THE STATE INVESTMENT CORPORATION LIMITED

Charters and Compliance


Other Subsidiary companies

SIC Development Co Ltd

Prime Partners Ltd Corporate Governance

National Real Estate Ltd

SBM (Mauritius) Infrastructure Development Company Ltd


SICDC CO LTD Corporate Governance

BOARD CHARTER

1. Introduction

1.1 Complementary to Law and Articles

The Board Charter sets out the objectives, roles and responsibilities of the Board of Directors of SIC Development Co Ltd (hereinafter referred as ‘the Company’). This Charter should be read in conjunction with the Company’s constitution, the Mauritian laws and regulations.

1.2 Charter on Website

 This Charter is posted on the Company's website.

2. Composition of the Board, Positions, Committees

2.1 Board Profile, Size, Expertise and Independence

(a) Board Profile

The Board, in consultation with the Corporate Governance Committee, shall prepare the profile of its size and composition, considering the nature of the Company's business, and the desired expertise and background of Board Members (the 'Board Profile').

(b) Number of Members

The Board shall have a minimum of two and a maximum of seven members.

(c) General Composition

 The Board shall use its best efforts to ensure that:

(i) Its members are able to act independently of one another;

(ii) They are in a position to assess the broad outline of the Company's overall position;

(iii) Each Board Member has sufficient expertise to perform his or her role as a Board

Member;

(iv) The Board matches the ideal Profile;

(v) At least one Board Member is fully conversant with critical financial issues, meaning he/she has expertise in financial administration and accounting of companies similar to the Company in size and sophistication; and

(vi) No less than two Members of the Board are independent as defined in Section 2.I

(d) Independence

 An independent director is a Board Member who:

(i) has not been an employee of the Company or the group in the past three years;

(ii) has not, or has not had in the past three years, a material business relationship with the Company either directly or as a partner, shareholder, director or senior employee of a body that has such a relationship with the Company;

(iii) has not received, or does not receive, additional remuneration from the Company apart from a director's fee or as a member of the Company's pension scheme;

(iv) is not a nominated director representing a significant shareholder.;

(v) does not have close family ties with any of the Company’s advisers, directors or senior employees;

(vi) does not have cross directorships, nor significant links with other directors, through involvement in other companies or bodies; and

(vii) has not served on the Board for more than nine years from the date of their first election.

2.2 (Re) Appointment; Term of Office; Resignation

(a) Election by Shareholders

A meeting of shareholders shall elect Members of the Board. All Board Members shall hold office until the next annual meeting and may offer themselves for re-election.

2.3 Chairperson and Vice- chairperson

(a) Election

 The Board shall elect a Chairperson from among its Members and a Vice-Chairperson if deemed necessary. The latter shall replace and assume the powers and duties of the Chairperson when the Chairperson is absent.

(b) Duties

The Chairperson of the Board shall primarily be responsible for the activities of the Board and its committees. He/She shall act as spokesperson for the Board and shall be the principal Board contact for Senior Executive Team. The Chairperson and the Senior Executive Team

shall meet regularly. The Chairperson of the Board shall preside over the meetings of shareholders.

(c) Responsibilities

 The Chairperson shall ensure that:

(i) the Board fulfills its duties;

(ii) Board Members, when appointed, participate in an induction program and, if needed, in supplementary training programs; 

(iii) Members receive all the information necessary for them to perform their  duties;

(iv) the agenda of Board meetings are determined;

(v) the Board meetings are chaired in an effective manner;

(vi) the Board has sufficient time for deliberation and decision-making;

(vii) minutes of Board and committee meetings are properly recorded and stored;

(viii) the committees function properly;

(ix) consultations are held with external advisors appointed by the Board;

(x) the performance of Board Members is evaluated regularly;

(xi) problems related to the performance of individual Board Members are addressed;

(xiii) internal disputes and conflicts of interest concerning individual Board Members, including the possible resignation of such Members as a result, are addressed; and

(xiv) the Board has proper contact with the executive team.

2.4 Company Secretary

(a) General Access

 The Company Secretary shall be available to Board Members for any advice required.

(b) Responsibilities

The Company Secretary shall see to it that the Board follows correct procedures and that the Board meets its obligations under law and the Company’s Constitution. The Company Secretary shall assist the Chairperson of the Board to organize the Board's activities

(including provision of information, preparation of an agenda, report of meetings, evaluation and organization of training programs).

