Corporate Governance
Overview Statement

The Manager recognises the importance of strong and effective corporate governance culture to promote and safeguard the best interests of its Unitholders and other stakeholders, thereby enhancing the credibility and reputation of the Trust.

The corporate governance adopted by the Manager provides a framework of control mechanisms to support the Trust in achieving its goals. This is also critical to the performance of the Manager and consequently, the success of the Trust. The Manager has adopted a strong corporate governance framework that is designed to meet the best practice principles. In particular, the Board and the Management of the Manager have the obligation to act honestly, with due care and diligence, and in the best interests of its Unitholders and other stakeholders by emphasising on the transparency of decision-making process, fairness and trustworthiness in managing the Trust. The Manager also recognises the need to adapt and improve the principles and practices to meet the ongoing changes and challenges in regulatory requirements, international developments and investor expectations.

The Trust is a real estate investment trust which was established under a Trust Deed with a mandatory requirement to appoint a trustee. Maybank Trustees Berhad was appointed as the Trustee for AmFIRST REIT and the appointment was approved by the SC as prescribed under sections 288(1)(a) and 289(1) of the Capital Markets and Services Act 2007 (“CMSA”). The Trustee is required to act honestly and discharge its roles and responsibilities in accordance with the Deed, SC’s Listed REITs Guidelines, trust laws and securities laws. It has to exercise a degree of due care and diligence and has to act in the best interests of Unitholders. The primary roles and functions of the Trustee are outlined in the Deed.

The following sections describe the Manager’s main corporate governance practices and policies which are guided by measures recommended in The Malaysian Code on Corporate Governance 2017 (the “Code”).

Chapter 15.25(3) of the Main Market Listing Requirement (“MMLR”) requires the Board to provide only an overview of the application of the Principles set out in the Code. However, in the spirit of good corporate governance, the Manager has applied and outlined the practices under the Principles (wherever possible) during the financial year under review. The Code requires the REIT to provide a summary of its corporate governance practices during the financial year with reference to the three (3) broad principles as follows:

Principle A Board Leadership and Effectiveness

Principle B Effective Audit and Risk Management

Principle C Integrity in Corporate Reporting and Meaningful Relationship with Stakeholders

The key focus areas on corporate governance and its priorities are as follows:

BOARD AND KEY MANAGEMENT LEADERSHIP

The Manager’s shareholders critically assess on an ongoing basis its Board’s leadership and its key management staffs, especially its Chief Executive Officer who plays an important role in executing strategies that had been approved by the Board.

The Board and the key management staffs face an uphill task to improve the REIT’s performance especially during the challenging market conditions coupled with increased leasing space within Klang Valley. It is only through continuous focus by the Board and key management staffs on the key challenges, that action plans were formulated and executed to achieve the REIT’s intended goals.

The key management staffs work closely with the licensed property managers on a day-to-day basis in ensuring effective property management. It will be the Board’s priority to ensure leadership in both the Board and key management staffs are always intact to ensure the REIT can deliver sustainable performance.

CODE OF ETHICS, CODE OF CONDUCT, WHISTLEBLOWER PROTECTION POLICY AND NO GIFT POLICY

The Code of Ethics as well as Code of Conduct has always been central in the Manager’s day-to-day activities. Being part of the AmBank Group, it has been continuously emphasised to all staffs that they are to comply with the internal policy. The Codes provide the framework for sound decision-making and guide for good business conducts. The policy outlines six (6) key principles, which every director and employee must adhere to. These are being Compliant, Responsible, Ethical, Accurate, Trustworthy and Equitable.

In addition, the Whistleblowing Policy as well as the No Gift Policy were established and employed by the Manager to further enhance the culture of good ethics and business conduct. The Manager’s staffs are also required to complete online trainings organised by AmBank Group whenever they are launched and attend refresher courses conducted by the Compliance Department.

The Whistleblowing Policy provides an independent reporting channel for all staffs and stakeholders. External parties can always have access via e-mail or call the Compliance Officer for lodgment of complaints or clarification when required. Whistleblowers are protected and the channels are independent of the operational departments. The Compliance Department and the Company Secretary play an important role in receiving complaints and channeling the same to specified ombudspersons.

