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Corporate Governance

BOARD CHARTER

1.0 STATEMENT OF POLICY

The Board of Directors of Pinehill Pacific Berhad (“the Company") is appointed by its shareholders to supervise the management of the business and affairs of the Company. The prime stewardship responsibility of the Board is to ensure the viability of the Company and to ensure that it is managed in the best Interests of the shareholders, including securing sustainable long-term financial results and increasing shareholder value, with proper social and environmental considerations. Hence, the Board should collectively have sound and sufficient knowledge and expertise to enable effective governance and oversight.

The Board has the following principal roles, which facilitate the discharge of the Board’s stewardship in the pursuit of the best interest of the Company:

  • Reviewing and adopting a strategic plan for the Company
  • Overseeing the conduct of the company's business to evaluate whether the business is being properly managed
  • Identifying principal risks and ensure the implementation of appropriate systems to manage these risks
  • Succession planning, including appointing, training, fixing the compensation of and where appropriate, replacing senior management
  • Developing and implementing an investor relations programme or shareholder communications policy for the company
  • Reviewing the adequacy and the integrity of the company's internal control systems and management information systems, including systems for compliance with applicable laws, regulations, rates, directives and guidelines
 

2.0 BOARD COMPOSITION

2.1 Selection of Members

The Board maintains an overview of the experience expected of the new Directors. It reviews candidates proposed by the Remuneration and Nomination Committee ('RNC"). The size of the Board is dictated by the Company‘s Constitution, which currently permits a minimum of two (2) and a maximum of twelve (12). Directors to be appointed to the Board.

On appointment of new Director, the new Director is required to commit sufficient time to attend to the Company’s meetings/matters before accepting his/her appointment to the Board.

In accordance with the Malaysian Code on Corporate Governance 2017 (“the Code”), Directors are required to notify the Chairman before accepting any new Directorship and to indicate the time expected to be spent on the new appointment.

On boardroom diversity, the Board is supportive of the gender boardroom diversity recommended by the Code. The Board through the RNC will review the proportion of the female to male board members during the annual assessment of the Directors' performance taking into consideration the appropriate skills, experience and characteristics required of the Board members, in the context of the needs of the Group.

The Board will periodically evaluate the performance of the Directors for re- appointment or retirement from the Board. The assessment and evaluation process are delegated to the RNC.

2.2 Membership Criteria

Board members must have an appropriate mix of skills, knowledge and experience in business and an understanding of the regions in which the Company operates, including the ability to provide stewardship over the Company's business.

To ensure effectiveness of the Board, members should be from diverse backgrounds, with knowledge and experience in different pertinent disciplines which may include finance, accounting, legal, business management, information technology and investment management. They should also possess strategic thinking and leadership skills and are dynamic and responsive to the business environment. In addition, they should have knowledge of regulatory requirements, and risk analyses and control.

2.3 Independent Directors

The number of independent directors on the Board and the determination of independence status shall be determined by the Board and guided by the relevant legislation and regulations.

Pursuant to the Main Market Listing Requirements (“Main LR’), at least two (2) Directors or one third of the Board must be independent.

An Independent Non-Executive Director is independent of management and free of any significant business or other relationships that could materially interfere with, or could reasonably be perceived to materially interfere with, the exercise of their unfettered and independent judgment, and who otherwise meet the criteria for independence.

The Independent Directors provide independent judgement, experience and objectivity without being subordinated to operational considerations. The views of Independent Directors should carry significant weight in the Board’s decision-making process.

The key roles of an Independent Directors include:

  • Support the skills and experience of the Executive Directors;
  • Provide unbiased and independent views, advice and judgement in order to safeguard the interest of minority shareholders;
  • Contributing to the formulation of policy and decision-making through their knowledge and experience of other businesses and sectors; and
  • Ensure that strategies proposed by the management are fully deliberated and examined, taking into account the long term interest of the shareholders, employees, customers and the many communities in which the Group conducts its business.

 

2.4 Chairman

The Chairman represents the Board to the shareholders. The Chairman is responsible for ensuring the integrity and effectiveness of the Board and will consult with the Board promptly over any matter that gives him cause for major concern.

The Chairman will act as a facilitator at meetings of the Board and ensure that no Board members, whether executive or non-executive, dominates the discussion, and that appropriate discussion takes place and that relevant opinion among Board members are forthcoming.

The key roles and accountabilities of the Chairman include:

  • Providing leadership for the board so that the board can perform its responsibilities effectively;
  • Ensuring that the Board plays a full and constructive part in the determination of the Company's strategies and policies;
  • Ensuring balance of membership, subject to the Board and shareholder approval;
  • Organizing information for deliberation at meetings and reviewing agendas for meetings and ensuring that all relevant issues are on the agenda;
  • Ensuring that all Directors, Executive and Non-Executive alike, are enabled and encouraged to play an active part in the meeting so as to bring to the Board a healthy level of deliberation and independence. This include making certain that Directors, especially Non-Executive Directors received timely, relevant information tailored to their needs and that they are properly briefed on issued arising at Board meetings;
  • Ensuring that Executive Directors look beyond their executive function and accept their full share of responsibilities of governance; and
  • Ensuring that every board resolution is put to a vote to ensure that it is the will of the majority and not that of the dominant owner that prevails.
  • Leading the board in establishing and monitoring good corporate governance practices in the company.

 

2.5 Executive Director

The Executive Director is accountable to the Board for the achievement of the Company’s goals and for the observance of the management authorities.

The Executive Director shall be the head of the Management of the Company and the Group and in that capacity is answerable to the Board.

The key roles of the Executive Director, amongst others, include:

  • Overseeing the running of the business operations;
  • Implementing policies and strategies adopted by the Board with the aim to achieve corporate objective;
  • Exploring new business opportunities/ventures for the Group;
  • Consistently find means to improve and achieve the Group’s performance target;
  • Keeping board fully informed of all important aspects of the Group’s operations and ensuring sufficient information is distributed to the board members;
  • Ensuring compliance with all relevant legislation and regulations by reviewing policies and monitoring compliance; and
  • Developing and maintaining effective relations with significant agencies, investing public and other trade associations and institutions.

