The Board of Directors of Taliworks Corporation Berhad (“the Company”) is committed to upholding the highest standards of Corporate Governance throughout the Company and its subsidiaries (“the Group”) by applying and adopting the pertinent best practices and principles of good governance in the discharge of the Board’s duties and responsibilities and in all of the dealings with its shareholders and relevant stakeholders.
All Board members are expected to exercise their powers and judgement for proper purpose, in good faith and in the best interest of the Company and the Group. It is therefore important for all Board members to act in a professional manner, thereby upholding the core values of transparency, integrity and enterprise with due regard to their fiduciary duties and responsibilities as directors of the Company.
This Board Charter shall constitute, and form, an integral part of each Director’s duties and responsibilities.
The key objectives of this Board Charter are:
to specify how the Group is governed so as to promote the Group and protect and uphold the interests of shareholders as well as other stakeholders;
to list out the roles and duties of the position of the Directors and how they relate to the Group’s overall mission and goals;
to ensure that all Board members acting on behalf of the Company are aware of their duties and responsibilities as Board members and the various legislations and regulations affecting their conduct;
to ensure that the principles and practices of good Corporate Governance are applied in all the Directors’ dealings in respect, and on behalf of the Company;
to exceed “minimum legal requirements” with due consideration to recognised standards of best practices locally and internationally.
The Board is charged with leading and managing the Group in an effective and responsible manner. Each Director has a legal duty to act in the best interest of the Group. The Directors, collectively and individually, are aware of their responsibilities to shareholders and stakeholders for the manner in which the affairs of the Group are managed. The Board is to set the Group’s values and standards and ensures that its obligations to its shareholders and stakeholders are understood and met.
The Board understands the responsibility for good Corporate Governance rests with them and therefore strives to follow the principles, best practices and recommendations stated in the Malaysian Code on Corporate Governance. The Board includes a narrative statement in the Company’s Annual Report on the extent of compliance with the principles and recommendations stated under each principle in the Statement of Corporate Governance made pursuant to the Main Market Listing Requirements (“MMLR”).
The Company by virtue of its admission to the Official List of Bursa Malaysia Securities Berhad (“the Exchange”), is bound by the MMLR, the Rules of the Exchange and the Rules of the Bursa Malaysia Depository Sdn Bhd.
The Board shall meet in person at least once every quarter to facilitate the discharge of its responsibilities. Members of the Management, who are not Directors, may be invited to attend and speak at meetings on matters relating to their sphere of responsibility.
Duties of the Board shall include establishing the corporate vision and mission, as well as the philosophy of the Group, setting the aims of the Management and monitoring the performance of the Management.
Reviewing and adopting a strategic plan for the Group;
Overseeing the conduct of the Group's businesses;
Identifying principal risks and ensuring the implementation of appropriate internal controls and mitigation measures;
Establishing a succession plan;
Overseeing the development and implementation of a shareholder communication policy for the Group; and
Reviewing the adequacy and the integrity of the management information and internal control system.
The Board shall establish written procedures determining which issues require a decision of the full Board and which issues can be delegated to Board Committees or the Management.
The Board reserves full decision-making powers on the following matters:
Conflict of interest issues relating to a substantial shareholder or a Director;
Material acquisitions and disposition of assets not in the ordinary course of business;
Investments in capital projects;
The Board shall establish a procedure whereby the Directors, collectively or individually, may seek independent professional advice in furtherance of their duties at the Company’s expense.
The Board shall commit to ethical values through a Code of Business Conduct and Ethics for Directors and ensures the implementation of appropriate internal systems to support, promote and ensure its compliance.
The Board shall consist of qualified individuals with diverse experience, background and perspective. The composition and size of the Board is such that it facilitates the making of informed and critical decisions.
At any one time, at least two (2) or one-third (1/3), whichever is higher, of the Board members shall be Independent Directors. Where the Chairperson of the Board is not an independent Director, the majority of Board members shall be independent Directors.
Profile of Board members shall be included in the Annual Report and/or website of the Company.
The Chief Executive Officer (“CEO”) is the “Executive” Director on the Board. However, the views of the Management are represented at meetings of the Board by the presence of senior executives when required.
