Remuneration Committee - TOR
HeveaBoardBerhad [Registration No. 199301020774 (275512-A)]
REMUNERATION COMMITTEE - TERMS OF REFERENCE
The Terms of Reference are as follows:
1. OBJECTIVE
1.1 The Remuneration Committee assists the Board to establish a formal and transparent procedure for developing remuneration policy for Directors and Senior Management, and implements the policy and procedures accordingly.
2. COMPOSITION
2.1 The Remuneration Committee shall be appointed from amongst the Board and shall:-
(i) comprise no fewer than three (3) members;
(ii) comprise solely of non-executive directors; and
(iii) a majority of them must be independent directors
2.2 A member shall automatically cease to be a member of the Remuneration Committee if he resigns or retires from the Board, or if he is removed or is disqualified from being a director under any provisions of the laws, rules and regulations of the relevant authorities.
2.3 Where appropriate, the Chairman of the Board should not be the chairman/member of the Remuneration Committee.
2.4 Chairman
2.4.1 The Chairman of the Remuneration Committee shall be elected from amongst the committee members whom shall be a Senior Independent Non-Executive Director identified by the Board.
2.4.2 In the absence of the Chairman, the members can elect from amongst themselves to chair the meeting.
2.3 Secretary
2.3.1 The Company Secretary of the Company shall be the Secretary of the Remuneration Committee.
3. DUTIES AND RESPONSIBILITIES
3.1
i. Develop remuneration policy and establish procedures for review of remuneration packages of Directors and Senior Management.
The level of remuneration should be in accordance with the Company’s Constitution, after due consideration on relevant factors including the function, workload and responsibilities involved, and after taking into account the compensation levels for comparable positions among others in the similar industry.
(a) Executive Director
- The remuneration should be structured so as to link corporate performance to individual performance and contribution.
- It is determined based on the performance of the Group and the Company and the achievement of the goals, including quantified organisational targets, key performance indicators and personal achievement.
- Executive Director is not entitled to Directors’ fees and meeting allowance.
- Executive Director shall have a service contract with the Company.
(b) Non-Executive Director
- The remuneration of Non-Executive Directors should reflect the contribution and level of responsibilities undertaken by them, and the Company’s performance.
- Non-Executive Directors are entitled to Directors’ Fees as ordinary remuneration and shall be a fixed sum and not payable by a commission or percentage of profits or turnover. They will also be paid a sum based on their responsibilities in Board Committees and for their attendance at meetings.
- The Directors’ Fees and benefits of Non-Executive Directors are subject to approval of shareholders.
(c) Senior Management
- Remuneration should be based on the function, workload and level of responsibilities, and performance measures set, together with assessment of each individual performance, and the Company’s performance
ii. Perform annual review and recommend to the Board on the remuneration for Non-Executive Directors, particularly on whether the remuneration remains appropriate to each Director’s contribution, by taking into account the level of expertise, commitment and responsibilities undertaken.
iii. Perform annual review and recommend to the Board on the remuneration for Executive Directors and Senior Management, including where appropriate, bonuses and salary adjustment based on individual performance.
iv. Recommend remuneration package for new Director.
v. Consider severance payments and in this connection, the Remuneration Committee should bear in mind that it must represent the public interest and avoid any inappropriate use of public funds. Care should be taken to avoid determining a severance package that public opinion might deem to be excessive.
vi. To carry out other responsibilities, functions or assignments as may be defined by the Board from time to time.
vii. Engage with shareholders during general meetings and annual general meetings on matters pertaining to remuneration of Directors and Senior Management as well as the overall remuneration framework of the Company.
4. AUTHORITY
4.1 Where possible, and to allow it to meet its duties, the Remuneration Committee should:
i. seek comparative information on remuneration and conditions of service in comparable organisations, within and without sectors of industry;
ii. seek any information it requires from Management in order to perform its duties; and
iii. Obtain, at the Company’s expense, outside legal or other professional advice on any matters within its Terms of Reference.
5. MEETINGS
5.1 The Remuneration Committee shall meet at least once a year or as and when required.
5.2 Except in the case of an emergency, reasonable notice of every meeting shall be given in writing.
5.3 The quorum for a meeting shall be two (2) members.
5.4 Other Board members, relevant management personnel or external professional/consultants may be invited to attend the meeting.
5.5 The participation of the Remuneration Committee members in the meeting can be facilitated by means of video or telephone conferencing or by means of other communication equipment or electronic means which enable all persons participating at the meeting to hear and/or see each other for the entire duration of the meeting in which event such participant shall be deemed to be physically present at the meeting.
5.6 Remuneration Committee members should abstain from discussion and from participating in decisions of their own remuneration packages.
5.7 Minutes of meetings shall be taken and documented.
5.8 The Remuneration Committee is also allowed to carry out the resolution by way of circulation.
5.9 The Remuneration Committee should report to the Board after each meeting.
This Terms of Reference has been revised and adopted by the Board on 25 November 2021.