GOVERNANCE, RISK MANAGEMENT AND INTERNAL CONTROL FRAMEWORK

Policies are approved by the Board and cascaded down to the entire organisation to ensure all departments are aware of what is expected of them. Standard operating procedures are formulated based on these approved policies. Staffs are guided by these policies and procedures in discharging their daily duties. The Board is assisted by the Audit Committee in ensuring the adequacy and effectiveness of the risk management and internal control framework.

The Risk Management Committee, a Management level committee headed by the Chief Executive Officer and supported by the Heads of Departments reviews the entity wide risk. The Committee is responsible for identifying the principal risks associated with the business activities and ensuring appropriate measures, systems and internal controls are in place to mitigate the risk exposure. The Risk Management framework further extends to functional roles and responsibilities established for the management of risk.

In parallel, Business Operational Controls Officer (“BOC”) performs relevant key controls testing to ensure adherence to policies and procedures adopted. In addition, the Compliance Department’s role is also to assess whether key areas such as regulatory compliance and internal policies are complied with accordingly.

Finally, the Internal audit function is undertaken by the GIAD which is independent of the Manager and REIT’s business and operations, and reports directly to the Audit Committee. The GIAD performs independent assessment of the adequacy and effectiveness of the Manager’s risk management, internal control and governance processes and systems. Results of GIAD’s reviews and issues of concerns are reported directly to the Audit Committee. The CEO and Heads of Departments are responsible to ensure the audit findings are resolved within the agreed timelines.

APPLICATION OF SPECIFIC PRACTICES FOR EACH PRINCIPLE

Although it is not mandatory, the Manager detailed out the specific applications of the practices for each principle as indicated by the Code as follows:

PRINCIPLE A: BOARD LEADERSHIP AND EFFECTIVENESS
Intended Outcome
1.0 Every company is headed by a board, which assumes responsibility for the company’s leadership and is collectively responsible for meeting the objectives and goals of the company.
Practice 1.1

The Manager is managed by an experienced Board with a wide and varied range of expertise. The Board is responsible for the overall management and corporate governance of the Trust, including establishing goals for management, monitoring the achievement of these goals and review of management’s performance.

Each Director has a duty to act honestly and in good faith, with due care and diligence, and in the best interests of the Unitholders. The Board ensures that proper and effective controls are in place to assess and manage business risk, and compliance with applicable laws, regulations, guidelines and policies.

The Board focuses mainly on strategy, financial performance and critical business issues, including: -

  • strategic business plans
  • key financial performance indicators
  • principal risks and their management
  • succession planning for Senior Management
  • Investors and Unitholders relations programs
  • system of internal control and policies

The Board is adequately resourced and supported by an Audit Committee of Directors to look into, amongst others the risk management, internal control and financial management of the Trust.

Practice 1.2

The Chairman of the Board, Mr Soo Kim Wai, a Non-Independent Non-Executive Director, leads the Board objectively and ensures its effectiveness. Whether in the Board meetings or informal discussions with the Management Team, the Chairman encourages active participation and all parties are free to express their opinions.

Practice 1.3

The roles and responsibilities of the Chairman and Chief Executive Officer are separated and the positions are held by two (2) different individuals. Mr Soo Kim Wai is a Non-Independent Non-Executive Director / Chairman while YM Raja Nazirin Shah Bin Raja Mohamad is the Executive Director / Chief Executive Officer. This is to ensure appropriate segregation of duties, authority and increased accountability.

The segregation ensures a clear distinction between the Chairman’s responsibilities to lead and manage the Board and the Chief Executive Officer’s responsibilities to manage the Trust and the Manager.

The Chairman, leads the Board and ensures that members of the Board work together with the Management in a constructive manner to address strategies, business operations, financial performance, risk management and internal control issues.

The Chief Executive Officer has full executive responsibilities in consultation with the Executive Committee (‘‘EXCO’) over the business directions and operational decisions of the Trust. He leads the Management and provides direction on the day-to-day operations and works with the Board to determine the overall business, investment and operational strategies for the Trust and ensures that they are implemented as planned and in accordance with the Deed and the SC’s Listed REITs Guidelines.

