CORPORATE GOVERNANCE

INTRODUCTION

The Malaysian Code on Corporate Governance 2017 (“MCCG 2017”) essentially aims to set out principles and specific recommendations on structures and processes used to direct and manage the business and affairs of Straits Inter Logistics Berhad (“Straits” or “the Company”) towards enchancing business prosperity and corporate accountability with the ultimate objective of realizing long-term shareholders’ value.

The Board of Directors (“the Board”) of the Company strives to adopt the substance behind corporate governance prescriptions and not merely the form. The Board is fully committed to maintain high standards of corporate governance by supporting and implementing the prescriptions of the principles and recommendations set out in MCCG 2017 respectively.

This Corporate Governance Overview Statement should be read together with the Company’s Corporate Governance Report for the financial year ended 31 December 2019 which is available on Bursa Malaysia website at https://www.bursamalaysia.com and at the Company’s website at https://www.straits-interlogistics.com. The Corporate Governance Report has disclosed to what extend the Company has applied the Practices set out in the MCCG 2017.

In order to provide the latest status update of the Company, this Overview Statement on Corporate Governance also includes information up to 5 May 2020.

The manner in which the corporate governance framework is applied is summarized as follows:-

1. PRINCIPLE A- Part I Board Responsibilities

Intended Outcome 1.0
Every company is headed by a Board, which assumes responsibility for the Company’s leadership and is collectively responsible for meeting the objectives and goals of the Company.

1.1 Roles & Responsibilities

The Board’s primary responsibility is to ensure the Company’s prosperity by directing and overseeing the Company’s affairs. The Board is accountable to shareholders for the performance of the Company and the Group (“Straits and its Subsidiaries”). Thus, the Board has at all times exercised their powers for the purpose they are conferred, for the benefit and best interest of the Company, shareholders and stakeholders.

The Board set the mission and vision of the Group assuring that all actions are related to and adhere to that mission. Based on the corporate mission statement, the Board determines the Company and Group’s direction, formulates strategic plans, financial objectives and significant policies for the Company and Group toward achievement of long-term success.

The Board  is responsible for oversight and overall governance of the Group to ensure that the strategic plans of the Group is implemented and accountability is monitored effectively, whilst the Management is responsible for the day-to-day operations of the business and effective implementation of the plans and goals decided by the Board.

The Group has established a Delegated Authority Limit (“DAL”) which indicates the specific powers of the Board, the Board Committees and the Group Managing Director (“Group MD”). The Management has to adhere to the DAL in carrying out its day-to-day functions.

The Board has established three (3) Board Committees to assist the Board in performing its duties and discharging its responsibilities more efficiently and effectively. They are the Nomination & Remuneration Committee (“NRC”), Board Risk & Compliance Committee (“BRCC”) and Audit Committee (“AC”).

The Board Committees operate on Terms of Reference approved by the Board and have the authority to examine pertinent issues and report back to the Board with their recommendations. The ultimate responsibility for the final decision on all matters lies with the Board.

1.2 Chairman and Group MD

The Board is chaired by YAM Dato’ Seri Tengku Baharuddin Ibni Sultan Mahmud who is primary responsible for the orderly conduct of the Board meetings and ensure effectiveness of the Board.

The positions of the Chairman and Group MD of the Company are held by two (2) different individuals and each has a clear accepted division of responsibilities to ensure a balance of power and authority, such that no one individual has unfettered powers in decision making.

The Group MD is Dato’ Sri Ho Kam Choy, who is responsible in the implementation of the Board policies, making operational decisions and monitoring the day-to-day running of the businesses, including defining the limits of Management’s responsibilities. By virtue if his position as a Board member, he also acts as the intermediary between the Board and the Senior Management Team. He also provides guidance and leadership to employees of the Company and the Group.

1.3 Qualified and Competent Company Secretaries

The Company Secretaries play an advisory role to the Board and support the Board in ensuring that all governance matters and Board procedures are followed and that applicable laws and regulations are complied with. The Board is regularly updated by the Company Secretaries on changes to the relevant statutory and regulatory requirements, particularly on areas relating to the duties and responsibilities and disclosure requirements of the Directors. The Company Secretaries also facilitate the communication of key decisions between the Board, Board Committees and Senior Management.

1.4 Access to Information and Advice

In ensuring the effectiveness of the functions of the Board, all Directors have access to all information and receive timely updates from Management in respect of matters pertaining to the Group. They may seek clarification from Management and the Company Secretaries as well as independent professional advice at the Company’s expense, if necessary, in the furtherance of their duties.

