CORPORATE GOVERNANCE OVERVIEW STATEMENT Senior Management Remuneration (Cont’d) With regard to application of Practice 8.2 which requires disclosure “on a named basis the top five senior management’s remuneration component including salary, bonus, benefits-in-kind and other emoluments”, the Board is of the view that such disclosure is not applicable and mandatory because the REIT Manager is not a listed entity; and the senior management’s remuneration is paid by the REIT Manager. Nevertheless, the Board wishes to give assurance that the remuneration of Directors and Senior Management commensurate with their individual performance, taking into consideration of the REIT’s performance as it is benchmarked against the market. The remuneration packages of Senior Management are based on experience, expertise, skills and industry benchmarking. Driving Sustainability The Board Sustainability Committee (BSC) together with Senior Management takes responsibility for the governance of sustainability in setting the company’s sustainability strategies, priorities, and targets. Further, the Board is cognizant of the philosophy promoted by MCCG 2021, effective board leadership and oversight also require the integration of sustainability considerations in corporate strategy, governance and decision-making. As ESG is gaining importance, the BSC has been mandated with oversight functions on ESG including climate change risk. The REIT Manager has established the Sustainability Management Committee (SMC) at the management level, which is led by the CEO and comprises the management team of the REIT Manager, the Property Manager, and its counterparts. The SMC is dedicated to managing sustainability strategically, including the integration of sustainability considerations in the operations. Further, the advocating sustainability initiatives have been embedded in the performance evaluations of the Board and senior Management in line with Practice 4.4 of the MCCG 2021. The Board also ensures that they stay abreast with and understand the sustainability issues, hence all Directors are required to attend the Mandatory Sustainability Onboarding Programme for Directors of PLCs by the end of 2024. Gender Diversity and Inclusion The company has long understood the importance of diversity and inclusion. The commitment to diversity is embedded in our Sustainability Policy that sets out DRMSB’s values. The composition and quality of the Board should be in keeping with the size and its investment portfolio, business direction, and status as the REIT Manager of two listed Funds. A diverse Board with a range of views enhances decision-making, which is beneficial to the Manager’s/ Fund’s long-term success in the interests of the stakeholders. To date, the REIT Manager’s Board composition comprises one female Director, Ms Lailatul Azma Abdullah who was appointed as Independent Non-Executive Director on 16 December 2022. In this respect, the Board has complied with Bursa Malaysia’s requirement to have at least one woman director by 2023. When selecting Directors, the process is based on objective criteria and there is no discrimination on any gender, personal, or physical attributes that would not speak to such a person’s ability to perform as a Director. PRINCIPLE A: BOARD LEADERSHIP & EFFECTIVENESS (CONT’D) 106 CORPORATE GOVERNANCE 1 2 3 5 6 AL-`AQAR HEALTHCARE REIT ANNUAL REPORT 2023
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