Corporate Governance


GuocoLand Limited (the “Company”) is committed to maintaining high standards of corporate governance as well as a strong and sound corporate culture to ensure the Company’s long-term success. During the financial year ended 30 June 2020 (“FY2020”), the Company continued to support the Corporate Governance – Statement Of Support 2019 organised by the Securities Investors Association Singapore (“SIAS”) to demonstrate its commitment to uphold high standards of corporate governance to enhance shareholders value. In November 2019, the Company was included in the SGX Fast Track which was launched by Singapore Exchange Regulation to recognise the efforts and achievements of listed issuers which have upheld high corporate governance standards and maintained a good compliance track record.

The Company was ranked 17th among the 578 companies listed on the Singapore Exchange Securities Trading Limited (“SGX-ST”) that were being assessed in the Singapore Governance and Transparency Index 2019. The Company was also awarded the Most Transparent Company Award, Real Estate Category-Runner Up at the SIAS 20th Investors’ Choice Awards 2019 which recognises excellence in companies and individuals that adopt good corporate governance practices.

During the FY2020, the Company has adhered to the principles and provisions of Code of Corporate Governance 2018 (“Code 2018”) as presented in this report. The Company’s own Code of Corporate Governance (“Company Code”) comprising the terms of reference for the Board of Directors and its Committees has also been updated to be in line with the principles and provisions of Code 2018.

(A) BOARD MATTERS

Principle 1
The Board’s Conduct of its Affairs

Board’s Role and Responsibilities

The Company is headed by an effective Board which is collectively responsible and works with key management personnel for the long-term success of the Company. The Board and key management personnel discharge their statutory and fiduciary responsibilities, both individually and collectively. The Board oversees the business affairs of the Group and carries out this oversight function by assuming responsibility for effective stewardship and corporate governance of the Company and the Group.

Its principal role and responsibilities include the following:

  1. providing entrepreneurial leadership, setting the overall business strategy, policies and direction for the Company;

  2. ensuring that the necessary resources are in place for the Company to meet its objectives;

  3. establishing and maintaining a sound risk management framework to effectively monitor and manage risks and to achieve an appropriate balance between risks and Company’s performance;

  4. reviewing Management’s performance;

  5. ensuring transparency and accountability to key stakeholder groups; and

  6. setting the Company’s values and standards to instil an ethical corporate culture and ensure that the Company’s values, standards, policies and practices are consistent with the culture.

Board Committees

The Board exercises independent judgment in dealing with the business affairs of the Group and objectively discharges its duties and responsibilities in the interest of the Group. To assist the Board in executing its duties, the Board has delegated specific functions to the following Board committees:

  • Audit and Risk Committee (“ARC”);

  • Nominating Committee (“NC”); and

  • Remuneration Committee ("RC").

Each Board committee reviews the matters that fall within its respective terms of reference and reports its decisions to the Board which endorses and accepts ultimate responsibility on such matters.

Matters which require Board Approval

The Company Code sets out the matters which require the Board’s approval. During the year, the Board reviewed and approved the business plan and budget, major investments including joint venture transactions, Directors’ Statement and audited Financial Statements for FY2020, the financial results announcements of the Company and interested person transactions which required announcements to be made.

Directors Attendance and Participation in Board and Board Committee and General Meetings

Meetings of the Board and its Committees are scheduled one year ahead. The Board meets at least on a quarterly basis to review, inter alia, the Company’s business and financial results. Additional meetings may be convened on an ad-hoc basis as and when necessary. Where appropriate, decisions are also taken by way of Directors’ Circulating Resolutions. As provided in the Company’s Constitution, Directors may convene Board meetings by teleconferencing or videoconferencing. During the FY2020, the Board held four meetings. The attendance of Directors at meetings of the Board and the Board Committees as well as Annual General Meeting (“AGM”) is set out in the table below:

Induction and Training and Development of Directors

Newly appointed Director(s) to the Board will be issued a formal letter by the Company and furnished with an induction package comprising meeting schedules of the Board and its Committees, the Company’s latest Annual Report, Company Code, materials on corporate overview such as corporate structure, strategic business units, Guidebook on being an Effective Director and Guidebook setting out the duties and obligations of Directors of the Company, etc.

When a Director is appointed to a Board Committee, it is the Company’s practice to highlight the relevant terms of reference to such Director and provide a copy of the related Guidebook for the Committee. New Directors will also be encouraged to attend the Listed Company Director programmes (where appropriate) conducted by the Singapore Institute of Directors (“SID”); and Director Financial Reporting Fundamentals co-organised by SID and the Institute of Singapore Chartered Accountants and supported by Accounting and Corporate Regulatory Authority (“ACRA”), where relevant. Newly appointed Director(s) with no prior experience as Director(s) of a listed company will undergo training in the roles and responsibilities of Director of a listed company as prescribed by the SGX-ST.

All Directors are provided with relevant information on the Company’s policies, procedures and practices relating to governance matters, including disclosure of interests in securities, dealings in the Company’s securities, restrictions on disclosure of price sensitive information and declaration of interests relating to the Group’s businesses.