Practice 1.4

The Board is supported by qualified and competent licensed Company Secretaries. They are the sources of guidance and advice to the Directors on areas of corporate governance, relevant legislations, regulations and policies besides ensuring compliance with the MMLR and other regulatory requirements.

The Company Secretaries attend the Board and the Board Committees’ meetings and are responsible for the accuracy and adequacy of records of the proceedings of the Board and the Board Committees’ meetings and resolutions.

Practice 1.5

The Company Secretaries work with the Chairman and Management to ensure that the Board papers and agenda are provided to the Directors ahead of meetings of the Board and Board Committees so that they have time to review matters to be discussed prior to the meetings. The Board papers are circulated at least five (5) business days in advance. Meetings are usually a half-a-day event and include presentations by the Management, and when necessary, presentations by external consultants and experts on strategic issues relating to specific business areas.

The Board meetings are scheduled at least four (4) times per annum with the purpose, amongst others, to discuss and review the operations of the Trust and approve the release of the interim and the audited financial statements of the Trust. Additional meetings are held as and when necessary between the scheduled meetings.

Directors Designation Number of Board Meeting Percentage of Attendance(%)
Soo Kim Wai Chairman / Non-Independent Non-Executive Director 4 100%
Dato' Abdullah Thalith bin Md Thani Independent Non-Executive Director 4 100%
Dato' Wong Nam Loong Independent Non-Executive Director 4 100%
Azlan Baqee bin Abdullah Non - Independent Non - Executive Director 4 100%
Seohan Soo Non - Independent Non - Executive Director 4 100%
YM Raja Nazirin Shah bin Raja Mohamad Executive Director / Chief Executive Officer 4 100%

Note: All attendances reflected were the number of meetings attended during the Directors’ tenure of service for FY2020.

Intended Outcome
2.0 There is demarcation of responsibilities between the Board, Board committees and management. There is clarity in the authority of the Board, its committees and individual directors.
Practice 2.1

Currently, the Manager has an Audit Committee of Directors, established to provide assistance to, and to review and report to the Board in relation to fulfilling the statutory responsibilities of the Manager, monitoring of the accounting and financial reporting practices, as well as ensuring adequate and effective internal control systems of the Manager are in place, amongst other roles and primary responsibilities. The Audit Committee comprises of three (3) members of the Board and the committee meets on a quarterly basis together with other key management staffs.

In addition, the Board has established an EXCO which was formed to support the Board to assess, deliberate and approve operational decisions expeditiously. The EXCO minutes are tabled quarterly to the Board. The minutes comprise EXCO’s key deliberations and decisions made. The EXCO comprises of four (4) members who are representatives of the Manager’s shareholders. The EXCO meeting is held on a monthly basis and is attended by Chief Executive Officer, Heads of Departments and key support staffs.

Intended Outcome
3.0 The Board is committed to promoting good business conduct and maintaining a healthy corporate culture that engenders integrity, transparency and fairness. The Board, management, employees and other stakeholders are clear on what is considered acceptable behavior and practice in the company.
Practice 3.1

The Board employs the Code of Ethics and Code of Conduct (“Codes”) which was enforced by the AmBank Group (“Group”). The Codes provide the framework for the decision-making and guides business conduct. The Group’s Code of Ethics sets out six (6) key principles, namely:

  • Compliant - Comply with all relevant laws and regulations
  • Responsible - Manage conflict of interest with honesty and integrity
  • Ethical - Practice honesty and integrity in everything we do
  • Accurate - Ensure completeness and accuracy of financial records
  • Trustworthy - Protect the confidentiality and sensitivity of information
  • Equitable - Treat each other and our community with respect

The code includes reporting of unlawful or unethical behavior through established procedures including via whistleblowing policies that are in place. Staffs are reminded periodically of the six (6) key principles through an electronic learning management system executed group-wide. The Manager’s staff are required to complete the refreshing course periodically to ensure staff understands what is required of them and are able to apply it when they are discharging their duties. In addition, the Compliance Officer too conducts briefing on the subject matter to further emphasise its importance.

The Manager has adopted the No Gift Policy enforced by the Group. This is to ensure no conflict of interest arises or preference is given to suppliers during transactions involving procurement process such as award of contracts or negotiations.