2.5 Committees

(a) Establishment of Committees

The Board may appoint committees from among its Members to perform specific tasks and determine their membership under the corporate governance structure. The Board shall establish, as a minimum, an Audit & Risk Committee and a Corporate Governance

Committee.

(b) Board Responsibility for Committee Action

The Board shall be collectively responsible for the decisions and actions taken by the committees. A committee may only perform the tasks delegated to it by the Board and shall not exceed the authority or powers of the Board as a whole. Decisions that, by law, 

must be taken by the Board may not be delegated to a committee.

(c) Committee Reporting

 The committees shall promptly inform the Board of the actions they have taken as well as of any major developments of which they become aware. Each Board Member will have unrestricted access to all committee meetings and records. The Board shall, as set forth in the

charter of the committee concerned, receive a report from the committee describing its actions and findings.

(d) Committee Charters

The Board shall establish (and may amend) charters for each committee. The charters shall specify the role and responsibilities of the committee, its composition and the way it should perform its duties.

(e) Website Disclosure

The charters and the composition of the committees shall be posted on the Company's website.

3. Duties and Powers

3.1 General Duties and Powers

(a) General Responsibilities

The Board shall be responsible for the supervision and oversight of the general business of the Company.

(b) The Board acts in the Interest of the Company

The Board shall act in the best interests of the Company, its business, shareholders and other stakeholders.

(c) Quality of Performance

 The Board is responsible for ensuring the standard of its own performance.

(d) Action in Concert

To the extent possible and remaining within the limit of their individual responsibilities as Board Members, they shall act and speak in concert with respect to important affairs and matters of principle. 

(e) Provision on Information

The Chairperson and the Company Secretary shall see to it that the management provides, in a timely manner, to the Board and its committees with information they need to function properly.

 (h) Use of Experts

The Board may have recourse to the services of experts for advice or assurance, the cost of which shall be agreed in advance by the Board and paid by the Company. A Board Member

may rely upon the advice of a relevant expert so long as the Member has no reason to question the expert's report or conclusion.

3.2 Duties Regarding the Supervision of Management

(a) Nature of Supervision

 In supervising management, the Board shall consider:

(i) the achievement of the Company’s objectives;

(ii) the strategy and risks inherent in the Company’s activities;

(iii) the structure and operation of the internal risk management, and audit and control  systems;

(iv) the financial reporting process;

(v) compliance with law and regulations; and

(vi) any other matters the law requires the Board to consider.

(b) Financial Reporting

The Board shall, in consultation with the Audit and Risk Committee, supervise the Company's financial reporting.

(c) Annual Risk Review

 At least once a year, the Board shall discuss the Company’s strategy and business risks, the management's assessment of the internal risk management and control systems, and any significant changes to such systems.

3.3 Duties Regarding the Members and the Performance of the Board

(a) Duties Regarding Board

The duties of the Board in relation to the Members of the Board include:

(i) The appointment of a Chairperson, the establishment of committees and defining their role, the evaluation of the Board, its individual Members and its committees (including an evaluation of the Board profile and the induction, education and training program);

 the approval of other positions of Board Members to the extent required under this Charter; and

(ii) addressing any conflict of interest issues between the organisation and Members of the Board.

(b) Board Assessment

At least once a year, the Board shall evaluate its own activities and those of its individual Members, the effectiveness of such activities, and competence of the Board and its committees.

4. Relations with Shareholders

(a) General Meeting; Record Date; Venue

The Board shall determine the date and place of any meeting of shareholders and date for the exercise of any voting. The Board shall use its best efforts to provide shareholders with all information necessary or requested for the shareholders to properly 

act at the meeting of shareholders.

(b) Attendance by Board Members

The Chairperson shall ensure that (unless there are important reasons) all Members of the Board attend the meetings of shareholders.

 (c) Disclosure of Resolutions

A resolution of the meeting of shareholders shall be publicly disclosed only through a statement from the Chairperson of the Board or the Company Secretary.

5. Board Meetings; Decision-Making

5.1 Frequency, Quorum, Notice, Agenda and Venue of Meetings

(a) Frequency

The Board shall meet as often as necessary, but not less than four times a year.

Quorum

(b) Quorum of the Board shall be a majority of directors appointed by the Company.

