Corporate Governance | Ablegroup Berhad

Corporate Governance Statement

The Board of Directors of AbleGroup Berhad (the “Company”) recognises the importance of adopting good corporate governance practise and is fully committed to ensuring that the Company and its subsidiaries (the “Group”) practices the highest standard of corporate governance and transparency in line with the principles and recommendations of the Malaysian Code on Corporate Governance (the “Code”) to achieve the Group’s objective and enhance shareholders’ value.

The application of the principles and practices of the Code by the Group are reported herein together with the Corporate Governance Report 2023.

PRINCIPLE A : BOARD LEADERSHIP AND EFFECTIVENESS

I. BOARD RESPONSIBILITY

Clear functions of the Board and Management

The role of the Board includes to lead and oversee the Group’s business operations and performance and ensure that the Group’s objectives are met and shareholders value are maximised.

The Group continues to be led by an experienced Board, with high personal integrity, business acumen and management skills, which is primarily entrusted with the responsibility of charting the direction of the Group.

In line with the Code, the roles and responsibilities of the Chairman and Managing Director are separated to ensure balance of power and authority, clear division of responsibilities and accountability. The responsibility of the Chairman is primarily to ensure that the conduct and function of the Board is in an orderly and effective manner and that appropriate procedures are in place whilst the Managing Director ensures that the daily business operations are properly managed and there are effective implementation of the policies and procedures adopted by the Board. The Managing Director lead a team of senior personnel who is responsible for the execution of business plans and strategies, policies and decisions approved by the Board and communicating the progress to the Board from time to time. The responsibilities and authorities of senior management team are clearly defined.

Clear Roles and Responsibilities

There are four (4) members on the Board of Directors, comprising the Managing Director and three (3) Independent Non-Executive Directors, including the Chairman of the Board.

The presence of Independent Directors that make up more than half of the Board are vital in providing unbiased and independent opinion and judgement in board deliberations. The Independent Directors act independently of Management and are not engaged in the day to day operations of the Group.

The main duties and responsibilities of the Board comprise the following:-

Setting and reviewing the objectives, goals and strategic plan for the Group;
Adopting and monitoring progress of the Group’s strategy, budgets, plans and policies;
Overseeing the conduct of the Group’s business to evaluate whether the business is properly managed to sustain the value for shareholders;
Considering and approving reserved matters covering corporate policies, material investment and acquisition/disposal of assets;
Promoting better investor relations and shareholder communications;
Reviewing the adequacy and the integrity of the Group’s internal control systems and management information system, including systems for compliance with applicable laws, regulations, rules directives and guidelines; and
Ensuring that the Group’s financial statements are true and fair and conform with applicable accounting standards.

The Board has delegated specific responsibilities to the Board Committees namely the Audit Committee (“AC”), Remuneration Committee (“RC”) and Nomination Committee (“NC”), each with defined terms of reference and responsibilities which are available at the Company’s website.

The Board receives reports and minutes of the Committees’ proceedings and deliberations at their respective meetings. Where these Committees have no authority to make decisions on matters reserved for the Board, recommendations would be presented to the Board for approval. The Chairman of the Committees report the outcome of their meetings to the Board and relevant decisions are recorded in the minutes of the Board of Directors’ meetings accordingly. The oversight functions and activities undertaken by these Board Committees are elaborated in their respective report set out in this Annual Report.

The Board is satisfied with its current composition with balanced mix of skills, knowledge and experience in the business and management fields which are essential to enable the Board to carry out its responsibilities in an effective and efficient manner.

Code of Conduct and Ethics

The Group has in place a Code of Conduct and Ethics (the “Code”) which governs the conduct of all employees including the Board members of AbleGroup Berhad and its subsidiaries. It reflects the Company’s underlying core ethical values and commitment to lay standards of integrity, transparency, fairness, accountability, contributing towards the social and environmental growth of the surroundings in which it operates, and the pursuit of excellence.

The Code is formulated to enhance the standard of corporate governance and corporate behaviour with the intention of achieving the following aims:

To articulate the high standards of honesty, integrity, ethical and law-abiding behaviour expected of Directors;
To encourage the observance of those standards to protect and promote the interests of shareholders and other stakeholders; and
To guide the Board as to the practices thought necessary to maintain the confidence of shareholders and other stakeholders in the Company’s integrity.

