The Board of Directors (“Board”) of YTL Corporation Berhad (“YTL Corp” or “Company”) remains firmly committed to ensuring an appropriate and sound
system of corporate governance throughout the Company and its subsidiaries (“YTL Corp Group”). The YTL Corp Group has a long-standing commitment to
corporate governance and protection of shareholder value, which has been integral to the YTL Corp Group’s achievements and strong financial profile
The YTL Corp Group’s corporate governance structure is a fundamental part of the Board’s responsibility to protect and enhance long-term shareholder
value and the financial performance of the YTL Corp Group, whilst taking into account the interests of all stakeholders.
In implementing its governance system and ensuring compliance with the Main Market Listing Requirements (“Listing Requirements”) of Bursa Malaysia
Securities Berhad (“Bursa Securities”), the Board has been guided by the principles and recommendations of the Malaysian Code on Corporate Governance
The Board is satisfied that the Company has, in all material aspects, complied with the principles and recommendations of the Code for the financial
year ended 30 June 2013. This statement explains the Company’s application of the principles and compliance with the recommendations as set out in
the Code for the financial year under review, including, where otherwise indicated, explanations of its alternative measures and processes.
ROLES & RESPONSIBILITIES OF THE BOARD
YTL Corp is led and managed by an experienced Board with a wide and varied range of expertise to address and manage the complexity and
scale of the YTL Corp Group’s operations. This broad spectrum of skills and experience ensures the YTL Corp Group is under the guidance of an
accountable and competent Board. The Directors recognise the key role they play in charting the strategic direction, development and control of the
YTL Corp Group. Key elements of the Board’s stewardship responsibilities include those set out in Code:
- Reviewing and adopting strategic plans for the YTL Corp Group;
- Overseeing the conduct of the YTL Corp Group’s business operations and financial performance;
- Identifying principal risks affecting the YTL Corp Group’s businesses and maintaining a sound system of internal control and mitigation
- Succession planning;
- Overseeing the development and implementation of shareholder communications policies; and
- Reviewing the adequacy and integrity of the YTL Corp Group’s management information and internal controls system.
The Managing Director and Executive Directors areaccountable to the Board for the profitability and development of the YTL Corp Group, consistent
with the primary aim of enhancing long-term shareholder value. The Independent Non-Executive Directors have the experience and business acumen
necessary to carry sufficient weight in the Board’s decisions and the presence of these Independent Non-Executive Directors brings an additional
element of balance to the Board as they do not participate in the day-to-day running of the YTL Corp Group. COMPOSITION & INDEPENDENCE OF THE BOARD
The differing roles of Executive and Non-Executive Directors are delineated, both having fiduciary duties towards shareholders. Executive Directors
have a direct responsibility for business operations whereas Non-Executive Directors have the necessary skill and experience to bring an independent
judgment to bear on issues of strategy, performance and resources brought before the Board. The Executive Directors are collectively accountable for
the running and management of the YTL Corp Group’s operations and for ensuring that strategies are fully discussed and examined, and take account
of the long-term interests of shareholders, employees, customers, suppliers and the many communities in which the YTL Corp Group conducts its business.
The Directors also observe and adhere to the Code of Ethics for Company Directors established by the CompaniesCommission of Malaysia,
which encompasses the formulation of corporate accountability standards in order to establish an ethical corporate environment.
In the discharge of their responsibilities, the Directors have established functions which are reserved for the Board and those which are delegated
to management. Key matters reserved for the Board’s approval include overall strategic direction, business expansion and restructuring plans,
material acquisitions and disposals, expenditure over certain limits, issuance of new securities and capital alteration plans. Further information on
authorisation procedures, authority levels and other key processes can also be found in the Statement on Risk Management & Internal Control set out
in this Annual Report.
The Board believes sustainability is integral to the long-term success of the YTL Corp Group. Further information on the YTL Corp Group’s s
ustainability activities can be found in YTL Corp’s Sustainability Report 2013, a separate report published in conjunction with this Annual Report.
The Board’s functions are governed and regulated by the Memorandum and Articles of Association of the Company and the various applicable legislation,
Listing Requirements and other regulations and codes. In accordance with the Code, a formal charter will also be drawn up for the Board’s adoption
at a later date.
