Ireka | Corporate Governance
16815
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CORPORATE

GOVERNANCE

Board Charter

1.    INTRODUCTION

 

The Board of Directors (“the Board”) of Ireka Corporation Berhad is committed to ensuring that good corporate governance principles are developed and implemented throughout the Group with the ultimate objective of enhancing shareholders’ value, whilst taking into account the interests of other stakeholders.

 

2.    PURPOSE

 

This Board Charter has been endorsed by the Board. It sets out the principles governing the Board and is designed to enhance the standards of Corporate Governance to enable the Board to provide strategic guidance and effective oversight of management of the Company and the Group.

 

The Charter clarifies the roles and responsibilities of the members of the Board and management to facilitate the Board’s and management’s accountability to the Company and its shareholders. The Charter also assists the Board in the assessment of its own performance and the performance of its Committees.

 

3.    COMPOSITION AND BOARD BALANCE

 

3.1  The Board shall comprise members of calibre from a diverse blend of professional backgrounds, skills, expertise and knowledge to enable the Board in discharging its responsibilities in an effective and competent manner.

 

3.2  The composition and size of the Board shall facilitate the decision making of the Company. In accordance with the Constitution of the Company, the Board shall not be less than two (2) Directors and more than twelve (12) Directors.

 

3.3  At any one time, at least two (2) or one-third (1/3), whichever is higher, of the Board members are Independent Directors to ensure that the strategies proposed by the executive management are fully deliberated and decisions are arrived at after taking into account the interest of the Group.

 

4.    APPOINTMENTS AND RE-ELECTION

 

4.1  All Board appointments are approved by the Board upon the recommendation of the Nomination Committee (“NC”). In making the recommendations, the NC will consider the required mix of skills, experience and diversity, including gender, where appropriate, which the Director brings to the Board.

 

4.2  Pursuant to Section 202 of the Companies Act 2016 (“Act”), every newly appointed Director shall hold office only until the next following annual general meeting (“AGM”) and pursuant to Section 205 of the Act, one-third of all other Directors, for the time being, or, if their number is not three or a multiple of three, then the number nearest to one-third, shall retire from office at the conclusion of the AGM. All retiring Directors shall be eligible for re-election.

 

4.3  A Director who is appointed for the first time as a director of a public listed company shall attend the Mandatory Accreditation Programme prescribed by the Bursa Malaysia Securities Berhad within 4 months of its appointment.

 

4.4  A Director who is appointed for the first time as a director of a public listed company shall attend the Mandatory Accreditation Programme prescribed by the Bursa Malaysia Securities Berhad within 4 months of its appointment.

 

5.    THE BOARD

 

5.1     THE BOARD

 

5.1.1  The Board takes full responsibility for the overall performance and business affairs of the Company and the Group. The principal responsibilities include, but not limited, to the following:-

 

a. reviewing and adopting strategic plans for the Group;

 

b. overseeing the conduct of the Group’s businesses to evaluate whether the businesses are being properly managed;

 

c. identifying principal risks and ensuring the implementation of appropriate internal controls and mitigation measures;

 

d. succession planning, including identifying, developing and appointing the right persons for key positions, fixing the compensation of and, where appropriate, replacing senior management;

 

e. overseeing the development and implementation of a shareholder and stakeholder communications policy for the Company;

 

f. reviewing the adequacy and effectiveness of the Group’s internal control systems and management information systems; including systems for compliance with applicable laws, regulations, rules, directives and guidelines; and

 

g. ensuring that the Group’s financial statements are true and fair and conform with the accounting standards.

 

5.1.2  In the normal course of events, day to day management of the Group will be in the hands of Management and under the stewardship of the Managing Director / Executive Directors.

 

5.2     THE CHAIRMAN

 

5.2.1  The Board will appoint a Chairman from among the Directors.

 

5.2.2  The Chairman is responsible for the overall leadership and efficient functioning of the Board. The key roles of the Chairman, among others, are as follows:-

 

a. leading the Board in the oversight of management;

 

b. chairing the Board meetings and ensuring the efficient organisation and conduct of the meetings;

 

c. chairing all general meetings with the shareholders and ensuring effective communication with shareholders and relevant stakeholders;

 

d. promoting constructive and respectful relations between Directors, and between the Board and Management;

 

e. leading the Board and ensuring a balance composition of skills, knowledge and experience within the Board members; and

 

f. providing governance in matters requiring corporate justice and integrity.

 

5.3     THE MANAGING DIRECTOR

 

5.3.1  The Managing Director, with the assistance of the Deputy Managing Director, is primarily accountable for overseeing the day-to-day operations to ensure smooth and effective running of the Group.