The Board is provided with comprehensive board papers on a timely manner prior to board meetings. This is to ensure and enable the members of the Board to discharge their duties and responsibilities competently in a well-informed manner.

In most instances, the Senior Management are invited to be in attendance at Board meetings to provide insight and to furnish clarification on issues that may be raised by the Board. Every Director also has unrestricted access to all information with regard to the activities of Straits Group.

Intended Outcome 2.0
There is demarcation of responsibilities between the Board, Board Committees and Management. There is clarity in the authority of the Board, its Committees and individual Directors.

2.1 Board Charter

The Board Charter is aimed at ensuring that all Board members acting on behalf of the Company are aware of their duties and responsibilities as Board members and the various legislations and regulations affecting their conduct and that the principles and practices of good corporate governance are applied in their dealings in respect, and on behalf of the Company.

The Board Charter comprises, among others, well-defined terms of reference as well as the authority limits for the Board and its Committees, and the various relevant internal process.

The Board Charter would be reviewed periodically and updated in accordance with the needs of the Company and any new regulations. Any amendments to the Board Charter shall be approved by the Board.

The Board Charter is available on the Company’s website at http://www.straits-interlogistics.com.

Intended Outcome 3.0
The Board is committed to promoting good business conduct and maintaining a healthy corporate culture that engenders integrity, transparency and fairness. The Board, Management, employees and other stakeholders are clear on what is considered acceptable behaviour and practice in the Company.

3.1 Directors’ Code of Ethics and Whistleblowing Policy

The Company has adopted the Directors’ Code of Conduct and Ethics (“Code of Ethics”) with the aims to encourage high standards of honesty, integrity, ethical and law-abiding behaviour expected of Directors as well as to foster standards to protect and promote the interests and maintain the confidence of all shareholders and stakeholders.

The Code of Ethics is published on the Company’s website at http://www.straits-interlogistics.com.

Besides that, the Board has also put in place a Whistleblowing Policy to encourage employees and others who have serious concerns about any aspect of the Company and Group including, but not limited to unethical or fraudulent practices within the Group to come forward and voice their concerns.

The purpose of a Whistleblowing Policy is to establish a system for the reporting, investigation and resolution of reportable conduct, so that, damage control or remedial action can be taken promptly.

The Whistleblowing Policy is published on the Company’s website at http://www.straits-interlogistics.com.

2. PRINCIPLE A- Part II Board Composition

Intended Outcome 4.0
Board decisions are made objectively in the best interests of the Company, taking into account diverse perspectives and insights.

4.1 Strengthen Composition of the Board

As at 5 May 2020, the Board of Straits consists of seven (7) members, of which two (2) are Independent & Non-Executive Directors (“INED”), representing 1/3 of the total Board members as per Practice 4.1 of the MCCG 2017. The composition of the Board of Directors also complies with Paragraph 15.02 of the ACE Market Listing Requirements of Bursa Malaysia Securities Berhad whereby one-third (1/3) of the Board are Independent Directors.

The Board recognises the benefit in having access to the diversity of input from people with a wide range of backgrounds, skills and experience. This is reflected in the composition of the Board. The current Board composition is of optimal size and with the appropriate balance of skills, knowledge, experience, independence and diversity to enable it to discharge its duties and responsibilities effectively. The composition and size of the Board is assessed and reviewed from time to time to ensure its appropriateness with the needs of the Company and the Group.

The INEDs, all of whom are persons of high caliber and integrity, play important roles by exercising independent judgement and objective participation in the proceedings and decision-making processes of the Board. The presence of INEDs fulfills a pivotal role in corporate accountability to ensure that the interests of minority shareholders are properly safeguarded.

The Non-Executive Directors of the Company are not involved in the day-to-day management of the Group and have the range of skills and experience which enable them to oversee business performance and provide constructive opinion, advise and judgement to ensure the interests of the Group, shareholders, employees, customers and other stakeholders in which the Group conducts its businesses are well represented and taken into account.

The profile of each member of the current Board is set out in the Directors’ Profile of this Annual Report.

4.2. Tenure of an Independent Director

Independent Directors play an important role in improving corporate credibility and governance standards functioning.

During the financial year under review, none of the Independent Directors of Straits has exceeded the tenure of a cumulative term of nine (9) years in the Company.