 

The Executive Director is supported by the Management team, whose roles and accountabilities shall include:

  • Make and implement operational decisions within the limits set by the Board;
  • Carry out the day-to-day operations and control of the business of the Company;
  • Assist the Executive Director in exploring new business opportunities/ventures for the Group;
  • Assist the Executive Director in finding means to improve and achieve the performance target of the Company and its subsidiaries (‘the Group”); and
  • Collect information of the business environment, propose policies and strategies for consideration of the Board.

 

Separation of the positions of the Chairman and Executive Director promotes accountability and with a clear division of responsibilities, ensures a balance of power and authority, such that no one individual has unfettered powers of decision-making.

2.6 Term of Directors

Generally, the Board members have no fixed term of appointment. Subject to the Company’s Constitution, at each Annual General Meeting, one-third of the Directors for the time being, or if their number is not a multiple of three, the number nearest to one-third, shall retire from office. A Director retiring at a meeting shall retain office until the close of the meeting, whether adjourned or not.

New Board members will only hold office until the next Annual General Meeting at which they will retire and become available for re-election.

The Board does not prescribe a maximum age limit for its Board members.

The tenure of an Independent Director shall not exceed a cumulative term of nine (9) years. Upon completion of the nine (9) years, an Independent may continue to serve on the Board subject to the Director’s re-designation as a Non-Independent Director. Otherwise, the Board must justify and seek shareholders’ approval at Annual General Meeting in the event it retains the Directors as an Independent Director.

 

3.0 BOARD COMMITTEES

The Board may delegate specified matters to individual members or committees of the Board to oversee critical or major functional areas and to address matters which required detailed review or in-depth consideration. All such committees must be provided with written terms of reference which state clearly the extent and limits of their responsibilities and authority, specifically whether they have authority to decide on behalf of the Board or are to report back to the Board.

The following are the Company’s existing Board committees:

  • Audit Committee
  • Executive Committee
  • Remuneration and Nomination Committee; and
  • Risk Management Committee

 

 

4.0 MEETINGS OF THE BOARD AND COMMITTEES

4.1 Agenda

The Executive Director must ensure that an agenda is carefully prepared prior to the Board meeting, raising issues that require attention, ensuring that proceedings are conducted efficiently and all appropriate matters are addressed accordingly to enhance the Board’s productivity and strengthen its strategic and supervisory role. The Company Secretaries must work with the Executive Director on preparing the agenda for the Board meeting.

4.2 Documents

Information and materials, duly endorsed by the Executive Director and the relevant group functional heads, that are important to the Directors’ understanding of the agenda items and related topics are distributed in advance of the meeting. The Company will provide information on the business, finance and risks of the Company to the Directors on a regular basis as well as on an as-required basis.

4.3 Meetings

The Board shall meet at regular intervals throughout the year. At all meetings of the Board, the Chairman, if present, shall preside. If the Chairman of the Board is absent, the members present at the meeting shall elect a chairman of the meeting.

The secretaries of the Company shall be in attendance and a record of the proceedings shall be kept. Any Director may participate at a meeting of Directors by way of telephone and video conferencing or by means of other communication equipment whereby all persons participating in the meeting are able to hear each other and be heard for the entire duration of the meeting in which event such Director shall be deemed o be physically present at the meeting. A Director participating in a meeting in the manner aforesaid may also be taken into account in ascertaining the presence of a quorum at the meeting.

The meetings of the Board Committees are similarly guided by their respective terms of reference.

4.4 Management at Meetings

Appropriate members of the Management of the Group may be invited to participate and/or make presentations at meetings to allow Directors to gain additional understanding and insight into the Company’s business.

4.5 Written or Circulating Resolutions

A resolution in Writing, signed or assented to by majority of Directors shall be as valid and effectual as if it had been passed at a meeting of the Directors and may consist of several documents in the like form, each signed by one or more Directors.

The expressions "in writing" and "signed" include approval by any such Director by facsimile or other similar means of communication approved by the Directors for such purpose from time to time incorporating, if the Directors deem necessary, the use of security and/or identification procedures and devices approved by the Directors.

The written resolutions of the Board Committee are similarly guided by their respective terms of reference.

4.6 Minutes of Committee Meetings

Minutes of the Committee meetings should be provided to all Directors at the next appropriate Board meeting following the Committee meetings. The Directors are invited to seek clarifications of the issue raised in the Committee meeting

 

5.0 BOARD RESPONSIBILITIES

The Board has responsibilities to adhere to the laws of the jurisdiction within which it operates. Management operates within the confines of the rules and regulations and provides the Board with the assurance that they have been duly adhered and complied with. Apart from the above, the Board ensures that it complies with the Constitution of the Company.

The powers and authorities of the Board emanate from the shareholder and shall be exercised within this framework. The Board delegate authority to the Board Committees, Executive Director and any other bodies as it deems fit for effective management of the Company. Any authority delegated emanates from the Board and is not intended to replace the powers of the Board.

Broadly, the duties and responsibilities of the Board of Directors include but not limited to the following:

5.1 Risk Oversight and Internal Control

In the implementation of the group policies, the Board of Directors should be:

  • Providing oversight in ensuring that the Company’s risk appetite and activities are consistent with the Group's strategic intent, the Group and local operating environments, effective internal controls, and regulatory standards;
  • Developing and instilling a strong risk culture in the Company and exercising prudence and effective corporate governance in risk management;
  • Understanding the risks associated with the business activities and taking all necessary measure to ensure that such activities are conducted in a safe and sound manner and in line with high standards of professionalism and sound business practice;
  • Ensuring that comprehensive and adequate written risk management policies and procedures are established and which clearly delineate authority limits and scope of activities;
  • Reviewing management’s periodic reports on risk exposure, risk portfolio composition and risk management activities, and ensuring that deficiencies are promptly remedied; and
  • Ensuring that senior management is capable of managing the risk and that they undertake to implement the risk strategy and policy approved by the Board.

 

5.2 Policy Deliberation

  • Providing input on the Company’s policies in line with the prevailing regulatory framework, economic and business environment.

 

5.3 Business Performance

  • Ensuring the Company is operated so as to preserve its financial integrity and in accordance with policies approved by the Board;
  • Approves the annual budget for the Company and conduct periodic review of achievements against the annual budget, as well as review the management’s business action plans;
  • Institute succession planning by ensuring that there is effective succession plan to grow and retain talents

 

5.4 Corporate Governance

  • Conducting reviews of Board and Committee performance, including Directors’ individual contributions;
  • Ensuring that Directors are provided with relevant continuing education and are updated on changes in laws, regulations and standards.

