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by a Chairman who is sanctioned by the shareholders and
who will act in the best interests of the shareholders as a
whole. He exercises independent and broad judgment as
well as provides independent opinions and constructive
views on proposals from the Management. As the Chairman
is representing JCorp which has substantial interest in the
Company, he is well placed to act on behalf of shareholders
and in their best interests.
The Independent Non-Executive Directors do not engage in
any business dealings or other relationships and the day-to-
day management of the Company. Hence, they are capable of
exercising independent judgment and act in the best interests
of the Company and its shareholders. All Independent Non-
Executive Directors are qualified professionals in their
respective fields and carry with them vast industry experience
along with subject matter expertise in medical, legal,
accounting and business management.
The current Board composition complies with Paragraph
15.02 of the Main Market Listing Requirements of Bursa
Malaysia Securities Berhad (Main LR), as five (5) out of
eleven (11) are Independent Directors, and fulfills the criteria
of independence as defined under paragraph 1.01 of the
Main LR. The high number of of Independent Non-Executive
Directors further provides for effective checks and balances
in the functioning of the Board.
Although all the Directors have equal responsibilities for
the Group’s operations, the role of these Independent Non-
Executive Directors is particularly important in ensuring that all
business strategies proposed by the executive management
are fully and independently discussed and assessed, and take
into account the long term interest, not only of shareholders,
but also employees, customers, suppliers, and the many
communities in which the Group operate.
Board Duties and Responsibilities
In discharging their duties and responsibilities, the Board
ensures that all decisions made are in the best interests
of the Company and stakeholders. As prescribed by the
MCCG 2012, the Board assumes the principals stewardship
responsibilities as the following:
•
Review and adopt the business strategic plans
for the Group
The strategic and business plan for the period 2013 –
2017 was tabled, discussed and approved by the Board
at its meeting on 29 November 2012. Additionally, on
an ongoing basis as need arises, the Board will assess
whether projects, purchases and sale of equity as well
as other strategic consideration being proposed at Board
meetings during the year are in line with the objectives
and broad outline of the adopted strategic plans.
Statement on Corporate Governance
(Pursuant to Section 15.26 of the Bursa Malaysia Listing Requirements)
63
• Oversee the conduct of the company’s business to evaluate whether
the business is being properly manage
The Board is responsible to oversee and review the Group’s annual budget,
operational and financial performance on a periodic basis against the budget.
At Board meetings, all operational matters will be discussed and appropriate
consultation will be sought if necessary. Where and when available, the
performance of the Group will be benchmarked and compared against the
performance of its competitors.
• Identify and manage principal risks and ensure the implementation of
appropriate systems to manage these risks
Various committees in relation to clinical and professional risk were set up
under the Medical Advisory Committee and the functions of each committee
are disclosed in pages 83 to 91. Building Committee was formed to oversee the
risks involving projects and development of new hospitals.
• Succession planning, including appointing, training and fixing the
compensation of, and where appropriate, replacing senior management
The Board will deliberate on the latest plans and actions taken in respect of the
succession planning as provided by the Group Talent Management Services.
More importantly, after several years of continuous efforts in emphasizing and
communicating the importance of succession planning, the subject has now
become an ongoing agenda being reviewed and discussed at various high-level
management and operational meetings of the Group. An overview of the Group
Talent Management Services and its importance to the Group are mentioned on
page 130 to 131 of this Annual Report.
• Develop and implement investors’ relations programme or shareholder
communications policy for the Group
The Group has introduced many activities with regards to engagement and
communication with investors to ensure that they are well informed about the
Group affairs and developments. Details of investors’ activities are disclosed on
page 74 of this Annual Report.
• Review the adequacy and integrity of the internal controls of the Group
and management information systems, including compliance with
applicable laws, regulations, rules, directives and guidelines
The Board’s function as regard to fulfilling these responsibilities effectively
are supported and reinforced through the various Committees established at
both the Board and Management’s level. Aided by an Independent function of
the Group Internal Audit division, the active functioning of these Committees
through their regular meetings and discussions would provide a strong check
and balance and reasonable assurance on the adequacy of the Group’s internal
controls. Details of these functions are discussed in the Internal Control
Statement in pages 75 to 78 and Audit Committee Report in pages 79 to 82 in
this Annual Report.
The Board is also responsible to ensure smooth functioning of core processes,
board governance, business value and ethical oversight, whilst the Non-Executive
Independent Directors will further provide an independent and objective view with
effective check and balance in deliberating the above mentioned.
Formalised Ethical Standards through Code of Ethics
Terms of reference have been developed for both the Board and Management,
defining their respective authorities, duties and responsibilities, and this is covered by
the Group’s Code of Conduct and Business Ethics. While the Chairman encourages
full discussion and deliberation of issues affecting the Group by all Board Members,
the Board has appointed Zainah Mustafa, the Senior Independent Non-Executive
Director, to whom concerns pertaining to the Group maybe conveyed by shareholders
and other stakeholders.
Annual Report
2012
KPJ Healthcare Berhad