However, the Board recognises that shareholders are increasingly concerned about the potential negative impact of long tenure Independent Directors due to familiarity and close relationship with the Board and Management. Bearing this in mind, the Board applies Practice 4.3 to lay down a policy in its Board Charter to limit the tenure of its Independent Directors to nine (9) years.

Upon completion of the nine (9) years, an Independent Director may continue to serve on the Board subject to the director’s re-designation as a Non-Independent Director. If the Board desires to retain them beyond nine (9) years, upon recommendation of the Nomination and Remuneration Committee, the Board should justify and seek annual shareholders’ approval.

4.3 Board Diversity

The Board takes appropriate measures to ensure that boardroom diversity is considered as part of its selection and recruitment exercise. However, the merits of the individual and knowledge and expertise relevant to the Company will be the main criteria when considering the selection of new candidates to the Board and/or senior management team.

Although currently, the Company does not have a formalised Board Diversity Policy or Gender Diversity Policy, the Board always taken into account diversity as one of the selection criteria. The Group is an equal opportunity employer and all appointments to the Board and employment of senior management are based on objective criteria, merit, skills and experience, and may not be driven by any age, cultural background or gender considerations.

The Board takes note of the MCCG 2017 with regard to Board gender diversity. The Group currently has one (1) female Director on the Board.

4.4. Time Commitment of the Directors

The Board conducts at least four (4) scheduled meetings annually, with special meetings convened as warranted by specific circumstances. Board meetings are also supplemented by resolutions circulated to the Directors for decision between the scheduled meetings.

The Board is satisfied with the level of time commitment given by the Directors towards fulfilling their roles and responsibilities. All Directors have given their full commitment to the Board meeting by attending all of the Board meetings held during the FYE 31 December 2019, which are evident based on the attendance record set out in the table below. During the FYE 31 December 2019, the Board met
nine (9) times.

All Directors do not hold more than 5 directorships as required under Rule 15.06 of the Listing Requirements.

The attendace of all the Directors at Board meetings held during the financial year ended 31 December 2019 surpassed the minimum requirements stipulated under the ACE Market Listing Requirement.

4.5. Continuing Education and Training of Directors

Paragraph 15.08 of the Listing requirements of Bursa Securities requires Directors to undertake continuous professional development programs to keep themselves abreast with the changing business environment, regulatory and corporate governance.

Directors were encouraged to continually update their skills and knowledge of the business and to actively participate on continuous professional development programs, so that, the Board is equipped to meet the fast changing competitive business environment and technological changes.

Some of the training/courses attended by the Directors up to date of this Annual Report are as follows:

In addition, the Directors were briefed at Board meetings and Audit Committee meetings on any updates or changes to the relevant guidelines o the regulatory and statutory requirement by the Company Secretary, Internal Auditors and External Auditors.

The Directors are also notified of any corporate announcement released to Bursa Securities and the impending restriction in dealing with the securities of the Company prior to the announcement of financial results or corporate proposals. Directors are also expected to observe insider trading laws at all times when dealing with securities within the permitted trading period.

Intended Outcome 5.0
Stakeholders are able to form an opinion on the overall effectiveness of the Board and individual Directors.

5.1 Nomination and Remuneration Committee (“NRC”)

The NRC comprises the following members: –

Chairman : Ho Fook Meng
Independent & Non-Executive Director

Member : Leong Fook Heng
Independent & Non-Executive Director

Member : Tan Sri Mohd Bakri Bin Mohd Zinin
Non-Independent & Non-Executive Director

All members of NRC are Non-Executive Directors (“NED”).

The NRC is empowered by the Board to amongst others, identify and recommend to the Board suitable candidates for appointment to the Board and Board Committees, re-election and re-appointment of Directors, and review the independence of independent Directors as well as considering the Board’s succession planning and training programme.

The NRC shall evaluate candidates on the aspect of their:

  • Integrity, Commitment and Ethics
  • Skills, Knowledge, Expertise and Experiences
  • Judgement and Decision Making
  • Professionalism
  • For position of independent non-executive director, the candidates’ abilities to discharge such responsibilities/functions independently as expected from the independent non-executive director;

The NRC also recommends to the Board the policy framework on terms of employment and on all elements of the remuneration of Executive Directors and is authorised to review the following:-

  • Annual salary increments and bonuses of Executive Directors.
  • NEDs’ fees and meeting allowances and thereupon recommends to the Board for approval.

