Corporate Governance Overview Statement


The Board of Directors ("Board") is fully committed to ensuring that a high standard of corporate governance in accordance with the Malaysian Code on Corporate Governance 2017 ("Code") are applied and maintained throughout the Group with the ultimate objective of safeguarding the interests of the shareholders as well as the stakeholders and the financial performance of the Group.

The Board is pleased to set out below how the Group has applied the three (3) key principles laid down in the Code. This Statement, together with the Statement on Risk Management and Internal Control, sets out the manner in which the Company has applied the principles and practices of the Code.

This statement is to be read together with the Corporate Governance Report ("CG Report") which is available on the Company's website at www.timwell.com.my as well as via an announcement on the website of Bursa Malaysia Securities Berhad ("Bursa Securities")


Corporate Governance Structure




PRINCIPLE A - BOARD LEADERSHIP AND EFFECTIVENESS

PART I - BOARD RESPONSIBILITIES


1.0 Board's Leadership on Objectives and Goals

1.1 Strategic Aims, Values and Standards

The Board has full control of and is responsible for the Groups overall strategy, formulation of policies, annual budget, review of financial and operational performance and internal control.

The Board has delegated matters pertaining to the day-to-day management, operations and strategic development of the Group to the Chief Executive Officer ("CEO") who is supported by a competent Management team.

The Board acknowledges the essential of ensuring that the Company's strategies promote sustainability. As in the timber industry, the Board is strongly aware of the importance of balancing of environmental, social and governance aspect with the interest of various stakeholders is essential to enhancing investors' perception and public trust.

The Sustainability Statements, stated the actions taken by the Company in protecting the environment while striking to achieve a better performance towards the goal at sustainable development.

The Board is constantly mindful of the need to safeguard the interests of the Group's stakeholders. In order to facilitate the effective discharge of its duties, the Board is guided by the Board Charter, which was reviewed and revised by the Board on 21 February 2017 and 28 march 2018. The Board Charter has been published on the Company's website, www.timwell.com.my

The Board Charter serves to ensure that all Board members acting on the Group's behalf are aware of their expanding roles and responsibilities. It sets out the strategic intent and specific responsibilities to be discharged by the Board members collectively and individually. It also regulates on how the Board conducts business in accordance with Corporate Governance principles. The Board Charter is reviewed periodically to ensure that it complies with the best practices and regulations.

The Board has set the management authority limit and retained its authority of approval on significant matters. The Board has also formalised its responsibilities and functions as well as the division of responsibilities and powers between the Board, Management and Board Committees in its Board Charter. This Board Charter also provides a basis to the Board in assessing its own performance and that of its individual directors. Key matters such as approval of annual and interim results, acquisitions and disposals, as well as material agreements are reserved for the Board.

The responsibility for the operation and administration of the Group is delegated by the Board to the CEO and Management.

As set out in Board Charter, the Board, whilst supportive of Management, must:-

The Board, through the Audit Committee, Risk Management Committee and other relevant Committees, provides effective oversight of Management's performance, risk assessment and controls over business operations, and compliance with regulatory requirements.

1.2 The Roles of Chairman and CEO

The Board has adopted the recommendation of the Code that the position of the Chairman and the CEO should be held by different individuals and the Chairman must be a non-executive member of the Board.

Dato' Seri Abdul Azim Bin Mohd Zabidi, who is an Independent Non-Executive Director was appointed as the Chairman of the Board on 28 August 2006. Mr Pau Chiong Ung was appointed as the CEO of the Company on 23 May 2006.

The details of the role and functions of the Chairman and CEO are stated in the Board Charter page, which is available in the Company’s website www.timwell.com.my.

1.3 Separation of the Positions of the Chairman and CEO

The position of the Chairman and the CEO is held by different individuals, accordingly there is a clear division of responsibilities between the Chairman and the CEO to ensure that there is a continued balance of power and authority. In addition, the separation of these positions promotes accountability and facilitates division of responsibilities.

The task of the Chairman includes leading the Board in the oversight of management whilst the CEO focuses on the business and day to day management of the Group.

The Board's principal focus is the overall strategic direction, development and control of the Group. As such, the Board approves the Group’s strategic plan and its annual budget and receives reports from respective standing committees.

The Chairman as an Independent Non-Executive Directors is independent of management and free from any business or other relationship, which could materially interfere with the exercise of his independent judgment. Independent Non-Executive Directors provide unbiased and independent views in ensuring that the strategies proposed by Management are fully deliberated and examined, in the interest of shareholders as well as stakeholders.

