Board Charter – Harbour-Link Group

1. INTRODUCTION

The Directors of HARBOUR-LINK GROUP BERHAD (“Harbour-Link” or “the Company”) regard Corporate Governance as vitally important to the success of Harbour-Link’s business and are unreservedly committed to applying the principles necessary to ensure that the following principles of good governance are practised in all of its business dealings in respect of its shareholders and relevant stakeholders:-

The Board is the focal point of the Company’s Corporate Governance system. It is ultimately accountable and responsible for the performance and affairs of the Company.
All Board members are expected to act in a professional manner, thereby upholding the core values of integrity and enterprise with due regard to their fiduciary duties and responsibilities.
All Board members are responsible to the Company for achieving a high level of good governance.
This Board Charter shall continue and form an integral part of each Director’s duties and responsibilities.

This Board Charter is not a total document and should be read as an expression of principle for optimising corporate performance and accountability. The Board will review and update (if necessary) the Board Charter on an annual basis.

2. OBJECTIVES

The objectives of this Board Charter are to ensure 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 all their dealings in respect and on behalf of the Company.

In pursuit of the ideals in this Board Charter, the intention is to exceed “minimum legal requirements” with due consideration to recognised standards of best practices locally and internationally.

3. THE BOARD

3.1 Role

Broadly, all directors owe fiduciary duties to the Company and must exercise reasonable care, skill and diligence in the best interest of the Company in discharging its following principal responsibilities: –

3.1.1 The Board is in charged of leading and managing the Company in an effective and responsible manner. Each Director has a legal duty to act in the best interest of the Company. The Directors, collectively and individually, are aware of their responsibilities to shareholders and Stakeholders for the manner in which the affairs of the Group are managed.

3.1.2 Board meetings are held on quarterly basis, as determined annually in advance by the Board. Members of the management who are not Directors may be invited to attend and speak at meetings on matter relating to their sphere of responsibilities. An additional Board meeting can be convened by the Company Secretary at the request of any Director at any time. Physical attendance of Board members at meetings is preferred. But the Board and Board Committees may hold meetings at two or more venues using any technology (for example: tele-conferencing) that gives all members of the Board or the relevant Board Committee a reasonable opportunity to participate in the meeting.

3.1.3 Duties of the Board include establishing the corporate vision and mission, as well as the philosophy of the Company, setting the aims of the management and monitoring the performance of the management.

3.1.4 The Board assumes the following specific duties:-

(a) To review and adopt the Harbour-Link’s strategic plans to ensure that resources are available to meet the growth of the Group;

(b) To oversee the conduct of the Group’s business and to evaluate whether the business is being properly managed;

(d) To review budgetary control and conformance strategies;

(e) To identify principal risks and to ensure the implementation of appropriate systems that encourage enhancement of effectiveness in Board and management;

(f) To keep pace with the modern risks of business and other aspects of governance that encourage enhancement of effectiveness in Board and management;

(g) Be accountable to the shareholders to ensure the Group has appropriate corporate governance that operates efficiently and transparently;

(h) Establishing a succession plan;

(i) To review and approve annual reports to the shareholders; and

(j) To review the adequacy and integrity of the Group’s internal control systems and management information systems, including systems for compliance with applicable laws, regulations, rules, directives and guidelines.

The Board’s role includes, but not limited to the following matters. The Board may choose to delegate some of these responsibilities to one or more of its Board Committees. This delegation of responsibilities will be reflected in the terms of reference of the Board Committees.

3.2 Board Structure

3.2.1 The Regulations governing the management of Harbour-Link are found in the Company’s Constitution which stipulates among others, the appointment and number of Directors, the election of a Chairman of the Board; who will preside at all Board meetings, the appointment of CEO/Managing Director and rotation of Directors, etc.

3.2.2 Although the Board is made up of a variety of Directors with different roles and responsibilities, there is no distinction in their accountabilities to the Company.

