission (“MACC”) Act 2009 and the MACC (Amendment) Act 2018. The policy complements theManager’s Code of Conduct and Business Ethics, which must be adhered to by all employees and communicates our principles on corruption and money laundering among other issues related to bribery and corruption. It also details the Manager’s new guidelines on gifts, entertainment and hospitality expenses. In addition, it reminds employees that there are severe consequences if they violate the policy, which include dismissal as well as civil and criminal liability. Therefore, a training on anti-bribery and corruption has been conducted to all employees on 18th and 19th June 2020. In 2020, there were no reported incidents related to bribery and corruption. Other Committees Apart from the BOD, the Manager has in place various committees to ensure continuous governance in the overall operations such as: Committee Objectives Board Audit and Risk Management Committee (“BARC”) - To review issues on accounting policies and presentation of external financial reporting and ensure an objective and professional relationship is maintained with the appointed auditors. - To ensure that risk management is integrated in the Manager’s day-to-day operations and ensure consistency of operational procedures and practices within the organisation to ensure effective risk management. Nomination & Remuneration Committee (“NRC”) - To ensure that the board composition adopts the elements of MCCG 2017 and the remuneration arrangements support the strategic aims of a business - To ascertain that a succession planning framework is in to ensure that a retention talent pool among senior management positions in compliance with the requirements of the MCCG 2017 Enterprise Risk Management Committee (“ERMC”) - To assist the BARC and the BOD in establishing and maintaining effective policies and guidelines to ensure effective risk management. - To review and endorse the risk parameters, risk appetite, risk profiles, risk treatment options, risk action plans and key risk indicators - To ensure that the most effective mitigation plans are in place, implemented and executed within a stipulated timeframe. The relevant committees discuss matters of the REIT on a periodic basis in relation to the objectives of the establishment of these committees. Ultimately, updates relevant to the REIT will be reviewed by the BARC and reported to the BOD on a timely basis.