 

5.5 Duties of Directors

  • Upholding the highest standards of integrity and avoiding positions of conflict of interest between the Company and themselves, their relatives and corporations related to them;
  • Abstaining from any decisions which could place or potentially place them in situations of conflict and reporting to the Board at the first instance of any potential conflicts of interest;
  • The Directors are expected to:
    • Attend all board and relevant committee meetings
    • Study information and packages provided by management in advance of meetings and be prepared to discuss the contents at the meetings.
    • Read all reports and proposals submitted and if in order approve them promptly in writing.

 

5.6 Matters Reserved for Collective Decision of the Board

The authorities of the Board are specified below. The authorities may be varied from time to time as determined by the Board:

(a) Conduct of the Board

  • Appointment and recommendation for removal of directors.
  • Appointment and removal of Company Secretaries
  • Appointment of Board committees and members
  • Approval of terms of reference of Board Committees and amendments to such terms.
  • Appointment of senior executive positions, including that of the Executive Directors and Group
  • Executive Vice President of the Company and their duties and the continuation (or not) of their service.

 

(b) Remuneration

  • Approval/recommendation of the directors’ fee/ remuneration arrangements for non-executive directors
  • Approval of the remuneration structure and policy for Executive Directors.
  • Approval of remuneration packages for Executive Directors.
  • Approval of any proposed employees’ share option scheme and/or amendments to the scheme, subject to other approvals that may be required by law or regulations.

 

(c) Operational

  • Approval of business strategy and group operational plan and annual budgets.
  • Ongoing review of performance against business strategy and group operational plan, including monitoring of key risks and risk management policies and actions.
  • Approval of capital expenditure above the prescribed amount as may be determined from time to time.
  • Approval of bad debts write-off in excess of the prescribed amount as may be determined from time to time.
  • Approval of investment or divestment of a capital project which represents a significant diversification from the existing business activities.
  • Approval of changes in the major activities of the Company or Group.
  • Approval of treasury policies and bank mandate.
  • Approval of the limit of authority for the Company

 

(d) Financial

  • Approval of interim and annual financial statements
  • Approval for the release of financial announcements
  • Approval of the Annual Directors’ Report and Statutory Accounts.
  • Approval of interim dividends, the recommendation of final dividends and the making of any other distribution.
  • Adoption of accounting policies.
  • Review the effectiveness of the Group’s system of Internal Controls and Risk Management. This function is delegated to the Audit Committee which will in turn report to the Board on its findings.

 

(e) Other Matters

  • The granting of powers of attorney by the Company.
  • The entering into of any indemnities or guarantees.
  • Recommendations for the alteration of the Constitution of the Company.
  • Alteration of the accounting reference date, registered office and name of the Company.
  • Purchase of own shares by the Company.
  • Issue of any debt instruments.
  • Scheme of reconstruction or restructuring.
  • Any other significant business decision with percentage ratio of 5% or more.
  • Related Party transactions.
  • Any other matters requiring the convening of a general meeting of shareholders or any class of shareholders
  • Any other matters as may be required by the laws or the governing authorities.
  • Any other matters requiring the Board’s approval under the Limits of Authority of the Company.

 

 

6.0 ADMINISTRATIVE MATTERS

6.1 Board Confidentiality

Directors will maintain absolute confidentiality of the deliberations and decisions of the Board and of information received in meetings, except as may be specified by the Chairman or if the information is publicly disclosed by the Company.

6.2 Directors' Remuneration

The Company aims to set remuneration at levels which are sufficient to attract and retain the Directors needed to run the Company successfully, taking into consideration all relevant factors including the function, workload and responsibilities involved.

The level of remuneration for the Executive Director is determined by the RNC after giving due consideration to the compensation levels for comparable positions amount other similar Malaysian public listed companies.

The Non-Executive Directors will receive a fixed base fee, not by a commission or on percentage of profits/ turnover, as consideration for their Board duties. The aggregate amount of directors’ fees to be paid to Non-Executive directors is subject to the approval of the shareholders at a General Meeting.

6.3 Access to Information and Independent Advice

Directors may access such information and seek such independent advice as they individually or collectively consider necessary to fulfil their responsibilities and permit independent judgement in decision making.

Directors will be entitled to:

  • Access members of the senior management via the Executive Director at any time to request relevant and additional information or seek explanations;
  • Have access to internal and external auditors, without management being present to seek explanations or additional information; and
  • Seek independent professional advice with the prior consent of the Chairman or two (2) other Directors (one of whom is Non-Executive), which will not be unreasonably withheld or delayed, and which will be at the Company’s expense, subject to the quantum of the professional fees to be incurred shall not exceed RM50,000.00.

 

6.4 Company Secretary

The appointment and removal of Company Secretary or Secretaries of the Board shall be the prerogative of the Board.

The Secretary is responsible for ensuring that Board procedures are followed, that the applicable rules and regulations for the conduct of the affairs of the Board are complied with and for all matters associated with the maintenance of the Board or otherwise required for its efficient operation.

6.5 Investor Relations and Shareholder Communication

The Company is committed to ensure that shareholders are well-informed of all major developments affecting the State of affairs of the Company. To achieve this, the Company has implemented amongst others, the following:

 

  • Timely release of announcements and disclosures to Bursa Malaysia Securities Berhad, which include quarterly financial results, material contract and any other material information that may affect the investors’ decision making;
  • Encourage full participation of shareholders at all Annual General Meetings to ensure a high level accountability and discussion of the Company’s strategy and goals. The Company will also invite the external auditor to attend the Annual General Meeting and be available to answer shareholders’ questions about the conduct of the audit and the preparation and content of the auditors’ report; and
  • Shareholders can gain access to information about the Company including the summary of the Group’s investor relation activities and media releases through the Company’s website, www.pinepac.com.my.

 

6.6 Other Matters

The Board Charter serves to delineate the mission, structure, scope and functions of the Board and duties of the directors. The Board Charter complements the Constitution and the duties required by legislation and regulatory bodies, and does not replace the said requirements. Where ambiguity and/or contradiction arises, the Constitution, legislation and the regulations shall prevail over the contents of the Board Charter.

 

The provisions of this charter are subject to such revisions by way of modification, addition or otherwise as the Board, may from time to time consider fit.