3.3 Composition and Board Balance

3.3.1 The number of Directors shall not be less than 2 and not more than 9 unless otherwise determined by a General Meeting, as stipulated in Article 84 of the Company’s Constitution.

Pursuant to the Company’s Constitution, one-third (1/3) of the Directors or the number nearest to one-third (1/3) shall retire from office at each Annual General Meeting, provided always that all Directors shall retire from office at least once every three (3) years. A retiring Director is eligible for re-appointment. Any new or additional Director appointed by the Board during the year shall hold office until the next Annual General Meeting and shall then be eligible for re-election. The election of each Director is voted separately.

In the event of any vacancy which resulting in the non-compliance of Bursa Malaysia Securities Berhad Main Market Listing Requirements, the Company shall fill in the vacancy within three (3) months.

Board of Directors of Harbour-Link

Name	Designation
Dato Yong Piaw Soon	Group Managing Director
Dato’ Toh Guan Seng	Executive Director
Wong Siong Seh	Executive Director
Datuk Pau Chiong Ung	Independent Non-Executive Director
Bin Lay Thiam	Independent Non-Executive Director
Khoi Hoay Ling	Independent Non-Executive Director

3.3.2 The Board acknowledges the importance of board diversity, including gender, age and ethnicity diversity, to the effective functioning of the Board. Female representation will be considered when vacancy arises and suitable candidates are identified, underpinned by the overriding primary aim of selecting the best candidate to support the achievement of the Company’s strategic objectives.

3.3.3 The Board is the Company’s decision-making body. It is therefore imperative that the Board should be sized in a manner most effective to facilitate decision-makings and deliberation processes.

3.3.4 The Board comprises Directors who as a group provides core competencies such as accounting or finance, business or management experience, industry knowledge, strategic planning experience and customer-based experience or knowledge.

3.3.5 A strong and independent element on the Board should be present to exercise independent objective judgment on the corporate affairs of the Company. No individual or small group of individuals should be allowed to dominate the Board’s decision-making process.

3.3.6 In addition to ensuring the existence of an independent element, consideration is given to the characteristics of each Board member such as business acumen, skills, business background and experience, forming the dynamics of the Board. The tenure of an independent director should not exceed a cumulative term of 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 non-independent Director. Subject to obtaining the approval of the Company’s shareholders, the Board may recommend and provide strong justification in the event it retains an independent Director who has served a cumulative term of nine (9) years as an independent Director of the Company.

3.3.7 If the Board continues to retain the independent Director after the twelfth year, the Board should provide justification and seek annual members’ approval through a two-tier voting process.

3.3.8 Profiles of Board members are included in the Annual Report of the Company.

3.4 Appointments

3.4.1 The appointment of a new Director is a matter for consideration and decision by all members of the Board upon appropriate recommendation from the Nomination Committee (“NC”). In making these recommendations, the NC will consider the required mix of skills, experience and diversity, including gender, where appropriate, which the Director bring to the Board.

3.4.2 The Company Secretary has the responsibility of ensuring that relevant procedures relating to the appointments of new Directors are properly executed.

3.4.3 The Company has adopted educational/training programmes to update the Board in relation to new developments pertaining to the laws and regulations and changing commercial risks which may affect the Board and/or the Company.

3.4.4 In addition to the Mandatory Accredited Programme (MAP) as required by the Bursa Malaysia Securities Berhad, Board members are also encouraged to attend training programmes conducted by highly competent professionals and which are relevant to the Company’s operations and business. The Board will assess the training needs of the Directors and disclose in the Annual Report the trainings attended by the Directors.

3.4.5 The directorships held by any Board member at any one time shall not exceed five (5) in listed companies.

3.5 Re-election/Re-appointment

3.5.1 1/3 of Directors are subject to retirement by rotation yearly or at the interval of every 3 years.

3.6 Supply of Information

3.6.1 The Company aims to provide all Directors with timely and quality information and in a form and manner appropriate for them to discharge their duties effectively.