In its deliberation, NRC will take into consideration industry practices and norms in compensation in addition to the Company’s relative performance to the industry and performance of the individual Directors. No Directors will be involved in deciding his or her own remuneration.

The remuneration package for each individual Executive Director is structured to reflect his experience, performance and scope of responsibilities.

The remuneration of Independent & Non-Executive Directors is in the form of Directors’ Fees which reflects the diverse experience, skill sets and the level of responsibilities expected of the Independent & Non-Executive Directors.

A summary of the activities undertaken by the NRC in the discharge of its duty for the financial year ended 31 December 2019 up to 5 May 2020 are as follows:

  1. Reviewed and recommended Directors’ Fees and benefits payable to Non-Executive Directors to the Board for recommendation and approval at the forthcoming AGM
  2. The Independent Directors’ Self-Assessment
  3. Reviewed and deliberated on Board and Board Committees evaluation forms and recommended to the Board for approval
  4. Reviewed and recommended the re-election of Directors at the forthcoming AGM

5.2 Board Effectiveness Evaluation (“BEE”)

The Board has established formal assessment processes for evaluation of its performance and the performance of its committee and individual directors. These assessment processes comprise Board Assessment, Board Skills Matrix, Individual Directors Assessment, Board Committee Self and Peer Assessment, and Assessment of Independence of Independent Directors are overseeing by NRC. Based on this assessment, the Board was satisfied with the overall performance of individual Director, Board and Board Committees for the financial year under review.

A Director who is subject to re-election and/or re-appointment at an AGM is assessed by the NRC before a recommendation is made to the Board and shareholders.

The NRC (save for the members who abstained from deliberations on their own re-election) recommended to the Board that the following Directors who are due to retire pursuant to the Company’s Constitution be proposed for re-election at the forthcoming AGM:

  1. Dato’ Sri Ho Kam Choy
  2. Mr Leong Fook Heng
  3. YAM Dato’ Seri Tengku Baharuddin Ibni Sultan Mahmud
  4. Puan Harison Binti Yusoff

The Board (save for the members who abstained from deliberations on their own re-election) supported the NRC’s recommendations.

3. PRINCIPLE A- Part III Remuneration - Level and Composition of Remuneration

Intended Outcome 6.0
The level and composition of remuneration of Directors and Senior Management take into account the Company’s desire to attract and retain the right talent in the Board and Senior Management to drive the Company’s long-term objectives.

Remuneration policies and decisions are made through a transparent and independent process.

6.1 Remuneration policy

The NRC and Board are mindful of the need to remunerate and retain its Directors to ensure that their commitment remain and therefore their remuneration package is directly linked to their performance, service, seniority, experience and scope of responsibilities.

The NRC is responsible to establish, recommend and constantly review a formal and transparent remuneration policy framework and terms of employment for the Board to attract and retain directors which should be aligned with the business strategy and long-term objectives of the Group taking into consideration that the remuneration of the Board should reflect the Board’s responsibilities, expertise and complexity of the Group’s activities.

The Directors are satisfied that the current level of remuneration is in line with the responsibilities expected.

In recommending the proposed Directors’ Fee, the NRC takes into consideration the qualification, duty and responsibility, and contribution required from a Director in view of the Group’s complexity, and is guided by market norms and industry practices.

The Company will be seeking the shareholders’ approval for the Directors’ Fees and benefits payable to Directors for the period from the forthcoming AGM until the next AGM in 2021, for the purpose of facilitating payment of Directors’ Fees on a quarterly basis and/or as and when incurred.

Intended Outcome 7.0
Stakeholders are able to assess whether the remuneration of Directors and Senior Management commensurate with their individual performance, taking into consideration the Company’s performance.

7.1 Remuneration of Directors and Senior Management

1) The Board applies Practice 7.1 of the MCCG 2017 to disclose Directors’ remuneration on named basis for individual Directors with detailed remuneration breakdown. The remunerations received or receivable by the Directors in respect of the financial year ended 31 December 2019 are disclosed below:

COMPANY

Non-Executive Directors

Managing Director and Executive Director

GROUP

Non-Executive Directors

Managing Director and Executive Director

2) With the best interest of the Group in mind, and taking into consideration the sensitivity, privacy, security, issue of staff pinching, the Board has opted not to disclose on a named basis the remuneration of their key senior management. Instead, the Board discloses the key senior management’s remuneration on an aggregate basis for the financial year ended 31 December 2019, as follows:

4. PRINCIPLE B- Part I Effective Audit & Risk Management

Intended Outcome 8.0
There is an effective and independent AC.

