| BOARD OF DIRECTORS
Board Responsibilities
The Board retains full and effective control of the Group. This
includes responsibilities for determining the Group's overall
strategic directions as well as development and control of
the Group.
The Board reviews and approves the short-term budgets and
long-term strategies for the Group. In addition, all acquisitions,
major capital expenditure and disposal of investments will be
approved by the Board. The Board has established the authority
limits for Management to manage the business of the Group.
The Directors, collectively, have a wide range of relevant
experience to enable them to discharge their responsibilities
effectively.
The Board, together with the Audit Committee, reviews internal
control and risk management systems within the organization
in ensuring the custody and effective and efficient utilization
of Group assets. The Board is chaired by a Non-Independent
Non-Executive Chairman and the management of the Group
lies with the Group Managing Director. There is a division
of responsibility between the Chairman and Group Managing
Director to ensure a balance of power and authority. The roles
of the Chairman and Group Managing Director are separated
and clearly defined.
As part of good corporate governance, the Chairman is
responsible for ensuring board effectiveness and conduct. He
encourages a healthy debate on issues raised at meetings and
gives opportunity to directors who wish to speak on the motions,
either for or against them. Every Board resolution is then put to
a vote which would reflect the collective decision of the Board
and not the views of an individual or an interested group.
The Group Managing Director oversees the day-to-day
running of the business including organizational effectiveness,
implementation of Board policies and strategies and clarifying
matters relating to the Group's business to the Board. The
Group Managing Director's in-depth and intimate knowledge
of the Group's affairs contribute significantly towards the
direction of the Group to achieve its goals and objectives.
The Non-Executive Directors provide considerable depth of
knowledge collectively gained from experiences in a variety
of public and private companies and public service. The
Independent Non-Executive Directors provide unbiased and
independent views in ensuring that the strategies proposed by
the Management are fully deliberated and examined, in the
interest of not only of the Group but also of minority
shareholders, employees and the business communities
in which the Group conducts its business.
The Company has in place a succession planning programme
which inter alia includes appointing, training, fixing of
compensation and replacing senior management of the Group.
Board Composition and Balance
The Group considers that its complement of Non-Executive
Directors provide an effective Board with a mix of industry
specific knowledge and broad business and commercial
experience. The presence of Independent Non-Executive
Directors is particularly important in corporate accountability.
The Independent Non-Executive Directors provide unbiased
and independent views, advice and judgement in ensuring
that the strategies proposed by the management are fully
deliberated and examined, taking into account the long term
interest of the Group, shareholders, employees, customers
and the business communities in which the Group conducts
its business. This balance enables the Board to provide clear
and effective leadership to the Group and to bring informed
and independent judgement to many aspects of the Group's
strategies and performance so as to ensure that the highest
standards of conduct and integrity are maintained.
During the financial year under review, one (1) Independent
Non-Executive Director resigned from the Board. In maintaining
the number of Independent Non-Executive Directors on the
Board, an Independent Non-Executive Director was appointed
to the Board on 1 January 2009. To-date, there are nine (9)
directors, of whom four (4) are independent directors. The
composition of the Board was maintained so that not less than
one-third (1/3) were independent directors at all times. Dato'
N. Sadasivan is the Senior Independent Non-Executive Director
of the Company. A brief profile of each Director is presented
on pages 024 to 028 of the Annual Report.
APPOINTMENT AND RE-ELECTION OF DIRECTORS
Appointment
The Board has established a formal and transparent policy
on the appointment and selection process of its members,
which is consistent with the Company's Articles of Association.
The proposed appointment of a new member to the Board,
as well as the proposed re-appointment and re-election
of Director seeking re-election at the Annual General Meeting
are recommended by the Nomination & Remuneration
Committee (NRC) to the Board for their approval. The Board
is constantly reviewing the effectiveness of the Board as a whole,
the Committees of the Board and for assessing the contribution
of each individual director. All assessments and evaluation
carried out by the NRC in the discharge of all its functions are
properly documented.