3.6.2 The management is responsible for providing the Board with the required information in an appropriate and timely manner. The Group Managing Director assesses the type of information required to be provided to the Board. If the information provided by the management is insufficient, the Board will make further enquiries where necessary to which the persons responsible will respond as fully and promptly as possible.

3.6.3 A full agenda and comprehensive Board papers are circulated to all Directors well in advance of each Board meeting.

3.6.4 Amongst others, the Board papers include the following:-

(a) Quarterly financial report of the Company;

(b) Minutes of meetings of all Committees of the Board;

(d) Reports on Related Party Transactions;

(e) Directors’ share-dealings; and

(f) Annual Management Plans/Budget reports.

3.6.5 Minutes of each Board meeting are kept by the Company Secretary and are available for inspection by any Director during office hours.

3.7 Types of Directors

3.7.1 Independent Director

An “independent” director is one who does not have a relationship with the Company, its related Companies or its officers, that could interfere, or be reasonably perceived to interfere, with the exercise of the Director’s independent business judgment.

The Listing Requirements of Bursa Malaysia Securities Berhad prescribes strict guidelines for the classification of “independent directors”, signalling the importance of independent judgment within the Board of public listed companies.

3.7.2 Executive Director

A director who is employed full-time to run the Company’s business and is involved in its management activities is typically known as Executive Directors. They are therefore not independent to the Board. Examples of different categories of Executive Directors are:-

(a) Executive Director; and

(b) CEO/MD.

3.7.3 Non-Executive Director

Although the Non-Executive Director is present at the Board of the Company, he is not involved in the day-to-day running of business nor the managing of the business generally. He would therefore, normally not be in the office.

Nevertheless, Non-Executive Directors, together with the Executive Directors, play a part in:-

constructively challenging and helping develop on the Company’s strategy; and
reviewing and monitoring the performance of management.

Note: A Non-Executive Director may not necessarily be an independent director.

4. NON-EXECUTIVE CHAIRMAN AND GROUP MANAGING DIRECTOR (MD)

The Company aims to ensure a balance of power and authority between the Non-Executive Chairman and the Group MD with a clear division of responsibility between the running of the Board and the Company’s business respectively. The positions of Independent Non-Executive Chairman and Group MD are separated and clearly defined.

4.1 Independent Non-Executive Chairman

The Independent Non-Executive Chairman is responsible for leadership of the Board in ensuring the effectiveness of all aspects of his role. Decisions of the Board are made collectively during Board meetings. In order to ensure that meetings are properly facilitated, and the Board properly led, the Chairman plays a crucial and pivotal leadership role in ensuring that the Board works effectively. Additionally, the Chairman of the Board is usually the presiding Chairman during General Meetings of the Company.

Chairman of the Board endeavours to create an environment which promotes constructive deliberations leading to effective contributions by each Board member during Board meetings. Further, the Chairman must be able to manage personal conflicts and help to focus the Board on what really matters as oppose to simply ploughing through the agenda.

The Chairman is responsible for the following:-

(a) Provide leadership and run the Board effectively with the assistance of the Board Committees and management;

(b) Ensure the whole Board plays a full and constructive part in developing and determining the Group’s strategy and overall business and commercial objectives;

(d) Review the performances of individual Directors;

(e) Supply vision of the Group;

(f) Setting the Board meeting agenda for consideration, giving emphasis on important issues challenged by the Group with emphasis on strategic, rather than operational issues;

(g) Chairing of general meetings and Board meetings;

(h) Act as the Group’s representative in its dealing with external parties;

(i) Help guide the Group on long term strategic opportunities and represent the Group with key industry, civic and philanthropic constituents; and

(j) Promote the highest standards of integrity, probity and corporate governance in the Group.

4.2 Group MD

Group MD is responsible to the Board for the day-to-day management of the Company and for fulfilling all policy matters set by the Board. These are expounded below.

Group MD leads the management team. The Board holds the Group MD accountable for the performance of the management team.

