BOARD RESPONSIBILITY
The Board affirms its overall responsibility for establishing the
Group’s system of internal controls and risk management
framework as well as reviewing its adequacy, integrity and
effectiveness. The Board has put in place a sound governance
structure, risk management framework and internal control
system pursuant to Principle 6 of the Malaysian Code on
Corporate Governance 2012 to ensure effective oversight of
controls and risks in the Group.
The Audit Committee (“AC”) reviews the adequacy and
effectiveness of internal controls system and risk management
framework through the internal audits and risk management
reviews conducted by the Group Internal Audit Services and
the Risk & Compliance Services respectively. Issues raised and
actions taken by Management to address these issues were
deliberated in the AC meetings and the minutes of the AC
meetings were then presented to the Board.
MANAGEMENT RESPONSIBILITY
The Management is overall responsible for implementing the
Board’s policies on risks and controls by allocating resources
for the design and implementation of policies and procedures
on risk management and internal control system to facilitate
the identification and evaluation of significant risks faced by
the Group and formulating adequate controls to manage these
risks, according to the risk appetite set by the Board.
The principal objective of the risk management framework and
internal control system is to identify and manage business
risks effectively and safeguard assets.
As the internal controls system is designed to manage and
reduce risks rather than eliminating them, the system can only
provide reasonable assurance to the Board regarding the
achievement of company objectives through:-
• effectiveness and efficiency of operations
• reliability of financial reporting
• compliance with applicable laws and regulations
The likelihood of achievement of the Group’s objectives is
affected by limitations inherent in any internal control systems.
The Management therefore has to consider the cost of
implementation of internal controls against the expected
benefits to be derived.
RISK MANAGEMENT AND INTERNAL
CONTROL STRUCTURE
Integrity and Ethical Values
The Group is committed to promote ethical behaviour culture
in employees and medical consultants. At the annual staff
assembly called “Pedoman” (Perhimpunan, Dialog dan Anugerah
Tahunan Anggota Pekerja), all employees and medical
consultants are reminded of the five Core Values adopted by
the Group, which are Safety, Courtesy, Integrity, Professionalism
and Continuous Improvement.
Employees are expected to be transparent in their conduct to
promote high ethical values and reaffirm their commitment to
the Group through the Staff Integrity Pledge ceremony.
In addition, the Group also encourages employees to report
directly to the Managing Director of any misconduct or
unethical behaviour committed by any staff of the Group
through the annual Borang Peradaban declaration.
To complement this expectation, the Group also has in place
a comprehensive Whistle-Blowing Policy that outlines the
Group’s commitment to promote the highest standards of
governance, ethics and integrity in all aspects of business
dealings. The Policy covers, inter-alia, 3 tiers of whistle-blowing
reporting line, comprising of the Managing Director, the
Chairman of the Audit Committee and the Chairman of the
Board, to facilitate whistle-blowing activities according to
different possible circumstances. In order to encourage a
conducive environment for effective whistle-blowing, the Policy
also provides assurances on the preservation of identity,
confidentiality of information and protection of whistle-blowers
from possible retaliation.
The Group is also a signatory to the “Malaysian Corporate
Integrity Pledge” since 2011, introduced by the Malaysian
Institute of Integrity (MII) in support of the Government efforts
to combat corruption and unethical practices. Please refer to
page 212 for the Group’s Corporate Integrity Statement.
The Group has put in place the “No Gifts and Entertainment”
policy applicable to all staff and the “Asset Declaration” policy
applicable to staff of Manager grade and above. The purpose
of these policies is to uphold ethical and responsible behaviour
by all its employees and to avoid conflict of interest situation
in any ongoing or potential business dealings in the Group with
various suppliers and service providers.
185
KPJ Healthcare Berhad
Annual Report
2015
