Terms of Reference of Nomination and Remuneration Committee

(1st revision approved by the Board of Directors on 13 June 2022)
1.1The principal objectives of the Nomination and Remuneration Committee (“NRC”) are to assist the Apex Equity Holdings Berhad (“AEHB”) Board of Directors (“Board”) in the following:
Nominating Function
1.1.1In respect of the AEHB Group of Companies (“Group”), the selection of Board Directors, Chief Executive Officer (“CEO”) and Key Responsible Persons (“KRP”) as defined below, for recommendation to the Board for approval. The nominees must meet the Fit and Proper Criteria as set out in the Group Human Resource Policy Document.
1.1.2To ensure there is an appropriate assessment of the effectiveness of the Board as a whole, its Committees and the contribution of each individual Director on at least, an annual basis. The assessment shall include but not be limited to the required mix of skill sets, knowledge and experience, diversity, the size of the Board and the balance between the number of Executive and Non-Executive Directors.
1.1.3To ensure there is an efficient and effective organisation structure providing for sufficient succession planning and human capital development in the Group.
Remuneration Function
1.1.4To recommend to the Board for approval, the remuneration framework for the Group.
1.1.5The framework should take into account all elements relating to remuneration, terms of employment, reward structure and fringe benefits (where relevant) through a transparent and independent process, taking into consideration the need to attract and retain talents in the Group, for the furtherance of corporate values and objectives, and its sustained long-term growth.
1.1.6The framework shall be applied to the Board and all employees in the Group.
1.2Key Responsible Persons shall be defined as follows:-
(a)selected Heads of Group Departments/functions named in the annual report; and
(b)key personnel holding key positions in the Group and/or whose appointment is subject to regulatory requirements, review and/or approvals, and subject always to the fit and proper tests required to be carried out in accordance with the regulatory framework and processes.
2.1The NRC members shall be appointed by the Board from amongst their number and shall consist of not less than three (3) Members, all of whom shall be Non-Executive Directors, a majority of whom shall be Independent Directors.
2.2The Chairman of the Board shall not be a member of the NRC.
2.3No alternate Director shall be appointed as a member of the NRC.
2.4Any NRC member may relinquish his/her membership after the expiration of five (5) working days prior written notice to the NRC Chairman.
2.5In the event the number of Members falls below three (3), the Board shall fill the vacancy within three (3) months of that event.
3.1The Chairman of the NRC shall be elected from amongst the NRC members and shall be an Independent Non-Executive Director or the Senior Independent Non-Executive Director appointed by the Board.
3.2The role of the NRC Chairman includes:
3.2.1leading the succession planning and appointment of Directors.
3.2.2overseeing the development of a diverse pipeline for Board and Management succession including the future Chairman, Executive Directors and CEO.
3.2.3leading the annual assessment of Board effectiveness, ensuring that the performance of each individual Director and the Chairman of the Board are independently assessed.
4.1The Secretary of the NRC shall be the Company Secretary. 
5.1The NRC is authorised by the Board, and at the expense of the Company to perform the following:
5.1.1secure the resources in order to perform its duties as set out in its Terms of Reference (“TOR”).
5.1.2to investigate any matter within its TOR.
5.1.3obtain independent professional advice, service and/or expertise to perform its duties, where necessary.
5.1.4have full and unrestricted access to Management and any information pertaining to the Group, including without limitation, its data, records, properties and personnel.
5.1.5convene meetings without the presence of other Directors and/or Management of the Group, as it deems fit.
5.1.6provide its recommendations to the Board for consideration and approval. For the avoidance of doubt, the NRC does not have any approval authority.
6.Duties and Functions
The main duties and functions of the NRC shall include but are not limited to the following:
6.1Nominating Functions and Duties
6.1.1Assessment of Board Composition
(a)Establish a policy formalising the Group’s approach to boardroom diversity (including diversity in gender, nationality, age, culture, socio-economic background, skills, experience and independence).
(b)Annually evaluate, review and recommend to the Board the appropriate size of the Board, required mix of skills, experience and other qualities, including core competencies which Non-Executive Directors shall bring to the Board to ensure that these are in line with the Group’s requirements.
(c)Consider and recommend any policy regarding the period of service of Non-Executive Directors, tenure of Independent Directors and the term of office of Board Committee members, including the Chairmen of Board Committees.
(a)To assess and recommend to the Board, candidates for appointment as Directors, Board Committee Members, CEO and KRPs taking into consideration the following selection criteria:
required skills, knowledge, expertise and experience;
time commitment, character, professionalism and integrity;
ability to work cohesively with the other members of the Board;
diversity in age, gender, experience/background and independence;
number of directorships in companies outside the Group; and
specialist knowledge or technical skills relevant to the implementation and execution of the Group’s strategy.
(b)In recommending candidates for appointment as Independent Non-Executive Directors, to assess that such candidate meets the criteria of independent Director as defined in the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (“Main Market LR”).
