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The Board of Directors ("the Board") of Jaya Tiasa Holdings Berhad ("JTH" or the "Company") is committed to ensuring that the highest standard of corporate governance is practiced throughout the Group as a fundamental part of discharging its responsibilities in managing the business and affairs of the Group to create long-term and sustainable growth in shareholder value.

The Company has in the financial year ended 30 June 2013 complied with the Principles and Recommendations of the Malaysian Code on Corporate Governance 2012 ("the Code"), save for the Recommendation that the tenure of an independent director should not exceed a cumulative term of 9 years.

Pursuant to the Main Market Listing Requirements of Bursa Malaysia Securities Berhad ("Listing Requirements"), the Board is pleased to present the following statement on the application by the Group of the Principles and Recommendations set out in the Code.

Board Of Directors

Roles and Responsibilities

The Board is responsible for the proper stewardship of the Company and its subsidise stakeholders' interests including securing sustainable long-term financial results and increasing shareholder value, with proper social and environmental considerations.

The Board has the following major responsibilities, which facilitate the discharge of the Board's stewardship and fiduciary functions in the pursuit of the best interest of the Group:

  1. Adopting and reviewing a strategic plan for the Group;

  2. Overseeing the conduct of the Group's business to evaluate whether the business is being properly managed and sustained;

  3. Ensuring that effective Risk Management ("RM") framework is in place and aligned with the Group'sbusiness objectives;

  4. Succession planning including training and induction programs;

  5. Developing and implementing an investor relations programme for the Company; and

  6. Reviewing the adequacy and integrity of the Group's internal control system.

Functions Reserved for the Board

There is a schedule of significant matters reserved for the collective decision of the Board, including the approval of financial results, annual corporate and business plans, dividend policy, acquisition and disposal of undertakings and properties of a substantial value as well as major investments and strategic decisions.

Directors' Code of Ethics and Board Charter

The Directors observe a code of conduct in accordance with the Code of Ethics established by the Companies Commission of Malaysia, which forms an integral part of the Company's Board Charter.

The Board Charter sets out the roles and responsibilities of the Board and Board Committees, division of responsibilities between the Board, Management, Chairman, CEO and Board Committees as well as processes and procedures for meetings. It serves as a reference and primary induction document providing prospective and existing Board Members insights into their fiduciary and leadership functions.

Size, Composition and Diversity

As at the date of this statement, the Board has nine (9) members. Two (2) are Executive Directors and seven (7) Non-Executive Directors. Four (4) Directors or 44% of the Board members are Independent Non-Executive Directors.

On 1st January 2013, Dato' Wong Sie Young was appointed as the Chief Executive Officer (CEO) of the Company. Dato' Wong has been with the Group for 25 years during which time he has acquired extensive experience in the running of the Group's operations. Simultaneously with Dato' Wong's appointment, the ex Managing Director Dato' Sri Tiong Chiong Hoo was re-designated as Deputy Executive Chairman. The re-organisation is to enable Dato' Sri Tiong Chiong Hoo to delegate the day-to-day operations to the new CEO and focus his time towards developing the Group's corporate/business strategy and attaining the long-term growth objective. This is also in line with the Group's long term plan and policy to develop professional talent that will provide adequate support for growth and continuity. The nine (9) members of the Board are persons of high calibre and integrity, and they possess the appropriate skills, knowledge, experience and core competencies to address key issues relating to the business and affairs of the Group. The Board collectively has sufficient knowledge and expertise to enable effective governance and oversight.

The Group promotes corporate culture that embraces gender diversity when determining composition of employees at all level from a diverse pool of qualified candidates. Although the Board does not endorse quotas, it does commit to having an increasing representation of women in senior positions in the Group and on the Board. The Board through the Nomination Committee will review the proportion of the female to male board members during recruitment and 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.

Currently, there are two (2) female Directors, namely Mdm Tiong Choon and Dato' Wong Lee Yun.

The Board has reviewed the size of the Board, and is of the opinion that its current size and composition is appropriate and constitutes an effective Board which is conducive to effective discussion and decision making and that the Board has an appropriate number of Independent Directors. The Board is also satisfied that the current Board composition fairly reflects the interest of the minority shareholders in the Company. A brief profile of each Director is presented on pages 5 to 9.

Strategies Promoting Sustainability

Promoting sustainability and enhancing shareholder value are embedded in our business model that takes into account market place, work place, environment and community, details of which are set out in the Corporate Social Responsibility Statement on pages 18 to 22 of this annual report.

Access to Information and Advice

The Directors have unrestricted access to all information pertaining to the Group's business and affairs whether as a full Board or in their individual capacity in furtherance of their duties.

The agenda for each Board Meeting together with a full set of board papers are forwarded to each Director for their perusal well in advance of the date of the Board Meeting to facilitate informed decision making.