The Chairman is responsible for the integrity and effectiveness of the Board as a whole. He conducts Board meetings and ensures that it proceeds in an orderly manner.

The CEO is responsible for the implementation of broad policies approved by the Board and he is obliged to report to the Board and discuss with them at Board Meetings all material matters currently or potentially affecting the Group and its performance, including all strategic projects and regulatory developments. He is supported by management and the Group Accountant.

The sound operation of the Company depends critically on its CEO. Thus, he must be able to devote his full attention and time to discharge his duties and responsibilities effectively and diligently.

As the CEO is directly responsible for the day-to-day operations of the Company, he must be familiar with the operations of the Company, the state of internal controls, requirements of regulations, as well as current issues and policies affecting the industry in general. He must also have the necessary knowledge and professional competence in the conduct of the Company's business.

In the absence of its CEO, the Managing Director who is fully acquainted with the Company's affairs, is the person who will be directly responsible for the overall running of the Company.

1.4 Qualified and Competent Secretaries

In performing their duties, all Directors have access to the services of the Company Secretaries. The Company Secretaries acts as the corporate governance counsel and ensures good information flow within Board, Board Committees and Management. The Company Secretaries attended all meetings of the Board and Board Committees and advises the Directors on the requirements encapsulated in the Company's Constitution and legislative promulgations such as the Companies Act 2016 ("the Act"), Main Market Listing Requirements ("MMLR"), the Code, etc.

1.5 Board Meetings

The Board meets on a quarterly basis, with additional meetings convened as and when necessary. All the proceedings at the Board meetings are properly minuted and signed by the Chairman. The Board follows formal schedules for meeting and all the Board members are adequately provided with status report and Board papers at least three (3) days prior to the meeting to assist them to make the best decisions in the best interest of the Company at all times. To facilitate productive and meaningful deliberations, the proceedings of the Board meetings are conducted in accordance with a structured agenda. The Board papers include, among others, the following documents or information:

To ensure that the Directors have the time to focus and fulfil their roles and responsibilities effectively, the Directors must not hold directorships in more than five (5) public listed companies and shall notify the Chairman before accepting any new directorship.

The Board is satisfied with the level of time commitment given by the Directors towards fulfilling their roles and responsibilities as Directors of the Company. During the financial year ended 31 December 2018, a total of five (5) Board Meetings were held. The following are the details of attendance of the Directors:

Name of DirectorsDesignationNumber of Meetings attended
Y. Bhg. Dato’ Seri Abdul Azim Bin Mohd Zabidi (Chairman)Independent Non-Executive Director4/5
Dato Sri Tiong King Sing Managing Director3/5
Datuk Yap Pak Leong (or his Alternate Director : Ms Yap Fook Fung)Senior Independent Non-Executive Director5/5
Mr Loo Choo Hong Independent Non-Executive Director5/5
Madam Agnes Soei-Tin Lamey Independent Non-Executive Director5/5
Mr Melton Martin Independent Non-Executive Director5/5

All Directors complied with the requirements of Paragraph 15.05(3)(c) of the MMLR which stipulates a minimum of 50% attendance of the Board meetings held in a financial year.

1.6 Access to Information and Advice

The Board has full access to all information pertaining to the Group's business affairs to enable them to discharge their responsibilities effectively.

Board meetings are prepared diligently and are structured with a pre-determined agenda. Prior to the meetings, Board papers, which include operational and financial information, are circulated to the Board members to provide time for the Directors to read and contemplate the issues. During the meetings, Management will provide details on each issue raised for discussion or as supplementary information.

In furtherance of their duties, the Directors have full and unrestricted access to any information pertaining to the Company, the advice and services of the Company Secretaries. Independent professional or other advice is also made available to Directors at the Company's expense and in accordance with decision of the Board as a whole should such advice is required.

1.7 Code of Ethics and Conduct

The Board is committed in maintaining a corporate culture which engenders ethical conduct. The ethical standards is formalised through the Company's Code of Ethics and Conduct, which requires all Directors and Employees to observe high ethical business standards, honesty and integrity and to apply these values to all aspects of the Group's business and professional practice and act in good faith in the best interests of the Group and its shareholders.

The Code of Ethics and Conduct is accessible on this Company's website.

