1. INTRODUCTION
This Board Charter sets out the principles for the operation of the Board of Directors ("Board") of TWL Holdings Berhad ("TWL” or "the Company") and describes the functions of the Board and those functions delegated to the Management of the Company.
The Board has primary responsibility to shareholders for the welfare of the Company and its subsidiaries ("the Group"). The Board is responsible for guiding and monitoring the business and affairs of the Group. The Board recognizes the importance of good corporate governance in the operations of the Group.
This Board Charter is established to promote high standards of corporate governance and is designed to provide guidance and clarity for Directors and Management with regard to the roles of the Board and its committees. This Board Charter does not overrule or pre-empt the statutory requirements and other relevant statutes. This Board Charter shall form an integral part of each Director's duties and responsibilities.
2. COMPOSITION OF THE BOARD
2.1 The Board shall be of a size and composition that encourages diversity in perspectives and skills, which would enable the Board to have a better understanding of and deal more effectively with the current/emerging issues relating to the business of the Group.
2.2 The Board shall ensure that at least two (2) Directors or one-third (1/3), whichever is higher, of the Board members are Independent Directors. If the Chairman is not an Independent Director, the Board shall comprise a majority (more than half) of Independent Directors.
2.3 The appointment of a new member to the Board is made only after consultation with the Nomination Committee.
2.4 The Board recognizes the importance of having a clearly accepted division of power and responsibilities at the head of the Company to ensure a balance of power and authority. It is the policy of the Board to keep the roles of the Chairman and the Managing Director separate.
2.5 A Director shall inform the Board's Chairman before he/she accepts any new directorships in other public listed companies. The Board's Chairman shall inform the Board before he/she accepts any new directorships in other public listed companies.
2.6 The tenure of an Independent Director shall not exceed a cumulative term of nine (9)years. The Board may, in appropriate cases and subject to the assessment of the Nomination Committee on an annual basis, recommend that an Independent Director who has served a consecutive or cumulative term of nine (9) years to remain as an Independent Director subject to shareholders' approval.
3. ROLE OF THE BOARD
3.1 The Board shall assume ultimate accountability and responsibility for the performance and affairs of the Company and shall in so doing effectively represent and promote the legitimate interests of the Company and its shareholders. The Board, at all times, shall retain full and effective control over the Group and shall direct and supervise the business and affairs of the Group.
3.2 The Board shall ensure that Management has in place appropriate processes for risk assessment, risk management and internal controls and monitoring performance against agreed benchmarks. The Board shall work with Management as collaborators in advancing the interest of the Group.
3.3 The Board has delegated certain responsibilities to committees, which operate in accordance with their respective Terms of Reference approved by the Board. The Board has also delegated the day-to-day management of the business of the Group to Executive Directors and Management, subject to an agreed authority limit.
3.4 The principal responsibilities of the Board, including those adopted from the Malaysian Code on Corporate Governance 2017, are, amongst others, as follow:
reviewing and adopting a strategic plan including setting performance objectives and approving operating budgets for the Group and ensuring that the strategies promote sustainability;
overseeing the conduct of the Group's business and building sustainable value for shareholders;
reviewing procedures to identify principal risks and ensuring the implementation of appropriate internal controls and mitigation measures;
succession planning, including appointing, assessing, training, fixing the compensation of and where appropriate, replacing senior management;
reviewing the adequacy and integrity of the Group's internal control and management information systems, including those for compliance with applicable laws, regulations, rules, directives and guidelines;
monitoring and reviewing management processes aimed at ensuring the integrity of financial and other forms of reporting;
ensuring that the Company's financial statements are true and fair and conform with accounting standards;
overseeing matters relating to occupational health and safety and compliance with relevant laws and regulations; and
ensuring that the Company adheres to high standards of ethics and corporate behaviour.
3.5 In overseeing the conduct of the Group's business, the Board shall ensure that an appropriate financial planning, operating and reporting framework as well as an embedded risk management framework are established. Elements under this combined framework include the business plan, budget, financial statements, divisional strategic/performance review reports and risk management reports.
4. ROLE OF THE CHAIRMAN
The Chairman is primarily responsible for:
4.1 leading the Board in the oversight of the Management of the Company;
4.2 representing the Board to shareholders and chairing the general meeting of shareholders;
4.3 ensuring the integrity of the governance process and issues;
4.4 ensuring that all Directors are enabled and encouraged to participate in the activities of the Board;
4.5 guiding and mediating Board actions with respect to organisational priorities and governance concerns; and
4.6 undertaking the primary responsibility for organising information necessary for the Board to deal with items on the agenda and for providing this information to Directors on a timely basis.
5. ROLE OF THE MANAGING DIRECTOR (“MD”)
5.1 The position of the MD in essence is to ensure the effective implementation of the Group's business plan and policies established by the Board as well as to manage the daily conduct of the business and affairs to ensure its smooth operation.
5.2 The MD is responsible to the Board for the following:
executive management of the Group's business covering, inter alia, the development of a strategic plan; an annual operating plan and budget; performance benchmarks to gauge management performance and the analysis of management reports;
developing long-term strategic and short-term profit plans, designed to ensure that the Group's requirements for growth, profitability and return on capital are achieved;
set, review and ensure compliance with the Company's values;
effectively oversee the human resources of the Group with respect to key positions in the Group's hierarchy;
assures the Group's corporate identity, products and services are of high standards and are reflective of the market environment;
ensures compliance with legislation and regulatory requirements;
coordinates business plans with the business heads, coordinates management issues through the Board, and oversees divisional function groups and cost containment process in consultation with the Executive Directors; and
maintains and facilitates a positive working environment and good employee relations.
In discharging the above responsibilities, the MD can delegate appropriate functions to the
Executive Directors, who shall report to the MD.
