CORPORATE GOVERNANCE OVERVIEW STATEMENT The governance structure of the Company where the responsibilities of the Board are delegated to the relevant Board Committees and the Management of the Company is illustrated below: (Cont’d) CORPORATE GOVERNANCE STRUCTURE (CONT’D) Components Subcomponents Description TALENT & CULTURE • Business and operating principles • Core belief and risk culture • Leadership development and talent programmes performance • Management and incentives • Aligns governance with operating and business principles • Articulates core beliefs and foundation for culture • Highlights characteristics of risk culture • Outlines leadership succession, assessment, and development responsibilities • Aligns performance management, approach, measures and responsibilities to compensation and incentive plans INFRASTRUCTURE • Policies and Procedures • Establishes design and content of policy manual and associated procedures • Outlines type and frequency of internal reporting and communications • Define scorecards, measures, and metrics to track performance • Aligns technology and governance requirements Board Leadership and Management The Board is led by an Independent Non-Executive Director and comprised of 4 other Independent Non-Executive Directors and 4 Non-Independent Non-Executive Directors. The Directors have a balance and depth of skills, experience, independence and knowledge of the Real Estate/ Property industry and the REIT business model, which enables them to discharge their respective duties and responsibilities effectively. Each Director and Senior Management were assessed for compliance with the Policy on Fit & Proper Criteria, their performance, and effectiveness. Should any of them are found no longer fit and proper or is underperforming, the BNRC will take corrective measures to manage such event accordingly. The board is collectively responsible for the long-term success of a company and the delivery of sustainable value to its stakeholders. In discharging its fiduciary duties and leadership functions, it is imperative for the board to govern and set the strategic direction of the company while exercising oversight on management. It also plays a critical role in setting the appropriate tone at the top, providing thought leadership and championing good governance and ethical practices throughout the company. The Board is also responsible for the governance and management of the company. To ensure the effective discharge of its functions, the Board undertakes the following responsibilities: 1. To review, challenge and approve the annual corporate plan, which includes the overall corporate strategy, marketing plan, human resources plan, information technology plan, financial plan, budget, regulations plan and risk management. 2. To oversee the conduct of the businesses and to determine whether the businesses are being properly managed. 3. To review and identify new areas of improvements that promote high standards of corporate governance and compliance culture within the Company. 4. To identify principal risks and ensuring the implementation of appropriate internal controls and mitigation risks to effectively monitor and manage these risks. 5. To review and realign key policies adopted in keeping abreast of new opportunities and potential challenges affecting the sustainability of the Company. 6. To implement succession planning of the Chairmanship of the Board and key management positions that involve appointing, training, fixing the remuneration of, and where appropriate. PRINCIPLE A: BOARD LEADERSHIP & EFFECTIVENESS 102 CORPORATE GOVERNANCE 1 2 3 5 6 AL-`AQAR HEALTHCARE REIT ANNUAL REPORT 2023
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