ANNUAL REPORT 2006
NOMINATING AND REMUNERATION COMMITTEE
The Nominating and Remuneration Committee (“NRC”) comprises of three (03) Non-Executive Directors, namely Tan Sri Dato’ Ir. Muhammad Radzi bin Haji Mansor (Chairman), Ir. Prabahar s/o Nagalingam Kirupalasingam and Mr. Moksevi Rasingh Prelis.
The role of the NRC is to identify, consider and propose suitable candidates for appointment as new directors, and to formulate, review, approve and make recommendations to the Board with regard to the remuneration of the Executive, Non- Executive Directors and key positions of the senior management.
The NRC ensures that the Directors appointed to the Board possess the background, experience and knowledge in business, technology, finance and/or management so as to maintain an appropriate balance of skills and experience on the Board, and also to ensure that each Director brings to the Board an independent and objective perspective to ensure that balanced and well-considered decisions are made. The NRC held one (01) meeting during the financial year ended 31 December 2006 and the attendance at this meeting is set out below.
CONSTITUTION OF THE BOARD Principle
There should be a clear division of responsibilities at the head of the Company, which will ensure balance of power and authority between the running of the Board, and the executive responsibility for the running of the Company’s business. No one individual should have unfettered powers of decision.
The roles of the Chairman and CEO are separate with a clear distinction of responsibilities between them, which ensures the balance of power and authority between the running of the Board, and the executive responsibility for the running of the Company’s business.
The Chairman, Tan Sri Dato’ Ir Muhammad Radzi Haji Mansor, who is a Non-Executive director, is responsible for providing leadership to the Board, for the efficient organisation and conduct of the Board’s function, and in ensuring the integrity and effectiveness of the relationship between the Non-Executive and Executive Director(s).
The CEO, Dr. Hans Wijayasuriya, who is also an Executive Director, is responsible for the implementation of broad policies and strategies approved by the Board, and is responsible for developing and recommending to the Board the
Name of Director Attendance %
Tan Sri Dato’ Ir. Muhammad Radzi bin Haji Mansor 1/1 100
Ir. Prabahar s/o Nagalingam Kirupalasingam 1/1 100
Mr. Moksevi Rasingh Prelis 1/1 100
business plans and budgets that support the Company’s long-term strategy and vision that lead to the creation of shareholder value.
BOARD BALANCE AND INDEPENDENCE Principle
To be effective, Independent directors should form at least one fourth of the membership of the Board.
The Board comprises of seven (07) Directors, of which six (06) are Non- Executive Directors and one (01) is an Executive Director who is also the CEO of the Company. Of the Non-Executive Directors, two are Independent. The present Board composition and expertise are sufficient to ensure optimum effectiveness to meet the needs of the Company.
The Non-Executive Directors provide considerable depth of knowledge collectively gained from experiences whilst serving in a variety of public and private companies. Out of the six Non- Executive Directors, four (04) directors, namey Tan Sri Dato’ Ir. Muhammad Radzi bin Haji Mansor, Ir. Prabahar s/o Nagalingam Kirupalasingam, Dato’ Sri Mohammed Shazalli bin Ramly and Mr. Yusof Annuar bin Yaacob, are Non- Independent and are nominees of the parent company, Telekom Malaysia Berhad.
Table-3: Attendance at NRC
Statement of Corporate Governance
100
DIALOG TELEKOM LIMITED
ANNUAL REPORT 2006
Mr. Mohamed Vazir Muhsin was appointed as an Independent Non Executive Director on 14 June 2006. The two (02) Independent Non-Executive Directors, namely, Mr. Moksevi Rasingh Prelis and Mr. Mohamed Vazir Muhsin, are both independent of management and free from any business or other relationship, which could materially interfere in the exercise of their judgment.
Profiles of each Director are found on pages 15 of this report.
ACCESS TO INFORMATION Principle
The Board and key executives should be supplied in a timely manner with information in a form and of a quality appropriate to enable it to discharge its duties.
The Board is supplied with complete, adequate information, which includes an agenda, minutes, background or explanatory information relating to matters to be brought before the Board, copies of disclosure documents, budgets, forecasts and monthly internal financial statements in advance of each meeting to enable them to make informed decisions. The Board has separate and independent access to the Company’s senior management. All Directors have access to the advice and services of the Company Secretary. Directors, especially Non-Executive Directors have access to independent, professional advice in the course of fulfilling their responsibilities, at the Company’s expense.
The re-election of Directors ensures that shareholders have a regular opportunity to reassess the composition of the Board. The names of the Directors submitted for re-election are provided to the shareholders to enable them to make an informed decision on their election. The retiring Directors eligible for re- election this year are mentioned in the Notice of AGM on page 160.
PRINCIPLE 2: REMUNERATE FAIRLY AND RESPONSIBLY
Principle
• Ensure that the level and composition
of remuneration is sufficient and reasonable and that its relationship to corporate and individual performance is defined.
• There should be a formal and
transparent procedure for developing policy on executive remuneration and for fixing the remuneration packages of individual directors. No director should be involved in deciding his or her own remuneration.
The Company believes that the levels of remuneration should be sufficient to attract, retain and motivate directors of the quality required to run the Company successfully. Further the performance-related elements of remuneration have been designed to align the interests of Executive Directors with those of shareholders and link rewards to corporate and individual performance.
PERFORMANCE EVALUATION & PROFESSIONAL DEVELOPMENT Principle
The Board should undertake a formal and rigorous annual evaluation of its own collective and individual performance
The NRC is responsible for evaluating the Board’s performance and decides how the Board’s performance may be evaluated and it also proposes objective performance criteria. A formal performance evaluation and board effectiveness exercise was carried out by PricewaterhouseCoopers Advisory Services Sdn Bhd for 2006.
Induction programmes are provided for new Board directors where they are fully briefed on the business and performance of the Company.
RE-ELECTION Principle
All directors should be submitted for re- election at regular intervals, subject to continued satisfactory performance. The Board should ensure planned and progressive refreshing of the Board.
The Company’s Articles of Association require that one-third of the Directors, excluding the Executive Director, retire and submit themselves for re-election at every Annual General Meeting. The Directors who retire are those who have been longest in office since their appointment/re-appointment. In addition, a newly appointed Director is required to submit himself for retirement and re- election at the Annual General Meeting immediately following his appointment.