Identifying individuals of suitable quality and background is essential for a high performing Board. The nomination and appointment process is crucial to strong corporate performance as well as effective accountability.
The Independent Directors shall provide independent judgment, experience and objectivity without being subordinated to operational considerations.
The Independent Directors shall help to ensure that the interests of all shareholders, and not only the interests of a particular fraction or group, are indeed taken into account by the Board and that the relevant issues are subjected to objective and impartial consideration by the Board.
The views of the Independent Directors shall carry significant weight in the Board’s decision-making process.
The Board shall appoint a Senior Independent Director to whom shareholders’ concerns can be conveyed if there are reasons that contact through the normal channels of the Chairperson or the CEO have failed to resolve them. The Senior Independent Director shall chair the meetings between the Non-Executive Directors where both the Chairperson and Executive Directors do not attend.
If, on any matter discussed at a Board meeting, any Director holds views contrary to those of any of the other Directors, the Board minutes shall clearly reflect this.
The appointment of a new Director is a matter for consideration and decision by the full Board upon appropriate recommendation from the Nomination Committee.
New Directors are expected to have such expertise so as to qualify them to make a positive contribution to the Board performance of its duties and to give sufficient time and attention to the affairs of the Company.
The Company Secretary shall have the responsibility of ensuring that relevant procedures relating to the appointment of new Directors are properly executed.
Upon the appointment of a new Director, the Company Secretary shall advise the Director of his/her principal duties and responsibilities and explains the restrictions to which he or she is subject to in relation to price -sensitive information and dealings in the Company’s securities.
The Company shall adopt educational/training programmes to update the Board in relation to new developments pertaining to the laws and regulations and changing commercial risks which may affect the Board and/or the Company.
In addition to the Mandatory Accredited Programme (MAP) as required by the Exchange, Board members are also encouraged to attend training programmes conducted by competent professionals and which are relevant to the Company’s operations and business. The Board shall assess the training needs of the Directors and disclose in the Annual Report the trainings attended by the Directors.
The directorships held by any Board member at any one time shall not exceed any number as may be prescribed by the relevant authorities.
At the time of appointment, the Board shall obtain the Director’s commitment to devote sufficient time to carry out his responsibilities. Directors should notify the Chairperson before accepting any new directorship. The notification should include an indication of time that will be spent on the new appointment.
Directors shall not accept appointment of directorship in other companies having similar businesses which may put them in a position of conflict with the Company.
All Directors shall be subjected to retirement by rotation.
The Company aims to provide all Directors with timely and quality information and in a form and manner appropriate for them to discharge their duties effectively.
The Management shall be responsible for providing the Board with the required information in an appropriate and timely manner. The Chairperson, assisted by the Company Secretary, shall assess the type of information required to be provided to the Board. If the information provided by the Management is insufficient, the Board shall make further enquiries where necessary to which the persons responsible will respond as fully and promptly as possible.
A full agenda and comprehensive Board papers shall be circulated to all Directors well in advance of each Board meeting.
Amongst others, the Board papers shall include the following:
Quarterly financial report and report on the Group’s cash and borrowing positions;
Minutes of meetings of all Committees of the Board;
A current review of the operations of the Group;
Reports on Related Party Transactions and Recurrent Related Party Transactions;
Full Board minutes of each Board meeting shall be kept by the Company Secretary and are to be made available for inspection by any Director during office hours.
The Board shall promote diversity and gender mix in its composition and gives due recognition to the financial, technical and business experience of the Directors.
The Board believes the presence of diverse nationalities and gender mix on the Board can widen the Board’s perspectives in effectively discharging its duties and responsibilities as well as assist the Board in its decision-making process in line with the challenging and evolving business environment.
The Company aims to ensure a balance of power and authority between the Chairperson and CEO with a clear division of responsibility between the running of the Board and the Company’s business respectively. The positions of Chairperson and CEO shall be separated and clearly defined.