1.8 Whistle Blowing Policy

The Board has also adopted a whistleblowing policy ("WP") setting out the appropriate communication and feedback channels to facilitate whistleblowing. The implementation of the WP is in line with Section 587 of the Companies Act 2016 ("the Act") where provisions have been made to protect Timberwell's officers who make disclosures on breach or non-observance of any requirement or provision of the Act or on any serious offence involving fraud and dishonesty.

The Whistle Blowing Policy is accessible on this Company's website.


PART II - BOARD COMPOSITION

1.0 Strengthen Board's Objectivity

1.1 Board Committees

The Board is supported by the following Board Committees whose compositions are in accordance with the best practices as prescribed by the Code to ensure the Board's effectiveness and to efficiently discharge its duties and responsibilities. Each Board Committee operates within its terms, which clearly define its functions and responsibilities. Minutes of Board Committee meetings are circulated at the Board Meetings.

  1. Audit Committee ("AC")

  2. The objective, composition, terms of reference and activities of this Committee together with its report are presented on page Annual Report.

  3. Nomination and Remuneration Committee

  4. The Company has a combined Nomination Committee and Remuneration Committee for the purpose of expediency, since the same members are entrusted with the functions of both the Committees. The members of the Nomination and Remuneration Committee ("NRC") are mindful of their dual roles, which are clearly reflected and demarcated in the Agendas of each meeting.

    Objectives

    The current members of the NRC are as follows:


    Name of DirectorsDesignation
    Datuk Yap Pak Leong (Chairman)Senior Independent Non-Executive Director
    Madam Agnes Soei-Tin Lamey Independent Non-Executive Director
    Mr Melton Martin Independent Non-Executive Director

    The NRC shall be appointed from amongst the Board and shall comprise exclusively non-executive directors and a majority of whom are independent.

    The detailed terms of references of the NRC is made available on the Company’s website at www.timwell.com.my.

    Nomination Function

    The NRC is responsible for identifying and recommending suitable candidates for Board membership and also for assessing the performance of the Directors on an ongoing basis. The Board will have the ultimate responsibility and final decision on the appointment. This process shall ensure that the Board membership accurately reflects the long-term strategic direction and needs of the Company and determine skills matrix to support strategic direction and needs of the Company.

    Management shall engage broadly to develop a pool of interested potential candidates meeting the skills, expertise, personal qualities and diversity requirements for both the Board and the Committee appointments.

    The NRC evaluates and matches the criteria of the candidate, and will consider diversity, including gender, where appropriate, and recommends to the Board for appointment.

    Consideration will be given to those individuals possessing the identified skill, talent and experience.

    The NRC will contact those persons identified to determine interest in serving the Company. This communication will ensure that prospective Board members have clarity regarding the nominating process as well as Director/Board profiles, roles and responsibilities, expectations of time commitments and other information as required.

    Remuneration Function

    The NRC also reviews the remuneration of the Board and Senior Management from time to time with a view to ensuring the Company offers fair compensation and is able to attract and retain talent who can add value to the Company. The Directors' Fees paid to the Directors are tabled at the Company's Annual General Meeting ("AGM") for approval.


    Summary of Activities of NRC

    During the financial year under review, five (5) meetings were held and attended by all members. The main the activities carried out by the NRC during the financial year under review were as follows:


    The NRC is satisfied with the effectiveness of the Board and its Committees, including the contributions by each of the members based on the annual assessments conducted and affirmed by each of the members of the Board. The NRC is confident that each of the members of the Board and its Board Committees will continue to operate and contribute effectively.

  5. Risk Management Committee ("RMC") (previously known as Business Risk Management Committee)

  6. The RMC shall assist the Board in assessing and overseeing the Group’s business risk profile. The assessments set out the results of the Group's business risk assessment and provide the Risk Management Plan for the Group. Actions and strategies adopted by the Group would be developed and executed by the management and reviewed by the AC and RMC nominated by the Board.

    The current members of the RMC are as follows:

    Name of DirectorsDesignation
    Datuk Yap Pak Leong (Chairman)Senior Independent Non-Executive Director
    Madam Agnes Soei-Tin Lamey Independent Non-Executive Director
    Mr Melton MartinIndependent Non-Executive Director

    Duties and Responsibilities

    Summary of Activities

    The risk assessment statement was reviewed on 3 October 2018 and the key risk areas were updated to better reflect the Group and Company's current situation and business environment. In 2018, two (2) meetings was held to discharge its duties and responsibilities.


