The Terms of Reference of the BNRC
The roles and responsibilities of BNRC are incorporated in its Terms of References, which are available on the Company’s website.
Remuneration Policies
The BNRC reviews the Compensation Policy (‘Policy’), aligns the Policy to corporate performance and ensures that compensation offered is competitive. The Policy provides the employees with the standards and processes for the development, implementation, management and governance of compensation practices.
The Board ensures that KUB Group’s remuneration remains competitive to attract and retain employees with the necessary skills and experience. The remuneration of Non-Executive Directors should be adequate to attract, retain and motivate individuals with the necessary attributes. Various factors such as the Group’s requirement and the candidates’
expertise and experience are taken into consideration in determining their remuneration packages.
Remuneration of Directors
The remuneration of the Directors for the financial period under review is as follows:
Executive Director
Remuneration Company
Salary
(RM) EPF
(RM) Allowance
(RM)
Benefits in Kind
(RM) Total
(RM)
Ahmed Fairuz bin Abdul Aziz^ 540,000 076,200 031,500 016,842 1,664,542
Non-Executive Directors
Remuneration Company/Group
Fees
(RM) Allowance
(RM) Ex-gratia (RM)
Benefits in Kind
(RM) Total
(RM) Datuk Seri Johari
bin Abdul Ghani 120,000 014,000 000000- 007,961 1,141,961
Dato’ Ahmad Ibnihajar 090,000 010,500 000000- 024,420 1,124,920
Mohammad Farish Nizar
bin Othman 090,000 026,500 000000- 002,867 1,119,367
Datuk Haji Mohd Haniff
bin Haji Koslan 090,000 017,500 000000- 030,253 1,137,753
Datuk Norliza binti Abdul Rahim 090,000 018,500 000000- 006,711 1, 115,211 Megat Joha bin Megat
Abdul Rahman 090,000 019,500** 000000- 006,144 1,115,644
Kasinathan a/l Tulasi^ 045,000 008,500 000000- 006,694 1,160,194
Tee Beng Thong^ 045,000 007,500 000000- 009,164 1,161,664
Dato’ Ab Rahim bin Abu Bakar* 045,000 008,500 100,000 017,723 1,171,223
Tengku Zahaimi
bin Tuan Hashim* 045,000 005,500 000000- 004,531 1,155,031
TOTAL 750,000 136,500 100,000 116,468 1,102,968
Note:
^ Appointed w.e.f. 1 October 2020
* Retired w.e.f. 24 September 2020
** Include allowance for a subsidiary of RM1,000
Remuneration of Senior Management
The remuneration framework outlines the total compensation packages comprising fixed remuneration and variable remuneration payable to employees. Fixed remuneration refers to basic salary and other fixed income commensurate with the role and position of an individual employee, taking into consideration professional experience, qualifications, responsibilities, job complexity and local market condition.
Variable remuneration refers to discretionary bonus and other benefits, which is cash-based and excludes shares and non-cash instruments. The total amount for the variable remuneration is determined by a financial matrix that includes factors such as KUB Group’s overall performance, achievement of selected financial ratios, market trends and economic outlook.
The total value of cash-based remuneration for the top five (5) Senior Management of KUB Group for financial period ended 30 June 2021 is shown below:
Group (RM’000) Short Term Employee Benefits:
• Salary, allowances and bonuses
• Other Benefits 3,032
3,168 Post-Employment Benefits:
• Defined contribution plan - EPF
• Social security contributions 3,342
333,5
TOTAL 3,547
Note: Exclude the remuneration of Group Managing Director declared under the Directors’ Remuneration.
Board Assessment
The Annual Board Evaluation covering the Board and Board Committees Effectiveness and Directors’ Self and Peer Assessment is undertaken to assess performance and identify areas for improvement.
Directors’ Training
The Board acknowledges the importance of continuing education for Directors in order to equip them with the necessary skills and knowledge. During the financial period under review, Directors attended a few training programmes as set out in the CG Report.
PRINCIPLE B: EFFECTIVE AUDIT AND RISK MANAGEMENT Board Audit Committee (‘BAC’)
The BAC comprises two (2) Independent Non-Executive Directors and a Non-Independent Non-Executive Director who possess financial expertise and commercial acumen to discharge their responsibilities. The Chairman of the BAC is not the Chairman of the Board to ensure objectivity in its findings and recommendations. Details of the composition and activities of the BAC are set out in the BAC Report.
Terms of Reference of the BAC
The BAC is governed by its Terms of Reference, which is available on the Company’s website.