The Company will arrange for new Directors to attend trainings in the relevant areas as appropriate. To facilitate each Director to develop his/her competencies to effectively discharge his/her duties, all Directors are updated regularly on key regulatory and accounting changes and risk management from time to time. Directors are also informed of training programmes and seminars organised by SID, SGX-ST, ACRA and KPMG LLP. During the FY2020, Directors attended training programmes and seminars organised by SID such as Transformation from Ordinary to Extraordinary, Annual Corporate Governance Roundup, Looking Beyond the Veneer of Numbers. To keep Directors abreast of the Group’s development projects, site visits for Directors were arranged, such as the ground breaking ceremony of the 1st phase of the Group’s large scale mixed-use development, Chongqing 18 Steps project located in the Yuzhong District of Chongqing, China. The NC has reviewed the training and professional development programmes attended by Directors and supported by the Company.

Access to Information

In order to enable the Directors to make informed decisions in the discharge of their duties and responsibilities, Management furnished the Board with reports of the Company’s operations and performance, financial position and prospects for review at each Board meeting. Management also keeps the Board apprised of the Company’s operations and performance through separate meetings and discussions. To facilitate participation at meetings, Directors are provided with electronic devices to enable them to read reports/materials in real time once these are being uploaded to a secured system accessible by all Directors. Directors are updated regularly on key legislative and regulatory requirements so that appropriate systems and procedures and/or policies may be established and implemented to ensure compliance.

In addition, the Board is provided with management accounts explaining the Group’s financial performance and operations update on a regular basis. Such reports enable the Board to make a balanced and informed assessment of the Group's performance, position and prospects, and Directors are kept abreast of the Group’s business activities.

Separate and Independent Access

Directors have separate and independent access to Management and the Company Secretary, whose role includes, inter alia, ensuring that Board procedures as well as applicable rules and regulations are complied with. The incumbent Company Secretary, Ms Mary Goh, has more than two decades of corporate secretarial experience in professional consultancy firms and public listed companies. Ms Goh is a Fellow of the Chartered Secretaries Institute of Singapore.  She holds a Master of Business Administration Degree from the University of South Australia and a Master of Laws in Commercial Law from the Singapore Management University. 

The Company Secretary attends all Board and Board Committee meetings; and ensures that board procedures are followed and that applicable rules and regulations prescribed by, inter alia, the Companies Act (Chapter 50) and the SGX-ST Listing Manual are complied with.  She also advises the Board on all governance matters, as well as assisting with the co-ordination of training and professional development for Board members.

Directors also have access to independent professional advice at the Company’s expense, in consultation with the Chief Executive Officer of the Company.

Principle 2
Board Composition and Guidance

Board Independence

The Board currently consists of ten Directors. On an annual basis, the NC determines the independence of the Directors taking into consideration the circumstances as set out in Code 2018 and the SGX-ST Listing Manual, as well as whether there was any circumstance or relationship that might impact on a Director’s independence or perception of independence. For the year under review, all Directors had made declarations on their respective status of independence which were submitted to the NC for review. The NC had determined that Mr Moses Lee Kim Poo, Mr Timothy Teo Lai Wah, Mr Francis Siu Wai Keung, Mr Abdullah Bin Tarmugi, Ms Lim Suat Jien and Ms Jennie Chua Kheng Yeng are independent. Mr Francis Siu, who had served on the Board for more than 9 years and will be retiring by rotation at the Company’s forthcoming AGM in October 2020, has notified that he will not seek re-election at the said AGM.

Mr Timothy Teo Lai Wah, who is also a member of the NC and had served on the Board for more than 9 years, was subjected to particular rigorous review of his independence by the remaining NC members. The NC had after due and careful rigorous review determined that Mr Teo remained independent, taking into account that Mr Teo continued to demonstrate strong independence in character and judgment in the discharge of his responsibilities as an Independent Director. He had also actively expressed his independent opinions as well as made suggestions and recommendations for the benefit of the Company. Mr Teo who has in-depth understanding of the Group’s business continued to contribute to the Company based on his experience and knowledge of the industry in which the Group operates and markets that it competes in. Based on Mr Teo’s declaration of independence, he has no relationships or circumstances that could or were likely to affect his judgment and ability to compromise his independence and discharge of his duties as an Independent Director. During the review, Mr Teo had recused himself and abstained from all deliberations and discussions.

The Board had accepted the assessment of Directors’ independence by the NC. Based on the NC’s review of independence, the Board is satisfied that there is a strong and independent element on the Board with six out of ten Directors, constituting more than 50% of the Board, being independent.

Board Size

The Board, having taken into account the review by the NC, considers its present size of ten Directors to be adequate to facilitate effective decision making for the current nature and scope of the Group’s business operations.

Board Competencies

The NC conducted its annual review on the composition of the Board which comprises ten well-qualified Directors with diversified skills, experience, knowledge, gender and providing core competencies in the areas of accounting, financial, banking, legal, business management and industry experiences such as property development and hotel operations.

The Board considers its current composition with a balanced mix of skills as appropriate for the existing needs and demands of the Group’s businesses. The NC which is being tasked with the review of the succession and renewal plans for Board continuation, also took into account inter alia each Board member’s tenure of directorship in the Company, in particular, the date on which each Independent Director would reach their respective 9-year tenures on the Board.