 

5.3.2  The responsibilities of the Managing Directors, among others, are as follows:-

 

a. implementing the corporate and financial strategies, annual budget and corporate performance targets of the Company;

 

b. reporting/presenting to the Board on the current and future initiatives of the Company and bringing material and other relevant matters to the attention of the Board in a timely and regular manner;

 

c. ensuring the adequacy and integrity of the management information systems, financial control systems and internal control systems of the Company;

 

d. ensuring that the Company’s risk management practices and policies are operating adequately and effectively;

 

e. maintaining an effective communications policy and overseeing shareholders’ communications; and

 

f. assuming full accountability to the Board for all aspects of the Company’s operations and performance.

 

5.4     BOARD COMMITTEES

 

5.4.1  The Board may from time to time establish committees as is considered appropriate to assist in carrying out its duties and responsibilities. The Board delegates certain functions to the following committees to assist in the execution of its responsibilities:

 

a. Executive Board;

 

b. Audit Committee;

 

c. Nomination Committee;

 

d. Remuneration Committee; and

 

e. Risk Management Committee

 

The Audit Committee exercised oversight responsibility over Risk Management of the Group

 

5.4.2  The committees shall operate under clearly defined terms of reference. The committees are authorised by the Board to deal with and to deliberate on matters delegated to them within their terms of reference and make the necessary recommendations to the Board for its consideration and decision making.

 

6.    INDEPENDENT DIRECTORS

 

6.1  The presence of the Independent Directors is to ensure that there is proper check and balance on the Board as they are able to provide unbiased and independent views in Board deliberations and decision-making of the Board taking into consideration the interests of the Group and the minority shareholders.

 

6.2  A Director will be considered independent if he has no material relationship with the Company that may interfere with the exercise of his independence from Management and the Company and subject to the requirements as stated in the Main Market Listing Requirements. Family ties and cross-directorships may be relevant in considering interests and relationships which may compromise independence, and should be disclosed by the Directors to the Board.

 

6.3  The Board undertakes to assess the independence of its Independent Directors upon his proposed appointment, annually and when any new interest or relationship develops.

 

6.4  The Board shall appoint a Senior Independent Non-executive Director who will attend to any query or concern raised by shareholders.

 

6.5  The tenure of an Independent Director shall not exceed a cumulative term of nine (9) years. Upon the completion of the nine (9) years, the Independent Director may continue to serve on the Board subject to the Director’s re-designation as a Non-Independent Director. However, the Board may seek the shareholders’ approval in the event the Board retains an Independent Director who has served in that capacity for more than nine (9) years and provide strong justification to the shareholders at a general meeting.

 

7.    ACCESS TO INFORMATION AND INDEPENDENT ADVICE

 

7.1  The Board, whether as a full Board or in their individual capacity, has unrestricted access to all information pertaining to the Group’s business affairs and right to seek independent professional advice, if necessary, at the Group’s expense, to enable them to discharge their duties effectively.

7.2  The Directors have access to the advice and services of the Company Secretary and senior management, in the furtherance of their duties.

 

8.    BOARD MEETINGS

 

8.1  The Board meets at least five (5) times annually, with additional meetings to be convened as and when necessary. Board meetings for each financial year are scheduled before the end of the preceding financial year.

 

8.2  All Board members are provided with Board report containing relevant documents and information in a timely manner and within reasonable time for Board members to read and understand before participating in discussions and deliberations in Board meetings. All Directors have the right and duty to make further enquiries where they consider necessary. Members of the senior management team are invited to provide insight and to furnish clarification on issues that may be raised by the Board.

 

8.3  During these meetings, the Board reviews the Group’s financial performance, business operations, reports of the board committees and results are deliberated and considered. Management and performance of the Group and any other strategic issues that affect or may affect the Group’s businesses are also deliberated.

 

8.4  All proceedings of the Board meetings covering the deliberations of issues and the conclusions are recorded in the minutes and later confirmed by the Board.

 

9.    FINANCIAL REPORTING

 

9.1  The Board aims to present a balanced, clear and meaningful assessment of the Group’s position and prospect in all their reports to the shareholders, investors and regulatory authorities.

 

9.2  The Directors are required by the Act to prepare financial statements for each financial year which have been made out in accordance with the applicable approved accounting standards so as to give a true and fair view of the state of affairs of the Company and the Group at the end of the financial year and of the results and cash flows of the Company and the Group for the financial year then ended.

 

9.3  The Directors have responsibility for ensuring that the Company keeps accounting records which disclose with reasonable accuracy the financial position of the Company and the Group which enable them to ensure that the financial statements comply with the financial reporting standard and the Act.

