BOARD AUDIT COMMITTEE REPORT Board membership • Considered matters relating to the appointment of Directors. • Reviewed the Board’s diversity based on the Board Diversity Policy and the Company’s needs. • Recommended the Directors who are eligible for re-election and re-appointment at the AGM. Succession planning • Maintained oversight of the change of MISC’s President/Group CEO to ensure a smooth leadership transition. • Reviewed and recommended the appointment of new Directors. • Reviewed the MISC Board and Board Committees’ composition and recommended changes to the composition of the BAC to align with the MCCG 2021. • Received updates on succession planning for MC Positions and critical positions. • Endorsed changes to the MC positions. Performance management • Reviewed and endorsed the Group’s FY2021 Balanced Scorecard results. • Reviewed and endorsed the proposed performance bonus for Appraisal Year 2021. • Reviewed and endorsed the Group’s FY2023 Balanced Scorecard. Board performance evaluation • Maintained oversight of the Board Effectiveness Evaluation facilitated by an independent expert. • Reviewed the independent Board Effectiveness Evaluation Report. • Reviewed and endorsed the Board KPIs for FY2023. Training and development Reviewed and endorsed topics for the FY2022 Annual Directors’ Training. Annual reporting Reviewed and endorsed the disclosures in the NRC Report for the 2021 Integrated Annual Report. DATUK NASARUDIN MD IDRIS Chairman Nomination & Remuneration Committee SUMMARY OF THE NRC’S WORK IN 2022 DATO' SEKHAR KRISHNAN Chairman Board Audit Committee I am pleased to share the Board Audit Committee (BAC) Report for 2022, highlighting the key areas of focus of the BAC during the year. Over the course of the year, one key focus area of the BAC was the continued oversight of the internal audit function. An external review of MISC Group's internal audit process was conducted by the Institute of Internal Auditors Malaysia (IIAM). The outcome of the IIAM assessment indicated that MISC is in full compliance with best practices in terms of audit function, processes and standards. Another key area that the BAC focused on was the Regulatory & Legislation Register (Register). The Register was established in 2021 to ensure that MISC adheres to all applicable statutory requirements and provides the Board and Management with assurances on the Group's compliance with all applicable laws and regulations. Maintaining strict oversight on project execution, the BAC reviewed performance in terms of percentage of completion, as well as total project costs for major projects under execution as part of our review of MISC's financial results. By having at least one member that sits on both the BAC and the Board Sustainability & Risk Committee, we are able to have effective oversight of major ongoing projects. For 2023, the BAC has endorsed the MISC Group Annual Internal Audit Plan to also encompass the Environmental, Social and Governance (ESG) and sustainability agenda that MISC is committed to. Group Internal Audit will conduct a review of information and data gathered to ensure that MISC's reporting is accurate and reliable. Finally, on behalf of the BAC, I would like to convey our appreciation to Puan Liza Mustapha, who retired from the BAC on 1 April 2022, for all her contributions throughout her tenure. I also take this opportunity to welcome Dato' Ab. Halim Mohyiddin, who became a member of the BAC from the same date. The aforementioned changes resulted in the BAC comprising solely of Independent Non-Executive Directors (INEDs), in line with Step-Up Practice 9.4 of the Malaysian Code on Corporate Governance (MCCG) 2021. DATO' SEKHAR KRISHNAN Chairman Board Audit Committee NOMINATION & REMUNERATION COMMITTEE REPORT CHAIRMAN’S REMARKS 203 202 Governance Governance MISC Berhad Integrated Annual Report 2022
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