FGV Annual Report 2016

FELDA GLOBAL VENTURES HOLDINGS BERHAD 130 HOW WE ARE GOVERNED DIVIDEND POLICY The Company presently adopts a dividend pay-out ratio of at least 50 percent of its profit after tax (PAT) attributable to Shareholders excluding non-recurring income. As the Company is an investment holding company, its income and ability to pay dividends are dependent upon the dividends received from its subsidiaries, which in turn would be determined by the subsidiaries' distributable profits, operating results, financial condition, capital expenditure plans and other relevant factors. It is the policy of the Board, in recommending dividends, to allow Shareholders to participate in the Company's profit, as well as to retain adequate reserves for future growth. With the new Companies Act 2016 requirement, the Company shall perform a solvency test to ensure that the Company is solvent and able to guarantee continued operations subsequent to the declaration of the dividend. The Directors shall sign a statutory declaration verifying that the Company is solvent when declaring dividend. FINANCIAL REPORTING AND DISCLOSURE TheBoardensuresthatShareholdersarepresentedwithaclear,balanced and comprehensive view of FGV Group's financial performance and prospects through the audited Financial Statements, quarterly announcement of results, the Chairman's Statement, the Management Discussion and Analysis in the AIR 2016 as well as corporate announcements on significant developments affecting the Company and the Group in accordance with the Bursa Securities Listing Requirements. Timely release of announcements reflects the Board's commitment to provide up-to-date and transparent information on the Group's performance. In the preparation of the Financial Statements, the Directors have considered compliance with all applicable Financial Reporting Standards, provisions of the Companies Act and relevant provision of laws and regulations in Malaysia and the respective countries in which the subsidiaries, associates and joint venture companies operate. The Audit Committee assists the Board in reviewing both the annual Financial Statements and the quarterly announcement of results to ensure the reports reflect a true and fair view of the state of affairs of the Group and the Company. STATEMENT OF DIRECTORS' RESPONSIBILITY IN PREPARING AUDITED FINANCIAL STATEMENTS The Companies Act requires the Directors to prepare Financial Statements for each financial year in accordance with the Financial Reporting Standards. The Companies Act also places responsibility on the Directors to ensure that the Company's Financial Statements provide a true and fair view of the financial position of the Group and the Company, the financial performance and the cash flows for the financial year ended. The Board is satisfied that it has met its obligation to present a balanced and understandable assessment of the Group's and the Company's position in the Directors' Report on pages 146-150 and the Financial Statements set out on pages 146-340 of this AIR 2016. ENHANCING GOVERNANCE In our efforts to enhance governance, the Board endorsed the following policies in 2016: • Code of Business Conduct and Ethics for Employees (COBCE) The COBCE guides our employees to embrace the Group's values and comply with applicable laws and regulations, through honest, transparent and ethical business practices. The COBCE covers areas such as compliance, integrity, conduct in the work place, business conducts, protection of the Group's assets, confidentiality and conflict of interest. • External Gift, Entertainment &Hospitality Policy (GEH Policy) The GEH Policy is modelled based on good practices to govern the giving and receiving of gifts, entertainment and hospitality to or from third parties with emphasis on integrity, ethical standards and adherence to the law. The Group endeavours to maintain a high standard of integrity, transparency and accountability in all aspects of its business through efficient, productive and disciplined behaviour. • Asset/Personal Interest Declaration Policy (APID Policy) The APID Policy is intended to reflect the directors and employees' transparency towards the Group. It is also to ensure that the assets and personal interests are acquired through reasonable legal means within their financial ability and free from conflict of interest situation. CORPORATE GOVERNANCE STATEMENT