There are currently two female Directors which make up 20% of the total Board size of ten Directors. The Company recognises the importance and benefits of diversity on the Board as this would enhance the effectiveness of the Board in terms of varied perspectives, skills, industry discipline, business experience, gender, background and other distinguishing factors/qualities. Recognising that diversity on the Board is an essential element to support the attainment of the Company’s strategic objectives and the Company’s sustainable and balanced development, the Company has adopted a Board Diversity Policy. The Board Diversity Policy sets out the approach to achieve diversity on the Board and has stated that the NC is responsible to review and monitor its implementation.

Non-Executive Directors are encouraged to constructively challenge and help develop proposals on strategy. During the FY2020, Non-Executive Directors had met without the presence of Management.

Principle 3
Chairman and Chief Executive Officer

Separate Role of Chairman and Chief Executive Officer ("CEO")

The Board Chairman, Mr Moses Lee Kim Poo is an Independent Director. There is clear division of responsibilities in the respective roles and functions of the Chairman, Mr Lee and the CEO, Mr Raymond Choong Yee How. There is no familial relationship between Mr Lee and Mr Choong.

The Chairman leads the Board and ensures its smooth and effective functioning.

The CEO is responsible for the vision and strategic direction of the Group, implementing the policies and decisions of the Board, initiating business ideas and corporate strategies to create competitive edge and enhancing shareholders wealth, setting the benchmark and targets for operating companies, overseeing the day-to-day operations and tracking compliance and business progress. The CEO also holds regular meetings with senior management and on a quarterly basis, updates the Board on progress made on corporate strategies and operational targets that were pre-set.

Lead Independent Director

As the Chairman is independent from the Company’s officers, related corporations and major shareholder(s); and the Directors and Management are accessible by the Company’s shareholders, the appointment of a lead independent director is deemed to be not necessary.

Principle 4
Board Membership

Nominating Committee

The NC consists of the following three Directors, all of whom are non-executive with the majority, including its Chairman, being independent:

  • Mr Abdullah Bin Tarmugi, Chairman (Independent Non-Executive Director);

  • Mr Timothy Teo Lai Wah, Member (Independent Non-Executive Director); and

  • Mr Kwek Leng Hai, Member (Non-Independent Non-Executive Director).

The terms of reference of the NC are set out in the Company Code and include, inter alia, the following:

  • review the structure, size and composition of the Board and its Committees;

  • review and recommend to the Board all new Board appointments (including alternate Directors, if applicable) and re-election of Directors at AGM;

  • determine annually whether or not, a Director is independent;

  • rigorously review, as appropriate, the independence of any Director who has served on the Board beyond 9 years from the date of his first appointment;

  • evaluate the performance of the Board as a whole, the Board Committees, individual Directors and the Board Chairman;

  • review training and professional development programmes for Directors; and

  • review Board succession plans for Directors, in particular, the Chairman and the CEO.

Selection of Directors

The Company has in place a process for the selection and appointment of new Directors to the Board which has been followed by the NC. Factors considered by the NC include the relevant skills that the Company sought such as strategic planning, business and management experience, industry knowledge e.g. real estate, hotel operations, etc.

In the selection and appointment of a new Director, candidates may be put forward or sought through internal promotion, contacts and recommendations from Directors/substantial shareholders or external sources, when appropriate. Taking into account the Board Diversity policy, the NC will review the profile of the candidate proposed for appointment, having regard to the range of diversity perspectives including but not limited to gender, age, competencies, skills, professional expertise, experiences, background and track record, and make recommendation to the Board on the appointment of new Director.

As prescribed by the Company’s Constitution and the SGX-ST Listing Rules, one-third of the Directors for the time being are required to retire from office and are individually subject to re-election by shareholders at the Company’s AGM. Every Director is required to retire from his/her office and is subject to re-election at least once in every three years. The NC will review the contributions and performance of the Directors who are retiring at the AGM to determine their eligibility for re-nomination.

The NC also took into consideration Directors’ number of listed company board representations and other principal commitments, and is satisfied that each Director is able to and has been adequately carrying out his/her duties as a Director of the Company. The Board has reviewed and is satisfied that the Directors’ current directorships in other listed company boards and their other principal commitments did not affect their time commitment to the Board of the Company and has accordingly not made a determination of the maximum number of board representations a Director may hold.

Directorship/Chairmanship of Directors

Key information of each member of the Board including date of first appointment as a Director, date of last re-election, academic and professional qualifications, background and experience, directorships or chairmanships in other listed companies and principal commitments, and other relevant information can be found in the “Board of Directors” section of this Annual Report.

Principle 5
Board Performance

Evaluation of Board Chairman, individual Directors and Board Committees

On an annual basis, the NC assesses the effectiveness and performance of each individual Director, the Board Chairman, the Board as a whole and each Board Committee.

Each Director carried out a self-assessment on his/her performance based on evaluation criteria such as his/her contributions to the functions of the Board, participation and attendance at Board Meetings, his/her competency, expertise and skills as well as knowledge of the Group/Company’s business and the industry in which the Group/Company operates in.

The Chairman has also carried out a self-assessment of his performance with particular emphasis on his role and responsibilities as a Chairman based on criteria drawn from the guidelines as set out in SID’s NC Guide, including conduct of meetings of the Board and shareholders, leadership, communication and interaction with Directors, shareholders and other stakeholders, possession of high level of ethics/values, etc.