The Board is able to objectively review the AC’s findings and recommendations. The Company’s financial statement is a reliable source of information.

8.1 Audit Committee

The AC comprises three (3) members, majority of whom are Independent & Non-Executive Directors (“INED”) and assists the Board to fulfill its corporate governance and oversight responsibilities in relation to financial reporting, internal control system, risk management system and internal and external audit functions. The AC carries out its functions and duties in accordance with its Terms of Reference (“TOR”).

The AC is chaired by Leong Fook Heng, who is an INED, while the Chairman of the Board is YAM Dato’ Seri Tengku Baharuddin Ibni Sultan Mahmud, a Non-Independent & Non-Executive Chairman. The Company complied with Practice 8.1 of the MCCG 2017 which stipulated that the Chairman of the AC is not the Chairman of the Board.

All members of the AC are financially literate and able to perform their duties and discharge their responsibilities, including the financial reporting process, as spelt out in the TOR of the AC which is available on the Company’s website at http://www.straits-interlogistics.com.

The AC will undertake an annual assessment on the performance of internal and external auditors, including the suitability and independence of the auditors. Both the internal and external auditors are independent.

The AC has not adopted a policy that requires a former key audit partner to observe a cooling-off period of at least two (2) years before being appointed as a member of the AC.

However, none of the AC members were former key audit partners and in order to uphold the utmost independence, the Board has no intention to appoint any former key audit partner as a member of the AC.

The summary of the activities of the AC during the financial year are set out in the Report of the AC on pages 21 to 24 of this Annual Report.

5. PRINCIPLE B- Part II Risk Management and Internal Control Framework

Intended Outcome 9.0
Company makes informed decisions about the level of risk they want to take and implement necessary controls to pursue their objectives.

The Board is provided with reasonable assurance that adverse impact arising from a foreseeable future event or situation on the Company’s objectives is mitigated and managed.

9.1 The Board acknowledges that risk management and internal control are an integral part of good management practice. The Board has establish a Risk Management Framework which provides key principles and concepts and a clear direction and guidance on risk management to give assertion on the state of risks ad controls, with the objective to protect the interest of shareholders and stakeholders and achieve the Group’s business objectives.

However, the Board recognises that such system is structured to manage rather than eliminate the possibility of encountering risk of failure to achieve corporate objectives.

The Board through the Board Risk & Compliance Committee (“BRCC”) which comprises all Non-Executive Directors, reviews the key risks identified to ensure proper management and mitigation of risks and report to the Board as and when needed.

The Composition of the BRCC is set out on page 40 of this Annual Report

The TOR of the BRCC can be found in the Company’s website at http://www.straits-interlogistics.com.

An Overview of the state of internal controls and risk management within the Group is spelled out in this Annual Report under the Statement on Risk Management and Internal Control (“SORMIC”) on pages 40 to 43 of this Annual Report.

Intended Outcome 10.0
Company has an effective governance, risk management and internal control framework and stakeholders are able to assess the effectiveness of such framework.

10.1 To assist the Board in maintaining a sound system of internal control for the purposes of safeguarding shareholders’ investment and the Group’s assets, the Group outsourced its internal audit function to an independent internal audit service provider i.e NGL Tricor Governance Sdn. Bhd. (“NGL”).

The outsourced Internal Auditors (“IA”) reports to AC and provides the Board with much assurance it requires regarding the adequacy and integrity of the system of internal control.

During the financial year ended 31 December 2019, the AC had reviewed and assessed the adequacy of the scope, functions, competency and resources of the outsourced IA and that they have the necessary authority to carry out their work.

10.2 The outsourced internal audit function is headed by Mr. Chang Ming Chew, a Director of NGL. Mr. Chang is a Certified Internal Auditor and holds a Certification in Risk Management Assurance from the Institute of Internal Auditors; professional member of the Institute of Internal Auditors Malaysia; member of the Association of Chartered Certified Accountants (UK); and member with the Malaysian Institute of Accountants (“MIA”).

All the internal audit personnel involved are free from any relationships or conflicts of interest, which could impair their objectivity and independence. All the internal audit personnel are guided by International Professional Practices Framework(“IPPF”) issued by The Institute of Internal Auditors Malaysia in carrying out the Internal Audit Function.