New members of the Board undergo an in-house training
programme to familiarize themselves with the operations of
the Group.
Re-election
The Company's Articles of Association provide that at least
one-third (1/3) of the Board are subject to retirement by
rotation at each Annual General Meeting provided always that
each Director shall retire at least once in every three years.
The Directors to retire in each year are the Directors who have
been longest in office since their appointment or re-appointment.
This provides an opportunity for shareholders to renew their
mandates. To assist shareholders in their decision, sufficient
information such as personal profile, meeting attendance
and the shareholdings in the Company of each Director
standing for election are furnished in a separate statement
accompanying the Notice of Annual General Meeting.
Directors over seventy years of age are required to submit
themselves for re-appointment annually in accordance with
Section 129 (6) of the Companies Act, 1965.
Directors Training
The Board acknowledges the importance of continuous education
and training to enable effective discharge of their responsibility.
All Board members have attended the Mandatory Accreditation
Programme (MAP) as prescribed by Bursa Malaysia Listing
Requirement.
The Directors are regularly informed of industry-specific
conventions to enable them to understand the industries within
which the Group operates. The Company has initiated its own
comprehensive and formal training programme tailored to the
needs of the Board of Directors. During the year, the Directors
have attended the Continuing Education Programme on
"Directors' Duties and Responsibilities in respect of the recent
Amendments to the Companies Act, 1965" and "Directors Training on Asia Pacific Emerging Pharma Markets" organized
by the Company and facilitated by industry experts.
In addition to the in-house seminars, Directors are also
encouraged to attend seminars and/or conferences organized
by relevant regulatory authorities and professional bodies to
further enhance their skills and knowledge as well as update
themselves on new developments in the business environment.
Newly appointed Directors also underwent programmes such
as plant visits and briefings to familiarize them with each
of the business divisions.
STRUCTURE AND PROCESS
Board Meeting
Board meetings are scheduled a year ahead in order to enable
full attendance at Board meetings. A minimum of four (4) Board
meetings are held during the year. Additional meetings are held
as and when required.
There is a formal agenda for all scheduled meetings and Board
papers are prepared and submitted in advance to ensure
adequate information is available to assist deliberation
by Board members.
During the financial year, ten (10) Board Meetings were held
where the Board deliberated and considered a variety of matters
including the Company's financial results, the business plan,
direction and potential acquisitions.
Details of the Directors' meeting attendances during the financial
year are as follows:
| |
Number
of Board Meetings |
| |
Held |
Attended |
Tan Sri Ab Rahman bin Omar Chairman, Non-Independent Non-Executive Director |
10 |
10 |
Dato' Dr. Mohamad Hashim bin Ahmad Tajudin Group Managing Director |
10 |
10 |
Dato' N. Sadasivan Senior Independent Non-Executive Director |
10 |
10 |
E. Sreesanthan Non-Independent Non-Executive Director |
10 |
8 |
Dato' Kalsom binti Abdul Rahman Independent Non-Executive Director |
10 |
8 |
Abdul Rahim bin Abdul Hamid Independent Non-Executive Director |
10 |
10 |
Tan Sri Dato' Dr. Abu Bakar bin Suleiman Non-Independent Non-Executive Director |
10 |
10 |
Datuk Dr. Saharan bin Haji Anang (appointed w.e.f. 1/1/2009) Independent Non-Executive Director |
N/A |
N/A |
Mohd. Nizam bin Zainordin (appointed w.e.f. 11/5/2009) Non-Independent Non-Executive Director |
N/A |
N/A |
Tan Sri Dato' Dr. Mohamed Yusof bin Hashim (resigned w.e.f. 9/12/2008) Independent Non-Executive Director |
10 |
4 |
Jamiah binti Abdul Hamid (resigned w.e.f. 5/5/2009) Non-Independent Non-Executive Director |
10 |
7 |
RELATIONSHIP BETWEEN BOARD AND SENIOR MANAGEMENT
The Chairman, together with the Board, reviews and approves the
strategic objectives and Key Performance Indicators for the Group
Managing Director.