Pursuant to the incorporation of Section 17A, Corporate Liability (for corruption) under the MACC Act 2009, which is effective form 1 June 2020, the Manager had performed an assessment to ensure that there are adequate procedures in place based on the prescribed Guidelines on Adequate Procedures (“GAP”). The GAP was issued pursuant to Section 17A(5) of MACC Act 2009 and was derived based on the 5 principles as follow:

  • Top level commitment
  • Risk assessment
  • Undertake control measures
  • Systematic review, monitoring & enforcement
  • Training & communication

The Manager has adequate procedures and in compliance with the prescribed guidelines.

Practice 3.2

The whistleblowing policy and procedure was adopted by the Board and is currently in place. The purpose is to report the following, but not limited to:

  • dishonest, fraudulent, corruption, bribery or illegal practices;
  • manipulation of accounts;
  • unethical behaviour;
  • abuse of power;
  • violation of laws and constitution; or
  • conflict of interest.

The policy embeds the requirement for the protection of the whistleblower which is fundamental for the entire process. Key principles include:

  • Whistleblower will be protected for reporting any actual or suspected improper conduct upon demonstrating sufficient basis for whistleblowing.
  • The confidential information relating to whistleblowing will also be safeguarded.
  • Whistleblower including his / her spouse and related persons who are employees of the Manager, will be protected from detrimental action.
  • It is imperative that whistleblower should provide sufficient and accurate information on best effort basis.
Intended Outcome
4.0 Board decisions are made objectively in the best interests of the company taking into account diverse perspectives and insights.
Practice 4.1

The Manager’s Board retains its Board composition with one-third (1/3) of independent directors and is of the view that the decisions that the Board makes are objective and in the best interest of all stakeholders.

The Board has six (6) members comprising five (5) Non-Executive Directors and one (1) Executive Director. Two (2) of the Board members are Independent Directors (1/3 of the Board) in compliance with the MMLR and SC’s Listed REITs Guidelines while the Chairman of the Board is a Non-Independent Non-Executive Director.

As at the date of this Report, none of the Directors held directorships in more than five (5) listed issuers. The relationships among the Board members are disclosed on page 132 of this Annual Report. In addition to this, information on direct and indirect unitholdings related to the Manager and transactions with the companies related to the Manager are disclosed in Note 15 and Note 27 respectively, in the Notes to the Financial Statements.

The Board comprises business leaders and experienced professionals with backgrounds in fund management, property, banking, legal and finance. The profiles of the Directors are set out on pages 32 to 37 of this Annual Report. The Board is of the view that its current composition comprises individuals who, as a group, provide the necessary core competencies and that the current Board size is appropriate and effective, taking into consideration the nature and scope of AmFIRST REIT’s operations.

The Board diversity in terms of ethnicity, professional background and experience are as illustrated below:-

Practice 4.2

The Code states that the tenure of an Independent Director should not exceed a cumulative term of nine (9) years. This is in line with the Group’s existing policy which states that an Independent Non-Executive Director shall serve up to a maximum of nine (9) years (the “9-Year Rule”).

The Independent Director may continue as a Non-Independent Director subsequently subject to the recommendation of the Group Nomination and Remuneration Committee (“GNRC”) of Directors and the approval of the Board.

Practice 4.3 [A Step Up]

The Manager has adopted the policy which limits the tenure of its independent directors to nine years. The policy has been complied diligently, and this was demonstrated in prior years, where independent directors had stepped down after nine (9) years of service. As of this annual report date, the Manager’s current independent directors have both served for approximately 3 years and 9 months.

Practice 4.4

It is imperative that the Board and Senior Management are appointed based on objective criteria, merit and taking into account diversity in skills, experience, age, cultural background and gender. The Manager adopts the Group’s appointment procedures for both directors and for its staff. The Manager utilises the resources made available by Group Human Resources. The Board places significance on the merit as well as the role which objective criterias were derived.

Newly appointed Directors and Senior Management are given briefings by the Management on the business activities of the Trust, its strategic directions and policies and the regulatory environment in which the Trust operates. Directors are also informed of their statutory and other duties and responsibilities as well as policies and procedures relating to the corporate conduct and governance including the disclosure of interests, prohibitions on dealings in the Trust’s units and restrictions on the disclosure of price-sensitive information.