6. PRINCIPLE C- Part I Effective Audit & Risk Management

Intended Outcome 11.0
There is continuous communication between the Company and Stakeholders to facilitate mutual understanding of each other’s objectives and expectations.

Stakeholders are able to make informed decisions with respect to the business of the Company, its policies on governance, the environment and social responsibility.

11.1 Communication with Stakeholders

The Board acknowledges the importance of ensuring prompt dissemination of information to shareholders and regulatory bodies with the intention of giving as clear and complete information of the Group’s position and financial performance as possible within the boundaries of practicality and legal and regulatory framework governing the release of material and price sensitive information.

The Group’s financial performance, major corporate developments and other relevant information are promptly disseminated to both retail and institutional shareholders and investors via announcement of its quarterly results, Annual Report, announcement to Bursa Securities and press conferences.

Further updates of the Group’s activities and business operations are also disseminated to shareholders and investors through dialogues with analysts and fund managers, investor relations roadshows and the media. Corporate presentations and announcements are available on the Company’s corporate website.

Corporate Disclosure Policy

The Board has ensured timely disclosure of material information pertaining to the Group’s performance and operations to the public, in accordance with the disclosure requirements under the ACE Listing Requirement and other applicable laws. It has formalised a written Corporate Disclosure Policy for the Group, a copy of which is available in the Company’s website at http://www.straits-interlogistics.com.

7. PRINCIPLE C- Part II Conduct of General Meetings

Intended Outcome 12.0
Shareholders are able to participate, engage the Board and Senior Management effectively and make informed voting decisions at General Meetings.

12.1 Shareholder Participation at General Meetings

The AGM remains the principal forum for dialogue with shareholders as it affords them the opportunity to raise questions and seek clarifications on the Group’s operations, performance, strategies and latest developments.

Notices of Annual General Meeting (“AGM”) and Extraordinary General Meetings (“EGM”) of the Group and related papers are sent out to shareholders within a reasonable and sufficient time frame in accordance with the Company’s Constitution. Adequate time is given during AGM and EGM to allow shareholders to seek clarifications or ask questions on pertinent and relevant matters. The results of all the resolutions set out in the Notice of AGM and EGM were announced on the same day via Bursa Link which is accessible on the website of the Company and Bursa Malaysia Securities Berhad.

Senior Management and the Group’s External Auditors as well as the Company’s advisers are also available to respond to shareholders’ questions during the AGM/EGM as the case may be.

Shareholders who are unable to attend the AGM are allowed to appoint up to two (2) proxies to attend, participate, speak and vote on their behalf. In line with good corporate governance practices, the notice of the AGM was circulated at least twenty-eight (28) days before the date of AGM to enable shareholders to make the necessary arrangements to attend the AGM and the said notice will also be advertised in a nationally circulated English or Bahasa Malaysia newspaper.

Poll voting

Pursuant to Bursa Malaysia ACE Market Listing Requirements, any resolution set out in the notice of any general meeting, or in any notice of resolution which may properly be moved and is intended to be moved at any general meeting, must be voted by poll. Hence, voting for all the resolutions as set out in the forthcoming and future general meetings will be conducted as such. An Independent scrutineer will be appointed to validate the votes cast at the general meetings.

The Company had conducted the voting on all resolutions tabled during its EGM and AGM held on 28 January 2019 and 19 June 2019 respectively by poll accordingly.

This Corporate Governance Overview Statement together with the Corporate Governance Report were approved by the Board on 5 May 2020.

The Directors are responsible to ensure that the financial statements of the Company and the Group are properly drawn up in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act, 2016 in Malaysia (“the Act”), so as to give a true and fair view of the state of affairs of the Company and the Group as at the end of the financial year and of the financial performance and cash flows of the Company and the Group for the financial year then ended.

In preparing the financial statements, the Directors have:

i.   Adopted appropriate accounting policies and applied them consistently;

ii.  Made judgements and estimates that are reasonable and prudent; and

iii. Adhered to all applicable approved accounting standards in Malaysia.

The Statement by the Directors pursuant to Section 251 (2) of the Act is set out in the section headed “Statement by Directors” of the Directors’ Report enclosed with the Group’s consolidated Annual Audited Financial Statements for the financial year ended 31 December 2019.

This statement is made in accordance with a resolution of the Board of Directors dated 5 May 2020.