 

9.4  The Directors have overall responsibilities to take such steps as reasonably available to them to safeguard the assets of the Group, to prevent and detect fraud and other irregularities.

 

10.    DIRECTORS’ REMUNERATION

 

10.1  The Remuneration Committee is responsible for recommending the remuneration packages of Executive Directors for consideration and approval by the Board. The Executive Directors play no part in decision on their own remuneration. The Remuneration Committee reviews the remuneration packages of Executive Directors based on their responsibilities and scope of work, corporate and individual performance, drawing from outside advice as necessary.

 

10.2  In the case of Non-executive Directors, the level of remuneration reflects the experience and level of responsibilities undertaken by the particular Non-executive Directors concerned. The determination of the remuneration of the Non-executive Directors is a matter for the Board as a whole. The Company reimburses reasonable expenses incurred by these Directors in the course of their duties as Directors. Non-executive Directors do not participate in decision on their own remuneration packages.

 

10.3  The Directors’ fees are recommended by the Board and approved by the shareholders at the AGM.

 

11.    DIRECTORS’ TRAINING

 

11.1  Newly appointed Directors shall receive induction on joining the Board which include briefings by the Board members with the necessary information to assist them in understanding the operations of the Company, current issues and corporate strategies, as well as the structure and management of the Company.

 

11.2  The Directors shall, from time to time, attend training programmes, seminars and talks to keep abreast with recent developments of the state of economy, management strategies and practices, laws and regulations to enhance their knowledge and skills in order to discharge their duties effectively.

 

11.3  The Directors shall regularly be updated by the Company Secretary on the changes to the Listing Requirements and key corporate governance developments from time to time.

 

12.    COMPANY SECRETARY

 

12.1  The Board is supported by a suitably qualified and competent Company Secretary, who plays an important advisory role.

 

12.2  The Company Secretary is accountable to the Board through Chairman of the Board and Committees on all governance matters.

 

12.3  The Company Secretary is a central source of information and advice to the Board and its committees on issues relating to compliance with laws, rules, procedures and regulations affecting the Company and the Group.

 

13.    INVESTOR RELATIONS AND SHAREHOLDER COMMUNICATION

 

13.1  The Board values regular communications with shareholders and investors. These include the following:-

 

a.  Timely release of announcements and disclosures to Bursa Malaysia Securities Berhad, which include quarterly financial results, award of contracts and any other material information that may affect the investors’ decision making;

 

b.  Timely release of annual reports, circulars to shareholders and press releases;

 

c.  Press conference with the media immediately after general meetings to provide them an opportunity to receive an update from the Board on the proceedings at the meetings and to address any queries from the media; and

 

d.  Regular meetings with analysts and investors to present and update the Group’s strategy, performance and major developments.

 

13.2  Shareholders and investors can access for up-to-date information about the Group through the Company’s website, www.ireka.com.my.

 

13.3  The Company regards the AGM as the principal forum for dialogue and interaction with shareholders and aims to ensure that the AGM provides an important opportunity for effective communication with, and constructive feedback from, the Company’s shareholders. The Board presents an overview of the performance of businesses in the Group to keep the shareholders informed and updated on current developments of the Group. The Chairman encourages active participation by the shareholders during the AGM.

 

14.    CODE OF ETHICS AND CONDUCT

 

14.1  The Directors are expected to conduct themselves with the highest ethical standards. All Directors and employees are expected to behave ethically and professionally at all times and thereby protect and promote the reputation and performance of the Company. The Group communicates its Code of Conduct to all Directors and employees upon their appointment/employment and is deemed to be part of the Terms and Conditions of Service.

 

14.2 Directors are required to declare their respective shareholdings, direct or indirect if any, in the Company and related companies and their interests, direct or indirect, in contracts or proposed contracts with the Company or any of its related companies. The Directors concerned are to abstain from deliberating and voting in relation to these transactions or in matters affecting their personal, business or professional interests.

 

14.3  Each Director will, at all times act honestly, fairly and diligently in all respects in accordance with the laws applicable to the Company.

 

15. REVIEW OF BOARD CHARTER

 

The Board Charter is available for reference on the Company’s corporate website, www.ireka.com.my.

 

The Board will periodically review the Board Charter and make necessary changes to ensure that they remain consistent with the Company’s objective, current law and practices.