Subsequent to a director’s appointment, the director will be required to complete the Mandatory Accreditation Programme as required by Bursa Securities, and the Capital Market Director Programme (“CMDP”) as required by SC within the timeline as stipulated in MMLR and SC’s Licensing Handbook respectively. CMDP is an exclusive platform for Directors of licensed intermediaries to be equipped with the relevant knowledge, skills and abilities to meet the expected competencies required of a board. It is also designed to allow Directors to explore and deliberate on pertinent issues affecting the industry from the perspectives of multi stakeholders.

Practice 4.5

The Board takes cognisance of having more women directors on the Board. The Code’s requirement is for the Board of large companies to comprise 30% of women directors. Although the REIT does not fall under the ambit of large companies as defined by the Code and it is not a requirement for the REIT, the shareholders of the Manager as well as the Board do consider women candidates who meet the role and merit. As of the annual report date, the Manager’s Board does not have any woman director.

Practice 4.6

The Manager’s Group has various approaches and sources to identify candidates for the appointment of directors. Apart from the common method of recommendation from Board members and major shareholders, the Group uses independent recruitment firms as well as the direct approach of identifying individuals that have relevant experience and undertaken similar Board roles, and are well known in the market.

Practice 4.7

The Board performs the function that a nominating committee would otherwise perform, namely it administers nominations to the Board, reviews the structure, size and composition of the Board, and reviews the independence of Board members. The composition of the Board is reviewed to ensure an appropriate mix of expertise, independence, experience and knowledge in business, finance and management skills critical to Trust’s business.

Intended Outcome
5.0 Stakeholders are able to form an opinion on the overall effectiveness of the board and individual directors.
Practice 5.1

The Manager took note of practice 5.1 on the recommended practice to conduct a formal and objective annual evaluation to determine the effectiveness of the board, its committees and each individual director even though this practice note is not applicable to REIT entities.

Intended Outcome
6.0 The level and composition of remuneration of directors and senior management take into account the company’s desire to attract and retain the right talent in the board and senior management to drive the company’s long-term objectives. Remuneration policies and decisions are made through a transparent and independent process.
Practice 6.1

The Manager acknowledges the need to ensure a fair and equitable remuneration mechanism for the directors and senior management, which commensurates with the demands and performance of the Manager, and also the individual’s responsibilities.

Practice 6.2

The GNRC at Group level looks into the aspect on remuneration of the directors and Key Management Personnel (where applicable and if required).

Intended Outcome
7.0 Stakeholders are able to assess whether the remuneration of directors and senior management is commensurate with their individual performance, taking into consideration the company’s performance.
Practice 7.1

The Directors’ remuneration is paid by the Manager and not the Trust. For Non-Executive Directors, they receive Directors’ fees and meeting allowances for their attendance at meetings of the Board and any of the Board Committees. The determination of the Non-Executive Directors’ remuneration is a matter for the Board as a whole and is subject to the approval of the Manager’s shareholders. The Directors are not involved in the approval of their own remuneration. The proposed Directors’ fees for the FY2020 and its comparative figures are as follows:-

Directors FY2020
Directors’ Fees
FY2019
Directors’ Fees
Soo Kim Wai 46,000 46,000
Dato' Wong Nam Loong 40,000 40,000
Dato’ Abdullah Thalith bin Md Thani 40,000 40,000
Azlan Baqee bin Abdullah 40,000 40,000
Seohan Soo (Appointed on 10 August 2018) 40,000 25,644
Total 206,000 191,644
Practice 7.2

The Board opined that the top senior management’s remuneration will not be disclosed due to sensitivity and competitive external human resource environment in the industry. This is necessary and in the best interest of the Manager as well as the Trust, in order to retain its experienced staff and ensure smooth continuity of the business operations.

Furthermore, the Code, referring to Guidance 7.2 suggests that the disclosure of how director’s remuneration is measured, allows stakeholders to understand the link between senior management remuneration and the company’s performance. On the contrary, due to the unique REIT structure whereby the Manager is separate from the Trust, there is no direct link between the remuneration of Management Team and the Trust’s performance. The remunerations were disbursed from the management fees earned by the Manager, which were predetermined at the inception of the Trust via the Trust Deed.