Board meetings are scheduled with due notice in advance at least 5 times a year in order to review and approve the annual and interim financial
results. Additional meetings may also be convened on an ad-hoc basis when significant issues arise relating to the YTL Corp Group and when necessary
to review the progress of its operating subsidiaries in achieving their strategic goals. The Board met 5 times during the financial year ended
30 June 2013.
The Directors are fully apprised of the need to determine and disclose potential or actual conflicts of interest which may arise in relation to
transactions or matters which come before the Board. In accordance with applicable laws and regulations, the Directors formally disclose any direct
or indirect interests or conflicts of interests in such transactions or matters as and when they arise and abstain from deliberations and voting at
Board meetings as required.
The Directors have full and unrestricted access to all information pertaining to the YTL Corp Group’s business and affairs to enable them to
discharge their duties. Prior to each Board meeting, all Directors receive the agenda together with a comprehensive set of Board papers encompassing
qualitative and quantitative information relevant to the business of the meeting. This allows the Directors to obtain further explanations or
clarifications, where necessary, in order to be properly briefed before each meeting.
Board papers are presented in a consistent, concise and comprehensive format, and include, where relevant to the proposal put forward for the Board’s
deliberation, approval or knowledge, progress reports on the YTL Corp Group’s operations and detailed information on corporate proposals, major
fund-raising exercises and significant acquisitions and disposals. Where necessary or prudent, professional advisers may be on hand to provide
further information and respond directly to Directors’ queries. In order to maintain confidentiality, Board papers on issues that are deemed to be
price-sensitive may be handed out to Directors during the Board meeting.
All Directors have full access to the advice and services of the Company Secretary who consistently ensures that Board procedures are adhered to at
all times during meetings and advises the Board on matters including corporate governance issues and the Directors’ responsibilities in complying
with relevant legislation and regulations. The Company Secretary works very closely with management for timely and appropriate information, which
will then be passed on to the Directors. In accordance with the Board’s procedures, deliberations and conclusions in Board meetings are recorded by
the Company Secretary, who ensures that accurate and proper records of the proceedings of Board meetings and resolutions passed are recorded and kept
in the statutory register at the registered office of the Company.
The Board currently has 13 Directors, comprising 9 executive members and 4 non-executive members, all 4 of whom are
independent. This provides an effective check and balance in the functioning of the Board, and complies with the Listing Requirements, which require
one-third of the Board to be independent.
In accordance with the Company’s Articles of Association, at least one-third of the Directors are required to retire from office at each Annual
General Meeting (“AGM”) and may offer themselves for re-election by rotation. Directors who are appointed by the Board during the financial year are
subject to re-election by shareholders at the next AGM held following their appointments. Directors who are over seventy years of age are required to
submit themselves for re-appointment by shareholders annually in accordance with Section 129 of the Companies Act 1965. The names and details of
Directors seeking re-election at the forthcoming AGM are disclosed in the Notice of Annual General Meeting and the
Profile of the Board of Directors, respectively, in this Annual Report.
The appointment of Directors has generally been undertaken by the Board as a whole, with the Managing Director
recommending candidates suitable for appointment to the Board, and the final endorsement being made by the entire Board to ensure the required mix of
skills, experience and expertise of members of the Board. However, on 23 May 2013, the Board established a Nomination Committee to take
responsibility for this function and will begin reporting on the activities of this committee in the next financial year.
Directors’ remuneration is decided in line with the objective recommended by the Code to determine the remuneration for Directors so as to attract,
retain, motivate and incentivise Directors of the necessary calibre to lead the YTL Corp Group successfully. In general, the remuneration of the
Directors is reviewed against the performance of the individual and the YTL Corp Group. The Executive Directors’ remuneration consists of basic salary, other emoluments and other customary
benefits as appropriate to a senior management member. The component parts of remuneration are structured so as to link rewards to performance.
Directors do not participate in decisions regarding their own remuneration packages and Directors’ fees must be approved by shareholders at the AGM.
Details of the aggregate remuneration of Directors categorised into appropriate components and the range of remuneration for each Director can be
found in Note 6 in the Notes to the Financial Statements in this Annual Report. Details are not shown with reference to Directors individually, both
for security reasons and because the Board believes that such information will not add significantly to the understanding and evaluation of the YTL
Corp Group’s standards of corporate governance.