 

The Board Charter has been reviewed and approved by the Board of Directors at a meeting held on 28 February 2017

Terms of Reference of Audit Committee

Membership

  1. The Committee shall be appointed by the Board from amongst the Directors and shall consist of not less than three (3) members, a majority of them shall be independent Directors.
  2. At least one (1) member of the Committee must be a member of the Malaysian Institute of Accountants or similar qualification as prescribed in Part I or Part II of the First Schedule of the Accountants Act, 1967 with at least 3 years’ working experience.
  3. No Alternate Director may be appointed as a member of the Committee.
  4. The members of the Committee shall elect a Chairman from among their members who shall be an Independent Non-executive Director.
  5. In the event of any vacancy in the Committee resulting in the number of Directors falling below three (3) members, the Board of Directors must fill the vacancy within three (3) months to make up the minimum number of three (3) members.
  6. The Nomination Committee to review the terms of office and performance of the Committee and each of its members annually to determine whether the Committee and its members have carried out their duties in accordance with their terms of reference.

Authority

  1. The Committee is authorised by the Board to investigate any matter within its terms of reference.
  2. The Committee is authorised to obtain any information it requires from any employee and all employees are directed to co-operate with any request made by the Committee.
  3. The Committee shall have unrestricted access to any information pertaining to the Group, from both the internal and external auditors, and have the power to carry out Internal Audit function or activity and is able to convene meetings with the external auditors, the internal auditors or both, excluding the attendance of other directors and employees of the Company, whenever deemed necessary.
  4. The Committee is authorised to obtain external legal or other independent professional advice as necessary.

Duties and Responsibilities

The duties of the Committee shall be among others:

1.  To review the following and report the same to the Board of Directors

 

a. with the external auditors, the audit plan;

 

b. with the external auditors, their evaluation of the system of internal controls;

 

c. with the external auditors, the audit report, in the absence of management where necessary;

 

d. the assistance given by the employees of the Company to the external auditors;

 

e. the adequacy of the scope, functions and resources of the Internal Audit function and that it has the necessary authority to carry out its work;

 

f. the internal audit programme, processes, the results of the internal audit programme, processes or investigation undertaken and whether or not appropriate action is taken on the recommendations of the Internal Audit function;

 

g. the quarterly results and year end financial statements, prior to the approval by the board of directors, focusing particularly on:

 

i.  changes in or implementation of major accounting policy;

 

ii. significant matters highlighted including reporting issues, significant judgment made by management, significant and unusual events or transactions, and how these matters are addressed; and

 

iii. compliance with accounting standard and other legal requirements;

 

h. any related party transaction and conflict of interest situation that may arise within the Company or Group including any transaction, procedure or course of conduct that raises questions of management integrity;

 

i. any letter of resignation from the external auditors of the Company; and

 

j. whether there is a reason (supported by grounds) to believe that the Company’s external auditors are not suitable for re-appointment.

 

2.  To recommend the nomination of a person or persons as external auditors.

 

3.  To review risk reports prepared by the Risk Executive Committee, assess the adequacy and effectiveness of the risk management framework and the appropriateness of Management’s responses to key risk areas and proposed recommendations for improvement to be implemented.

 

4.  To engage on a continuous basis with senior management, such as the Chairman of the Board, the Executive Director(s), the Head of Finance, the internal auditors and the external auditors in order to be kept informed of matters affecting the Company, when necessary.

 

5.  To promptly report to the Bursa Malaysia Securities Berhad of matters reported by the Audit Committee to the Board of Directors which have not been satisfactorily resolved, resulting in a breach of the Bursa Malaysia Securities Berhad’s Listing Requirements.

Meetings

  1. Meetings shall be held not less than four (4) times a year. In addition, the Chairman is required to call for a meeting of the Committee, if requested to do so by any Committee members, any Executive Directors or the external auditors.
  2. A quorum shall be two (2) members, majority of whom must be independent directors.
  3. Other directors and employees may attend any particular Audit Committee meeting only at the Committee’s invitation, specific to the relevant meeting.
  4. The Company Secretary shall be the Secretary to the Committee.

Reporting procedure

The Secretary shall be responsible for keeping the minutes of meetings of the Committee and circulating them to all members of the Committee and other members of the Board. The Chairman of the Committee shall report on each meeting to the Board.
Terms of Reference of the Nomination Commitee

Membership

  1. The Nomination Committee (“the Committee”) shall be appointed by the Board of Directors from among the Directors of the Company and shall comprise not fewer than three (3) members, all of whom must be non-executive directors, with a majority being independent.
  2. The members of the Committee shall elect a Chairman from among their members who shall be a senior independent director. The Chairman of the Committee shall be approved by the Board of Directors. In the absence of the Committee Chairman, the remaining members present shall elect one of their numbers to chair the meeting.
  3. In the event of any vacancy in the Committee resulting in the number of members falling below three (3) members, the Board of Directors must fill the vacancy within three (3) months to make up the minimum number of three (3) members.