  7. Executive Committee ("Exco")


  8. The current members of the Exco are as follows:

    Name of DirectorsDesignation
    Datuk Yap Pak Leong (Chairman)Senior Independent Non-Executive Director
    Madam Agnes Soei-Tin Lamey Independent Non-Executive Director
    Datuk Pau Chiong UngCEO

    Duties and Responsibilities

    Rights and Authority

    The Exco shall have the authority to call any staff of the Company to be present at a meeting of the Committee as and when required and to seek whatever independent, professional or other advice it considers necessary.

    Summary of Activities

    In 2018, three (3) meetings were held to discharge its duties and responsibilities.

    To facilitate and assist the Board in overseeing the business affairs of the Group, the roles of Exco has been strengthened to increase the involvement of Non-Executive Directors.


  9. Investment Committee

  10. The Investment Committee assists the Board in evaluating the viability of all new and potential investment or projects of the Group, which arise out of the ordinary course of business before recommending to the Board for approval.

    The current members of the Investment Committee are as follows:

    Name of DirectorsDesignation
    Datuk Yap Pak Leong (Chairman)Senior Independent Non-Executive Director
    Datuk Pau Chiong UngCEO
    Dato Sri Tiong King SingManaging Director

    Duties and Responsibilities


The Board receives periodic reports from the Board Committees and is constantly updated of their proceedings and deliberations. In cases where the Board Committees have no authority to decide on certain matters, the Board Committees will assess and examine the issue and subsequently provide their recommendations, which are highlighted in their respective reports for the Board's decisions. The ultimate responsibility for the final decision on the recommendations lies with the entire Board.

1.2 Board Composition

The Board consisted of six (6) members, comprising five (5) Independent Non-Executive Directors and one (1) Managing Director.

The present composition of the Board is in compliance with Paragraph 15.02 of the MMLR and the Code as more than half of its members are Independent Directors. The Board members have diverse backgrounds and experiences in various fields. Collectively, they bring a broad range of skills, experience and knowledge to direct and manage the Group's businesses.

The Board is satisfied that, through the annual performance appraisal of the Board, the Board Committees and individual directors, the current board composition represents a mix of knowledge, skills and experience required to discharge the Board's duties and responsibilities effectively.

1.3 Board Balance and Independence

The Board comprises only one Executive Director and a strong presence of five (5) Independent Non-Executive Directors. The presence of a majority of Independent Non-Executive Directors provides effective check and balance in the functioning of the Board to safeguard the interests of the Bank and all stakeholders.

Independence is important for ensuring objectivity and fairness in board's decision making. All Independent Directors comply with the criteria of 'independent directors' as prescribed in MMLR.

The Board, through the NRC, assesses the independence of Independent Directors annually. The criteria for assessing the independence of an Independent Director include the relationship between the Independent Director and the Company and its involvement in any significant transaction with the Company.

The Board is satisfied with the level of independence demonstrated by the Independent Directors and their ability to act in the best interest of the Company and/or the Group as all of the Independent Directors have satisfactorily demonstrated that they are independent from Management and free from any business or other relationship with the Group that could materially affect or interfere with the exercise of objective and independent judgement to act in the best interest of the Group.

1.4 Tenure of Independent Directors

The Company had adopted the recommendation of the Code that the tenure of an Independent Director should not exceed a cumulative term of nine (9) years. Upon completion of the nine (9) years, an Independent Director may continue to serve the Board subject to the Director's re-designation as a Non-Independent Non-Executive Director. The Board will seek shareholders' approval in the event that a Director, who has served in that capacity for more than nine (9) years, retains as an Independent Director. For a Director retained as an Independent Director after the twelfth (12) years, the Board shall seek shareholders' approval annually through a two-tier voting process as provided under the Code.

The Company does not have tenure limits for Independent Directors and the Board is of the opinion that the ability of an Independent Director to exercise his/her independence and objective judgment in Board deliberations shall not be a function of his/ her length of service as an Independent Director.

The NRC had reviewed and recommended to the Board for Dato' Seri Abdul Azim Bin Mohd Zabidi and Datuk Yap Pak Leong, who have served the Company for the tenure of more than twelfth (12) years to continue to serve as Independent Directors of the Company, subject to annual shareholders' approval through a two-tier voting process as stipulated in the Code.

1.5 Board Diversity and Senior Management Team

The Board acknowledges the importance of diverse Board and Senior Management. The Group strictly adhered to the practice of non-discrimination of any form, whether based on race, age, religion and gender throughout the organisation, which including the selection of Board members. The Board encourages a dynamic and diverse composition by nurturing suitable and potential candidates equipped with competency, skills, experience, character, time commitment, integrity and other qualities in meeting the future needs of the Company.