(c) Notice and Agenda

Meetings of the Board shall be called by the Chairperson. Save in urgent cases, as determined by the Chairperson, the agenda for a meeting shall be sent to all Board Members at least five calendar days before the meeting. To the extent possible, for each item of the agenda, an

explanation in writing shall be provided and related documentation attached. Management shall consult the Chairperson on the content of the agenda.

(d) Venue

Board meetings are generally held at the registered office of the Company. Where personal attendance of some or all the Directors is not possible, meetings of the Board may be held by audio conference and/or video call/video conference.

5.2 Attendance of and Admittance to Meetings

(a) Attendance by Managing Director/Executive Director

The Managing Director/Executive Director, if appointed, shall attend Board meetings. If requested by the Board, other executives shall also attend meetings of the Board in whole or in part.

(b) Undue Absence

If a Board Member is frequently absent from Board meetings, he/she shall be required to explain such absences to the Board.

(c) Attendance by Non-Members

The admission to a meeting of persons other than Board Members, the Managing Director/Executive Director, the Company Secretary and (if invited) other executives, shall be decided by majority vote of the Board Members present at the meeting.

5.3 Decision-Making within the Board

(a) Preference for Unanimity

Board Members shall try to unanimously adopt resolutions. Dissenting opinions shall be recorded in the minutes when unanimity cannot be reached.

(b) Individual Vote

 Each Board Member has the right to cast one vote.

(c) Majority Vote; Quorum

All resolutions of the Board are adopted by a majority of the votes cast. At a meeting, the Board may pass resolutions only if the quorum is present. 

Board Charter -SIC Development Co Ltd 

 (d) Written Resolutions

Board resolutions may also be adopted in writing, provided the proposal concerned is submitted to all Board Members entitled to receive notice of meeting and none of them objects to this form of adoption.

 (e) Minutes

Minutes shall be drawn up for every Board meeting and signed by the Chairperson. The minutes of Board Meetings and the resolutions in writing must be added to the Company’s records. Each member of the Board is entitled 

to a copy of the minutes and the resolutions in writing.

(f) Certification of Resolutions

A resolution adopted by the Board shall be publicly disclosed to relevant stakeholders only through a statement from the Chairperson of the Board or the Company Secretary.

6. Other Provisions

6.1. Conflicts of Interest of Board Members

(a) Duty to Disclose

 The personal interests of a Board Member, or persons closely associated with him/her, must not take precedence over those of the Company.

A Board Member shall immediately disclose to the Board any conflict of interest or potential conflict of interest and shall provide all relevant information, including information concerning persons closely associated with him/her and cause same to be entered in the

Interest Register. The Board Member concerned shall not take part in the assessment by the Board of whether a conflict of interest exists.

(b) Abstention by Conflicted Party

A Board Member shall not take part in any discussion or decision-making regarding any subject or transaction in which he/she has a conflict of interest with the organization.

(c) Requirements to Approve Conflicts of Interest

All transactions in which there are conflicts of interest with Board Members shall be agreed on terms that are customary for arm's-length transactions in the organisation's business. Decisions to enter into transactions in which there are conflicts of interest

 with Board Members require the approval of the Board.

6.2 Compensation of Board Members

(a) Approval by General Meeting

The compensation of the Board Members is determined by the shareholders. The Board may submit proposals to the shareholders.

(b) Reimbursement of Costs

 Apart from their compensation, Board Members shall be reimbursed for all reasonable costs incurred in connection with their attendance of meetings.

(c) Loans and Guarantees

The Company do not grant personal loans, guarantees or the like to Board Members, save as part of its usual business operations.

6.3 Induction Program, Ongoing Training and Education

(a) Induction Program

Upon his or her election, each Board Member shall participate in an induction program.

(b) Annual Review of Training

The Board shall conduct an annual review to identify areas where the Board Members require further training or education.

(c) Costs of Organisation

The costs of the induction course and any training or education shall be paid by the Company.

6.4 Confidentiality

(a) Duty to Keep Information Confidential

Unless required to do so by law, no Board Member shall, during his or her Membership of the Board or afterwards, disclose any information of a confidential nature regarding the business of the Company and/or any companies in which it holds a stake, that came to his or her

knowledge in the capacity of his or her work for the organisation and which he/she knows or should know to be of a confidential nature. A Board Member shall not use such confidential information for his or her personal benefit. 