In order to ensure balance of authority and accountability, the roles of the Executive Chairman and the Managing Director are separate and distinct,
and these positions are held by separate members of the Board. The Executive Chairman is primarily responsible for the orderly conduct and
effectiveness of the Board whereas the Managing Director oversees the day-to-day running of the business, implementation of Board policies and making
of operational decisions, in addition to advancing relationships with regulators and all other stakeholders. Whilst the Code recommends that the
Chairman should be a non-executive member, the Board is of the view that its existing measures, including the delineation of the roles and duties of
the Managing Director and the Executive Chairman and the presence of independent oversight by the Independent Non-Executive Directors, are sufficient
to ensure the balance of accountability and authority within the Board.
Together, the Directors believe that the structure of the Board satisfactorily reflects the interests of its shareholders and is able to provide clear
effective leadership to the YTL Corp Group. The composition of the Board reflects the wide range of business, commercial and financial experience
essential in the management and direction of a corporation with global presence. A brief description of the background of each Director is presented
in the Profile of the Board of Directors in this Annual Report.
The Code includes a recommendation that the tenure of an independent director should not exceed a cumulative term of 9 years. However, the Board does
not have set term limits for its members and considers instead the ability of the Directors to continue to serve and act in the best interests of the
YTL Corp Group. The Independent Non-Executive Directors must also fulfil the criteria for independence set out in the Listing Requirements. It is the
Board’s view that the length of service of the Independent Directors who have served on the Board for more than 9 years does not interfere with their
exercise of independent judgment or their ability to act in the best interests of the YTL Corp Group. The Independent Non-Executive Directors are not
employees and they do not participate in the day-to-day management or daily operations of the YTL Corp Group. These Directors serve in a professional
capacity and do not have executive roles or business ties to the Company.
Length of service enables the Independent Non-Executive Directors to better understand the YTL Corp Group and its businesses over the long-term and
therefore, better serve the interests of the Company and its shareholders by having a long-term familiarity with and understanding of the Company,
its operations and growth strategies.
The Board is satisfied with the skills, contributions and independent judgment that Dato’ (Dr) Yahya Bin Ismail, Dato’ Cheong Keap Tai and Mr Eu Peng
Meng @ Leslie Eu, who have served for 9 years or more, bring to the Board. In view thereof, the Board recommends and supports the resolutions
for their re-appointment as Independent Non-Executive Directors of the Company which will be tabled for shareholders’ approval at the forthcoming
AGM of the Company.
In accordance with the Listing Requirements, each member of the Board holds not more than five directorships in public
listed companies. This ensures that their commitment, resources and time are focused on the affairs of the YTL Corp Group thereby enabling them to
discharge their duties effectively. The details of each Director’s attendance of Board meetings are also disclosed in the Profile of the Board of
Directors in this Annual Report.
The Directors are fully cognisant of the importance and value of attending seminars, training programmes and conferences in
order to update themselves on developments and changes in the industries in which the YTL Corp Group operates, as well
as wider economic, financial and governance issues to enhance their skills, knowledge and expertise in their respective fields. All Directors have
attended and completed the Mandatory Accreditation Programme prescribed by Bursa Securities, and the Board will continue to evaluate and determine
the training needs of its Directors on an ongoing basis.
Throughout the financial year under review, the Directors attended various briefings, conferences, seminar programmes and speaking engagements
covering areas that included corporate governance, leadership, relevant industry updates and global business developments which they have
collectively or individually considered as useful in discharging their stewardship responsibilities.
INTEGRITY IN FINANCIAL REPORTING
The Company has in place an Audit Committee which comprises 3 Non-Executive Directors, in compliance with the Listing Requirements
which require all the members of the Audit Committee to be non-executive members. The Audit Committee holds quarterly meetings to review matters
including the YTL Corp Group’s financial reporting, the audit plans for the financial year and recurrent related party transactions, as well as to
deliberate the findings of the internal and external auditors.
The Audit Committee met 6 times during the financial year ended 30 June 2013. Full details of the composition, complete terms of reference and a
summary of the activities of the Audit Committee during the financial year are set out in the Audit Committee Report in this Annual Report.