Board of Directors Code of Conduct

Objectives

The Code of Ethics is formulated to enhance the standard of corporate governance and corporate behaviour with the intention of achieving the following objectives:

1. To establish a standard of ethical conduct for directors based on acceptable belief and values one upholds; and

2. To uphold the spirit of social responsibility and accountability in line with the legislation, regulations and guidelines governing a company.

 

Code of Conducts

 

In the performance of his duties, a director should at all times observe the following:

1.0 Corporate Governance

1.1 Should have a clear understanding of the aims and objectives, capabilities and capacity of the Company;

1.2 Should devote time and effort to attend meetings and to know what is required of the board and each of its directors, and to discharge those functions;

1.3 Should ensure at all times that the Company is properly managed and effectively controlled;

1.4 Should stay abreast of the affairs of the Company and be kept informed of the Company's compliance with the relevant legislation and contractual requirements;

1.5 Should insist on being kept informed on all matters of importance to the Company in order to be effective in corporate management;

1.6 Should limit his directorship of companies to a number in which he can best devote his time and effectiveness; each director is his own judge of his abilities and how best to manage his time effectively in the company in which he holds directorship;

1.7 Should have access to the advice and services of the company secretary, who is responsible to the board to ensure proper procedures, rules and regulations are complied with;

1.8 Should at all times exercise his powers for the purposes they were conferred, for the benefit and prosperity of the company;

1.9 Should disclose immediately all contractual interests whether directly or indirectly with the Company;

1.10 Should neither divert to his own advantage any business opportunity that the Company is pursuing, nor may he use confidential information obtained by reason of his office for his own advantage or that of others;

1.11 Should at all times act with utmost good faith towards the Company in any transaction and to act honestly and responsibly in the exercise of his powers in discharging his duties; and

1.12 Should be willing to exercise independent judgment and, if necessary, openly oppose if the vital interest of the Company is at stake

2.0 Relationship with Shareholders, Employees, Creditors and Customers

2.1 Should be conscious of the interest of shareholders, employees, creditors and customers of the Company;

2.2 Should at all times promote professionalism and improve the competency of management and employees; and

2.3 Should ensure adequate safety measures and provide proper protection to workers and employees at the workplace.

3.0 Social Responsibilities and the Environment

3.1 Should ensure that necessary steps are taken in accordance with the law to properly wind-up or strike off the company register if the company has not commenced business or has ceased to carry on business and is not likely to commence business in the future or resume business as the case may be;

3.2 Should adopt an objective and positive attitude and give the utmost cooperation for the common good when dealing with government authorities or regulatory bodies;

3.3 Should ensure the effective use of natural resources, and improve quality of life by promoting corporate social responsibilities;

3.4 Should be more proactive to the needs of the community and to assist in society-related programmes in line with the aspirations of the concept of 'Caring Society' in Vision 2020; and

3.5 Should ensure that the activities and the operations of the Company do not harm the interest and well-being of society at large and assist in the fight against inflation.

Terms of References - Audit Committee

Composition of members

The Board shall appoint the Audit Committee members from amongst themselves, comprising no fewer than three (3) non-executive directors. The majority of the Audit Committee members shall be independent directors.

In this respect, the Board adopts the definition of “independent director” as defined under the Listing Requirements of Bursa Malaysia Securities Berhad (“Bursa Securities”).

All members of the Audit Committee shall be financially literate and at least one (1) member of the Audit Committee must be:-

  • a member of the Malaysian Institute of Accountant (“MIA”); or
  • if he is not a member of MIA, he must have at least three (3) years of working experience and;
  • he must have passed the examinations specified in Part I of the First Schedule of the Accountants Act 1967; or
  • he must be a member of one of the associations of the accountants specified in Part II of the First Schedule of the Accountants Act 1967; or
  • fulfills such other requirements as prescribed or approved by Bursa Securities.

No alternate director of the Board shall be appointed as a member of the Audit Committee.

The term of office and performance of the Audit Committee and each of its members shall be reviewed by the Board annually to determine whether such Audit Committee and members have carried out their duties in accordance with their terms of reference.

 

Retirement and resignation

If a member of the Audit Committee resigns, dies, or for any reason ceases to be a member resulting in non-compliance to the composition criteria as stated above, the Board shall within three (3) months of the event appoint a such number of the new members as may be required to fill the vacancy.

 

Chairman

The members of the Audit Committee shall elect a Chairman from amongst their number who shall be an independent director.

In the absence of the Chairman of the Audit Committee, the other members of the Audit Committee shall amongst themselves elect a Chairman who must be independent director to chair the meeting.

Secretary

The Company Secretary shall be the Secretary of the Audit Committee and as a reporting procedure, the Minutes shall be circulated to all members of the Board.

 

Meetings

The Audit Committee shall meet regularly, with due notice of issues to be discussed, and shall record its conclusions in discharging its duties and responsibilities. In addition, the Chairman may call for additional meetings at any time at the Chairman’s discretion.

Upon the request of the external auditor, the Chairman of the Audit Committee shall convene a meeting of the Audit Committee to consider any matter the external auditor believes should be brought to the attention of the directors or shareholders.

Notice of Audit Committee meetings shall be given to all the Audit Committee members unless the Audit Committee waives such requirement.

The Chairman of the Audit Committee shall engage on a continuous basis with senior management, such as the Executive Director, Executive Vice President – Group Finance & Corporate, Group Financial Controller, Plantation Director, internal and external auditors in order to be kept informed of matters affecting the Company.

The Executive Vice President – Group Finance & Corporate, a representative of the internal and external auditors should normally attend meetings. Other Board members and employees may attend meetings upon the invitation of the Audit Committee. The Audit Committee shall be able to convene meetings with the external auditors, internal auditors or both, without executive Board members or employees present whenever deemed necessary and at least twice a year with the external auditors.

Questions arising at any meeting of the Audit Committee shall be decided by a majority of votes of the members present, and in the case of equality of votes, the Chairman of the Audit Committee shall have a second or casting vote.

 

Minutes

Minutes of each meeting shall be kept at the registered office and distributed to each member of the Audit Committee and also to the other members of the Board. The Audit Committee Chairman shall report on each meeting to the Board.