(b) Notice of Disclosure

 If a Board Member intends to disclose to third parties information which he/she has become aware of in his or her duties and which may be confidential, he/she must inform the Chairperson of his or her intent and the identity of the person who is to receive the information

with sufficient notice for the Chairperson to assess the situation and advise the Board Member.

6.5 Miscellaneous

(a) Acceptance by Board Members

Anyone who is appointed a Board Member must, upon assuming office, declare in writing to the Company that he/she accepts and agrees to comply with the provisions of this Charter.

(b) Occasional Non-Compliance

If permitted by law, the Board may occasionally decide (by unanimous decision) at its sole discretion not to comply with the provisions of this Charter.

(c) Amendment

This Charter may be amended by the Board at its sole discretion without prior notification.

(d) Interpretation

In case of uncertainty or difference of opinion as to how a particular provision of this Charter should be interpreted, the opinion of the Chairperson of the Board shall be decisive.

(e) Partial Invalidity

If one or more provisions of this Charter are (or become) invalid, this shall not affect the validity of the remaining provisions. The Board may replace the invalid provisions by provisions which are valid and the effect of which, given the contents and purpose of this

Charter is, to the greatest extent possible, similar to that of the invalid provisions.

AUDIT AND RISK MANAGEMENT COMMITTEE CHARTER

1. Purpose

1.1 The Audit and Risk Management Committee (hereinafter referred to as ‘the Committee’) assists the Board of Directors in fulfilling its oversight responsibilities related to corporate accounting, financial reporting practices, quality and integrity 

of financial reports, compliance, internal controls, risk management and business ethics.

2. Membership

2.1 The Committee shall comprise at least three (3) non- executive directors appointed by the Board and the majority shall be independent directors.

2.2 The Board shall appoint a Chairperson from independent members of the Committee.

2.3 The Chairperson of the Board, the Chief Operations Officer/ Chief Executive Officer and any executive director shall not be eligible to be appointed as Chairperson or member of the Committee.

2.4 Each member of the Committee must be financially aware, and the Board shall satisfy itself that the Chairperson has relevant financial experience and expertise.

2.5 The Board shall have the power at any time to remove any members from the Committee and to fill any vacancies created by such removal.

2.6 Only members of the Committee have the right to attend Committee meetings. However, the Committee may invite other persons to attend all or part of any meeting, as deemed necessary and appropriate.

3. Secretary

3.1 The Company Secretary shall act as the Secretary of the Committee.

4. Quorum

4.1 The quorum necessary for the transaction of business shall be a majority of members.

5. Frequency of meetings

5.1 The Committee shall meet at least twice a year or otherwise as required. The Board or any member thereof, including Members of the Committee, the External Auditors, and the Head of internal audit may call further meetings. 

6. Notice of meetings

6.1 Meetings of the Committee shall be called by the Secretary of the Committee at the request of the Chairperson of the Committee or Chief Operations Officer/Chief Executive Officer, or any of its members or at the request of the

 External Auditor or Internal Auditor or Risk Officer if they consider it necessary.

6.2 Unless otherwise agreed, notice of each meeting confirming the venue, time and date, together with an agenda of items to be discussed, shall be forwarded to each member of the Committee

and any other person required to attend the meeting within a reasonable time.

7. Minutes of meetings

7.1 The Secretary shall minute the proceedings of all Committee meetings, including the names of those present and in attendance.

8. Written Resolutions

8.1 Decision may also be taken by way of written resolution signed by all members of the Committee.

9. Terms of Reference

The Committee should carry out the following duties and responsibilities: -

9.1. Auditors and External Audit

9.1.1. The Committee may be requested to recommend to the Board which firm(s), subject to the Procurement Guidelines and Process set by the Company, should be appointed as External Auditor(s).