Under the Code of Conduct, there is clearly defined guidelines on maintaining confidentiality and disclosure of information, disclosure on conflict of interest, internal control, promote professionalism and competency, equal opportunity and non-discrimination, workplace health and safety, duty to protect the Group’s assets and whistle-blowing policy where there is a breach of Group’s policies and procedures.

The Board Charter clearly defines the code of conduct to be observed by all Directors of the Company. In the performance of Directors duties, a Director should at all times observe the following:-

Devote reasonable time and effort to attend the Group’s duties required of him;
At all times exercise their power for the purpose they were conferred, for the benefit and productivity of the Group;
Avoid any conflict of interest or where necessary, to disclose immediately all contractual interests whether directly or indirectly within the Group;
Be conscious in the process of value creation of the interest of shareholders, employers, creditors and customers of the Group;
Be aware of the Group’s policy on corporate social responsibility; and
Ensure adequate safety measures and provide protection to workers and employees at work places.

The Code of Conduct and Ethics is made available here.

Access to Information and Professional Advice

The Board recognises the importance of providing timely, relevant and updated information in ensuring an effective decision making process by the Board. Hence, the Board is provided with quantitative and qualitative information which is pertinent to enable the Board to discharge their duties effectively.

The Board receives management reports, including comprehensive review and analysis of the Group’s performance and operations. Board agenda together with the relevant documents and information are compiled and distributed to the Directors prior to the Board meeting to enable them to have sufficient time to review and be prepared for discussion. The Managing Director and/or key management personnel will brief and provide explanation of pertinent issues and/or recommendations of the Management on the proposal tabled. Matters requiring the Board’s review and approval will be deliberated and discussed thoroughly by the Board prior to decision making. Proceedings of the Board meetings are recorded and signed by the Chairman at the following Board meeting of the Company. Decision made and policies approved by the Board will appropriately be communicated to the Management Team for execution after the meeting.

Where necessary, member of the Management Team will be invited to attend Board/Board Committees’ meetings to report and/or update the Directors on specific areas of the business within their responsibility to enable Board members to seek further details or clarifications on the matter. Directors are encouraged to share their views and insights in the course of deliberation and to participate in discussions.

The Board members are updated on the Company’s activities and its operations on periodic and/or quarterly basis. In order to facilitate the Directors’ effective time planning, the annual meeting calendar setting out the scheduled dates for the meetings of the Board and Board Committees is prepared and circulated in advance by the Company Secretary to enable the Directors to plan effectively. All Directors and Principal Officers of the Group are reminded quarterly of the closed periods for dealings in the securities of the Company based on the targeted date of announcement of the Group’s interim financial results. All Directors whether as a full board or in their individual capacity have access to all information of the Group on a timely basis in an appropriate form and quality necessary to enable them to discharge their duties and responsibilities.

All Directors have access to the advice and services of the Company Secretary on matters relating to procedures regulating the Group and necessary compliance by the Group. The Directors, in their individual capacity or collectively, may take independent professional advice in furtherance of their duties, whenever necessary and in appropriate circumstances, at the Company’s expense. If such advice is considered necessary, it shall first be discussed with the Chairman before proceeding further.

Qualified and competent Company Secretary

The Board is supported by two (2) experienced Company Secretaries who are the members of the prescribed professional body and are qualified pursuant to the requirements of the Companies Act 2016. The Board has full and unrestricted access to the Company Secretary in ensuring the effective functioning of the Board. The Company Secretary plays an advisory role guiding and keeping the Board abreast of statutory and regulatory requirements, corporate governance practices and other relevant rules or guidelines applicable to the Group from time to time.

The Company Secretary is also responsible for advising the Directors of their statutory responsibilities and obligations including duties to disclose interest in securities, any conflict of interest and prohibition on dealings in securities, amongst others.

The Company Secretary organises and attends all Board and Board Committees’ meetings and ensures the meetings are properly convened as well as proper record of the proceedings and/or resolutions passed are maintained accordingly. The appointment and removal of Company Secretary shall be the decision of the Board.

Board Charter

The Board has adopted a Board Charter which sets out the principles governing the Board and outlines the Board and Board Committees’ roles and functions, Board processes, amongst others. The Board Charter is a source reference and primary induction literature, providing insights to prospective Board members.