The minutes of the Audit Committee meeting shall be signed by the Chairman of the meeting at which the proceedings were held or by the Chairman of the next succeeding meeting.

 

Quorum

The quorum for the Audit Committee meeting shall be the majority of members present who must be independent directors.

 

Objectives

The principal objectives of the Audit Committee are to assist the Board in discharging its statutory duties and responsibilities relating to accounting and reporting practices of the holding company and each of its subsidiaries. In addition, the Audit Committee shall:-

  • evaluate the quality of the audits performed by the internal and external auditors;
  • provide assurance that the financial information presented by management is relevant, reliable and timely;
  • oversee compliance with laws and regulations and observance of a proper code of conduct; and
  • determine the quality, adequacy and effectiveness of the Group’s control environment.

 

Authority

The Audit Committee shall, in accordance with a procedure to be determined by the Board and at the expense of the Company,

  • have explicit authority to investigate any matter within its terms of reference, the resources to do so, and full access to information. All employees shall be directed to co-operate as requested by members of the Audit Committee.
  • have full and unlimited/unrestricted access to all information and documents/resources which are required to perform its duties as well as to the internal and external auditors and senior management of the Company and Group.
  • obtain independent professional or other advice and to invite outsiders with relevant experience to attend, if necessary.
  • have direct communication channels with the external auditors and person(s) carrying out the internal audit function or activity (if any).
  • where the Audit Committee is of the view that the matter reported by it to the Board has not been satisfactorily resolved resulting in a breach of the Listing Requirements, the Audit Committee shall promptly report such matter to Bursa Securities.

 

Duties and Responsibilities

The duties and responsibilities of the Audit Committee are as follows:-

  • To consider the appointment of the external auditor, the audit fee and any question of resignation or dismissal;
  • To discuss with the external auditor before the audit commences, the nature and scope of the audit, and ensure co-ordination where more than one audit firm is involved;
  • To review with the external auditor his evaluation of the system of internal controls and his audit report;
  • To review the quarterly and year-end financial statements of the Board, focusing particularly on :
    1. any change in accounting policies and practices;
    2. significant adjustments arising from the audit;
    3. the going concern assumption; and
    4. compliance with accounting standards and other legal requirements.
  • To discuss problems and reservations arising from the interim and final audits, and any matter the auditor may wish to discuss (in the absence of management, where necessary);
  • To review the external auditor’s management letter and management’s response;
  • To do the following, in relation to the internal audit function:-
    1. review the adequacy of the scope, functions, competency and resources of the internal audit function, and that it has the necessary authority to carry out its work;
    2. review the internal audit programme and results of the internal audit process and, where necessary, ensure that appropriate actions are taken on the recommendations of the internal audit function;
    3. review any appraisal or assessment of the performance of members of the internal audit function; vapprove any appointment or termination of senior staff members of the internal audit function; and
    4. take cognizance of resignations of internal audit staff members and provide the resigning staff member an opportunity to submit his reasons for resigning.
  • To consider any related party transactions 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;
  • To report its findings on the financial and management performance, and other material matters to the Board;
  • To consider the major findings of internal investigations and management’s response;
  • To verify the allocation of employees’ share option scheme (“ESOS”) in compliance with the criteria as stipulated in the by-laws of ESOS of the Company, if any;
  • To determine the remit of the internal audit function;
  • To consider other topics as defined by the Board; and
  • To consider and examine such other matters as the Audit Committee considers appropriate.

Terms of References - Remuneration & Nomination Committee

Objectives

The principal objectives of the Remuneration and Nomination Committee as a recommending body are:

  • to assist the Board of Directors in their responsibilities in nominating new nominees to the Board of Directors and to assess the Directors of the Company on an on-going basis; and
  • to assist the Board of Directors in their responsibilities in assessing the remuneration packages of the executive and non-executive

 

Composition of members

The Board of Directors shall elect the Remuneration and Nomination Committee members from amongst themselves, composed wholly non-executive directors.

 

Chairman

The Chairman of the Remuneration and Nomination Committee shall be elected from amongst the Remuneration and Nomination Committee members. The Chairman of the Committee shall be approved by the Board of Directors.

 

Secretary

The Secretary of the Remuneration and Nomination Committee shall be the Company Secretary of the Company

 

Meetings

The Remuneration and Nomination Committee may meet together for the despatch of business, adjourn and otherwise regulate their meetings, at least once a year or more frequently as deemed necessary. The Chairman may call for additional meetings at any time at the Chairman’s discretion.

The Secretary shall on the requisition of the members of the Remuneration and Nomination Committee summon a meeting of the Remuneration and Nomination Committee and except in the case of an emergency, reasonable notice of every Remuneration and Nomination Committee meeting shall be given in writing.

Resolution taking the form of one (1) or more documents in writing signed or approved by letter, telex, telefax or other electronic communications by a majority of the Directors, provided that they are sufficient to form a quorum of the Remuneration and Nomination Committee shall be as valid and effectual as if it had been passed at a meeting of committee members duly called and constituted.

All such resolutions shall be described as Remuneration and Nomination Committee Circular Resolutions and shall be forwarded or otherwise delivered to the Secretary upon signing without delay and shall forthwith be recorded by the Secretary in the Minutes Book.

 

Quorum

A quorum shall consist of two (2) members.

 

Authority

The Remuneration and Nomination Committee, in accordance with a procedure or process to be determined by the Board of Directors and at the expense of the Company,

  • shall annually review the required mix of skills and experience and other qualities, including core competencies which non-executive and executive directors should
  • shall assess on an annual basis, the effectiveness of the Board as a whole, the committees of the Board and for assessing the contribution of each individual Director.
  • shall in accordance with a formal and transparent procedure or process or policy on Executive Directors’ remuneration packages to be determined and established by the Board of Directors review, assess and recommend to the Board of Directors the remuneration packages of the Executive Directors in all forms, with other independent professional advice or outside advice as
  • Shall be entitled to the services of a Company Secretary who must ensure that all appointments are properly made, that all necessary information is obtained from Directors, both for the company’s own records and for the purposes of meeting statutory obligations, as well as obligations arising from the Listing Requirements of Bursa Malaysia Securities Berhad or other regulatory requirements.