9.1.2. The Committee will:

(i) Evaluate the independence, performance and effectiveness of the External Auditor(s)

(ii) Consider and make recommendations on the appointment and retention of the External Auditor(s), and any questions of resignation or dismissal of the Auditor(s);

(iii) Discuss and review, with the External Auditor(s) before the audit commences, the Auditor(s) engagement letter, the terms, nature and scope of the audit function, the timing, new auditing standards, audit approach, 

reports and the audit fee with a view to obtain value for money services,

(iv) Agree on negotiable procedures, beyond minimum statutory and professional duties;

(v) Consider any problems identified and improvements to existing internal control system and risk management proposed by external auditors 

(vi) Consider accounting treatments, significant transactions, or accounting judgements, that could be unusual;

(vii) Identify key matters raised during audit and arising in the current year’s management letter and satisfy itself that these are being properly followed up;

(viii) Obtain assurance from the External Auditor(s) that adequate accounting records and systems are being maintained to ensure completeness and reliability.

9.2. Financial Statements

9.2.1 The Committee will examine and review the annual financial statements, the interim reports,

any report regarding the company’s results or other financial information to be made public,

prior to submission and approval by the Board, focusing particularly on:

(i) The implementation of new systems;

(ii) Tax and litigation matters involving uncertainty;

(iii) Any changes in accounting policies and practices and Major judgmental areas;

(iv) Significant adjustments resulting from the audit;

(v) The basis on which the company has been determined a going concern and

Capital adequacy;

(vi) Compliance with the financial conditions of loan covenants;

(vii) Compliance with international financial reporting standards, and legal requirements where applicable;

(viii) Review the annual report and accounts taken as a whole, to ensure they present a balanced and understandable assessment of the position, performance and prospects of the company;

(ix) Review the External Auditor(s) proposed audit certificate;

(x) Discuss problems and reservations arising from the audit, and any matters the auditor(s) may wish to discuss (in the absence, where requested by the Committee, of executive directors, and any other person who is not a member of the Committee);

(xi) Review the External Auditors’ management letter and management response; and

(xii) Change in audit fees (if any) after completion of audit exercise

9.3. Internal Control and Internal Audit

9.3.1 An important role of the Committee will be to monitor and supervise the effective function of the internal audit, ensuring that the roles and functions of the external audit with internal audit are sufficiently clarified and co-ordinated 

to provide an objective overview of the operational effectiveness of the company’s systems of internal control and reporting. This will include:

(i) Evaluating the performance of internal audit and assessment of the availability and adequacy of internal audit resources; 

(ii) Reviewing the internal audit function’s compliance with its mandate as approved by the Committee and the independence of internal auditors;

(iii) Reviewing the effectiveness of the company’s systems of internal control, including internal financial control and enterprise risk management and reporting;

(iv) Considering the appointment, dismissal or re-assignment of the head of the internal audit function;

(v) Reviewing and approving the internal audit charter, internal audit plans and objectives;

(vi) Reviewing findings, conclusions and recommendations from the internal audit exercise;

(vii) verify follow-up by internal auditors on the adequacy of corrective action taken in response to significant internal audit findings;

(viii) Reviewing management responses to internal audit findings reported

(ix) Maintaining proper and adequate accounting records;

(x) Safeguarding company’s assets against unauthorised use or disposal; and

(xi) Review significant cases, as may be reported by the internal audit department or management, of employee conflicts of interest, misconduct or fraud, or any other unethical activity by employees or the company;

9.4. Audit and Risk Management Committee

The Duties of the Committee pertaining to Risk management shall include the following:

(i) Consider and recommend to the Board the establishment and implementation of the Risk Management Framework (“RMF”) which also encompasses the Risk Management Strategies and processes;

(ii) Review and recommend to the Board areas where risk assessment exercises should be conducted including the risk identification and assessment methodologies proposed by Management;

(iii) Considering and taking appropriate action on the exposure of the Company to market risk, credit risk, liquidity risk, operational risk, commercial risk and any other risks appropriate

to investment management and financial activities which may be identified from time to time;

(iv) Review and recommend to the Board the remedial plans as proposed by Management, to mitigate the impact of risks;

(v) Review of the practices of the Company to ensure that any transactions that may have a material effect on the stability, solvency and reputation of the Company are identified in a

timely manner and dealt with; and 

The Committee shall also consider any other matters as may be instructed by the Board from time to time.

10. Reporting responsibilities

10.1 The Committee shall make recommendations to the Board as it deems appropriate, on any area within its remit where action or improvement is needed.

11. Other matters

The Committee shall:

11.1 Have access to sufficient resources in order to carry out its duties, including access to the Company secretary for assistance as required.