The Board Charter is reviewed and updated periodically in accordance with the needs of the Group to ensure its effectiveness and consistency with the Board’s objectives and responsibilities as well as relevant regulations and guidelines.

The Board Charter is accessible on this website here.

II. BOARD COMPOSITION

The current composition of the Board that comprised of the Managing Director and three (3) Independent Non-Executive Directors fulfils the requirements of paragraph 15.02(1) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad that requires one-third (1/3) of the Board Members of the Company to be independent directors. The Board composition also fulfils Practise 4.1 of the Code that provides at least half of the Board to be Independent Directors.

The three (3) Independent Non-Executive Directors bring their independent and objective view and judgment to Board deliberation and decision-making process, mitigate risks due to conflict of interest or undue influence from interested parties.

The composition of the Board not only reflects the broad range of experience, diverse perspective and insights, skills and knowledge required to oversee the Group business activities, but also the importance of independence in decision-making at the Board level.

The Board is responsible to determine the appropriate size of the Board and the appointment of new director is a matter for consideration and decision by the Board, upon the recommendation of the NC. The NC has been tasked to review the recruitment and selection process of new director and will consider the required mix of skills, experience, other qualities and diversity, including gender, amongst other attributes needed to ensure an effective Board in the review and selection of potential Board member. In the case of candidates for the position of Independent Non-Executive Directors, the NC and Board shall also evaluate the candidates’ ability to discharge responsibilities/functions as expected from an Independent Non-Executive Director.

In accordance with the Company’s Constitution, one-third (1/3) or the number nearest to one-third (1/3) shall retire from office at each Annual General Meeting. A retiring Director shall be eligible for re-election. The Constitution also provides that any new or additional Director appointed by the Board during the year shall hold office until the next Annual General Meeting convened after his appointment and shall then be eligible for re-election.

The NC is tasked to review and determine the Directors retiring and subject to re-election at the AGM in accordance with the provisions of the Constitution of the Company. All retiring Directors, being eligible, have offered themselves for re-election at the AGM.

Boardroom and Workplace Diversity

The Board is committed to provide a fair and equal opportunities and nurturing diversity in the boardroom and workplace. The Board believes that while it is important to promote gender diversity, it is of the view that Board membership should be determined based on a candidate’s skills, experience, and knowledge in areas identified by the Board. The Board will take opportunities and endeavours that suitably qualified women candidates will be sought and included in the pool of candidates for evaluation in respect of new appointments to the Board.

Annual Assessment of Board effectiveness and Independence

The Board, through the NC and facilitated by the Company Secretary, has carried out annual assessment on the effectiveness of the Board and Board Committees.

The NC also assesses the independence of the Independent Non-Executive Directors annually based on the established criteria to ensure that the Independent Non-Executive Directors continue to provide unbiased, objective and independent views and judgment in Board deliberations.

The assessment criteria for independence shall not limit to the length of service of the Independent Non-Executive Directors. Particular emphasis is placed on the role of Independent Non-Executive Directors to facilitate independent and objective review and decisions making of the Group, free from undue influence and bias.

The Board and NC concluded that all the Independent Non-Executive Directors continue to demonstrate conduct and behaviour that are essential indicators of independence, and that each of them continues to fulfil the prescribed definition and established criteria of independence.

Tenure of Independent Non-Executive Directors

The Code provides that the tenure of an independent non-executive director does not exceed a cumulative term limit of nine (9) years. Upon completion of the nine (9) years, an independent director may continue to serve on the board as a non-independent director. If the board intends to retain an independent director beyond nine (9) years, it should justify and seek annual shareholders’ approval. If the board continues to retain the independent director after the twelfth (12^th) year, the board should seek annual shareholders’ approval through a two-tier voting process.

The NC and the Board have assessed and is of the view that a Director’s independence cannot be determined solely with reference to tenure of service. The Group benefits from having long serving directors who have accumulated valuable knowledge of the Group’s operations and have demonstrated competence in advising and overseeing the management of the Group.

The NC and the Board have assessed the independence of Mr. Cheong Marn Seng, who has served for a cumulative period of more than twelve (12) years, considers him to continue remain independent, unbiased and objective in expressing his opinions and in participating in the decision making of the Board. Mr Cheong had also devoted sufficient time and attention to his responsibilities as Independent Director besides exercising due care during his tenure as Independent Director of the Company and carrying out his duty in the best interest of the Company and shareholders. The length of his services on the Board has not in any way interfere with his exercise of balance and objective view to Board deliberations. Furthermore, his experience and knowledge of the Group’s businesses and operations enables him to contribute effectively to the Board.