Each Board Committee Chairman evaluated his respective Board Committees, taking into account the respective Board Committees’ roles and responsibilities as well as the contributions of members to the functions of these Committees.

All Directors participated in the assessment process and submitted their respective completed and signed assessment forms to the Company Secretary for collation and presentation to the NC for evaluation.

Evaluation of the Board as a whole

The NC had evaluated the collective Board performance, taking into account the self-assessment conducted by individual Directors and the Board Chairman as well as the performance of each Board Committee. In assessing the Board’s performance as a whole, the NC had considered the Board’s integrity, competency, responsibilities, governance and organisation as well as team dynamics. The NC also carried out an evaluation and review of the contributions of Directors at meetings of the Board and Board Committees and Directors’ participation in the affairs of the Company, including a review of matters such as the independence of Directors, their individual skills, experience and time commitment, in particular for Directors who served on multiple boards as well as the overall Board size and composition.

On the basis of the aforesaid evaluation, the NC is satisfied that for the FY2020, the Board and its Committees had been effective in the conduct of their respective duties and the Directors have each contributed to the effectiveness of the Board and its Committees (as applicable). The results of the NC’s assessment had been communicated to and accepted by the Board.

(B) REMUNERATION MATTERS

Principle 6
Procedures for Developing Remuneration Policies

The RC comprises the following three Directors all of whom are non-executive, with the majority, including the Chairman, being independent:

  • Mr Abdullah Bin Tarmugi, Chairman (Independent Non-Executive Director);

  • Mr Quek Leng Chan, Member (Non-Independent Non-Executive Director); and

  • Ms Jennie Chua Kheng Yeng, Member (Independent Non-Executive Director).

No member of the RC was involved in deciding his/her own remuneration.

The terms of reference of the RC are set out in the Company Code and its duties include, inter alia, reviewing and recommending to the Board a framework of remuneration for the Board and key management personnel, reviewing and recommending to the Board for the Board’s endorsement with the specific remuneration packages for each Director as well as for the key management personnel; and the administration of the Company’s Executive Share Scheme 2018 (“ESS”).

The RC may seek remuneration consultants’ advice on remuneration matters for Directors as it deems appropriate. For the FY2020, the RC did not require the service of an external remuneration consultant. As regards the Company's obligations arising in the event of termination of service contracts, the Company does not provide any termination, retirement or post-employment benefits to its Directors, CEO and key management personnel (who are not Directors of the Company or the CEO).

Principle 7
Level and Mix of Remuneration

In its review and recommendation for the remuneration framework, the RC took into account the performance of the Group, the individual Directors and key management personnel, linking rewards to corporate and individual performance.

The RC also took into account industry practices and norms in remuneration to ensure that the remuneration packages for Directors and key management personnel are competitive to attract, retain and motivate Directors and key management personnel to provide good stewardship and effective management for the Company. Such remuneration framework is being reviewed on an annual basis to ensure that they remain relevant.

The Company’s remuneration structure for key management personnel comprises both fixed and variable components. Fixed component includes, inter alia, a basic salary whilst variable component includes performance-linked incentives which are described in more details below.

The performance-related remuneration scheme takes into consideration the balance between profit and risk, and is aligned with the long-term interest and risk framework of the Company. The scheme is symmetrical with risk outcomes and sensitive to the risk time horizon with the rewards commensurate with the business performance; and pay-out schedule is determined considering the nature and time horizon of risks generated.

To promote staff motivation, the Company established a remuneration framework comprising both short-term and long-term incentives that are linked to performance. Short-term incentives include performance-linked variable bonus. For the purpose of assessing the performance of the CEO and key management personnel of the Group, specific Key Result Areas (“KRA”) including both financial and non-financial measures are set for each financial year. An annual appraisal is conducted taking into consideration the achievements of the pre-set KRA for the CEO and each key management personnel.

To promote long-term success of the Company, long-term incentive scheme such as ESS is also incorporated in the remuneration framework of selected key management personnel.

Non-Executive Directors do not receive any salary. However, Non-Executive Independent Directors receive Director fees that are based on corporate and individual responsibilities and which are in line with industry norm.

The Company does not have any contractual provisions to reclaim incentive components of remuneration from Executive Director(s) and the key management personnel in any circumstances. However, upon the exercise of an option or upon the vesting of shares under the grant of ESS, the shares received by the Executive Director(s) and the key management personnel may be subject to retention period or restriction of transfer as determined by the RC at its absolute discretion. Further, the RC may at its absolute discretion, determine such malus and/or clawback provisions to be applied to an option and/or a grant (as the case may be) upon the occurrence of the applicable malus and/or clawback event(s) under the performance-linked ESS.

Principle 8
Disclosure on Remuneration

Directors and CEO

The breakdown of remuneration of Directors and CEO of the Company for the FY2020 is set out below:

Having considered the provisions in the Code 2018 on the disclosure of remuneration of Directors and CEO, the RC is of the view that it is appropriate to provide full disclosure of fees proposed to be paid to Directors for the FY2020 which aggregate to S$659,864 and will be tabled at the forthcoming AGM under Agenda Item No. 3 for shareholders’ approval.