(c)In recommending candidates for appointment of Directors, to consider candidates proposed by the existing Directors, major shareholders, CEO and from independent sources, such as a directors’ registry, open advertisement or the use of independent research firms.
(d)In recommending candidates for appointment as Senior Independent Non-Executive Director, the NRC shall assess the required skills and knowledge and other qualities necessary for the effective discharge of the person’s responsibilities.
(e)To review and recommend to the Board, the appointment, evaluation, acceptance of resignation, disciplinary actions and termination of the CEOs in the Group.
(f)To review and if deemed appropriate, endorse for the Board’s approval, the recommendations of the CEO (where relevant) on the appointment, evaluation, promotion, acceptance of resignation, disciplinary actions and termination of the Group’s KRPs.
6.1.3Retirement and Re-election
(a)To ensure that every Director is subject to retirement at least once in every three (3) years. A retiring Director is eligible for re-election unless the Director is required to vacate the position in compliance with the Company’s Articles of Association or Constitution as the case may be or with any law or regulation.
(b)Taking into consideration the existing composition of the Board and the tenure of each Director, and subject to the provisions in the Main Market LR and the best practices in the Malaysian Code on Corporate Governance 2021 (“MCCG”):
(i)to annually assess, consider and recommend to the Board, Directors for re-election to be approved by shareholders pursuant to the Company’s Articles of Association or Constitution as the case may be.
(ii)to annually assess, consider and recommend to the Board, the Independent Director who has served nine (9) years and beyond for continuation in office, taking into consideration his/her performance and ability to continue and contribute to the Board, whether his/her independence has been impaired, provided justification and seek annual shareholders’ approval through a two-tier voting process.
6.1.4Annual Performance Assessment
(a)To assist the Board in establishing procedures and processes towards an annual assessment of the effectiveness of the Board as a whole and each Board Committee (including its size and composition), as well as the contribution of each individual Director.
(b)To oversee the overall composition of the Board in terms of structure, appropriate size, required mix of skills sets, knowledge and experience, diversity, core competencies, and the adequacy of balance between Executive Directors, Non-Executive Directors and Independent Directors through annual review.
(c)To assess annually, the effectiveness of the Board as a whole, the Board Committees, each Director and the performance evaluation of the CEO based on the criteria for performance evaluation as approved by the Board. The NRC may seek the services of independent third parties to facilitate the Board effectiveness evaluation on a needs basis or in compliance with any law or regulation.
(d)To assess annually, the Fit and Proper Criteria and independence of each Independent Non-Executive Director as provided in Main Market LR to ensure he/she is independent in order to be able to provide continued appropriate scrutiny and impartial judgement.
(e)To review annually, the terms of office, competency and performance of the Audit Committee and each of its members to determine whether the Audit Committee and its members have carried out their duties in accordance with their terms of reference.
(f)To develop, maintain and review on a needs basis, the criteria for evaluating the performance of the Board, Board Committees, Directors, CEO and KRPs. Such Board evaluations shall include forward looking considerations such as mapping current Board competencies against those required to drive the Group’s future strategies and helps determine the upskilling or development needs of individual Directors or the Board collectively.
6.1.5Succession Planning
(a)The CEO shall assist the NRC in ensuring that an appropriate succession planning framework, talent management and human capital development programme is in place for the CEO and KRPs.
(b)To oversee succession planning for the Board Chairman, Directors, CEO and KRPs taking into account the challenges and opportunities facing the Group and the skills and expertise needed in the future.
6.1.6Training and Development
To facilitate and recommend suitable orientation and training programmes to continuously train and equip new and existing Directors by determining areas that would best strengthen their contributions to the Board.
6.2Remunerating Functions and Duties
(a)To establish and recommend to the Board, the general remuneration policy and procedures, and remuneration structure which takes into account the demands and complexities of the business, the levels of skills and experience relevant to individual performance for Directors, CEO and KRPs with the objective of attracting, retaining and motivating talents in line with the Group’s corporate objectives and needs.
(b)In respect of Executive Directors, CEO and KRPs, to ensure that the total remuneration package (“TRP”) takes into account the complexity of the Group’s business, commensurate with their individual performance, skills and responsibility expected of them, and to ensure the TRP is aligned with the business strategy and long-term objectives of the Group, and considers the Group’s performance in managing material sustainability risk and opportunities, benchmarked to the market to attract, motivate and retain talents needed for the Group.
(c)In respect of Non-Executive Directors, to ensure via the Board as a whole, that the remuneration payable reflects the skills, experience, time demanded of the Directors to discharge their duties and responsibilities undertaken, and to provide oversight, leadership and guidance to the Group.
(d)To assess the Annual Performance of the Executive Directors, CEO and KRPs.
(e)To oversee the overall bonus structure of the Group and to endorse broad targets.
(f)To oversee key human resource policies and guidelines to ensure they are in line with the Group’s corporate objectives and strategy.