The Group Managing Director is responsible for overseeing the
businesses as well as coordinating and implementing corporate
strategies.
Quality / Supply of Information
Board papers are prepared for all agenda items to ensure relevant
information is provided to assist decision making.
The Chairman is primarily responsible for ensuring that sufficient
information is provided to the Board members to assist them in
their deliberation. In line with this, the Company has established
a board paper rating process whereby all board papers tabled
at Board Meetings will be rated based on contents and
presentation to ensure sufficient information are provided to
the Board members for them to make an informed decision.
Access to Information / Advice
All Directors have the same right of access to all information
within the Group and the duty to make further enquiries which
they may require in discharging their duties including seeking
independent professional advice, if necessary, at the Company's
expense. Minutes of proceedings and resolutions passed at each
Board and Board Committees are kept in the statutory register
at the Registered Office of the Company and are accessible to
all Directors. The Company also provides a platform for dialogue
between the Board and the Divisional Directors either at Board
meetings or during the business units visits. This will assist the
Board in arriving at business and strategic decisions relating to the Group. The Directors also have access to the advice and
services of the Company Secretaries who are available to provide
them with the appropriate advice and services and also to ensure
that the relevant procedures are followed. The Directors are
regularly updated on the latest developments in the legislations
as well as statutory and regulatory requirements relating to
the duties and responsibilities of Directors. When necessary,
the Directors also visit locations of business units which would
assist the Board to make effective decisions relating to the
Group. During the financial year under review, the Board
were given the opportunity to visit the Group's regional office
in Jakarta.
Board Committees
The Board of Directors delegates specific responsibilities to the
Board Committees, namely the Nomination & Remuneration
Committee, Audit Committee, Finance & Investment Committee
and Government-Linked Companies Transformation Committee.
All committees have their terms of reference approved by
the Board. These Committees have the authority to examine
particular issues and submit reports of their deliberations and
major findings to the Board.
The terms of reference, composition and activities of the
respective committees are stated in their respective reports.
DIRECTORS' REMUNERATION
The remuneration of Directors is determined at levels which
enable the Company to attract and retain Directors with
the relevant experience and expertise to manage the Group
successfully. The component parts of remuneration are
structured so as to link rewards to corporate and individual
performance, in the case of Executive Director. In the case
of Non-Executive Directors, the level of remuneration reflect
the experience and level of responsibilities undertaken by
the particular Non-Executive Directors concerned.
The Nomination & Remuneration Committee is responsible for
setting the policy framework and for making recommendations
to the Board on all elements of the remuneration and other
terms of employment of the Executive Directors. The Executive
Directors abstain from the deliberations and voting decisions
in respect of their remuneration. All Non-Executive Directors
are paid directors' remuneration for Board and Committee
meetings. In addition, they are paid a meeting allowance for
attendance at each Board and Committee meeting. The
directors' fees are approved by the Company at the Annual
General Meeting in accordance with the Articles of Association.
The aggregate remuneration of Directors categorised into
appropriate components for the financial year ended 31
December 2008 is as follows:
| Category
of Directors |
Fees |
Allowance |
Salaries |
Bonus |
Benefits
In Kind |
Other Emoluments |
Total |
| |
(RM'000) |
(RM'000) |
(RM'000) |
(RM'000) |
(RM'000) |
(RM'000) |
(RM'000) |
| Group Managing Director |
- |
- |
516 |
511 |
191 |
172 |
1391 |
| Non-Executive
Directors |
449 |
74 |
- |
- |
- |
- |
522 |
| Range of Remuneration |
Executive
|
Non-Executive
|
| RM1
- RM50,000 |
-
|
-
|
| RM50,001
to RM100,000 |
-
|
8
|
| RM250,000
to RM 300,000 |
- |
- |
| RM700,000
to RM750,000 |
- |
- |
| RM750,001
to RM800,000 |
- |
- |
| RM800,001 and above |
1 |
- |
|