As regards the disclosure of remuneration of the CEO who is also an Executive Director of the Company, for the financial year under review, the Company took into account the very sensitive nature of the matter and the highly competitive business environment in which the Group operates and the impact such disclosure would have on the Group, and is of the view that the current disclosure on a named basis and in bands of S$250,000 (including the provision of a breakdown in percentage terms) is sufficient.

Top Key Management Personnel

In determining the remuneration packages of the Group’s top key management personnel, factors that were taken into consideration included their individual responsibilities, skills, expertise and contributions to the Group’s performance and whether the remuneration packages are competitive and sufficient to ensure that the Group is able to attract and retain executive talents.

On the disclosure of remuneration of the Group’s top key management personnel, the Company is of the view that it would not be in its best interest to make such disclosure on a named basis in bands of S$250,000 with breakdowns of each key management personnel’s remuneration earned through base/fixed salary, variable bonuses, benefits in kind, etc. Accordingly, such details are not disclosed as the Company believes that in view of the competitive nature of the human resource environment and to support the Company’s efforts in attracting and retaining executive talents, it should maintain confidentiality on employee remuneration matters.

The remuneration package of the top five key management personnel (who are not Directors of the Company or the CEO), comprising mainly salaries and bonuses, aggregated to a total remuneration of S$4,481,928 for the FY2020. The number of key management personnel (who are not Directors of the Company or the CEO) under each remuneration bands of S$250,000 is set out below:

As regards the Company’s ESS, the details are set out in the Directors’ Statement and Note 27 to the Financial Statements.

During the financial year, there was no termination, retirement and post-employment benefits granted to Directors, the CEO and the top five key management personnel (who are not Directors or the CEO).

There are no employees who are substantial shareholders of the Company, or are the immediate family members of any of the Directors or the CEO or a substantial shareholder of the Company, and whose remuneration exceeded S$100,000 for the FY2020.

(C) ACCOUNTABILITY AND AUDIT

Principle 9
Risk Management and Internal Controls

The Board recognizes the importance of risk management and the need to establish a sound system of risk management and internal controls to safeguard the interests of the Company and its shareholders. The ARC has been tasked to assist the Board to oversee the governance of risks and monitors the Group’s risks through an integrated approach of enterprise risk management, internal controls and assurance systems. As part of the Group’s enterprise risk management, the key risks faced by the Group on an enterprise wide level as well as those faced by each key strategic business unit had been identified.

Key Risks

Key risks faced by the Group include competition risks, investment and divestment risks, timely completion and delivery of projects, property management, etc. Financial risks are set out in Note 31 to the Financial Statements. A system of rating such potential risks has been established to identify tolerance level for the various classes of risks and determine the likelihood of the occurrences of such risks. The requisite internal controls and strategy to mitigate potential risks such as risks relating to information technology, disruption and cyber security risks, are also recorded and tracked in the Group Risk Register. A Business Continuity Plan which outlines the potential disaster scenarios that may have material adverse impact to the business operations as well as the mitigating recovery process supported by IT disaster recovery plan, had been drawn up as part of the enterprise risk management of the Group.

To ensure the adequacy and effectiveness of the Group's risk management and internal control systems, including financial, operational, compliance and information technology controls, the ARC reviews the Group Risk Register on a quarterly basis. Key risks profiles are updated on a half-yearly basis; nonetheless, timely updates will be made when there are major movements in the risk ratings and this will be presented at the quarterly ARC meetings. The internal auditors (“IA”) and risk manager will validate the internal controls and risk treatment plans respectively for each of the key risks while the external auditors will highlight any material internal control weaknesses that had come to their attention in the course of their audit. The findings of the IA and external auditors as well as the risk manager will be brought up to the ARC which will in turn highlight any issues or matters arising from the Group Risk Register and update on key risks report to the Board.

A robust process had been put in place whereby each business unit provided a quarterly financial status declaration to the CEO and Group Chief Financial Officer (“CFO”). Such declaration would confirm, inter alia, that the consolidated accounts of the business units were correct and had been prepared in accordance with the Group’s accounting policies and on a basis consistent with that of the preceding quarter. This process together with the findings and assurance from the IA with regard to the adequacy and effectiveness of the Group’s internal controls to address financial, operational, compliance and information technology controls and risk management systems, had facilitated the CEO and CFO to provide the assurance as stated in the paragraph below, to the Board.

The Board has received assurance from the CEO and the CFO that the financial records of the Group have been properly maintained and the financial statements give a true and fair view of the Group’s operations and finances. The Board has also received assurance from the CEO and key management personnel regarding the adequacy and effectiveness of the Group’s risk management and internal control systems.

Having regard to the reviews carried out by the ARC, findings raised by IA and external auditors and assurance from the Management and IA, the Board, with the concurrence of the ARC, is of the opinion that the Group’s internal controls addressing financial, operational, compliance and information technology controls and risk management systems, were adequate and effective as at 30 June 2020. During the FY2020, there were no material weaknesses being identified in internal controls or risk management systems.

Principle 10
Audit and Risk Committee

The ARC comprises the following Directors, all of whom are non-executive and independent:

  • Mr Timothy Teo Lai Wah, Chairman (Independent Non-Executive Director);
  • Mr Francis Siu Wai Keung, Member (Independent Non-Executive Director); and
  • Ms Lim Suat Jien, Member (Independent Non-Executive Director).