1.6 Board Gender Diversity

The Board acknowledges the importance of boardroom diversity and the recommendation of the Code pertaining to the establishment of a gender diversity policy.

The Board shall endeavour to reach 30% female Director target by 2020 as stated in the Board Charter and will consider appointing female Director as part of it future selection of candidates.

The Board currently comprises six (6) members, out of which one (1) is a female Director.

1.7 Board Appointment Process

The Company has in place formal and transparent procedures for the appointment of new Directors and Senior Management i.e. Board Diversity Policy. The Company strictly adhered to the practice of non-discrimination of any form, whether based on race, age, religion and gender throughout the organisation, which includes the selection of Board members. The Board encourages a dynamic and diverse composition by nurturing suitable and potential candidates equipped with competency, skills, experience, character, time commitment, integrity and other qualities in meeting the future needs of the Company.

As for the appointment of Independent Non-Executive Directors, the NRC evaluates the ability to discharge such responsibilities before making recommendation to the Board.

The Board has entrusted the NRC with the responsibility to review candidates for the Board and key Management positions and to determine remuneration packages for these appointments. The NRC is also entrusted to the nomination, selection, remuneration and succession policies for the Group.

1.8 Re-Election of Directors

Any Director appointed during the year is required under the Company's Constitution to retire and seek re-election by the shareholders at the following AGM immediately after their appointment. The Constitution also require that one-third (1/3) of the Directors including the Managing Director retire by rotation and seek re-election at each AGM and that each Director shall submit himself/herself for re-election at least once in every three (3) years. A retiring Director is eligible for re-election.

This provides an opportunity for shareholders to renew their mandates. The election of each Director is voted on separately. To assist shareholders to renew their decision, sufficient information such as personal profile, meetings attendance and the shareholdings of each Director standing for election are available in the Annual Report


2.0 Overall Board Effectiveness

2.1 Annual Evaluation

On annual basis, the relevant assessment and review forms / questionnaires in relation to the board evaluation will be circulated to all the Directors to complete in advance of the meeting of the NRC in order to collate the assessment results for the NRC's review.

The Board, through the NRC, had established criteria to ensure board composition and diversity with right mix of knowledge, skills and competency for which performance evaluation are to be based upon. The criteria adopted for the board's performance evaluation includes board mix and composition, directors' training, independence, quality of information, board proceedings, board’s roles and responsibilities and the Chairman’s roles and responsibilities. Annual board review was conducted by the NRC to assess and evaluate the board’s effectiveness base on the above criteria during the financial year.

In addition, peer review of the knowledge and skill sets of fellow directors is required to be performed by each director based on evaluation criteria established, which includes integrity, professionalism, knowledge, performance and participation during board meetings, contribution and board relationship. Peer review of directors was conducted by the NRC during the financial year.

As for the performance evaluation of board committees, the Board assesses the performance of the AC and NRC based on the recommended evaluation criteria adopts from Corporate Governance Guide issued by Bursa Securities, which includes committees' composition, contribution to the board’s decision making, expertise, appointment as well as timeliness and quality of communication and minutes. The NRC has concluded review of the performance of the board committees.

Based on the above assessments, the NRC was satisfied with the existing Board composition and was of the view that all Directors and Board Committees of the Company had discharged their responsibilities in a commendable manner and had performed competently and effectively. The Board is of the view that its present size and composition is optimal based on the Group's operations and that it reflects a fair mix of financial, technical and business experiences that are important to the stewardship of the Group.

The NRC also undertakes yearly evaluation of the performance of the CFO, whose remuneration is directly linked to performance, based on the score sheet. For this purpose, the performance evaluation for the year 2018 of the CFO was reviewed by the NRC on 25 February 2019.

2.2 Directors' Training

The Board fully supports the need for its members to continuously enhance their skills and knowledge to keep abreast with the developments in the economy, industry, technology and updates on regulations, amongst others to effectively carry out their duties and responsibilities as directors and to comply with continuous training as required by the MMLR.

All Directors have completed the Mandatory Accreditation Programme as prescribed by Bursa Securities. There were also briefings by the External Auditors and the Internal Auditors and the Company Secretary on the relevant updates on statutory and regulatory requirements from time to time during the Board meetings.