 

Duties and Responsibilities

The duties and responsibilities of the Remuneration and Nomination Committee are as follows:

  • To recommend to the Board of Directors, candidates for all directorships to be filled by the Shareholders or the Board of Directors;
  • To consider, in making its recommendations, candidates for directorships proposed by the Chairman and, within the practicability other senior executive or any Director or Shareholder;
  • To recommend to the Board of Directors the nominees to fill the seats on Board Committees;
  • To assess the effectiveness of the Board of Directors as a whole and each individual Directors/ committees of the Board;
  • To review and assess the remuneration packages of the Executive Directors in all forms, with or without other independent professional advice or other outside advice;
  • To ensure the levels of remuneration be sufficiently attractive and be able to retain Executive Directors needed to run the Company successfully;
  • To structure the component parts of remuneration so as to link rewards to corporate and individual performance and to assess the needs of the Company for talent at Board level at a particular time;
  • To recommend to the Board of Directors at remuneration packages of the executive and non-executive directors;
  • To act in line with the directions of the Board of Directors; and
  • To consider and examine such other matters as the Remuneration and Nomination Committee considers appropriate.

This Terms of Reference may change from time to time to fulfill such other requirements as prescribed by Bursa Malaysia Securities Berhad.

Terms of References - Risk Management Committee

Objectives

The principal objectives of the Risk Management Committee are:

  • to have a formal and on-going of identifying, evaluating and managing significant risks affecting the achievement of the Group's business objectives in a structured manner.
  • to inculcate an organisation-wide risk management culture whereby all members of the organisation (i.e. not confined to senior management only) are concerned and involved in risk management of the organisation.

 

Composition of members

The Board of Directors shall elect the Risk Management Committee members from amongst themselves and/or heads of division.

 

Chairman

The Chairman of the Risk Management Committee shall be elected from amongst the Risk Management Committee members. The Chairman of the Committee shall be approved by the Board of Directors.

 

Secretary

The Secretary of the Risk Management Committee shall be elected from amongst the Risk Management Committee members.

 

Meetings

The Risk Management Committee may meet together for the despatch of business, adjourn and otherwise regulate their meetings, at least once a year or more frequently as deemed necessary. The Chairman may call for additional meetings at any time at the Chairman’s discretion.

The Secretary shall on the requisition of the members of the Risk Management Committee summon a meeting of the Remuneration and Nomination Committee and except in the case of an emergency, reasonable notice of every Remuneration and Nomination Committee meeting shall be given in writing.

Resolution taking the form of one (1) or more documents in writing signed or approved by letter, telex, telefax or other electronic communications by a majority of the Directors, provided that they are sufficient to form a quorum of the Remuneration and Nomination Committee shall be as valid and effectual as if it had been passed at a meeting of committee members duly called and constituted.

All such resolutions shall be described as Risk Management Committee Circular Resolutions and shall be forwarded or otherwise delivered to the Secretary upon signing without delay and shall forthwith be recorded by the Secretary in the Minutes Book.

 

Quorum

A quorum shall consist of two (2) members.

 

Authority

The authority of the Risk Management Committee is as follows:

  • Establish its strategic and organisational context within the Group;
  • Set the risk appetite of the Group;
  • Communication control expectations;
  • Assess and evaluate the risk management process on a periodic basis; and

 

Duties and Responsibilities

The duties and responsibilities of the Risk Management Committee are as follows:

  • To review the Risk Profiles of all the Business Units/Subsidiaries to ensure that significant risks are properly addressed and adequate controls are recommended for the inherent residual risks before tabling it to the Board for approval.
  • To develop a Consolidated Risk Profile for the entire Group by choosing the key risks from the significant risks and control identified in the respective Business Units/Divisions.
  • Ensure that there is an on-going process for identifying, evaluating and managing the significant risks faced by the Group that is regularly reviewed by the Board.
  • To consider any changes in significant risks submitted by the Business Units/Subsidiaries from the help-yearly reviews performed by them.
  • To recommend to the Board of Director's mitigation actions or control as and when new risks are identified and to communicate to the Business Unit Head and Division  Head on actions and controls approved to be implemented.
  • To review reports submitted by Management on follow-up assignments performed to ensure proper implementation of actions for significant risks addressed.
  • To provide an annual assurance report (the assurance letter should be submitted by the respective Business Unit Head or Division Head as they are the people who will implement the control. The Risk Management Committee will then compile its annual report based on this) to the Board of Directors on the adequacy of the Risk Management Process (i.e. an on-going process)
  • To perform any other functions relating to risk management as may be determined or directed from time to time by the Board of Directors.

Employees Code of Conduct

The Code of Conduct contains policies and guidelines relating to the standards and ethics that all employees under Pinehill Pacific Berhad are expected to adhere to during work and when representing the company during external engagements. It is designed to maintain discipline and order among employees.

CODE OF CONDUCT

In the performance of duties, an employee should at all times conduct themselves and observe the following:

A. DUTIES OF GOOD FAITH, DILIGENCE AND INTEGRITY

i. Professional Conduct

All employees shall observe the highest standard of professional conduct. Employees must act in good faith and exercise due care, diligence and integrity in performing their duties and must not under any circumstances commit any act or omission that would bring damages to the Company, its property, reputation or general interest.

ii. Conflicts of Interest.

Employees are not permitted to engage in any activity, which can be detrimental, directly or indirectly to the interest of the Company and its subsidiaries. Employees are not allowed to participate in or influence any business transaction from any company or person in which or through which that employee has or will obtain a direct or indirect interest or benefit.

iii. Bribery and Corruption

Employees shall not offer, give, solicit or accept any bribes in order to achieve business or personal advantage for themselves or others or engage in any transaction that contravene any applicable anti –bribery or anti-corruption laws.

iv. Insider Trading

Employees who are in possession of market sensitive information are not allowed to trade in securities of the Company or another listed company if that information has not been made public. Employees are also prohibited from disclosing any non-public price sensitive information to any third party

v. Money Laundering

Employees should always ensure that they are conducting business with reputable customers, for legitimate business purposes and with legitimate funds.

vi. Compliance with Laws

Pinehill Pacific Berhad and its subsidiaries are committed to doing business the right way, by acting ethically and consistently with this Code of Conduct and Ethics ('Code') , its policies and all applicable laws, rule and regulations. Employees have a continuing obligation to familiarize themselves with applicable laws relating to their job responsibilities and policies.