A majority of the ARC members have recent and relevant accounting or related financial management expertise or experience and the Chairman of the ARC has extensive global experience in the financial industry. None of the ARC members were previous partners or directors of the Company’s external auditors, KPMG LLP, within the last 24 months or hold any financial interest in KPMG LLP. The profile of the ARC Chairman and its members are presented under the “Board of Directors” section of this Annual Report. The Board is satisfied that such members are appropriately qualified to discharge their responsibilities.

The terms of reference of the ARC are set out in the Company Code which provided, inter alia, that the ARC has explicit authority to investigate any matter within its terms of reference, have full access to and co-operation by Management and have full discretion to invite any Director or executive officer to attend its meetings, and reasonable resources to enable it to discharge its functions properly.

In accordance with the written terms of reference of the ARC, it had undertaken and performed, inter alia, the following functions during the financial year:

  • reviewing the Company’s draft announcements of its financial results prior to submission to the Board. During the year, the ARC reported and highlighted to the Board significant issues and judgements that the ARC considered in relation to the financial statements, and how these issues were addressed;

  • assisting the Board to oversee the Company’s risk management framework and policies;

  • reviewing the adequacy and effectiveness of the Company’s internal controls (including financial, operational, compliance and information technology controls, and risk management systems);

  • reviewing the adequacy, effectiveness, independence, scope, and results of the external audit and the Company’s internal audit function;

  • meeting with the Company’s external auditors and IA, without the presence of Management;

  • reviewing the independence of the Company’s external auditors and IA. The aggregate amount of fees paid to the external auditors, and a breakdown of the fees paid in total for audit and non-audit services are disclosed in Note 24 to the Financial Statements; the ARC is satisfied with the independence and objectivity of the external auditors and IA;

  • making recommendations to the Board on the re-appointment of the external auditors. In this regard, the ARC had assessed the independence and objectivity of the external auditors taking into consideration the requirements under the Accountants Act (Chapter 2) of Singapore, including the fees paid for audit and non-audit services and the co-operation extended by Management to allow an effective audit. The ARC had also assessed the quality of work carried out by the external auditors based on ACRA’s Audit Quality Indicators Disclosure Framework.

  • reviewing the assurance from the CEO and CFO on the financial records and financial statements;

  • reviewing the Company’s whistle-blowing policy to ensure that arrangements are in place for the independent investigation of possible improprieties in matters of financial reporting or other matters to be safely raised and that appropriate follow up action has been taken as well as highlighting any significant matters raised through the whistle-blowing channel; and

  • reviewing interested person transactions where they exceeded the relevant threshold levels or as required by SGX-ST Listing Manual.

In its review of the financial statements of the Group and the Company for the FY2020, the ARC has discussed with both the Management and the external auditors the accounting principles that were applied and their judgement of items that might affect the integrity of the financial statements. The ARC reviewed, amongst other matters, the following key audit matters as reported by the external auditors for the FY2020. Detailed information on the key audit matters is set out in the Independent Auditors’ Report.

Interested Person Transactions ("IPT")

The Company’s internal policy requires the ARC to note and review IPT, as recorded in the Company’s Register of IPT. Directors are required to disclose their interest and any conflict of interest in such transactions, and will accordingly abstain from the deliberation and voting in resolutions relating to these transactions. For each material/significant IPT, key information pertaining to the IPT together with the identification of relationship of each party is provided to the ARC for review and evaluation. The ARC will review the IPT to ensure that the terms are fair and at arms’ length, and not prejudicial to the interest of the Company and its minority shareholders. In the event that the relevant threshold as stipulated in the Listing Rules of SGX-ST is met, the IPT including the interested person(s) and its or their relationship with the Company, will be announced via SGXNET or put to vote by disinterested shareholders at the Company’s general meeting as the case may be. The type, nature and value of significant related party transactions during the financial year under review are listed in Note 29 to the Financial Statements.

The Company has complied with Rules 712, 715 and 716 of the Listing Manual issued by SGX-ST in relation to the appointment of its external auditors.

Internal Audit

The Company has its own in-house qualified internal audit team comprising the Head, Internal Audit, Mr Jason Ho, and his team of qualified personnel. The Head, Internal Audit’s primary line of reporting is to the Chairman of the ARC, although he reports administratively to the CEO. IA assists the ARC to review and assess the adequacy and effectiveness of the Group’s internal controls based on the COSO Internal Control Integrated Framework to ensure no material weaknesses in respect of financial, operational, compliance and information technology.

The IA also audits the operations of the Group to ensure regulatory compliances as well as adherence to Group policies and procedures. The scope of IA’s reviews is set out in IA’s annual work plan which is approved by the ARC. During the FY2020, IA had carried out its function according to the Standards for the Professional Practice of Internal Auditing set by The Institute of Internal Auditors (IIA).

The ARC reviews the adequacy, effectiveness and independence of the internal audit function to ensure that the internal audits are conducted effectively and the Management provides the necessary co-operation to enable the IA to perform its function. The ARC also reviews the IA reports and remedial actions taken by Management to address any internal control weaknesses that had been identified.

