BOARD Terms of reference (tor)

Board Terms of Reference (TOR)

1.0 Objective

1.1 The Board is responsible for the governance of the Company. Its objective is to focus on the fundamental roles and responsibilities, rather than on detailed operational matters. Hence, the Board should adopt a shareholders’ perspective and balance all valid stakeholders’ interests.


2.0 Composition

2.1 Comprises of at least 5 Directors. The Directors shall select a person from amongst its members to act as the Chairman of the Board.


3.0 Board Meeting

3.1 The Board shall meet at least four (4) times a year on quarterly basis with 2 meetings to be held in Labuan. The meetings can be conducted at more frequent intervals should there be a need.

3.2 A Director must attend at least half (50%) of the Board meetings held in the financial year.

3.3 A quorum shall consist of half of the Board members present in person or via video conferencing or telecommunication facilities.

3.4 Any circular resolutions requiring the Board’s decision must be signed-off.

3.5 The Secretary of the Board is the Company/Alternate Secretary.


4.0 Appointment, Resignation and Disqualification of Directors

4.1 Pursuant to the Company’s Articles of Association, the Directors are appointed by the respective shareholder in accordance with the Shareholders Agreement.

4.1.1 A disqualification of a Director shall follow the reasons as provided under Article 98.

4.2 The respective shareholder will arrange for a replacement for their respective nominee in the event of a resignation.

5.0 Board Effectiveness

5.1 The annual assessment on the effectiveness of the Board and the individual Board members is designed and established with the objective of assessing the effectiveness of the Board and the individual directors. It aims to improve the Board’s effectiveness as well as draw the Board’s attention to key areas that need to be addressed or improved.

5.2 The evaluation is based on a combination of self and peer assessment performed via a customised questionnaire. A summarised report of the results will be presented to the Remuneration and Nomination Committee and the Board to enable them to identify the areas for improvement and put in place appropriate measures.


6.0 Responsibilities of Directors

6.1 To effectively discharge their duties, the Directors should be committed to attend Board meetings, and are responsible to:-.

6.1.1 Be proactive in seeking more information within the Company and the industry, in an effort to have knowledge so as to participate and contribute effectively in the meetings.

6.1.2 Maintain confidentiality on Board deliberations and all confidential information received by a Director unless the disclosure is required by law.

6.1.3 Exercise independent judgement when making decisions and act strictly in the best interest of the Company and its shareholders generally and not in the interest of any one shareholder or group of shareholders.

6.1.4 Seek professional independent advice at the Company’s expense, as and when required.

6.1.5 Disclose in writing to the Board any actual or potential conflict of interest or duty that might reasonably be thought to exist as soon as the situation arises, and in addition take necessary and reasonable action to resolve or avoid any actual or potential conflict of interest or duty.

6.1.6 Continuously educate themselves to maintain the necessary depth and breadth of knowledge and skills.

6.1.7 Ensure that high standards of corporate governance are applied.


7.0 Responsibilities of the Chairman

7.1 The Chairman carries out a leadership role in the conduct of the Board and its relations with shareholders and other stakeholders.

7.2 He maintains a close professional relationship with the CEO and the management team.

7.3 He chairs Board meetings, as well as general meetings of shareholders, and concerns himself with the good order and effectiveness of the Board and its processes.

7.4 The Chairman acts as a facilitator at Board meetings and ensures that no Board members dominates the discussions.

7.5 The Chairman shall also encourage all Directors to participate in the affairs of the Board and be given adequate opportunity to express their views.

7.6 The key roles of the Chairman are:-

• Ensuring full participation of the Directors in the Board’s decision making processes and activities;

• Ensuring that the whole Board plays a full and constructive part in developing and determining the Company’s strategy and overall business and commercial objectives;

• Effectively leading the Board as a whole and in particular during Board meetings and general meetings; and

• Ensuring that complete, timely and clear information on the Company affairs are provided to the Board.


8.0 Roles and Responsibilities

8.1 The role of the Board is to provide overall strategic guidance for the Company and effective oversight of management. In undertaking its role and fulfilling its responsibilities, the Board has reserved to itself, but are not limited to, the following specific responsibilities

8.1.1 Strategy
(a) To approve strategic direction

(b) To challenge assumptions, priorities and options put forward by Management in the strategic plan
(c) To approve the business plan and budget, and to set targets for Management

8.1.2 Management Oversight
(a) To select and proactively plans CEO succession

(b) To review the performance management philosophy

(c) To evaluate the CEO

(d) To endorse the development plans of those in pivotal positions

(e) To approve senior appointments (inclusive the appointments of new Directors and the resignations of the existing Directors)

(f) To approve and implement a process or mechanism to ensure on an ongoing basis that the Directors, CEO and Key Responsible Person fulfil the ‘fit and proper’ criteria

8.1.3 Governance

(a) To inculcate sound corporate governance

(b) To approve the Company’s policies

(c) To uphold Shariah compliance in accordance to the relevant Shariah Governance

8.1.4 Shareholders/Stakeholders

(a) To ensure that all shareholders’ views are represented and shareholders are treated equally

(b) To balance and manage economic impact of stakeholder interests on shareholder value

(c) To support Management in managing key stakeholders


8.1.5 Financial

(a) To be regularly informed of the financial condition, business performance and management policies of the Company

(b) To review, approve and provide feedback on corporate KPIs and targets

(c) To approve the compensation and benefits of the staff

(d) To approve the payment of interim dividends

(e) To recommend the payment of final dividends

(f) To recommend the remuneration packages of the Directors to the Shareholders

(g) To approve the remuneration packages of the Directors and Senior Management

8.1.6 Risk Management & Compliance

(a) To conduct an overall oversight of risk management

(b) To approve the Company’s risk parameters

(c) To understand major risk exposures and to ensure appropriate risk mitigation approach is in place

(d) To consider the risk factors in all major decisions


9.0 Authority

9.1 Under the Company’s Articles of Association (Article 89), the Board may delegate responsibilities to committees consisting of their members, or other persons that they think fit, to oversee and address matters which requires a detailed review or in-depth consideration.

9.2 The Board has to establish the following committees with clearly defined responsibilities and delegated authority:-
(a) Audit Committee;
(b) Risk Committee;
(c) Investment Committee;
(d) Remuneration and Nomination Committee; and
(e) Shariah Supervisory Council.

9.3 Committees established by the Board will adopt the Terms of Reference setting out the objective, membership, authority, and responsibilities of the committees.

9.4 Other than those specifically reserved for the Board’s approval according to:-
(a) this Terms of Reference;
(b) the Terms of Reference of the committees specified in 4.3;
(c) the Limits of Financial Authority;
(d) the Limits of Underwriting Authority;
(e) the Investment Policy Statements;
(f) the Authority Limits of Investment Decisions; and
(g) the Company’s policies;

The Board has delegated to the CEO the power and authority to:-
(a) approve the Procedure Manuals/Standard Operating Procedures; and
(b) manage and supervise the management of the day-to-day operations and activities of the Company.

10.0 Independent Professional Advice

10.1 The Board may take, at the Company’s expense, such independent professional advice as is considered necessary to fulfill their relevant duties and responsibilities.