(g)To review and if deemed appropriate, endorse for the Board’s approval, the recommendations of the CEO, the annual bonus and salary increment framework for the Group, including the total quantum of payment.
(h)To review and recommend to the Board the terms and conditions of service, remuneration, compensation and benefits package (including bonus and salary increment) of the Executive Directors and CEO.
(i)To review and if deemed appropriate, endorse for the Board’s approval, the recommendations of the CEO, the terms and conditions of service, remuneration, compensation and benefits package (including bonus and salary increment) of the KRPs.
(j)To review and recommend to the Board, the granting of share incentives to the Executive Directors, CEO and KRPs.
(k)To engage external professional advisors to assist and/or advise the NRC on remuneration matters, where necessary.
(l)To review the remuneration framework, policies and procedures on an annual basis.
6.3Other Matters
6.3.1The NRC may delegate any of its duties and responsibilities under its TOR to a sub-committee as it deems fit. Notwithstanding, the NRC shall bear final responsibility and accountability for the actions and decisions of the sub-committee.
6.3.2To act in line with the directions of the Board.
7.1.1The NRC shall meet at least twice a year and at such other time(s) as it deems necessary.
7.1.2Other members of the Board and Management may attend the NRC meetings by invitation.
7.2Notice and Agenda
7.2.1Any NRC member may at any time, and the Secretary on the requisition of a NRC member shall, summon a meeting of the NRC by notice served on the NRC members.
7.2.2The NRC Meeting Agenda shall be the responsibility of the NRC Chairman with input from the NRC members as they deem fit, and assisted by the Secretary. Where necessary, the Agenda shall include input from Management or such other persons approved by the NRC Chairman.
7.2.3Unless otherwise agreed, the Secretary shall issue and circulate the notice of the NRC meetings confirming the venue, time and date at least seven (7) working days before each meeting by e-mail at the email address provided or by any means of telecommunication to the NRC members and all those who are required to attend the meeting. NRC members may waive the notice of any meeting either prospectively or retrospectively, if required. The agenda and meeting materials shall be emailed to the NRC members and to other attendees as appropriate, at the same time when available subject to the approval of the NRC Chairman.
7.3 Quorum
7.3.1The quorum for NRC meeting shall be two (2) members, both of whom must be Independent Non-Executive Directors.
7.3.2In the absence of the NRC Chairman, the Members present shall elect an Independent Non-Executive Director from amongst them to Chair the meeting.
7.4Meeting Mode
7.4.1A meeting of the NRC shall normally be conducted face-to-face to enable effective discussion; however, meetings may also be conducted by means of telephone conferencing, video conferencing or other electronic means as determined by the NRC, through which all persons participating in the meeting can hear and speak with each other.
7.4.2NRC members participating in any such meeting shall be deemed to be present in person at the meeting and shall be entitled to be counted in the quorum and vote accordingly.
7.4.3The meeting shall be deemed to be held at the place where the largest group of those participating is assembled or, if there is no such group, where the Chairman of the meeting is located.
7.5.1All decisions of the NRC shall be decided by a simple majority of votes, each member having one (1) vote. Any decision or recommendation made at the NRC shall be subject to the review and ultimate approval of the Board.
7.5.2In case of equality of votes, the Chairman shall have a second or casting vote. Where two (2) NRC members form a quorum, the Chairman of a meeting at which only such a quorum is present or at which only two (2) NRC members are entitled to vote in the question at issue, the Chairman shall not have a casting vote.
7.5.3NRC members are required to abstain from deliberations and voting in respect of their own remuneration and any matter which may give rise to an actual or perceived conflict of interest situation.
7.6Minutes of Meetings
7.6.1Minutes of each meeting signed by the Chairman of the said meeting or by the Chairman of the next succeeding meeting shall be kept at the registered office and distributed to each member of the NRC and also to the other members of the Board.
8.1A resolution in writing signed, confirmed or approved by letter, email or other means of written communications by a majority of the NRC members sufficient to form a quorum, shall be as valid and effectual as if it has been passed at a meeting of the NRC duly called and constituted.
8.2All such resolutions shall be described as “Nomination and Remuneration Committee’s Circular Resolutions” and shall be promptly forwarded or otherwise delivered to the Secretary, and shall be recorded by her in the Company’s Minutes Book. Any such resolution may consist of several documents in like form, each signed by one or more Members.
9.Reporting Responsibilities
9.1The NRC Chairman shall orally report on the proceedings of each NRC meeting to the Board at the first Board meeting following the NRC meeting.
9.2The NRC shall make whatever recommendations to the Board it deems appropriate, on any area within its TOR and/or where any action or improvement is needed.
10.Review of the Terms of Reference
10.1The NRC shall recommend to the Board for approval, any change to its TOR in such manner as the NRC deems appropriate. The TOR shall be assessed, reviewed and if required, updated as and when necessary, and in any event, at least on an annual basis.

Revision History

Version Effective Date
1 29.11.2021
1st Revision 13.06.2022

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