The Chairperson is responsible for all aspects of its role. The Chairperson shall be responsible to:
Lead the Board in setting the values and standards of the Group;
Maintain a relationship of trust with and between the Executive and Non-Executive Directors;
Ensure the provision of accurate, timely and clear information to Directors;
Ensure effective communication with shareholders and relevant stakeholders;
Arrange regular evaluation of the performance of the Board, its Committees and individual Directors;
Facilitate the effective contribution of Non-Executive Directors and ensuring constructive relations be maintained between Executive and Non-Executive Directors.
The Chairperson in consultation with the CEO and the Company Secretary, shall set the agenda for Board meetings and shall ensure that all relevant issues are on the agenda.
The Chairperson shall be responsible for managing the business of the Board to ensure that:
All Directors are properly briefed on issues arising at Board meetings;
Sufficient time is allowed for the discussion of complex or contentious issues and, where appropriate, arranging for informal meetings beforehand to enable thorough preparation for the Board discussion;
The issues discussed are forward looking and concentrates on strategy.
The Chairperson shall ensure that every Board resolution is out to vote to ensure the will of the majority prevails.
The Chairperson shall ensure that Executive Directors look beyond their executive functions and accept their full share of responsibilities on governance.
The Chairperson will have no casting vote if two (2) Directors form a quorum, or if there are only two (2) Directors competent to vote on the question at issue.
A CEO in relation to a corporation, means the principal executive officer of the corporation for the time being, by whatever name called, and whether or not he or she is a director of the corporation.
The CEO shall be the conduit between the Board and the Management in ensuring the success of the Group’s governance and management functions.
The CEO shall have the executive responsibility for the day-to-day operation of the Group’s business.
The CEO shall implement the policies, strategies and decisions adopted by the Board.
All Board authorities conferred on the Management shall be delegated through the CEO and this will be considered as the CEO’s authority and accountability as far as the Board is concerned.
The Board shall establish the following Board Committees with specific terms of reference:
The Board shall also establish various Board Committees with specific terms of reference, to address important areas in greater detail which may not be possible at Board meeting.
Independent and Non-Executive Directors shall play a leading role in these Committees. The Management and third parties are co-opted to the Committees as and when required.
The Audit and Risk Management Committee shall comprise at least three (3) members, a majority of whom are Independent Directors. All members of the Audit and Risk Management Committee are non-executive directors.
No alternate Director can be appointed as a member of the Audit and Risk Management Committee.
The Chairperson of the Audit and Risk Management Committee shall be an Independent Director who shall be appointed by the Board.
The Audit and Risk Management Committee shall undertake the following responsibilities and duties:
to review and recommend risk management strategies, policies and risk tolerance;
to review and assess adequacy of risk management policies and framework in identifying, measuring, monitoring and controlling risk and the extent to which they are operating effectively;
to ensure adequate infrastructure, resources and systems are in place for risk management i.e. to ensure that the staff responsible for implementing risk management systems perform those duties independently of the risk originating activities of the Group;
to review periodic reports from the Risk Management Working Group on risk exposure, risk portfolio composition and risk management activities;
to review and recommend new policies or changes to policies, and to consider their risk implications;
to review the impact of risk on capital adequacy and profitability under normal and stress scenarios;
to review and evaluate the various processes and systems engaged by the Group and to ensure that they are conducted within the standards and policies as set by the Board;
to assess the adequacy of the business recovery/disaster recovery procedures; and
to monitor the health, safety and environmental performance of the Group.
to review the quarterly results and year-end financial statements prior to approval by the Board, focusing particularly on:-
changes in or implementation of major accounting policies changes;
significant and unusual events; and
compliance with accounting standards and other regulatory requirements.
to discuss with the external auditors, prior to the commencement of an audit, the audit plan which states the nature and scope of the audit;
to consider the nomination and appointment of external auditors, as well as fixing their remuneration;
to establish policies governing the circumstances under which contracts for the provision of non-audit services can be entered into and procedures that must be followed by the external auditors;
to review major audit findings arising from interim and final audits, the audit report and the assistance given by the employees of the Group to the external auditors;
to review with the external auditors, their evaluation of the system of internal controls, the management letter and management’s response;
to monitor independence and qualification of the external auditors. The Audit Committee is to obtain written assurance from the external auditors confirming that they are, and have been, independent throughout the conduct of the audit engagement in accordance with the terms of all relevant professional and regulatory requirements;
to review any letter of resignation from the external auditors and any questions of resignation or dismissal; and
to review whether there is reason (supported by grounds) to believe that the external auditors are not suitable for re-appointment.