11.2 Work and liaise as necessary with all other Board Committees.

11.3 Arrange for periodic reviews of its own performance and, as when required, review its charter to ensure it is operating at maximum effectiveness and recommend any charges it considers necessary to the Board for approval.

12. Authority

12.1 The Committee is authorized by the Board to obtain, at the company’s expense, outside legal or other professional advice on any matter within its terms of reference.


CORPORATE GOVERNANCE COMMITTEE CHARTER

1. Purpose

1.1 The primary function of the Corporate Governance Committee (hereinafter referred to as ‘the Committee’) is to advise the Board of Directors on all aspects of corporate governance.

The tasks that are the usual responsibility of the Remuneration and Nomination Committee will also be entrusted to the Corporate Governance Committee.

2. Membership

2.1 The Committee shall comprise at least three (3) members and the majority should be nonexecutive and where possible independent directors.

2.2 Only members of the Committee have the right to attend Committee meetings. However, the Committee may invite other persons to attend all or part of any meeting, as deemed necessary and appropriate.

2.3 The Board shall appoint the Committee Chairperson who should be an independent nonexecutive director. In the absence of the Committee chairperson, the remaining members present shall elect one of themselves to chair the meeting 

from those who would qualify under these terms of reference to be appointed to that position by the Board.

3. Secretary

3.1 The Company Secretary shall act as the Secretary of the Committee.

4. Quorum

4.1 The quorum necessary for the transaction of business shall be a majority of members.

5. Frequency of meetings

5.1 The Committee shall meet at least twice a year or otherwise as required.

6. Notice of meetings

6.1 Meetings of the Committee shall be called by the Secretary of the Committee at the request of the Chairperson of the Committee or Chief Operations Officer/Chief Executive Officer with at least five [5] days’ notice.

6.2 Unless otherwise agreed, notice of each meeting confirming the venue, time and date, together with an agenda of items to be discussed, shall be forwarded to each member of the Committee and any other person required to attend the meeting within a reasonable time. 

7. Minutes of meetings

7.1 The Secretary shall minute the proceedings and resolutions of all Committee meetings, including the names of those present and in attendance.

8. Written Resolution

8.1 Decision may also be taken by way of written resolution signed by all members of the Committee.

9. Terms of Reference

The Committee should carry out the following duties and responsibilities: -

9.1. Corporate Governance

9.1.1 Oversee the implementation of the corporate governance framework.

9.1.2 Periodically review and evaluate the effectiveness of the Company`s Code of Conduct and Ethics.

9.1.3 Review the position descriptions of the Chairperson, and Board Committee chairs and recommend any amendment to the Board.

9.1.4 Review annually with the Board the size and composition of the Board as a whole.

9.2. Nomination

9.2.1 Give full consideration to succession planning for directors and other senior executives in the course of its work, taking into account the challenges and opportunities facing the Company, and the skills and expertise needed on the Board in the future.

9.2.2 Keep under review the leadership needs of the Company, both executive and non-executive, with a view to ensuring the continued ability of the Company to compete effectively in the marketplace.

9.2.3 Be responsible for identifying and nominating for the approval of the Board, candidates to fill board vacancies as and when they arise.

9.2.4 Ensure that on appointment to the Board, non-executive directors receive a formal letter of appointment.

9.2.5 Review the results of the board performance evaluation process that relate to the composition of the board.

9.2.6 Work and liaise as necessary with all other board committees.

9.3. Remuneration

9.3.1 Be responsible for the remuneration of Senior Officers and Executives of the Company.

9.3.2 The level and structure of remuneration for Directors shall be determined at the Shareholders’ Meeting. 

10. Reporting responsibilities

10.1 The Committee Chairperson shall report to the Board on its proceedings after each meeting on all matters.

10.2 The Committee shall make whatever recommendations to the Board it deems appropriate on any area within its remit where action or improvement is needed.

11. Other matters

The Committee shall:

11.1 Have access to sufficient resources in order to carry out its duties, including access to the Company Secretary for assistance as required.

11.2 Give due consideration to laws and regulations, the principles of the Code of Corporate Governance and any other applicable rules.

11.3 Arrange for periodic reviews of its own performance and, as when required, review its charter to ensure it is operating at maximum effectiveness and recommend any changes it considers necessary to the Board for approval.