Fostering Commitment

All Directors are expected to devote sufficient time and attention to carry out their responsibilities. In this regard, annual meetings timetable is circulated to the Board with details of the proposed scheduled date of meetings of the Board and Board Committees to enable the Directors to plan ahead.

The Board Charter provides that all Directors should notify the Chairman before accepting any new directorship.

Board Meetings

The Board meets on a quarterly basis with additional meetings held whenever necessary. Five (5) board meetings were held during the financial year ended 31 December 2023 and the attendance record were tabulated as follows:-

Directors	Attendance
Mr Yeoh Chong Keat	5/5
Dato’ Lim Kim Huat	4/5
Mr Loi Heng Sewn	5/5
Mr Cheong Marn Seng	5/5
Mdm Chong Wei Koon	2/2

Directors’ Training

The Board acknowledges the fact that continuous education is vital for the Board members to gain insight and keep abreast with the state of economy, manufacturing, technological advances in the core business, latest regulatory developments and management strategies.

The Board encourages its Directors to attend talks, seminars, workshops and in-house conferences to updates and enhance their skills and knowledge and to keep abreast with development in regulatory and corporate governance issues.

The Training Programmes attended by Directors during the financial year ended 31 December 2023 are summarised as follows:-

Date of Training	Subject
1 & 2 August 2023	National Tax Conference 2023
17 August 2023	Advocacy Sessions for Directors and CEOs of Main Market Listed Issuers
3 October 2023	Management of Cyber Risk
25 October 2023	2024 Budget Seminar

During the financial year, all the Directors have been continuously updated by the Company Secretary on changes to corporate governance developments, Listing Requirements besides other applicable laws and regulations. The Board was also briefed by the External Auditors on changes to the accounting standards that may affect the Group’s financial statements from time to time.

The Board is satisfied that the Directors have gathered sufficient experience and knowledge from their daily business activities to assist them in the discharge of their duties and responsibilities.

III. REMUNERATION

Directors’ Remuneration

The RC’s primary responsibility is to review and recommend to the Board the remuneration package of the Executive and Non-Executive Directors. The objective is to ensure that the Group attracts and retains Directors of the calibre needed to run the Group successfully. The Executive Director is to be appropriately rewarded giving due regard to the corporate and/or individual performance. In the case of Non-Executive Directors, the level of remuneration should be appropriate to the level of responsibilities undertaken by the Non-Executive Directors concerned, taking into account factors such as effort and time spent and responsibilities of the Directors including their appointment in the Board Committees.

The Group also reimburses reasonable expenses incurred by Directors where required, in the course of carrying out their duties as Directors.

Directors will abstain from discussion and voting on decisions in respect of their own remuneration. In compliance with the Companies Act 2016, the Board shall recommend the payment of Directors’ fees and allowance of the Non-Executive Directors for approval by the shareholders at the AGM of the Company.

Details of Directors’ remuneration for the financial year ended 31 December 2023 are set out below:-

GROUP

Remuneration	Executive Director (RM’000)	Non-Executive Directors (RM’000)	Total (RM’000)
Directors’ fees	–	148	148
Salaries, bonus and other emolument Defined contribution plan	– –	– –	– –
Total	–	148	148

The number of Directors whose total remuneration for the financial year ended 31 December 2023 fall within the respective bands is as follows:-

	Group Number of Directors
Range of remuneration	Executive	Non-Executive
RM1 to RM50,000 RM50,001 to RM100,000 RM100,001 to RM250,000 RM250,001 to RM300,000	– – – –	4 – – –
Total	–	4

PRINCIPLE B : EFFECTIVE AUDIT AND RISK MANAGEMENT

Audit Committee (“AC”)

The Audit Committee of the Company comprises three (3) members, with a majority being Independent Non-Executive Directors, one of whom is the member of the Malaysian Institute of Accountants.

The AC has established a transparent and professional relationship with the External Auditors. This includes undertaking annual evaluation to ascertain the suitability, independence, objectivity and professional scepticism of the External Auditors. The Auditors will highlight to the AC and the Board on matters that require their attention.