During the financial year, the Directors had attended training courses, conferences and seminars conducted by various external professionals to enhance their knowledge and expertise, and the Board will continue to evaluate and determine the training needs of its Directors on an ongoing basis. The Directors also attended various trainings conducted by their respective in-house companies and/or by external professionals. Amongst those training programmes, conferences, seminar, attended by the respective Directors are as follows:

NoContinuing Education Programme Attended Month Attended
1 Dato Seri Abdul Azim bin Zabidi
1. Corporate Governance Briefing Sessions "MCCG Reporting and CG Guide"March 2018
2. Post Commonwealth Games "Challenges of Sport in Malaysia" May 2018
3. Common Pitfalls in Transaction and RPT Rules and Managing RRPT July 2018
4. Olympic Marketing Seminar September 2018
2 Dato Sri Tiong King Sing
1. Technical Dialogue of Traffic Management and Safety on Road Diversion, JKR Bintulu.January 2018
2. Engagement Session and Dialogue on the Federal Road with the Ministry of Works, Kuala Lumpur February 2018
3. Seminar on Agricultural with the Magistrate of YunLin, Taiwan. March 2018
4. Seminar on Agriculture by National Pingtung University of Science and Technology, Taichung Taiwan. December 2018
3Datuk Yap Pak Leong
1. SSM What's new for Company Secretaries?
July 2018
2. MIA "2019 Budget Seminar"
November 2018
3. MIA "Best Practices in the Presentation of Financial Statements & Annual Reports"
December 2018
4 Madam Agnes Soei-Tin Lamey
1. SSM What's new for Company Secretaries?July 2018
2. MIA "2019 Budget Seminar"November 2018
3. Malaysian Sustainable Palm Oil Awareness TrainingDecember 2018
5Mr Loo Choo Hong
1. MIA "The Insights to Preparing Transfer Pricing Documentation"May 2018
2. Chartered Tax Institute of Malaysia "National Tax Conference 2018"July 2018
3. Chartered Tax Institute of Malaysia "2019 Budget Seminar"November 2018
6 Mr Melton Martin
1. MIA "2019 Budget Seminar"November 2018
7 Ms Yap Fook Fung (Alternate Director to Datuk Yap Pak Leong)
1. MIA "2019 Budget Seminar" November 2018

The Company will continue to identify suitable training for the Directors to equip and update themselves with the necessary knowledge in discharging their duties and responsibilities as Directors.

The Directors are encouraged to attend briefing, conferences, forums, trade fairs (locally and internationally), seminars and training to keep abreast with the latest developments in the industry and to enhance their skills and knowledge.


PART III – REMUNERATION

The NRC is responsible for developing the remuneration policy and determining the remuneration packages of the Directors so as to ensure that it attracts and retains the suitable directors to lead, control and manage the Group effectively. In the case of the CEO, the component parts of the remuneration are structured so as to link rewards to corporate and individual performance. For Non-Executive Directors, the level of remuneration is reflective of their experience and level of responsibilities.

Directors' fee and/or their remuneration are/is recommended by the Board for the approval by shareholders of the Company at the AGM.

Other than the CEO, all Directors are paid a fixed fee and receive meeting allowance for each Board Meeting they attended. The Chairman is paid at higher fee as compared to other Board members in recognition of his additional responsibilities.

The details of the remuneration of the Directors of the Group and Company, paid and payable for the financial year ended 31 December 2018 are as follows:

Fees and Allowances
RM’000
Executive Directors46.5
Non-Executive Directors295.5
TOTAL342.0

Director Fees
RM'000
Meeting Allowances
RM’000
Total
RM’000
Dato' Seri Abdul Azim Bin Zabidi (Chairman)45.010.055.0
Dato Sri Tiong King 40.56.046.5
Datuk Yap Pak Leong42.020.062.0
Madam Agnes Soei-Tin Lamey40.022.562.5
Mr Loo Choo Hong 40.015.055.0
Mr Melton Martin40.013.553.5
Ms Yap Fook Fung (Alternate Director to Datuk Yap Pak Leong)-7.57.5
TOTAL247.594.5342.0

The numbers of the Company’s Directors with total remuneration fall within the followings bands are as follows:-


Range of remuneration
Number of Directors
Executive

Non-Executive

Total
Above RM50,000-55
Below RM50,0001-1
TOTAL156

The number of top five (5) senior management whose remuneration (comprising salary, bonus, benefits in-kind and other emoluments) for the financial year ended 31 December 2018 within the successive bands of RM50,000 is as follows:



Position
Basic Salaries,
Bonus and Other Employee Benefit
RM’000

Employer Contribution (EPF)
RM’000

Total
RM’000
Datuk Pau Chiong UngChief Executive Officer507.560.9568.4
Lee Seng Choon Log Pond & Plantation Manager121.314.6135.9
William Joseph JomiuFMU Manager114.213.8128.0
Lee Yoke Wah Corporate Services Manager113.113.6126.7
Suhaili Bin SainanAssistant FMU Manager79.19.588.6
TOTAL935.2112.41,047.6

The top five (5) senior management with total remuneration fall within the successive bands are as follows:-


Remuneration BandNumber of top five (5) senior management
RM50,001 to RM100,0001
RM100,001 to RM200,0003
RM200,001 to RM300,000-
RM300,001 to RM400,000-
RM500,000 and above1


PRINCIPLE B - EFFECTIVE AUDIT AND RISK MANAGEMENT

PART I - AC

1.0 AC Composition and Chairman

The AC is made up exclusively of Independent Directors based on the recommendation of the Code and it also fulfils the requirements of the MMLR which requires the Committee to comprise no fewer than three (3) members and that all members must be Non-Executive Directors with a majority of them being Independent Directors.

The Chairman of the AC, Mr Loo Choo Hong is not the Chairman of the Board and is an Independent Director.

This is in compliance with the recommendation of the Code as well as the MMLR. The role and responsibilities of the Committee as well as their rights are set out in the Terms of Reference contained on the Company's website.

2.0 Oversight and Assessment of the Suitability and Independence of External Auditors

The Board considered the suitability and independence of the External Auditors during the discussion of the Group Audit Plan for the financial year ended 31 December 2018. The factors that take into account including the adequacy of experience and resources of the firm and professional staff assigned to the audit and the level of non-audit services to be rendered by the External Auditors to the Group for the financial year under review.

The Board is aware of the potential conflict of interest situation that may arise if the Company’s External Auditors are engaged to provide non-audit services to the Group. The External Auditors have reviewed the non-audit services provided to the Group during the year and that to the best of their knowledge, the non-audit services did not impair their independence. The Company also discloses fees received by the External Auditors for non-audit work for the financial year under review in Additional Disclosure Requirements.

AC on 25 February 2019 conducted an annual assessment of the timeliness, competence, audit quality and resource capacity of Crowe Malaysia PLT in relation to the audit, the nature and extent of the non-audit services rendered and the appropriateness of the level of fees.

The AC had also obtained assurance confirming that the External Auditors are independent in accordance with the terms of all relevant professional and regulatory requirements

3.0 Financial Reporting

The Board aims to present a balanced and meaningful assessment of the Group's position and prospects, primarily through the annual financial statements and the quarterly announcement of results.

Before the financial statements are drawn up, the Directors take the necessary steps to ensure that the Group had used all the applicable accounting policies and supported by reasonable and prudent judgements and estimates. All accounting standards which the Board considers to be applicable, have been followed, subject to any explanations and material departures disclosed in the notes to the financial statements.

4.0 Financial Literacy of the AC

The AC complies with the recommendation of the Code requiring all members to be independent and at least one member fulfils qualifications prescribed by the MMLR. There is a strong element of independence to fulfil their role objectively and provide a critical and sounding view in ensuring the integrity of financial controls and integrated reporting, and identifying and managing key risk. All members of the AC are financially literate.

5.0 Relationship with the auditors

The Board has established a transparent relationship with the Company’s External Auditors and Internal Auditors via the AC who has explicit authority to communicate directly with them. The External Auditors confirmed to the AC of their independency at each financial year and during their presentation of relevant audit Memorandum.

The External Auditors are working closely with the Internal Auditors and Tax Consultants, without compromising their independence. Their liaison with the Internal Auditors is to achieve the main objective of avoiding duplication of efforts to maximise audit effectiveness and efficiency. The External Auditors will continue to review all Internal Audit reports and discuss findings with the Internal Auditors.


PART II – Risk Management and Internal Control Framework

1.0 Risk Management and Internal Control Framework

The Board has the overall responsibility to ensure that sound and effective risk management and internal control systems are maintained, while Management is responsible for designing and implementing risk management and internal control systems to manage risks. Sound and effective systems of risk management and internal control are designed to identify and manage the risk of failure to achieve business objective.