The key roles of the Group MD are:-

(a) Manage the Group’s business and ensure that operational planning and control systems are in place;

(b) Accountable and responsible for the Group’s operations and financial performance;

(d) Prepare and implement strategic plans;

(e) Submit and implement acquisition/investment proposals;

(f) Develop an organizational structure with the necessary succession planning;

(g) Promote communications internally and externally for the Group as the chief communicator by monitoring the goals, visions, missions and challenges;

(h) Maintain a friendly environment and develop organization culture, values and reputation in its markets;

(i) Have a good corporate social responsibility program for shareholders, staff, customers, suppliers, partners and regulatory/official bodies;

(j) Ensure the executive team implements the decisions of the Board and its Committees;

(k) Assist the Chairman in drawing up the agenda for Board meetings by providing input in relation to important strategic issues facing the business;

(l) Highlight and update to the Chairman on complex and sensitive issues that might affect the Company and/or Group and maintaining a consistent dialogue with the Chairman of the Board; and

(m) To lead the group to meet its vision & mission.

5. BOARD COMMITTEES

5.1 To assist the Board in fulfilling its duties and responsibilities, the Board has established the following Committees:-

(a) Audit and Risk Management Committee;

(b) Nomination Committee; and

5.2 Most of the Committees have Terms of Reference which have been approved by the Board and are available for reference at the Company’s website at https://www.harbour.com.my. The Chairman of the respective Committees reports to the Board on the outcome of the Committee meetings and such reports or minutes will be included in the Board papers.

5.3 The Board can establish ad hoc Committees.

6. GENERAL MEETINGS

6.1 Annual General Meeting (AGM)

6.1.1 The Company regards the AGM as an important event in the corporate calendar of which all Directors and key senior executives should attend.

6.1.2 The Company regards the AGM as the principal forum for dialogue with shareholders and aims to ensure that the AGM provides an important opportunity for effective communication with, and constructive feedback from, the Company’s shareholders.

6.1.3 The Chairman encourages active participation by the shareholders during the AGM.

6.1.4 The Chairman and, where appropriate, the CEO/MD responds to shareholders’ queries during the meeting. Where necessary, the Chairman will undertake to provide a written answer to any significant question that cannot be readily answered at the meeting.

6.2 Extraordinary General Meeting (EGM)

The Directors will consider requisitions by shareholders to convene an EGM or any other urgent matters requiring immediate attention of the Company.

7. INVESTOR RELATIONS AND SHAREHOLDER COMMUNICATION

7.1 The Board acknowledges the need for shareholders to be informed of all material business matters affecting the Company and as such adopts an open and transparent policy in respect of its relationship with its shareholders and investors.

7.2 The Board ensures the timely release of financial results on a quarterly basis to provide shareholders with an overview of the Company’s performance and operations in addition to the various announcements made during the year.

7.3 All relevant announcements and/or press releases must be approved by GMD prior release to Bursa Malaysia Securities Berhad and/or the media.

7.4 The Company’s website provides easy access to corporate information pertaining to the Company and its activities and is continuously updated.

8. COMPANY SECRETARY

8.1 The Board appoints the Company Secretary, who plays an important advisory role, and ensures that the Company Secretary fulfils the functions for which he/she has been appointed.

8.2 The Company Secretary is accountable to the Board through the Group MD on all governance matters.

8.3 The Company Secretary is a central source of information and advice to the Board and its Committees on issues relating to compliance with laws, rules, procedures and regulations affecting the Company.

8.4 The Company Secretary should advise Directors of their obligations to adhere to matters relating to:-

(a) Disclosure of interest in securities;

(b) Disclosure of any conflict of interest in a transaction involving the Company;

(d) Restrictions on disclosure of price-sensitive information.

8.5 The Company Secretary must keep abreast of, and inform, the Board of current governance practices.

8.6 The Board members have unlimited access to the professional advice and services of the Company Secretary.

9. REVIEW OF BOARD CHARTER

The Board shall review this Charter and may from time to time amend it as it deems appropriate to reflect the changing legal, regulatory and ethical standards.

This Board Charter is reviewed on 25 November 2019.