B. WORKPLACE CULTURE AND ENVIRONMENT

i. Equal Opportunity and Non- Discrimination

Pinehill Pacific Berhad is guided by the principles of non-discrimination and respect of human rights and individual liberties of all citizens. All employees are expected to conduct themselves in a manner that assures customers, suppliers and fellow employees are treated with respect, fairness and dignity.

ii. Workplace Health and Safety

Pinehill Pacific Berhad is committed to providing a safe and healthy work environment to all Employees. Health and safety support and training will be provided to Employees so that they understand their occupational health and safety obligations and diligently comply with all health and safety requirements, policies and procedures set out by the Company.

iii. Harassment, Threat and Violence

Pinehill Pacific Berhad seeks to provide a work environment free from any form of harassment, treat, intimidation, violence or any other inappropriate behavior. All complaints or grievances will be investigated and appropriate action will be taken immediately.

iv. Drugs, Alcohol and Prohibited Substances.

Employees must perform their job duties free from the influence of any substance that could impair their job performance and pose unacceptable safety risk to the employee and others. The use, possession, distribution or sale of alcohol, illegal drugs or controlled substances in the workplace is strictly prohibited

C. Company Information, Records and Assets

i. Data Integrity and Data Protection

Employees shall record, manage, store and transfer all data and records in compliance with applicable legal tax, regulatory and accounting requirements.

ii. Protection and Use of Company Assets and Resources.

Pinehill Pacific Berhad provides its Employees a variety of resources and assets including licensed software for Employees to deliver their work. Employees shall safeguard and make proper and efficient use of the assets and resources in compliance with all applicable laws, company policies and licensing agreements and take all necessary steps to prevent loss, damage, misuse, theft and fraud or destruction of the company assets and resources.

iii. Records and Reporting

Pinehill Pacific Berhad has put in place the Document Management Policy which sets out the time period to retain and destroy data and records based on specific statutory and regulatory requirements. Employees are responsible to retain and store proper records in compliance with company policy legal and regulatory requirements.

iv. Proprietary and Confidential Information

Employees are required to protect the Company confidential information and guard them against unauthorized disclosure or use. Employees are also required to protect confidential information of third party which employees have access to in the course of their work. Employees shall not disclose confidential information or allow such disclosure or use confidential information for unauthorized purposes. This obligation continues beyond the termination of employment.

Whistleblowing Policy

Introduction

Pinehill Pacific Berhad is committed to carrying its business in accordance to the highest standards of professionalism, honesty, integrity, competence and ethics. Whistleblowing is the voluntary disclosure of inappropriate, unethical or unlawful behaviour and practices by the Management or employees.

Whistleblower - A person or entity making a disclosure about improper or illegal activities.

Whistleblower may refer to ALL employees, external parties and other stakeholders.

Objective

This whistleblowing Policy aims to establish a workplace that practices good corporate governance and upholds integrity in all its operational activities and business dealings.

Its a platform for employees and stakeholders of the company to voice their concerns in an effective, responsible manner when they are aware of actual or potential wrongdoings that will cause any shortfalls thus enable corrective actions to be taken.

Types of Wrongdoing

The following are generally accepted as improper and reportable conduct for whistleblowing.

However the list below is not exhaustive:

  • Fraud, theft, bribery, corruption, forgery, cheating or malpractice
  • Criminal Breach of trust
  • Breach of policies and/or procedures
  • Bullying and harassment
  • Actions which can cause physical danger/harm to another person and/or can give rise to risk of damage to properties/assets.
  • Profiteering as a result of insider knowledge
  • Gross mismanagement or dereliction of duties
  • Sexual Harassment
  • Giving false or misleading information
  • Failure to comply with legal or regulatory requirements.
  • Conflict of interest.

  

Scope

This Policy governs the disclosures, reporting and investigation of misconduct within the Group as well as the protection offered to the person 9s) making the disclosures ("Whistleblower (s)") from detrimental action in accordance to Act 711 Whistleblower Protection Act 2010.

The scope of the policy applies to Pinepac Group's Board members, employees, external parties and other stakeholders.

Role of Whistleblowers

Any person may disclose allegations of suspected misconduct or breach or suspected breach of law or regulation that may adversely impact the Company

Acts of misconduct may be

  • disclosed via email to the dedicated email addresses
  • verbally to a designated person or private meeting
  • can be made via a form and submitted to Human Resource & Admin Dept - Refer Appendix 1.

Whistleblowers should note that:

  • To raise early and identify or supply as much factual and verifiable facts and objective information pertaining to the issue/allegation
  • To safeguard from the abuse of this disclosure process
  • Investigation/verification proceedings must not be discussed or disclosed to any other personnel.
  • Whistle-blower is not acting for personal gain. If the case involves the complainant's personal interests, it must be informed at the outset.
  

Procedures

  • Disclosure of misconduct shall be writing via email to hca@pinepac.com.my
  • The whistle-blower should disclose the following information
    • Name of whistle-blower
    • Contact Details
    • Detail of person involved
    • Nature of allegation, time and venue of the incident took place
    • Provide evidence, if any together with the report
  • The disclosure should seek to obtain pertinent facts including
    • the background and history of the issues concerned (giving relevant dates)
    • the reason why the Whistle-blower is particular concerned about the situation and
    • enclose any supporting or documentary evidence (if applicable)
  • If an allegation is raised verbally, the recipient of disclosures may out the verbal disclosure in writing. The information should be reviewed and confirmed by the person providing the information. This is to ensure that it properly reflects the concern that has been raised and accurately understood.
  • When dealing with the disclosure under the Whistle-blowing Policy, the recipients must determine whether there is sufficient evidence to substantiate the disclosure and the corrective and preventive actions to be taken.
  • A register of all disclosures received shall be maintained in the Executive Director office.
  • Any anonymous disclosure will not be entertained. However the Company reserves the right to investigate into any anonymous disclosure.
  

Investigation Procedure

  • Designated Recipients may appoint an Investigating Officer (IO) from Internal Audit or any party deemed appropriate to investigate the case.
    1. The Investigating Officer (IO) may interviews with any persons he deems appropriate, depending on nature of allegation and to secure discovery/disclosure of all relevant documents and information
  • May be further investigated by Human Capital and Administration Dept or dealt with through disciplinary process
    1. referred to relevant authority such as Royal Malaysia Police, Malaysian Anti Corruption Commission or regulatory authorities.
    2. referred to external auditor
    3. result in the formation of an independent inquiry or
    4. lead to the seeking of relevant external assistance other than those listed above.
  • The Company reserves the right not to inform the Whistleblower of the precise action plan/or the outcome of the investigation as this may infringe a duty of confidentiality owned to someone else.
  • The concluded investigation report shall be tabled to the Board. The Boars will evaluate and decide in the necessary action (s).
 