12. Authority

12.1 The Committee is authorised by the Board to obtain, at the Company`s expense, outside legal or other professional advice on any matters within its terms of reference.

Prime Partners Ltd Corporate Governance

Key Governance Responsibilities and Accountabilities

(i) Chairman of the Board

The roles of the Chairman and the Chief Operations Officer are distinct. The Chairman is primarily responsible for the activities of the Board and its Committees. He is responsible for the running of the

Board and ensuring its effectiveness in all aspects of its role, including regularity and frequency of meetings. He acts as the spokesman for the Board and is the principal contact for the Chief Operations

Officer. The Chairman and the Chief Operations Officer (also an Executive Director) meet regularly. The Chairman discusses and sets the agenda with the Chief Operations Officer and the Company

Secretary and facilitates the effective contribution of non-executive directors and encourages active participation during Board Meetings. He ensures that Board members, upon appointment, participate in

an induction programme and that the development needs of directors are identified and appropriate training is provided. The Chairman ensures effective implementation of Board decisions.

The Chairman should ensure that directors (particularly non-executive directors) have sufficient time to consider critical issues and obtain answers to any questions or concerns they may have and are not

faced with unrealistic deadlines for decision making. The Chairman maintains sufficient contact with major Shareholders to understand their issues and concerns. The Chairman also ensures that the views

of Shareholders are communicated to the Board as a whole so that all directors develop an understanding of their views.

(ii) Chief Operations Officer

The Chief Operations Officer has the authority and responsibility to manage the overall operations and resources of the Company. He acts as the main point of contact between the Board and the Management.

The Chief Operations Officer ensures that a proper assessment of the risks under a variety of possible or likely scenarios is undertaken and presented to the Board. The other responsibilities of the Chief

Operations Officer include among others: to develop and recommend to the Board a long-term vision and strategy for the Group as well as the annual business plan and budgets that support the Group’s

strategy; to execute and implement the strategy of the Board; to monitor the Group’s performance and keep the Board appropriately informed; to foster a corporate culture that promotes ethical practices,

rejects corrupt practices, offers equal opportunities, encourages individual integrity and meets social responsibility objectives and imperatives. The Chief Operations Officer serves as the chief 

spokesperson for the Company on all operational and day-to-day matters. The Chief Operations Officer communicates with stakeholders and the public.

(iii) Chairman of the Audit and Risk Management Committee

The Chairman of the Audit and Risk Management Committee works in close cooperation with and provides support and advice to the Chairman of the Board. He has the following responsibilities,

amongst others:-

➢ To provide risk expertise to the Committee;

➢ To ensure the financial statements comply with the appropriate accounting standards;

➢ To guide and advise the Board on an appropriate risk management framework; and

➢ To report the deliberations of the Audit and Risk Management Committee to the Board.

(iv) Chairman of the Corporate Governance Committee

The Chairman of the Corporate Governance Committee works in close collaboration with, and provides support and advice to the Chairman of the Board. He has the following responsibilities, amongst others:-

➢ To provide expertise in the areas of corporate governance;

➢ To ensure that the Board is up to the standard with the Code;

➢ To ensure that an evaluation is carried out each year of the Board performance; and

➢ To report the deliberations of the Corporate Governance Committee to the Board.

(v) Company Secretary

The Company Secretary provides guidance and support to the Board as a whole and directors individually with detailed guidance as to how their responsibilities should be properly discharged in the

best interests of the Company. The main responsibilities of the Company Secretary include amongst others, to: prepare and circulate agendas of Board, Board Committees and Shareholders’ meetings and

any supporting papers; take minutes of meetings and circulate same to members; ensure that the procedure for the appointment of directors is properly carried out; and ensure that the Corporation

complies with its Constitution and all relevant statutory and regulatory requirements and any procedures set by the Board.

The Company Secretary ensures the presentation of high-quality information to the Board, Board Committees and Shareholders and that the meetings and resolutions of the Board and Shareholders are

held and passed in accordance with the Company’s Constitution and the Companies Act. The Company Secretary assists in the proper induction of directors, including assessing the specific needs of directors.

The Company Secretary provides comprehensive practical support and guidance to directors both as individuals and as a collective with particular emphasis on supporting the non-executive directors.