Authority

  1. To review annually the required mix of skills and experience and other qualities, including core competencies which executive and non-executive Directors should bring to the Board.
  2. To assess annually the effectiveness of the Board as a whole, the Board committees and also the contribution of each Director.
  3. To assess annually the independence of the Independent Directors.
  4. To assess annually the Directors who are standing for election or re-election and the Independent Director who has served on the Board for a cumulative term of more than nine (9) years for re-appointment, before they are recommended to the shareholders for approval in the annual general meeting.
  5. Be entitled to the services of the company secretary, among others, in summoning the meeting of the Committee and maintenance of minutes of the Committee’s meeting.

Duties and Responsibilities

1.  To recommend to the Board, candidates for all directorships to be filled by the shareholders or the Board, in the Company after considering the following attributes of the candidates:

 

– skills, knowledge, expertise, experience and diversity (including gender diversity);

 

– professionalism;

 

– integrity; and

 

– in the case of candidates for the position of independent non-executive directors, to evaluate the candidates’ ability to discharge such responsibilities/functions as expected from independent non-executive directors and time commitment expected from them.

 

2. To consider, in making its recommendation and within the bounds of practicability, candidates proposed by any director or shareholder.

 

3.  To recommend to the Board, suitable Directors to fill the seats on Board committees.

 

4.  To regularly review the structure, size and composition (including the skills, knowledge, experience, diversity and other qualities) required of the Board, including core competencies which non-executive directors should possess and be able to contribute to the Board including assessment on whether the directors are spending enough time to fulfil their duties, and make recommendations to the Board with regard to any changes.

 

5. To assist the Board to introduce a criteria and to formulate and implement a procedure to be carried out by the Committee annually for assessing the effectiveness of the Board as a whole, the board committees and the contribution of each individual director, and reporting to the Board at the end of each financial year with an assessment of the Board’s performance and areas in which the Board, board committees or individual director could improve on.

 

6. To review the induction and training needs of directors, and to ensure the training programme attended by the directors must be one that aids the directors in the discharge of his duties.

 

7. To give full consideration to succession planning for the Board Chairman and other Board members in the course of its work, taking into account the challenges and opportunities facing the Company, and the skills and expertise, including diversity, needed on the Board in the future.

 

8. To assess and recommend to the Board the election and re-election of Directors retiring by rotation. To assess and recommend to the Board whether an independent director who is retained beyond 9 years should remain independent or be re-designated before obtaining the shareholders’ approval on the resolution to re-appoint him as an independent director at the annual general meeting.

 

9. To carry out such other responsibilities as may be delegated by the Board from time to time and such other matters as the Committee considers appropriate.

Reporting Responsibilities

  1. The Chairman shall report the proceedings of each meeting of the Committee to the Board.
  2. The Committee shall make whatever recommendations to the Board it deems appropriate on any area within its remit where action or improvement is needed.
  3. Any decision or recommendation made by the Committee shall be subject to the review and ultimate approval of the Company’s Board of Directors.

Meetings Procedures

1.  Frequency and calling

The Committee shall meet at least annually or more frequently as the Chairman may determine. A member of the Committee may request a meeting if it is considered necessary.

 

2. Notice

Meetings of the Committee shall be called by the Secretary of the Committee at the request of the Committee Chairman.

 

The notice period convening the meeting of the Committee shall be at least seven (7) days, which may be waived with the consent of all members of the Committee.

 

3. Quorum

A minimum of two (2) members of the Committee present in person shall form a quorum.

 

4. Secretary

The Secretary of the Company shall serve as the Secretary of the Committee.

 

5. Minutes of meetings

The Secretary shall minute the proceedings and resolutions of all the Committee meetings, and shall table the minutes of each meeting and shall circulate the same for each member’s record. The Chairman’s confirmation of the minutes shall be taken as a correct record of the proceedings thereat. The Secretary shall be responsible for keeping the minutes of meetings.

Circular Resolution

  1. A resolution in writing signed or approved by the majority of the members who are sufficient to form a quorum, shall be as valid and effective as if the same has been passed at a meeting of the Committee duly convened and held.
  2. Any such resolution may consist of several documents in like form, each signed by one or more members. Any such document, may be accepted as sufficiently signed by a member if transmitted to the Company by facsimile or other electrical or digital written message purporting to include a signature of the member.

Terms of reference approved on 28 February 2017
Extract Minutes of General Meetings

40th Annual General Meeting
30 August 2016

39th Annual General Meeting
29 September 2015

Extraordinary General Meeting
23 April 2015

38th Annual General Meeting
26 September 2014