171 ANNUAL INTEGRATED REPORT 2021 HOW WE ARE GOVERNED REINFORCING SUSTAINABILITY ADDITIONAL INFORMATION Application of the Principles and Practices of the Malaysian Code on Corporate Governance 2021 (MCCG 2021) FGV’s application of the principles and practices of the MCCG 2021 in respect of FY2021 are explained in the Corporate Governance (CG) Report available on our website, www.fgvholdings.com and also in the Annual Integrated Report 2021 set out in the following pages: Practice Details Applied / Departure / Adopted / Not Adopted / Not Applicable Page* PRINCIPLE A : BOARD LEADERSHIP AND EFFECTIVENESS 1.1 The board should set the company’s strategic aims, ensure that the necessary resources are in place for the company to meet its objectives and review management performance. The board should set the company’s values and standards, and ensure that its obligations to its shareholders and other stakeholders are understood and met. Applied 4-15, 17, 30-31, 36-79 1.2 A Chairman of the board who is responsible for instilling good corporate governance practices, leadership and effectiveness of the board is appointed. Applied 4-7, 16, 82, 84, 86 1.3 The positions of Chairman and Chief Executive Officer (CEO) are held by different individuals. Applied 82, 84, 86, 95, 108 1.4 The Chairman of the board should not be a member of the Audit Committee, Nomination Committee or Remuneration Committee. Applied 85, 117, 125 1.5 The board is supported by a suitably qualified and competent company secretary to provide sound governance advice, ensure adherence to rules and procedures, and advocate adoption of corporate governance best practices. Applied 16, 102, 108 1.6 Directors receive meeting materials, which are complete and accurate within a reasonable period prior to the meeting. Upon conclusion of the meeting, the minutes are circulated in a timely manner. Applied Please refer to CG Report 2.1 The board has a board charter which is periodically reviewed and published on the company’s website. The board charter clearly identifies: • the respective roles and responsibilities of the board, board committees, individual directors and management; and • issues and decisions reserved for the board. Applied 106 3.1 The board establishes a Code of Conduct and Ethics for the company, and together with management implements its policies and procedures, which include managing conflicts of interest, preventing the abuse of power, corruption, insider trading and money laundering. The Code of Conduct and Ethics is published on the company’s website. Applied 106 3.2 The board establishes, reviews and together with management implements policies and procedures on whistleblowing. Applied 104, 106, 139, 142 4.1 The board together with management takes responsibility for the governance of sustainability in the company including setting the company’s sustainability strategies, priorities and targets. The board takes into account sustainability considerations when exercising its duties including among others the development and implementation of company strategies, business plans, major plans of action and risk management. Strategic management of material sustainability matters should be driven by senior management. Applied 4-7, 36-40, 44-47 4.2 The board ensures that the company’s sustainability strategies, priorities and targets as well as performance against these targets are communicated to its internal and external stakeholders. Applied 148 4.3 The board takes appropriate action to ensure they stay abreast with and understand the sustainability issues relevant to the company and its business, including climate-related risks and opportunities. Applied 109, 133, 114-116 4.4 Performance evaluations of the board and senior management include a review of the performance of the board and senior management in addressing the company’s material sustainability risks and opportunities. Applied 111, 124 4.5 (Step Up) The board identifies a designated person within management, to provide dedicated focus to manage sustainability strategically, including the integration of sustainability considerations in the operations of the company. Adopted 100 5.1 The Nomination Committee should ensure that the composition of the board is refreshed periodically. The tenure of each Director should be reviewed by the Nomination Committee and annual re-election of a Director should be contingent on satisfactory evaluation of the director’s performance and contribution to the board. Applied 104, 106 5.2 At least half of the board comprises independent directors. For Large Companies, the board comprises a majority independent directors. Applied Please refer to CG Report 5.3 The tenure of an Independent Director does not exceed a term limit of nine years. Upon completion of the nine years, an Independent Director may continue to serve on the board as a non-independent director. If the board intends to retain an Independent Director beyond nine years, it should provide justification and seek annual shareholders’ approval through a two-tier voting process. Not Applicable - Step Up 5.4 Adopted * To also refer to our CG Report, which is available on our website, www.fgvholdings.com
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