Intended Outcome
8.0 There is an efective and independent Audit Committee. The board is able to objectively review the Audit Committee’s fndings and recommendations. The company’s fnancial statement is a reliable source of information.
Practice 8.1

The Chairman of the Audit Committee, Dato’ Wong Nam Loong is not the Chairman of the Board. Dato’ Wong Nam Loong was appointed on 15 August 2016 as an Independent Non-Executive Director and has led the Audit Committee since then.

The Chairman of the Audit Committee ensures that the Committee’s primary roles and responsibilities are discharged in accordance with its Terms of Reference which is set out in the Audit Committee’s Report, pages 126 to 129 of this annual report.

Practice 8.2

The Board takes cognisance of matters pertaining to independence and conflict of interest. It is imperative that the functions of Board Committees are not impaired when they are discharging their duties. In this respect, the Board will require a former key audit partner to observe a cooling-off period of at least two years before being appointed as a member of the Audit Committee, if there is any. This will also apply to any other similar appointments if the Board deems there is a potential conflict or an issue on independence.

Practice 8.3

It is the Audit Committee’s responsibility to review the appointment of the external auditors and resignation of external auditors, negotiate and approve the annual audit fees. This is clearly outlined in the Audit Committee’s Terms of Reference.

During the annual audit plan presentation by the external auditor, the Audit Committee had assessed the suitability, objectivity and independence of the external auditor. The external auditor had confirmed their independence during the meeting with the Audit Committee prior to the commencement of their annual audit.

Practice 8.4 [A Step Up]

While the requirement of the Code states that the Audit Committee should solely comprise of Independent Directors, the Board is of the view that the Audit Committee is able to discharge its duties effectively with its two-third (2/3) composition of Independent Directors. The inclusion of a Non-Independent Director who represents one-third (1/3) of the Committee is deemed necessary to facilitate and support the Independent Directors in areas of his expertise.

Practice 8.5

The Audit Committee possesses the necessary range of skills to effectively discharge its duties. All members have good understanding of the operations and its financial reporting process. Mr Soo Kim Wai, who is an Audit Committee member possesses extensive experience in the accounting field and is a member of several professional accounting bodies namely the Malaysian Institute of Accountants, Malaysian Institute of Certified Public Accountants and Association of Chartered Certified Accountants.

Apart from financial knowledge, the Board has ensured that the Independent Directors should also comprise of members who have experience in the relevant property related industry. Collectively, the current Audit Committee members have extensive experience and knowledge in accounting, finance, legal and real estate field.

During the financial year under review, the Directors, including the Audit Committee members had attended various conferences, seminars and workshops to enhance their knowledge and expertise and to keep abreast with the relevant changes in laws, regulations and the business environment. The training programs attended by the Directors during the FY2020 were, on areas relating to real estates, corporate leadership and governance, professional development, risk management, information technology, regulatory and compliance which were arranged by the Group Learning and Development Department of the ultimate holding company of the Manager and regulators as well as professional establishments.

PRINCIPLE B: EFFECTIVE AUDIT AND RISK MANAGEMENT
Intended Outcome
9.0 Companies make informed decisions about the level of risk they want to take and implement necessary controls to pursue their objectives. The board is provided with reasonable assurance that adverse impact arising from a foreseeable future event or situation on the company’s objectives is mitigated and managed.
Practice 9.1

The Board has established an effective risk management and internal control framework. It plays a vital function in the Manager’s management of its risks and transactions. The Board through its Audit Committee is responsible for the risk management of the Trust which includes but is not limited to, identifying the principal risks associated with the business activities and ensuring appropriate measures, systems and internal controls are in place to mitigate the risk exposure.

Practice 9.2

The features of the risk management and internal control framework are disclosed in detail in the Statement on Risk Management and Internal Control on pages 121 to 125 of this Annual Report.

The internal control is mainly driven by policies and procedures which are designed to provide reasonable assurance to the Board that the Trust will achieve its objectives. There is an established internal audit function which is undertaken by GIAD. The Manager also has a designated Compliance Officer to ensure compliance with regulations, internal policies and procedures. The current risk management framework and internal control is adequate and effective.