to support and provide directions to the internal audit function to ensure its effectiveness;
to review the adequacy and effectiveness of internal control systems instituted within the Group;
to review the adequacy of scope, functions, competency and resources of the internal audit function and whether it has the necessary authority to carry out its work;
to review the internal audit programme, processes, the results of the internal audit programme, processes or investigations undertaken and whether or not appropriate action is taken on the recommendations of the internal audit function;
to review the major findings of internal audit investigations and management’s response, and ensure that appropriate actions are taken on the recommendations of the internal audit function;
to review any appraisal or assessment of the performance of members of the internal audit function;
to approve any appointment or termination of senior staff members of the internal audit function; and
to take cognisance of resignations of internal audit staff members and provide the resigning staff member an opportunity to submit his reasons for resigning.
To review any related party transactions and conflict of interest situation that may arise within the Group including any transaction, procedure or course of conduct that raises questions of management integrity and in particular ensuring that any related party transactions to be entered into are:-
on terms not more favourable to the related party than those generally available to the public;
not detrimental to the minority shareholders; and
in the best interest of the Group.
to verify that the allocation of options pursuant to the Employees’ Share Options Scheme of the Company is in accordance with the criteria for allocation established under the scheme at the end of each financial year; and
to promptly report to the Exchange if it is of the view that a matter reported by it to the Board has not been satisfactorily resolved resulting in a breach of the Listing Requirements.
The Audit and Risk Management Committee shall meet at least four (4) times for each financial year and should call for additional meetings as and when necessary to carry out its functions. The Audit and Risk Management Committee shall also be responsible for recommending the person or persons to be nominated to act as the external auditor and the remuneration and terms of engagement of the external auditor.
The Audit and Risk Management Committee shall ensure that other directors and employees attend any particular Audit and Risk Management Committee meeting only at the Audit and Risk Management Committee’s invitation, specific to the relevant meeting.
The Board shall review the term of office and performance of the Audit and Risk Management Committee and each of its members at least once in every three (3) years to determine whether the Audit and Risk Management Committee and its members have carried out their duties in accordance with these terms of reference.
The Nominating Committee shall comprise no less than three (3) members made up exclusively of Non-Executive Directors, a majority of whom must be Independent Directors.
The members of the Nominating Committee shall elect a Chairperson from among their members who shall be an Independent Director.
The primary objectives of the Nominating Committee are to act as a committee of the full Board to assist in discharging the Board’s responsibilities in:-
Assessing the existing directors’ ability to contribute to the effective decision making of the Board;
Identifying, appointing and orientating new directors;
Identifying the mix of skills and experience and other qualities the Board requires for it to function completely and efficiently;
Establishing a policy formalising its approach to boardroom diversity.
The Nominating Committee shall have the following responsibilities:-
Developing, maintaining and reviewing the criteria to be used in the recruitment process and annual assessment of Directors and Independent Directors.
The following criteria should be considered in the recruitment process before making any recommendation to the Board for consideration:-
diversity (including gender diversity and diversity in ethnicity and age);
With regards to the annual assessment of Directors and Independent Directors, the Nominating Committee shall be guided by the Board Assessment Procedures on Directors and Independent Directors.
Proposing or assessing the candidature of Directors for the Board as well as the Directors to fill the seats on Board Committees having regard to the mix of skills, independence, diversity (including gender diversity and diversity in ethnicity and age), competencies, commitment, contribution and performance (if applicable);
Reviewing on an annual basis the effectiveness of the Board as a whole, Executive Director, Independent Directors, Board Committees and the contribution of each individual Director and the required mix of skills and experience and other core qualities, including core competencies, which the Directors should bring to the Board;
Making recommendation, based on the assessment results, to the Board for the re-election and/or re-appointment of Directors at the Annual General Meeting;
Reviewing the succession plans of the Board;
Reviewing training programs for the Board and ensure that all newly appointed Directors undergo appropriate induction programs and receive continuous training; and
Facilitating achievement of Board diversity policies and targets.