The Board is responsible for the Group's risk management and internal control systems and for reviewing their effectiveness. The Risk Assessment Management Committee supports the Board in monitoring the Company risk exposures, the design and operating effectiveness of the underlying risk management and the internal control systems. Thereafter, the Risk Management Committee will report to the Board after due review of the effectiveness of the Group's risk management and internal control by the AC.

The risk management processes in identifying, evaluating and managing significant risks facing by the Company are embedded into the operating and business processes. These processes are undertaken by the CEO and Management in their course of work. Key matters covering the financial performance, operating, market, regulation and compliance, environment and etc. are reviewed and deliberated in the Business Risk Assessment Management Committee.

The Board has been integrating the risk issues into their decision making process whilst maintaining the flexibility to lead the business of the Group through the ever-changing internal and external environments.

The Company continues to maintain and review its internal control procedures to ensure the protection of its assets and its shareholders' investment.

Details of the main features of the Company’s risk management and internal controls framework are further elaborated in the AC Report and the Statement on Internal Control.

2.0 Internal Audit Function

The Board recognises the importance of good corporate governance and is committed to maintaining a sound system of internal controls and risk management. This includes the establishment of an appropriate control environment and risk management framework, processes and structures, and a continuous review of the adequacy and integrity of the said systems to safeguard shareholders' investment and the Group’s assets. The Board is pleased to provide the following statement, which outlines the nature and scope of risk management and internal controls of the Group during the year.


PRINCIPAL C - INTEGRITY IN CORPORATE REPORTING AND MEANINGFUL RELATIONSHIP WITH STAKEHOLDERS

PART I - COMMUNICATION WITH STAKEHOLDERS

The Company recognises the importance of effective communication with the shareholders as well as other stakeholders through timely dissemination of information. The Board is committed to ensuring that the shareholders and other stakeholders are well informed of the major developments of the Company and the information is communicated to them through the publication of the Annual Report, various timely announcements, periodic disclosures made during the financial year and the release of financial results on the quarterly basis to Bursa Securities. The Company will ensure that all quarterly financial results are announced to Bursa Securities no later than two (2) months after the end of each quarter of a financial year and that the Annual Report is released within four (4) months after the end of each financial year.

The Company has identified Datuk Yap Pak Leong as the Senior Independent Non-Executive Director to whom concerns of shareholders and other stakeholders may be conveyed.

The corporate website also serves as another channel of communication for the shareholders, the investors and the general public. Information such as announcements made to Bursa Securities as well as documents such as Board Charter, Whistleblowing Policy, and Code of Ethics and Conduct can be obtained from the corporate website at www.timwell.com.my.


PART II - CONDUCT OF GENERAL MEETING

The AGM of the Company provides the principal forum of dialogue and interaction between the Board and the shareholders. The Board presents the progress and performance of the Company in the AGM and shareholders are given the opportunity to raise questions or to seek for clarifications of pertinent and relevant information of the Company. During the meeting, the Chairman, the Board members and the external auditors are available to respond to the shareholders' queries.

The AGM of the Company will be held at a hotel which is an easily accessible location. The notices of the AGM and the Annual Report are sent out to shareholders at least twenty eight (28) days prior to the meeting so that shareholders are given sufficient time to consider the resolutions that will be discussed at the AGM.

In line with the MMLR of Bursa Securities, the Company will implement poll voting for all the resolutions set out in the notice of AGM. Each item of special business included in the notice of AGM will be accompanied by an explanation of the proposed resolutions. All shareholders or proxies will be briefed on the voting procedures prior to the poll voting by the Share Registrar. The Company will appoint scrutineers to validate the votes cast at the AGM. The outcome of resolutions tabled and passed at the AGM are released to Bursa Securities on the same meeting day.

This Corporate Governance Overview Statement was approved by the Board on 26 March 2019.


DIRECTORS' RESPONSIBILITY STATEMENT

The Directors are responsible in the preparation of the Annual Audited Financial Statements to give a true and fair view of the state of affairs, results and cash flows of the Company and of the Group at the end of the financial year.

In preparing the financial statements, the Directors will ensure that suitable accounting policies have been applied consistently, and that reasonable and prudent judgments and estimates have been made. All applicable approved accounting standards and provisions of the Companies Act 2016 have been complied with.

The Directors are also responsible for ensuring that proper accounting and other records are kept which disclose with reasonable accuracy, the financial position of the Company and of the Group and which enables them to ensure that the financial statements comply with the relevant statutory requirements.

The Directors have general responsibilities for taking such steps as are reasonably open to them to safeguard the assets of the Group, and to prevent and detect fraud and other irregularities.