The Senior Management Staff are invited to attend the Board and Committee Meetings to report on matters relating to their respective areas of responsibility and also to provide detail or clarification on issue(s) that may be raised by any Director.

All the Directors have direct access to the advice and services of the Company Secretary whether as a full Board or in their individual capacity. The Directors also have the liberty to seek external professional advice if so required by them at the Company's expense.

Company Secretary

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.

Board Committees

The Board has established three (3) Committees, namely, Audit Committee, Nomination Committee and Remuneration Committee to assist the Board in the execution of its duties and responsibilities. The functions and terms of reference of the committees as well as authority delegated by the Board to these Committees are clearly defined and, where applicable, complied with the recommendations of the Code.

The Chairman of the respective Board Committees reports to the Board the outcome of the Committee meetings including salient matters which require the Board's attention or direction.

  1. Audit Committee

    The Audit Committee's principal function is to assist the Board in meeting its responsibilities in ensuring a sound and effective system of internal control and for meeting its external financial reporting obligations.

    It has four (4) members, all of whom are independent non-executive directors.

    The composition, terms of reference and summary of the Audit Committee and internal audit activities are presented on pages 37 to 40.

  2. Nomination Committee

    The Nomination Committee is made up entirely of Non-Executive Directors, of whom two-third (2/3) are independent.

    The following Directors are members of the Nomination Committee:-

    - Datuk Talib Bin Haji Jamal (Independent Non-Executive Director)

    - Mr John Leong Chung Loong (Independent Non-Executive Director)
    - Dato' Sri Dr. Tiong Ik King (Non-Independent Non-Executive Director)

    The key terms of reference of the Nomination Committee are: -

    • to consider, evaluate and recommend to the Board any new Board appointment;
    • to recommend to the Board, Directors to fill the seats on Board Committees;
    • to review annually and recommend to the Board with regard to the structure, size, balance and composition (including gender diversity) of the Board and Committees including the required mix of skills and experience, core competencies which non-executive directors should bring to the Board and other qualities to function effectively and efficiently;
    • to evaluate on an annual basis, the effectiveness of the Board as a whole, the Board Committees and each Director's ability to contribute to the effectiveness of the Board and the relevant Board Committees;
    • to recommend to the Board whether Directors who are retiring should be put forward for re-election/ re-appointment at annual general meetings; and
    • to assess independence of Independent Directors.

    The Nomination Committee upon its annual review carried out, is satisfied that the size and composition of the Board is optimum and conducive to effective discussion and decision making. There is appropriate mix of skills, experience and core competencies in the composition of the Board and that the Board has an appropriate number of Independent Directors. The Nomination Committee is also satisfied that all the members of the Board are suitably qualified to hold their positions as Directors of the Company in view of their respective academic and professional qualifications, experience, core competencies and qualities.

    The Committee met twice during the financial year ended 30 June 2013 and were attended by all the members.

  3. Remuneration Committee

    The Remuneration Committee is made up entirely of Non-Executive Directors, of whom two-third (2/3) are independent.

    The following Directors are members of the Remuneration Committee:-

    - Mr John Leong Chung Loong (Independent Non-Executive Director)

    - Datuk Talib Bin Haji Jamal (Independent Non-Executive Director)
    - Dato' Sri Dr. Tiong Ik King (Non-Independent Non-Executive Director)

    The key term of reference of the Remuneration Committee is to recommend to the Board the framework, remuneration package and performance related pay schemes for Executive Directors.

    Remuneration packages of both Executive Directors and Non-Executive Directors are a matter to be decided by the Board as a whole with the Director concerned abstaining from deliberations and voting on decisions in respect of his/her individual remuneration.

    The Remuneration Committee met twice during the financial year ended 30 June 2013 and recommended to the Board the remuneration package for the Deputy Executive Chairman and Chief Executive Officer in all its form. The meeting was attended by all the members.

Appointments to the Board

There is in place a formal and transparent procedure for the appointment of new Directors to the Board. The Nomination Committee is responsible for evaluating and recommending to the Board suitable candidates for appointment as new Directors of the company. The Nomination Committee also recommends to the Board, directors for re-election and re-appointment by shareholders at the Annual General Meeting. The Company Secretary will ensure that all appointments are properly made and that legal and regulatory obligations are met.

Re-appointment and Re-election of Directors

Pursuant to Section 129(6) of the Companies Act, 1965, Directors over seventy (70) years of age are required to retire at every annual general meeting and submit themselves for re-appointment to hold office until the next annual general meeting.

The Company's Articles of Association requires all Directors appointed by the Board to retire from office and submit themselves for re-election by shareholders at the next Annual General Meeting after their appointment. All Directors are required to retire from office and submit themselves for re-election by rotation at the Annual General Meeting at least once in every three (3) years.

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