In the event that the Board appoints a new Chairperson, the Nominating Committee shall be guided by the following principles prior to making recommendations to the Board:
That the Senior Independent Director shall lead the appointment process;
That a systematic evaluation shall be undertaken to identify the skills and expertise required for the role;
That all short listed candidates shall be considered with the possibility of obtaining external advice, if necessary.
The Remuneration Committee shall comprise no less than three (3) members, the majority of whom shall comprise of Non-Executive Directors.
The members of the Remuneration Committee shall elect a Chairperson from among their number who shall be a non-executive director.
The primary objective of the Remuneration Committee is to act as a committee of the Board to assist in discharging the Board's responsibilities in:-
assessing the remuneration of:-
the Directors reflecting the responsibility and commitment undertaken by the Board members; and
the chief executive officer ("CEO") of the Company;
setting the relevant performance standards of the Executive Directors and the CEO to commensurate with their remuneration.
Recommending to the Board the remuneration policies, procedures and framework for the remuneration of Directors including remuneration and terms of service of the Executive Directors in all its forms, drawing from external advice, if necessary;
Reviewing and recommending to the Board the remuneration packages of the Directors and the CEO. A fair remuneration is critical to attract, retain and motivate the Directors and the CEO;
Determining and setting performance measures for incentive plans of the Executive Directors and the CEO; and
Reviewing the compensation policy of the Executive Directors and the CEO and ensuring alignment of compensation to corporate performance, and that the compensation offered are in line with market practice and industry norm.
The Company aims to set remuneration at levels which are sufficient to attract and retain the Directors needed to run the Group successfully, taking into consideration all relevant factors including the function, workload and responsibilities involved, but without paying more than is necessary to achieve this goal.
The level of remuneration for the CEO and Executive Directors shall be determined by the Remuneration Committee after giving due consideration to the compensation levels for comparable positions among other similar Malaysian public listed companies.
Non-Executive Directors shall be entitled to participate in the Company’s Employee Share Options Scheme (“ESOS”) subject to approval at a general meeting. Non-Executive Directors who participated in the ESOS shall be prohibited to sell, transfer or assign the shares within one (1) year from the date of offer of such options.
No Director other than the CEO and Executive Directors, shall have a service contract with the Company.
A formal independent review of the Directors’ remuneration shall be undertaken no less frequently than once every three (3) years or as and when necessary.
There shall be adequate disclosure in the Annual Report with a note on the remuneration of Directors.
The Directors shall present a clear and balanced assessment of the Group’s financial position and future prospects that extends to the interim and price sensitive information and other relevant reports submitted to regulators.
The Directors shall ensure that the financial statements are prepared so as to give a true and fair view of the current financial status of the Group in accordance with the approved accounting standards.
The Group’s practice is to announce to the Exchange its quarterly financial results as early as possible within two (2) months after the end of each quarterly financial period or at such other period(s) as maybe stipulated by the Exchange from time to time.
The Auditors’ Report shall contain a statement from the Auditors explaining their responsibility in forming an independent opinion, based on their audit, of the financial statements.
The Board shall establish formal and transparent arrangements for considering how financial reporting and internal control principles will be applied and for maintaining an appropriate relationship with the Company Auditors through its Audit and Risk Management Committee.
The Audit and Risk Management Committee shall also keep under review the scope and results of the audit and its cost effectiveness and the independence and objectivity of the Company Auditors. The Board shall ensure that the Company Auditors do not supply a substantial volume of non-audit services to the Group.
Appointment of the Company Auditors shall be subjected to approval of shareholders at general meetings. The Company Auditors shall retire during the annual general meetings of the Company every year and be re-appointed by shareholders for the ensuing year.
The Board shall ensure a well-resourced internal audit function, which critically reviews all aspects of the Group's activities and its internal controls. Comprehensive audits of the practices, procedures, expenditure and internal audit controls of all business support units and subsidiaries shall be undertaken on a regular basis. The Head of Internal Audit shall have direct access to the Board through the Chairperson of the Audit and Risk Management Committee.