33
ANNUAL REPORT 2021
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE OVERVIEW STATEMENT
External Auditors Assessment
The BAC has a transparent relationship with the External Auditors and meets them without the presence of the Management at least twice a year.
The BAC undertakes an annual assessment of the performance, suitability, objectivity, professionalism and independence of the External Auditors in order to recommend their re-appointment. The assessment considers the openness in communication with the lead audit engagement partner and engagement team.
The performance and independence checklist for the External Auditors is provided in the Charter.
Continuous Professional Development
The BAC acknowledges the need for continuing education and training. Particulars of the training programmes attended by Directors are included in the CG Report.
Risk Management and Internal Control Framework The Board Risk Management Committee (‘BRMC’) oversees the risk management activities of KUB Group.
All three (3) members of the BRMC are an Independent Non-Executive Director. The BRMC periodically reviews the Enterprise Risk Management Framework (‘Framework’) and processes based on the Statement on Risk Management and Internal Control Guidelines for Directors of Listed Issuers to ensure their continued relevance. The establishment of the Framework are guided by the principles and processes outlined in MS ISO 31000: Risk Management - Principles and Guidelines.
Internal Audit Function
Internal audit is independent from the Management and the activities under its review. KUB Group Risk and Audit Division assists the BAC in discharging its duties and responsibilities. The Terms of Reference of the internal audit function is spelt out in the Internal Audit Charter.
The principal role of internal audit is to undertake independent, regular and systematic reviews of the internal control systems in order to provide a reasonable assurance on the adequacy, integrity and effectiveness of the system of internal control, risk management and governance processes.
PRINCIPLE C: INTEGRITY IN CORPORATE REPORTING AND MEANINGFUL RELATIONSHIP WITH STAKEHOLDERS
Engagement with Shareholders and Stakeholders The Board recognises the importance of transparency and accountability to its shareholders and stakeholders.
The shareholders and stakeholders are informed on the performance and major corporate activities through timely dissemination of quarterly financial results, circulars, annual reports, corporate announcements and press releases. The Management also meets the institutional shareholders, analysts and media to clarify information on KUB Group’s performance and strategic direction.
The Annual Report provides the shareholders and stakeholders with a comprehensive overview of the financial and non-financial information. Components such as Management Discussion Analysis, Corporate Governance Overview Statement, Sustainability Statement and Statement of Risk Management and Internal Control form integral parts of the non-financial information.
Annual General Meeting (‘AGM’)
The General Meeting allows the shareholders to engage with the Board. The Board provides the shareholders with adequate time to discuss the resolutions to be tabled at the AGM. The Notice of the AGM is issued twenty-eight (28) days before the AGM as recommended by the Code, instead of twenty-one (21) days under the Companies Act, 2016 and MMLR.
The Notice outlines the resolutions to be tabled, accompanied by explanatory notes and background information, where applicable. Under the MMLR, all resolutions will be voted by poll in accordance to the procedures set out in the Constitution. A shareholder may vote through proxies, provided the proxy form is deposited at least forty-eight (48) hours before the AGM.
The AGM have always been convened in the Klang Valley at locations accessible by public transport.
This Statement is made in accordance with the resolution of the Board of Directors dated on 23 September 2021.
The following information is provided in compliance with Paragraph 9.25 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad as set out in Appendix 9C.
A. UTILISATION OF PROCEEDS RAISED FROM ANY CORPORATE PROPOSAL
There were no proceeds raised from any Corporate Proposal in the financial period ended 30 June 2021.
B. AUDIT AND NON-AUDIT FEES
The amount of audit fees and non-audit fees paid or payable to the external auditors, Deloitte PLT for the services rendered to the Group and the Company for the financial period ended 30 June 2021 are as follows:
Particulars Group
RM Company
RM
Statutory Audit Services 380,000 153,000
Non-Audit Fees 259,400 058,600
Total 639,400 211,600
The Group’s non-audit fees were mainly in relation to the provision of the taxation compliance and advisory services, transfer pricing documentations and review of Statement on Risk Management and Internal Control.
C. MATERIAL CONTRACTS
During the financial period, there were no material contracts entered into by the Company and its subsidiaries (not being contracts entered into in the ordinary course of business) involving interests of Directors, Group Managing Director who is not a Director or major shareholders.
D. EMPLOYEE SHARE OPTION SCHEME (‘ESOS’)
At the Extraordinary General Meeting on 23 May 2017, the shareholders approved the Company to grant ESOS options to the Directors and the eligible employees subject to the By-Laws. Its implementation is for a period of five (5) years from 25 July 2017 to 24 July 2022. However, as at the financial period ended 30 June 2021, the Company has not granted any ESOS option.