(D) SHAREHOLDER RIGHTS AND ENGAGEMENT

Principle 11
Shareholder Rights and Conduct of General Meetings

The Company believes in treating all shareholders fairly and equitably by recognizing, protecting and facilitating the exercise of shareholders’ rights, and continually reviews and updates such governance arrangements. The Company currently has one class of shares in issue being ordinary shares which carry one vote for one share held.

The Company also believes in providing its shareholders with a balanced and understandable assessment of the Company’s financial performance, position, and prospects. Such information is furnished through the Company’s announcements of its financial results and media releases (where appropriate) to the SGX-ST.

To facilitate shareholders’ participation at general meetings of the Company, detailed information is provided to shareholders in reports/circulars. Notices of general meetings which set out the resolutions to be tabled to shareholders for approval together with proxy forms were sent to all shareholders by post, published in a local newspaper, announced via SGXNET and uploaded on the Company’s website. General meetings were held at venue easily accessible by shareholders. Relevant rules and procedures governing the general meeting(s) including, in particular, the voting procedures are communicated to shareholders. Resolutions tabled at general meetings are passed through a process of voting by poll.

A registered shareholder may appoint one or two proxies to attend and vote on his/her behalf at the Company’s general meetings. A relevant intermediary, as defined in the Companies Act (Chapter 50), may appoint more than two proxies to attend, speak and vote at the Company’s general meetings.

The Company’s general meetings are the principal forum for dialogues with its shareholders where the Board and Management address shareholders’ concerns, if any. The Company may also solicit views or inputs of shareholders during general meetings. At the Company’s general meetings, the Chairman invites shareholders to participate and provides them with the opportunity to ask questions as well as communicate their views on various matters of relevance to the Company.

Separate resolutions are proposed for approval at general meetings on each substantially separate issue, for example, resolutions relating to payment of Director fees, the authorisation for issue of additional shares, re-appointment of the auditors and re-election of each Director, are separately proposed for shareholders’ approval. The rationale, information and explanation relating to each resolution are set out in the Notice of AGM. The profiles of each Director proposed for re-election as stated in the Notice of AGM are cross-referenced to the “Board of Directors” page in the Company’s Annual Report. Due to security concerns, the Company will not be implementing absentia voting methods such as by mail, e-mail or facsimile.

To promote effective shareholders’ participation and enhance transparency of the voting process at general meetings, the Company has been conducting electronic poll voting for all the resolutions proposed at its general meetings. The electronic voting procedures were presented to shareholders before the start of the AGM. Independent scrutineer has been engaged to count and validate the votes cast for or against each resolution which are tallied and displayed live on screen to shareholders immediately after each poll is conducted at the AGM. The results of the votes cast on the resolutions as well as the name of the independent scrutineer are also announced via SGXNET after the AGM.

All Directors, including the Chairman of the Board, the CEO and the respective Chairmen of the ARC, NC and RC as well as senior Management were present at the AGM to address any questions that shareholders may have. The Company’s external auditors were also present at the Company’s AGM to assist the Board in addressing any queries raised by shareholders.

In view of the current coronavirus disease 2019 (COVID-19) situation, the forthcoming 44th AGM of the Company to be held in respect of FY2020 will be convened and held by electronic means pursuant to the COVID-19 (Temporary Measures) (Alternative Arrangements for Meetings for Companies, Variable Capital Companies, Business Trusts, Unit Trusts and Debenture Holders) Order 2020. Alternative arrangements relating to attendance at the AGM via electronic means (including arrangements by which the meeting can be electronically accessed via live audio-visual webcast or live audio-only stream), submission of questions in advance of the AGM, addressing of substantial and relevant questions at or prior to the AGM and voting by appointing the Chairman of the AGM as proxy, will be put in place for the 44th AGM of the Company.

The Minutes of the AGM which will incorporate substantial and relevant comments or queries from shareholders relating to the agenda of the AGM and responses from the Board and Management will be published on the Company’s website: http://www.guocoland.com.

Dividend

The Company has a Dividend Policy which aims to create long term value for its shareholders through maintaining a balance between dividend distribution, preserving adequate liquidity and reserve to meet its working capital requirements, and capturing future growth opportunities. The Dividend Policy provides for the Board to propose/declare the payment of dividend(s) after taking into account the current financial performance of the Company, the future financial requirements of the Company and any other factors as the Board may deem relevant. The Board will be proposing at the forthcoming 44th AGM of the Company, the declaration of a first and final tax exempt one-tier dividend of 6 cents per ordinary share in respect of the FY2020. The proposed dividend, when approved by shareholders at the AGM, shall be paid on 19 November 2020.

Principle 12
Engagement with Shareholders

In compliance with the continuous disclosure obligations provided in the listing rules of SGX-ST, the Company ensures timely and adequate disclosure of information on matters that may have material impact to the Group.

Corporate Website

To enhance communication with all stakeholders on an on-going basis, the Company has established a corporate website http://www.guocoland.com which is indicated in the Annual Report and a web-link is provided on the SGX-ST website. Information available on the Company’s website includes, inter alia, corporate structure and profile, development projects of the Group, financial results and publications etc.