The Audit Committee has established formal and professional arrangements for maintaining an appropriate relationship with the Company’s external
auditors, Messrs HLB Ler Lum. The external auditors also attend each AGM in order to address clarifications sought pertaining to the audited
financial statements by shareholders.
The Directors are responsible for ensuring that financial statements are drawn up in accordance with the Companies Act 1965, the Listing Requirements
and applicable Financial Reporting Standards in Malaysia. The Statement of Directors’ Responsibilities made pursuant to Section 169 of the
Companies Act 1965 is set out in this Annual Report.
In presenting the financial statements, the Company has used appropriate accounting policies, consistently applied and supported by reasonable and
prudent judgments and estimates, to present a true and fair assessment of the Company’s position and prospects. Interim financial statements
were reviewed by the Audit Committee and approved by the Board prior to release to Bursa Securities.
The Board acknowledges its overall responsibility for maintaining a sound system of risk management and internal
control to safeguard the investment of its shareholders and the YTL Corp Group’s assets. Details of the YTL Corp Group’s system of risk management and
internal control and its internal audit function are contained in the Statement on Risk Management & Internal Control and the Audit Committee Report in
this Annual Report.
CORPORATE DISCLOSURE & COMMUNICATION WITH
The YTL Corp Group values dialogue with investors and constantly strives to improve transparency by maintaining
channels of communication with shareholders and investors that enable the Board to convey information about performance, corporate strategy and other
matters affecting stakeholders’ interests. The Board believes that a constructive and effective investor relationship is essential in enhancing
shareholder value and recognises the importance of timely dissemination of information to shareholders
Accordingly, the Board ensures that shareholders are kept well-informed of any major development of the YTL Corp Group. Such information is
communicated through the Annual Report, the various disclosures and announcements to Bursa Securities, including quarterly and annual results, and
corporate websites. Corporate information, annual financial results, governance information, business reviews and future plans are disseminated
through the Annual Report, whilst current corporate developments are communicated via the Company’s corporate website at
www.ytl.com and the YTL
Corp Group’s community website at www.ytlcommunity.com,
in addition to prescribed information, including its interim financial results, announcements, circulars, prospectuses and
notices, which is released through the official website of Bursa Securities.
The Managing Director and the Executive Directors meet with analysts, institutional shareholders and investors throughout the year not only to
promote the dissemination of the YTL Corp Group’s financial results but to provide updates on strategies and new developments to ensure better
understanding of the YTL Corp Group’s operations and activities. Presentations based on permissible disclosures are made to explain the YTL Corp
Group’s performance and major development programs. Whilst efforts are made to provide as much information as possible to its shareholders and
stakeholders, the Directors are cognisant of the legal and regulatory framework governing the release of material and sensitive information so as to
not mislead its shareholders. Therefore, information that is price-sensitive or that may be regarded as undisclosed material information about the
YTL Corp Group is not disclosed to any party until after the prescribed announcement to Bursa Securities has been made.
The AGM is the principal forum for dialogue with shareholders. The Board provides opportunities for shareholders to raise questions pertaining to
issues in the Annual Report, corporate developments in the YTL Corp Group, the resolutions being proposed and the business of the YTL Corp Group in
general at every general meeting of the Company. The notice of the AGM and a circular to shareholders in relation to the renewal of the Company’s
share buy-back and recurrent related party transactions mandates, if applicable, are sent to shareholders at least 21 days prior to the AGM in
accordance with the Listing Requirements and the Companies Act 1965 in order to enable shareholders to review the YTL Corp Group’s financial and
operational performance for the financial year and to fully evaluate new resolutions being proposed.
The Managing Director and Executive Directors take the opportunity to present a comprehensive review of the progress and performance of the YTL Corp
Group and provide appropriate answers in response to shareholders’ questions during the meeting, thereby ensuring a high level of accountability,
transparency and identification with the YTL Corp Group’s business operations, strategy and goals. Each item of special business included in the
notice of the meeting is accompanied by an explanatory statement for the proposed resolution to facilitate full understanding and evaluation of the
The rights of shareholders, including the right to demand a poll, are found in the Articles of Association of the Company.
At the 29th AGM of the Company, held on 27 November 2012, the resolutions put forth for shareholders’ approval were voted on by a show of hands as
there were no shareholder demands for voting to be done by way of a poll.
This Statement was approved by the Board of Directors on 3 October 2013.