6. BOARD COMMITTEES
6.1 The Board shall establish committees from time to time in the discharge of its duties and responsibilities.
6.2 Where a committee is formed, specific terms of reference of the committee would be established to serve as guidance which covers matters such as the purpose, composition and functions of the committee.
6.3 Several committees with written terms of reference have been established namely the following:
a) Audit Committee
Audit Committee assists in providing oversight on the Group's financial reporting, disclosure, regulatory compliance and monitoring of internal control processes within the Group. The Audit Committee reviews the quarterly financial results, unaudited and audited financial statements, internal and external audit reports as well as related party transactions.
b) Nomination Committee
The Nomination Committee oversees matters relating to the nomination of new Directors, annually reviews the required mix of skills, experience and other requisite qualities of Directors as well as the annual assessment on the effectiveness of the Board as a whole, its Committees and the contribution of each individual Director as well as identify candidates to fill board vacancies, and nominating them for approval by the Board.
c) Remuneration Committee
The Remuneration Committee is primarily responsible for recommending to the Board the remuneration of Executive Directors and Non-Executive Directors in all its forms, tapping on external advice if necessary.
d) ESOS Committee
The Employees Share Option Scheme (ESOS) Committee is primarily responsible to oversees and administer the matters related to ESOS which involve the granting of the rights to employees and directors to subscribe new shares of the Company. The ESOS Committee determine whether the options are subject to any vesting period and if so the vesting conditions and whether such vesting are subject to performance target and such other terms and conditions as it shall deem fit and appropriate to be imposed for the participation in the ESOS scheme. The ESOS Committee may also recommend to the Board any amendments to any provisions of the ESOS Scheme and the Bylaws from time to time.
7. BOARD PROCESSES
Board meetings shall be conducted in a business-like manner where all Directors are encouraged to share their views and partake in discussions.
7.1 Frequency
7.1.1. The Board shall meet regularly, at least on a quarterly basis. Prior notice of meetings shall be given to all who are required to attend the meetings.
7.1.2. Board members are required to attend the Board meetings and their meeting attendance for each financial year is to be disclosed in the Annual Report.
7.1.3. Other senior management may be invited to attend the Board meetings for particular items within their responsibility. The Board may also invite external parties such as the auditors, solicitors and consultants as and when the need arises.
7.1.4. Additional formal business is dealt with as required, whether by physical, video conferencing or telephonic meetings, as well as other electronic meetings allowed under the laws or the Company's Constitution.
7.2 Agenda
7.2.1. The notice of a Directors' meeting, board papers and agenda shall be provided in writing at least seven (7) days prior to the meeting.
7.2.2. The agenda shall include, amongst others, matters specifically reserved for the Board's decision. The Board shall record its deliberation, in terms of the issues discussed, and the conclusions thereof in discharging its duties and responsibilities.
7.3 Access to Information and Independent Professional Advice
7.3.1. All Directors (executive and non-executive) have the same right of access to all information within the Group whether as a full board or in their individual capacity, in furtherance of their duties and responsibilities as Directors of the Company.
7.3.2. All Directors shall have access to the advice and services of the Company Secretary. The Board shall recognise that the Chairman is entitled to the strong and positive support of the Company Secretary in ensuring the effective functioning of the Board.
7.3.3. The full Board or the Directors in their individual capacity, in furtherance of their duties, shall be able to obtain independent professional advice at the Company's expense.
8. THE BOARD’S RELATIONSHIP WITH SHAREHOLDERS AND STAKEHOLDERS
8.1 The Board shall maintain an effective communications policy that enables both the Board and Management to communicate effectively with its shareholders, stakeholders and the general public.
8.2 It is the role of the Board to ensure that the Annual General Meeting ("AGM") and Extraordinary General Meeting ("EGM") of the Company are conducted in an efficient manner and serve as crucial mechanisms in shareholder communications. Key ingredients behind this include the supply of comprehensive and timely information to shareholders and the encouragement of active participation at the general meeting of the Company.
8.3 The Board will focus its efforts on the following best practices to
enhance the effectiveness of the general meeting:
ensure that each item of special business included in the notice to be accompanied by a full explanation of the effects of the proposed resolution;
encourage poll voting on substantive resolutions and make an announcement of the detailed results showing the number of votes cast for and against each resolution;
for re-election of Directors, ensure that the notice of meeting states which Directors are standing for election or re-election with a brief description to include matters such as age, relevant experience, directorships in other public companies, date of appointment to the Board and details of participation in board committee.
conduct a business presentation with a question and answer session, where appropriate and if required.
8.4 The MD is authorized by the Board to speak on behalf of the Group and to manage the communication of information to shareholders, investors, other stakeholders and the public.
9. DIRECTORS’ EXTERNAL COMMITMENTS AND CONFLICTS OF INTEREST
9.1 The Company's Constitution stipulates that a Director who is in any way, whether directly or indirectly, interested in a contract or proposed contract with the Company shall declare his/her interest in accordance with the provisions of the Companies Act, 2016. The Director concerned shall not participate in deliberations and shall abstain himself/herself from casting his/her votes in any matter arising thereof.
9.2 Shall there be an actual, potential or perceived conflict of interest between the Company or a related corporation and a Director, or person(s) connected to a Director such as a spouse or other family members, or a related company, the Director involved shall make full disclosure and act honestly in the best interest of the Company.
9.3 An actual, potential or perceived conflict of interest shall not necessarily disqualify an individual Director from the Board provided that full disclosure of the interest has been made in good faith and with due honesty.
10. Review
This Board Charter shall be reviewed periodically by the Board in accordance with the needs of the Company and any new regulations that may have impact on the discharge of the Board's responsibilities.