To facilitate access to pertinent information, a dedicated “Investors & Media” section on the Company’s website serves as a repository of information for shareholders and the investment community. These include financial information, newsroom, Annual Reports, Sustainability Reports, AGM-related materials and Corporate Communications & Investor Relations contact.

Investor Relations Policy

The Company has a Corporate Communications & Investor Relations department, and regularly conveys to shareholders, information on the Company’s financial performance, corporate developments and business prospects via half-yearly financial results announcements, Annual Reports, Sustainability Reports, and press releases or other additional announcements uploaded onto SGXNET and the Company’s website. Press releases are also disseminated to the media. Investors may subscribe to the Company’s mailing list to receive the latest updates on the Group via the Company’s website.

A Corporate Communications & Investor Relations contact (contact@guocoland.com) is published on the Company’s website to facilitate two-way communication with investors. The Company’s Corporate Communications & Investor Relations team promptly attends to calls/email enquiries on the Group and endeavours to respond within 1 week.

Release of Financial Results

In April 2020, the Company had announced that it will report its financial results on a half-yearly basis and will continue to comply with the continuing disclosure obligations under the SGX-ST Listing Manual to keep stakeholders informed of material developments relating to the Company and the Group. The Company had released its half-year financial results within 16 days of the half-year ended. Its full-year audited financial results were announced within 60 days of the FY2020. The Company’s financial results are readily available on its website.

In addition, a press release on the Company’s full-year audited financial results was disseminated to the media which was accordingly uploaded on the Company’s website and posted on SGXNET to ensure equality of information for all stakeholders. The CFO, together with the Corporate Communications & Investor Relations team carried out meetings with investors and analysts, where appropriate. As the Company embraces openness and transparency in the conduct of its affairs, it also ensures safeguarding of its commercial interest.

Release of Annual Report

In line with the Company’s sustainability efforts towards environmental conservation, the Company will continue to make available its Annual Report and Circular(s)/Addendum(s) (“AGM Document”) on its corporate website. Shareholders may, if they prefer, request for a printed copy of the AGM Document. The Notice of AGM, Proxy Form and Request Form will also be available on the Company’s website.

(E) MANAGING STAKEHOLDERS RELATIONSHIPS

Principle 13
Engagement with Stakeholders

The Company’s material stakeholders namely, its employees, investors, customers (tenants/shoppers/ home buyers), suppliers, regulators/Government are listed in the Company’s Sustainability Report (“SR”). SR describes inter alia, the Company’s sustainability governance and practices in the Group’s business operations and management of stakeholder relationships. The Environmental, Social and Governance factors that are material to the Company and its stakeholders have been identified and are described in the Company’s SR. The Company’s SR for FY2020 and previous editions are available on the Company’s corporate website: http://www.guocoland.com.

(F) DEALINGS IN SECURITIES

The Company Code provides guidelines to its officers in relation to dealings in securities. These guidelines set out, inter alia, that officers who are Directors of the Company or its subsidiaries must give notice in writing to the Company of the particulars of any dealings in the securities of the Company within 2 business days of such dealing or of any change in such particulars of which notice had already been given.

The guidelines also provided that officers of the Group should refrain from dealing in any securities of the Company at any time when in possession of unpublished price-sensitive information in relation to those securities, and during the Company’s close period which is the relevant period of time as stipulated in the SGX-ST Listing Manual preceding the announcement of the Company’s results up to and including the date of announcement of the relevant results. Officers are also reminded to refrain from dealing in the Company’s securities on short-term considerations. These guidelines are disseminated to all Directors, officers and key management personnel of the Group periodically to serve as reminder.

(G) CODE OF CONDUCT

The Company has established a Code of Conduct which is made available for easy access in the Company’s intranet. The Company’s Code of Conduct provides guidance to employees’ conduct in areas such as integrity in conducting business, prohibition on disclosure of confidential information relating to the Group, avoidance of conflict of interest, prohibition on accepting gifts/benefits from business associates, etc. The relevant information is presented to all new employees during the induction programme and the Company notifies employees of subsequent updates.

The Board emphasizes the importance of professionalism and integrity when conducting business. Employees are required to embrace and practice these values in the course of performing their duties at work, and to act in the best interest of the Group at all time.

(H) WHISTLE-BLOWING POLICY

The Company is committed to conduct business with integrity and high standards of corporate governance and conduct as well as compliance with applicable laws and regulatory requirements. In line with this commitment, the whistle-blowing policy is adopted to provide proper avenues or channels for employees and any other persons to raise or report any concerns/issues about serious wrong doings, misconduct, malpractices or improprieties in matters relating to the Group.

The whistle-blowing policy sets out procedures and rules for employees and external parties to raise responsibly, in confidence, concerns about possible improprieties in the Group, without fear of undue reprisals. Whistle-blowers may raise potential issues through a dedicated secured email address or contact the ARC Chairman directly.

The ARC oversees the whistle-blowing policy to ensure that arrangements are in place for independent investigation of matters raised and for appropriate follow-up action to be taken. The identity of the whistle-blower and person(s) being reported on are kept confidential. The whistle-blowing policy also allows for concerns or irregularities expressed anonymously to be considered, taking into account the seriousness and credibility of the issues raised. The Company’s whistle-blowing policy is published on its website.

 

 
 
 
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