The Board shall ensure the system of internal controls is reviewed on a regular basis.
The Audit and Risk Management Committee shall receive reports regarding the outcome of such reviews on a regular basis.
The Company regards the AGM as an important event in the corporate calendar of which all Directors and key senior executives should attend.
The Company regards the AGM as the principal forum for dialogue with shareholders and aims to ensure that the AGM provides an important opportunity for effective communication with, and constructive feedback from, the Company’s shareholders.
The Chairperson shall encourage active participation by the shareholders during the AGM.
The Chairperson and, where appropriate, the CEO shall respond to shareholders’ queries during the meeting. Where necessary, the Chairperson shall undertake to provide a written answer to any significant question that cannot be readily answered at the meeting.
The Directors shall consider requisitions by shareholders to convene an EGM or any other urgent matters requiring immediate attention of the Company.
The Board acknowledges the need for shareholders to be informed of all material business matters affecting the Group and as such adopts an open and transparent policy in respect of its relationship with its shareholders and investors.
The Board shall ensure the timely release of financial results on a quarterly basis to provide shareholders with an overview of the Group’s performance and operations in addition to the various announcements made during the year.
The Board shall ensure that the Company’s website provide easy access to corporate information pertaining to the Group and its activities and is continuously updated.
In the course of pursuing the Group’s mission and goals, the Board recognises that no Company can exist by maximising shareholders’ value alone. In this regard, the needs and interests of other stakeholders shall be taken into consideration by the Board and the Management.
The Board acknowledges that the employees are invaluable assets of the Group and play a vital role in achieving the Group’s mission and goals.
The Board is committed to promoting a safe and healthy working environment that foster mutual respect where employees irrespective of status , position and gender are treated with dignity.
The Board acknowledges the need to safeguard and minimise the impact to the environment in the course of achieving the Group’s mission and goals.
The Board shall adopt policies and procedures as part of its commitment to protect the environment and contribute towards sustainable development.
The Board supports initiatives on environmental issues.
The Board acknowledges that the Group should play a vital role in contributing towards the welfare of the community in which it operates.
The Board shall adopt policies and procedures towards responsible marketing and advertising of its products and services.
The Board supports charitable causes and initiatives on community development projects.
The Board shall appoint the Company Secretary, who plays an important advisory role, and shall ensure that the Company Secretary fulfils the functions for which he/she has been appointed.
The Company Secretary shall be accountable to the Board through the Chairperson of the Board and its Committee on all governance matters.
The Secretary is central source of information and advice to the Board and its Committee on issues relating to compliance with corporate laws, rules, procedures and regulations affecting the Company and the Group.
The Company Secretary shall advise Directors of their obligations to adhere to matters relating to:
The Company Secretary shall keep abreast of, and inform, the Board of current governance practices.
The Board members shall have unlimited access to the professional advice and services of the Company Secretary.
The principles on which this Board Charter is based are drawn and derived from the Malaysian Code on Corporate Governance, Higgs Report, Main Market Listing Requirements and Corporate Disclosure Guide. The Board Charter has been prepared specifically intended to meet the requirements of the aforesaid regulations.
The principles set out in this Board Charter are:
Kept under review and updated as practices on Corporate Governance develop and further guidelines on Corporate Governance are issued by the relevant regulatory authorities;
Applied in practice having regard to their spirit and general principles rather than to the letter alone.
The Board shall endeavour to comply with the principles and practices set out in this Board Charter.
The provisions of this Board Charter are in addition to, and not in substitution for, any obligation imposed upon a Director by agreement, common law, equity, statute or regulation. The Directors acknowledge that compliance with this Board Charter will not relieve them from any such obligations.
Directors are responsible for establishing, reviewing and updating appropriate policies, guidelines and procedures for this Board Charter. They are also required to provide advice and if appropriate, issue written opinions to Directors on matters in relation to the Board Charter that they may encounter in fulfilling their respective responsibilities.
The Board shall review and reassess the adequacy of the Board Charter periodically and make such amendments to the Board Charter as the Board may deem appropriate.
The provisions of this Board Charter can be amended and supplemented from time to time by resolution of the Board.
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