Protection from Retaliation

This Whistleblowing Policy provides an assurance to the whistleblower that he/she would be protected against any unfair practice not limited to retaliation or intimidation of termination/suspension of service, disciplinary action, transfer, demotion, refusal of promotion or any direct or indirect use of authority to obstruct the whistleblower from continuing making his/her disclosure.

Staff Awareness

All employees shall be given appropriate awareness of this Policy and information made accessible to all employees. This shall include on how to identify and disclose misconduct, communicate the protections afforded to Whistleblowers and potential consequences of committing or being complicit to misconduct

Confidentiality

The Company shall treat all reports or disclosures as sensitive and confidential to the extent reasonably practical.

ANTI - BRIBERY AND CORRUPTION POLICY

INTRODUCTION

Bursa Malaysia has made a media release in 18 Dec 2019 requiring listed companies to adopt Anti Bribery and corruption policy effective from 1 June 2020. The Anti-Bribery and Corruption Policy (“ABC Policy”) has been developed as part of the Pinehill Group policy in accordance with

  • Malaysia Anti Corruption Commission Act 2009 (MACC 2009)
  • Malaysia Anti Corruption Commission (Amendment) Act 2018 (MACC 2018

The ABC policy is to be in accordance with anti corruption measures in support of the National Anti Corruption Plan 2019 - 2023

OBJECTIVE

This policy sets out Pinehill Group’s overall position on bribery and corruption in all its forms. These policies are not exhaustive and will be continously updated in accordance with changes taking place.

SCOPE

This policy is applicable to Pinehill Group, its subsidiaries, business associates on Pinehill’s behalf, the Board of Directors and all Pinehill personnel.

DEFINITIONS

Bribery & Corruption” means any action which would be considered as an offence of giving or receiving ‘gratification’ under the MACC 2009 Act. In practice, this means offering, giving, receiving or soliciting something of value in an attempt to illicitly influence the decisions or actions of a person who is in a position of trust within an organisation.

Gratification” is defined in the MACC 2009 Act mean the following:

a) money, donation, gift, loan, fee, reward, valuable security, property or interest in property being property of any description whether movable or immovable, financial benefit, or any other similar advantage;

b) any office, dignity, employment, contract of employment or services, and agreement to give employment or render services in any capacity;’

c) any payment, release, discharge or liquidation of any loan, obligation or other liability, whether in whole or in part;

d) any valuable consideration of any kind, any discount, commission, rebate, bonus, deduction or percentage;

e) any forbearance to demand any money or money’s worth or valuable thing;

f) any other service or favour of any description, including protection from any penalty or disability incurred or apprehended or from any action or proceedings of a disciplinary, civil or criminal nature, whether or not already instituted, and including the exercise or the forbearance from the exercise of any right or any official power or duty; and

g) any offer, undertaking or promise, whether conditional or unconditional, of any gratification within the meaning of any of the preceding paragraphs (a) to (f).

GIFTS, DONATIONS AND SPONSORSHIPS

Pinehill Group personnel are prohibited from receiving or asking for (soliciting) gifts from external parties.

The only form of gift-giving or accepting gift must fulfil the following conditions

  • They are limited, customary and lawful under the circumstances;
  • They do not have or are perceived to have (by either the giver or the receiver), any effect on actions or decisions.
  • There must be no expectation of any specific favour or improper advantages from the intended recipients;
  • The independent business judgment of the intended recipients must not be affected;
  • There must not be any corrupt / criminal intent involved; and
  • The giving out of the gift and hospitality must be done in an open and transparent manner.

Donations and sponsorships are permitted in accordance with the Company policy to ensure acceptability. However, the Company prohibits the giving and receiving of donations and sponsorships to influence business decisions.

THIRD PARTIES & AGENCIES

All arrangements with third parties and agencies including agents, suppliers, contractors and business partners shall be subject to transparent contractual terms including special provisions requiring them to comply with minimum standards and procedures relating to bribery and corruption. They are required to acknowledge / confirm in writing that they :

a) understand and will comply with all laws relating to anti-bribery and corruption.

b) have not been convicted or subject to any investigations by the relevant authorities for actual or suspected breach of law.

c) undertake to inform the Group of any breach or infringement of the Policy.

d) acknowledge that the Group has the right to terminate or suspend their contract and disqualify them from tendering for future contracts if they are found in breach of the Policy.

FACILITATION PAYMENTS

Facilitation payment is a payment or other provision made personally to an individual in control of a process or decision. It is given to secure or expedite the performance of a routine or administrative duty or function. Personnel shall decline to make the payment and report to management immediately when they encounter any requests for a facilitation payment

DONATION & SPONSORSHIPS

Donations and sponsorships (in cash, gifts or hospitality) may be given for legitimate or valid causes to support local community or welfare development and reciprocal business arrangements. However it must be ensured that donations and sponsorships are not used as a scheme to conceal bribery or corruption practices.

RECORD MANAGEMENT & CONTROL

Appropriate and complete invoices, documents and records on all transactions with third parties including customers, suppliers, contractors and business contacts are to be maintained to ensure they are bona fide and conform to generally accepted and applicable laws and regulations

ADMINISTRATION

In the advent an improper conduct had been committed, the matter shall be handled in accordance with the Group’s disciplinary procedures and applicable laws and regulations of the domicile company or subsidiary. Improper conduct includes illegal act, malpractice, unethical conduct and other forms of wrongful conduct, which if proven, constitutes a disciplinary or criminal offence.

CONTINUOUS IMPROVEMENT

PinePac shall monitor the legal and regulatory regimes where it operates. Regular assessments of the ABC policies should be carried out to ensure its scope, policies, procedures and controls match the bribery and corruption related risks faced by the Group

DECLARATION

All Employees are required to have read, understood and will abide by the ABC Policy. Human Resource Department from time to time shall coordinate and disseminate relevant communications, internal and external training to refresh staff awareness on anti-bribery and corruption system.