During the financial year ended 31 December 2023, the AC has conducted private sessions with the External Auditors without the presence of the Management on 24 February 2023, 5 April 2023 and 24 November 2023 to discuss material matters relating to the audit and the assistance provided by the Management to the External Auditors. The AC noted that there were no major issues within the Group that requires the attention of the AC during the course of the audit.

The AC has in the adopted External Auditors Policy provided that the key audit partners shall not be nominated for appointment as a Director of the Company or any of its related corporations within two years of undertaking any role on the audit or the audit firm ceasing to be the external auditors.

The AC was satisfied with the External Auditors’ quality of services and sufficiency of resources they provided to the Group, in terms of the firm and the professional staff assigned to the audit and had recommended to the Board for approval the proposed re-appointment of the External Auditors at the AGM of the Company.

Risk Management and Internal Control

The Board acknowledges its responsibility and re-affirms its commitment in maintaining a sound risk management and internal control system to safeguard the interest of shareholders and the Group’s assets. The responsibility of reviewing the adequacy and integrity of the Group’s risk management and internal control system is delegated to the AC which is empowered by its Terms of Reference to seek assurance on the adequacy and integrity of financial, operational and compliance control and internal control system and risk management procedures through independent reviews carried out by the internal audit function and management.

The Board through the AC has established an ongoing process in identifying, evaluating and managing significant risks faced by the Group. This ongoing process which includes updating the risk management and internal control system when there are changes in the business environment or regulatory guidelines is reviewed by the Board.

The Board recognises that risk cannot be totally eliminated and the system of internal control instituted can only help to minimise and manage risk and provides reasonable assurance that assets of the Company and of the Group are safeguard against material loss and unauthorised use and the financial statements are not materially misstated.

The Company has outsourced its internal audit function to an independent professional consultancy firm with the aim of providing independent and systematic reviews on the systems of internal control within the Group whose role is to review and provide independent and objective review on the organisation’s management, records, accounting policies and control, management of risks and processes as well as systems of internal control, and report to the AC. The internal auditorsevaluate and improve the effectiveness of risk management and the control processes where significant risks are identified, assessed and managed.

The Internal Auditors present and report to the AC internal audit reports on their findings and recommendations with respect to identified control weaknesses and Management responses to the recommendations. Follow up reviews will be conducted to ensure that the necessary corrective actions and/or improvement procedures have been implemented by Management to address the audit observations highlighted. The internal audit function is conducted in a manner that is consistent with and meets the Standards for the Professional Practice of Internal Auditing and Code of Ethics of the Institute of Internal Auditors Malaysia.

PRINCIPLE C : INTEGRITY IN CORPORATE REPORTING AND MEANINGFUL RELATIONSHIP WITH STAKEHOLDERS

Investors Relations and Shareholders Communication

The Board values dialogue with its shareholders and investors through the maintenance of an open communication policy with investors and shareholders alike. In ensuring effective communication, the various means and forums such as press releases, public announcements released by the Group including the interim financial report on quarterly basis, annual report and financial statements, disclosures to the Bursa Malaysia Securities Berhad and other Group activities are made.

In addition to its published annual report and quarterly reports announced to Bursa Malaysia Securities Berhad, the Group has established a website at www.ablegroup.com.my from which shareholders can assess for information.

Members of the Board including the Chairman of the Board and Board Committees attend the general meetings to engage with and address shareholders’ queries on the business and performance of the Group at these meetings.

Annual General Meeting (“AGM”)

The notice convening the 2023 AGM of the Company was sent to the shareholders at least twenty-one days’ before the AGM in accordance with the provisions of the Listing Requirements of Bursa Securities and the Company’s Constitution. The notice convening the 2023 AGM was advertised in the newspaper giving shareholders sufficient time to prepare and/or to appoint proxy to attend and vote for their behalf.

The AGM of the Company represents the principal forum for dialogue and interaction between the Board and the shareholders. The participation of shareholders at the general meetings to seek clarifications on the Group’s operations and business and to have direct interaction with the Management and Board for exchange of views are encouraged. Pursuant to the Listing Requirements, all resolutions proposed for shareholders’ approval at the general meeting of the Company will be voted by poll, and the Company will appoint a scrutineer to validate the votes cast at the general meeting. The Company will consider introducing electronic voting and leverage on technology to facilitate greater shareholders’ participation in the general meetings of the Company at appropriate time.