173 ANNUAL INTEGRATED REPORT 2021 HOW WE ARE GOVERNED REINFORCING SUSTAINABILITY ADDITIONAL INFORMATION Practice Details Applied / Departure / Adopted / Not Adopted / Not Applicable Page* PRINCIPLE B : EFFECTIVE AUDIT AND RISK MANAGEMENT 9.1 The Chairman of the Audit Committee is not the Chairman of the board. Applied 85, 108, 125 9.2 The Audit Committee has a policy that requires a former partner of the external audit firm of the listed company to observe a cooling-off period of at least three years before being appointed as a member of the Audit Committee. Applied 125 9.3 The Audit Committee has policies and procedures to assess the suitability, objectivity and independence of the external auditor to safeguard the quality and reliability of audited financial statements. Applied 129 9.4 (Step Up) The Audit Committee should comprise solely of independent directors. Not Adopted 125 and Audit Committee Terms of Reference 9.5 Collectively, the Audit Committee should possess a wide range of necessary skills to discharge its duties. All members should be financially literate, competent and are able to understand matters under the purview of the Audit Committee including the financial reporting process. All members of the Audit Committee should undertake continuous professional development to keep themselves abreast of relevant developments in accounting and auditing standards, practices and rules. Applied 88, 90, 91, 93 10.1 The board should establish an effective risk management and internal control framework. Applied 140-143 10.2 The board should disclose the features of its risk management and internal control framework, and the adequacy and effectiveness of this framework. Applied 140-143 10.3 (Step Up) The board establishes a Risk Management Committee, which comprises a majority of independent directors, to oversee the company’s risk management framework and policies. Adopted 85, 131-134 11.1 The Audit Committee should ensure that the internal audit function is effective and able to function independently. Applied 18, 129-130 11.2 The board should disclose: • whether internal audit personnel are free from any relationships or conflicts of interest, which could impair their objectivity and independence; • the number of resources in the internal audit department; • name and qualification of the person responsible for internal audit; and • whether the internal audit function is carried out in accordance with a recognised framework. Applied 101, 129-130 Please refer to CG Report PRINCIPLE C : INTEGRITY IN CORPORATE REPORTING AND MEANINGFUL RELATIONSHIP WITH STAKEHOLDERS 12.1 The board ensures there is effective, transparent and regular communication with its stakeholders. Applied 2-3, 16, 26-29, 135-138 12.2 Large companies are encouraged to adopt integrated reporting based on a globally recognised framework. Applied 2-3, 139 13.1 Notice for an Annual General Meeting should be given to the shareholders at least 28 days prior to the meeting. Applied Please refer to CG Report 13.2 All directors attend general meetings. The Chair of the Audit, Nominating, Risk Management and other committees provide meaningful response to questions addressed to them. Applied Please refer to CG Report 13.3 Listed companies should leverage technology to facilitate: • voting including voting in absentia; and • remote shareholders’ participation at general meetings. Listed companies should also take the necessary steps to ensure good cyber hygiene practices are in place including data privacy and security to prevent cyber threats. Applied 138 Please refer to CG Report 13.4 The Chairman of the board should ensure that general meetings support meaningful engagement between the board, senior management and shareholders. The engagement should be interactive and include robust discussion on among others the company’s financial and non-financial performance as well as the company’s long-term strategies. Shareholders should also be provided with sufficient opportunity to pose questions during the general meeting and all the questions should receive a meaningful response. Applied Please refer to Board Charter and CG Report 13.5 The board must ensure that the conduct of a virtual general meeting (fully virtual or hybrid) support meaningful engagement between the board, senior management and shareholders. This includes having in place the required infrastructure and tools to support among others, a smooth broadcast of the general meeting and interactive participation by shareholders. Questions posed by shareholders should be made visible to all meeting participants during the meeting itself. Departure 138 Please refer to CG Report 13.6 Minutes of the general meeting should be circulated to shareholders no later than 30 business days after the general meeting. Applied Please refer to CG Report Detailed explanation on the application/departure/adoption of the Principles and Practices of the MCCG 2021 are explained in our CG Report, which is available on our website at www.fgvholdings.com
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