NATIONAL REAL ESTATE LTD

AUDIT AND RISK MANAGEMENT COMMITTEE CHARTER

1. Purpose

The Audit and Risk Management Committee (hereinafter referred to as ‘the Committee’) assists the Board of Directors in fulfilling its oversight responsibilities related to corporate accounting, financial

reporting practices, quality and integrity of financial reports, compliance, internal controls, risk management and business ethics.

2. Membership

2.1 The Committee shall comprise at least three (3) non- executive directors appointed by the Board and the majority shall be independent non-executive directors.

2.2 The Board shall appoint a Chairperson from independent non-executive members of the Committee.

2.3 The Chairperson of the Board, the Managing Director, the Chief Finance Officer and any executive director shall not be eligible to be appointed as Chairperson or member of the Committee.

2.4 The Board shall satisfy itself that the Chairperson of the Committee has recent and relevant financial experience with a professional qualification from one of the professional accountancy bodies.

2.5 The Board shall have the power at any time to remove any members from the Committee and to fill any vacancies created by such removal.

2.6 Only members of the Committee have the right to attend Committee meetings. However, the Committee may invite other persons to attend all or part of any meeting, as deemed

necessary and appropriate.

3. Secretary

3.1 The Company Secretary shall act as the Secretary of the Committee.

4. Quorum

4.1 The quorum necessary for the transaction of business shall be a majority of members.

5. Frequency of meetings

5.1 The Committee shall meet at least twice a year at appropriate intervals in the financial reporting and audit cycle and otherwise as required.

6. Notice of meetings

6.1 Meetings of the Committee shall be called by the secretary of the Committee at the request of the Committee chairperson or any of its members or at the request of the External Auditor or Internal Auditor

or Risk Officer if they consider it necessary.

6.2 Unless otherwise agreed, notice of each meeting confirming the venue, time and date, together with an agenda of items to be discussed and supporting papers, shall be sent to Committee members and any

other attendees before the date of the meeting

7. Minutes of meetings

7.1 The Secretary shall minute the proceedings of all Committee meetings, including the names of those present and in attendance.

8. Written Resolutions

8.1 Decisions may also be taken by way of written/circular resolutions signed/approved by all members of the committee.

9. Terms of Reference

The Committee shall fulfill its duties and responsibilities as follows:

9.1 Financial Statements

9.1.1 The Committee will examine and review the quality and integrity of the financial statements of the Company including its annual report.

9.1.2 The Committee shall consider and recommend dividend payment to the Board.

9.1.3 In particular, the Committee shall review and challenge where necessary:-

➢ Compliance with International Financial Reporting standards and legal requirements;

➢ The methods used to account for significant or unusual transactions where different approaches are possible;

➢ Whether the Company has followed appropriate accounting standards and made appropriate estimates and judgements taking into account the views of the External Auditor;

➢ The clarity and completeness of disclosure in the Company’s financial reports and the context in which statements are made;

➢ All material information presented with the financial statements, such as the business review and the corporate governance statements relating to the audit and to risk management; and

➢ The basis on which the Company has been determined a going concern.

9.2 Internal Controls and Risk Management Systems

The Committee shall:

9.2.1 keep under the adequacy and effectiveness of the Company’s systems of internal control, including internal financial control and business risk management and maintaining effective  internal control systems.

9.2.2 Support the Risk Officer by understanding key risks the organization has assumed and overseeing the management of these risks.

9.2.3 Review the risk philosophy, strategy and policies recommended and consider reports.

9.2.4 Ensure compliance with such policies and with the overall risk profile.

9.2.5 Review the management of current and emerging risks.

9.2.6 Provide guidance on areas of focus.

9.2.7 Propose risk appetites and risk limits for key risks to the Board of Directors.

9.2.8 Focus on risk identification, measurement, monitoring and management processes.

9.2.9 Ensure appropriate methodologies and systems are in place to identify and adequately assess and manage operational risks.

9.2.10 Monitor insurance experience relative to valuation assumptions and projections.

9.3 Compliance

The Committee shall:

9.3.1 Review the annual compliance work plan and other reports from the Compliance function.

9.3.2 Keep under review the adequacy and effectiveness of the Company’s compliance function.

9.4 Internal Audit

The Committee shall:

9.4.1 Ensure the Internal Auditor has direct access to the Board Chairperson and to the Committee Chairperson and is accountable to the Committee.

9.4.2 Review and assess the annual internal audit work plan.