Practice 9.3 [A Step Up]

A Risk Management Committee which is a management level committee was established to assist the Audit Committee in assessing the adequacy of internal control and risk management. The Risk Management Committee comprises of the Chief Executive Officer and Heads of Departments of the Manager, with the support from the Group Risk Management Department.

Intended Outcome
10.0 Companies have an effective governance, risk management and internal control framework and stakeholders are able to assess the effectiveness of such a framework.
Practice 10.1

The internal audit function is performed by the GIAD operating under a charter which gives it unrestricted access to review all activities of the Manager. The Head of GIAD reports independently to the Audit Committee.

GIAD has internal procedures in place to ensure that the audit personnel are free from any relationships or conflicts of interest and their objectivity and independence are not impaired when conducting audits on the Manager.

The current structure allows GIAD to perform its function effectively and independently.

Practice 10.2

GIAD is headed by the Group Chief Internal Auditor (“GCIA”) Encik Shamsul Bahrom Mohamed Ibrahim, who has over 21 years of comprehensive internal auditing and management experience in the financial services industry. En Shamsul holds a BSc (Hons) Finance & Accounting from University of Salford, Manchester as well as Masters in Business Administration from University of Strathcylde, Scotland. En Shamsul is also a Chartered Banker and Qualified Risk Auditor.

GIAD focuses its efforts in accordance with the Annual Audit Plan which is developed based on a structured risk-based assessment of all the activities undertaken by the Manager that ensures all risk-rated areas are kept in view to ensure appropriate audit coverage. The risk-based audit plan is reviewed periodically, taking into account the changes in the business and risk environment.

The Annual Audit Plan, including the internal audit resources required to execute the plan is approved by the Audit Committee.

The main objective of the audit review is to assess the adequacy and effectiveness of the risk management and systems of internal control.

Apart from the above, GIAD also performs ad-hoc reviews and investigations involving fraud, misconduct, when requested by Regulators, the Board or Management.

The results of audit review, including Management’s action plans to address issues highlighted by internal auditors are tabled to the Audit Committee for deliberation. GIAD conducts follow-up and reports to the Audit Committee regarding the status of implementation of Management action plans, until full resolution.

The Audit Committee is of the view that GIAD is adequately resourced to perform its functions and has maintained its independence from the activities that it audits.

PRINCIPLE C: INTEGRITY IN CORPORATE REPORTING AND MEANINGFUL RELATIONSHIP WITH STAKEHOLDERS
Intended Outcome
11.0 There is continuous communication between the company and stakeholders to facilitate mutual understanding of each other’s objectives and expectations. Stakeholders are able to make informed decisions with respect to the business of the company, its policies on governance, the environment and social responsibility.
Practice 11.1

The Board emphasises the need to communicate with stakeholders regularly, effectively and in a transparent manner.

Apart from media write ups, the Manager posts key information on the Trust’s official website www.amfirstreit.com.my for stakeholder awareness.

The stakeholders are able to query or reach senior management both via e-mail or telephone. The contact details are listed on the said website.

Intended Outcome
12.0 Unitholders are able to participate, engage the board and senior management effectively and make informed voting decisions at General Meetings.
Practice 12.1

The Board through its management and Company Secretary strictly complies with the Annual General Meeting (“AGM”) notice issuance to the unitholders. The Manager gives more than 28 days notice prior to the meeting. The number of days of notice period provided since past 3 years were as follow:

  7th AGM 6th AGM 5th AGM
Financial Year 2019 2018 2017
Date of Notice of AGM 31 May 19 31 May 18 31 May 17
Date of AGM 22 Jul 19 25 Jul 18 25 Jul 17
Notice period in no. of days (including Saturday, Sunday & Public Holiday) 52 55 55
Practice 12.2

All directors are required to attend the AGM to address any questions raised by the Unitholders. All the questions raised with responses provided during the AGM are minuted by the Company Secretary and will be posted on the official website for Unitholders reference.

Practice 12.3

At all times the Board and the Senior Management encourage its Unitholders to attend its General Meetings. Where possible, electronic means were considered to facilitate Unitholders’ participation. As a start, electronic poll voting was introduced. In the best interest of Unitholders, the Board emphasises that the General Meetings are held at locations easily accessible within Klang Valley vicinity