However, the board is still fully responsible for the overall conduct of the board committees. The board also established the RMC to define and review the group's risk management strategies, policies and risk tolerance. The board has delegated to AC to examine the effectiveness of the group's internal control systems and management information systems.
A Chairman of the Board of Directors is appointed who is responsible for instilling good practices in corporate governance, leadership and effectiveness of the Board of Directors. The chairman of the board is Datuk Kamaludin Bin Yusoff and the group CEO is Mr. The board of directors has a governance charter that is periodically reviewed and published on the company's website.
Details of the Board's Statute are published on the Company's official website at http://www.johoretin.com.my/investor/cg/bc.
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The NC will review and assess the performance of the Board and Board Committees on an annual basis. The peer assessment will be carried out by means of an evaluation form that will be circulated to all directors, which assesses the competence, contribution to interaction and quality of input of the members of the Board and Board Committees. In its annual report, the board discloses the company's policy on gender diversity, its targets and measures to achieve those targets.
Since 2014, the Board has appointed one (1) female director, representing approximately 16.67% of the Board, as an independent non-executive director on the Board and Board Committees. Stakeholders can form an opinion on the overall effectiveness of the Board and individual Directors. The Board must undertake a formal and objective annual evaluation to determine the effectiveness of the Board, its committees and each individual Director.
The Nomination Committee ("NC") is responsible for assessing and evaluating the performance of the Board and the committees on an annual basis in relation to their performance and contribution to the needs of the Company. The area of assessment for individual directors and chairmen of boards and board committees includes contribution to interaction, quality of input and understanding of roles. The company secretary will compile and present the result of the NC analysis.
In 2020, the CC had concluded that the overall performance of each individual Director was rated as “Strong”, while the overall performance of the Chairmen of the Board and Board Committees was rated as. The Board has established policies and procedures to determine the remuneration of directors and senior management, which take into account the requirements, complexity and performance of the Company, as well as the skills and experience required. The Remuneration Committee (“RC”) is assisting the Board to assess and review the remuneration packages of the Company's and its subsidiaries' Executive Directors (ie key senior management), to reflect the directors' responsibility and commitment to stewardship.
The Directors' fees for both Executive Directors and Non-Executive Directors of the Company are recommended by the Board as a whole, subject to the shareholders' approval at the forthcoming Annual General Meeting. The Board has a compensation committee to implement its policies and procedures on compensation, including reviewing and recommending matters regarding the compensation of the board and senior management.
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Stakeholders can assess whether directors' and senior management's remuneration is commensurate with their individual performance, taking into account the company's performance. Siah Chin Leong, who is an independent non-executive director and is not the chairman of the board. AC's terms and conditions are available on the company's website at http://www.johoretin.com.my/investor/cg/tor.
The audit committee has a policy of requiring a former key audit partner to serve at least a two-year standstill period before being appointed as an audit committee member. The Board of Directors reviewed and revised the mandate of the audit committee to include observing a three (3) year standstill period before the former key audit partner of the external auditors will be appointed as a member of the audit committee. . To date, none of the key audit partners has been appointed as a member of the audit committee.
The Audit Committee has policies and procedures to assess the suitability, objectivity and independence of the External Auditor. Crowe Malaysia PLT ("Crowe") submitted to the Audit Committee ("AC") the 2020 audit plan which highlighted the scope of work, engagement team, areas of audit emphasis and key audit issues prior to commencement of the audit of the financials . year ended 31 December 2020. The AC had then discussed and reviewed the performance and remuneration, including the non-audit services provided by Crowe, and made recommendations to the Board for approval.
AC has obtained confirmation from Crow that they have continuously met the appropriate ethical requirements of independence by performing the audit engagement in accordance with the International Association of Accountants' Code of Ethics for Professional Accountants and the Bylaws (On Professional Ethics, Conduct and Practice). The Board approved the AC's recommendation and, being satisfied with Crow's suitability in terms of performance, effectiveness, independence and remuneration for audit and non-audit services, approved the re-appointment of Crow as the Group's external auditor, subject to shareholder approval at the forthcoming 20th Annual General Meeting in 2021.
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Taken together, the audit committee should possess a wide range of skills necessary to carry out its duties. All members should be financially literate and be able to understand matters under the audit committee's remit, including the financial reporting process. All members of the audit committee should undertake ongoing professional development to keep abreast of relevant developments in accounting and auditing standards, practices and regulations.
All members of the Audit Committee (“AC”) are financially literate and suitably qualified with good knowledge and experience in accounting, business and financial management. All AC members had completed the Mandatory Accreditation Program (“MAP”) prescribed by Bursa Malaysia. Details of the Profile of the Board of Directors and the training and seminar programs attended by the directors are disclosed in the 2020 Annual Report.
Management is provided with reasonable assurance that the negative impact arising from a foreseeable future event or situation on the company's objectives is mitigated and controlled. The management confirms its overall responsibility for risk management and the group's internal control system, as well as for reviewing the adequacy and integrity of the system. Details of the Group's risk management and internal control system are disclosed in the 2020 Annual Report.
The Board must disclose the characteristics of its risk management and internal control framework, and the adequacy and effectiveness of this framework. Subsequently, a Risk Management Committee (“RMC”) was set up to define and review the risk management strategies, policies and risk tolerance of the Group, which will be affected by the external factors. The Board is provided with reasonable assurance that the adverse impact arising from a foreseeable future event or situation on the Company's objectives is mitigated and managed.
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The Internal Auditors (“IA”) have submitted the annual internal audit plan to the Audit Committee (“AC”) for review and comment prior to implementation, and the AC will subsequently recommend it to the Board of Directors for consideration and approval. The internal audit assessment will be reported to the AC on a quarterly basis to highlight the weaknesses and improvements that need to be carried out for better efficiency and effectiveness of the internal control system. The AC reviews Forreststone's performance and compensation and makes annual recommendations to the Board of Directors for approval.
Lew Sze How, head of the internal audit engagement team, is a Chartered Accountant and holder of a professional degree from the Association of Chartered Certified Accountants (“ACCA”). He is a member of the Malaysian Institute of Accountants (“MIA”) and fellow member of the Association of Chartered Certified Accountants (“FCCA”). Stakeholders can make informed decisions regarding the company's activities, its governance, environmental and social responsibility policies.
Shareholders are invited to attend the general meeting and take part in the discussion, and take advantage of the opportunity to ask questions regarding the Group's results and operations. Notice of an annual meeting must be given to shareholders at least 28 days before the meeting. The Board is committed to best corporate governance practice and has notified shareholders of the upcoming 2021 20th Annual General Meeting at least 28 days prior to the meeting.
The chairman of the audit, nominating, risk management and other committees provides meaningful answers to questions put to them. Crowe Malaysia PLT to the company's general meeting if the questions require a professional response and opinion. In light of the Movement Control Order (MCO) and conditional MCO due to the Covid-19 pandemic, and in accordance with the Government's guidelines for holding AGMs, the Company is aware of the need to hold the Full Virtual Meeting ('FVM') in this period.
In accordance with the guidelines of the supervisory board and Article 327 (2) of the Companies Act 2016, the chairman must be present at the venue of the broadcast, and the shareholders must not be physically present at the venue of the broadcast on the day of the general meeting. Registration procedures are set out in the Administrative Guide on page 157 of the annual report.
