CORPORATE GOVERNANCE STATEMENT
YEAR ENDED 31 DECEMBER 2015
The board of directors of the Company (the “Board” or “Directors”) is committed to raising the standard of corporate governance within
the Group in order to enhance transparency in the disclosure of material information. The Company confirms that it has adhered to the
principles and guidelines of the Code of Corporate Governance 2012 (the “Code”) and if there is any deviation from the Code, appropriate
explanations are provided in this Statement on each area of non-compliance.
BOARD MATTERS
The Board’s Conduct of Affairs (Principle 1 of the Code)
The Board is collectively responsible for the long-term success of the Company. The Board works with management to achieve this
objective and management remains accountable to the Board.
In accordance with the Code, the Board has, without abdicating its responsibility, delegated the authority to make decisions to the Audit
and Risk Management Committee, the Nominating Committee and the Remuneration Committee (collectively referred to as the “Board
Committees”). Each Board Committee has its own terms of references to address their respective duties and responsibilities.
The Board held meetings on a regular basis during FY2015 to review,
inter alia
, the Company’s and the Group’s operations and financial
results. Details of attendance of Directors at the Board meetings, Audit and Risk Management Committee meetings, Nominating
Committee meetings, and Remuneration Committee meetings are set out on page 21. The Company’s Constitution permits Directors to
attend meetings through the use of audio-visual communication equipment.
Guidelines are established to specify which material transactions require the Board’s approval. These transactions include mergers and
acquisitions, divestments and major capital expenditure.
Newly appointed Directors will receive appropriate training and orientation programmes to familiarise themselves with the operations of
the Group and its major business processes.
On the appointment of a new Director, the Company will provide a formal letter to the Director, setting out the Director’s duties and
obligations.
The Company also funds and arranges for the Directors to receive regular training. In this connection, the Company’s external auditors,
KPMG LLP, conducted a briefing session for the Board during FY2015 on the latest changes to the financial reporting standards. Further,
a briefing session was conducted for the Board during FY2015 on the amendments to the Companies Act. Various Directors attended
seminars and courses organised by the Singapore Institute of Directors and other professional organisations, including the Corporate
Governance Roundup 2015 and Remuneration Committee Chairmen Conversation, and a seminar in relation to the recent changes to
the Listing Manual organised by the Singapore Exchange Limited.
The Board has no dissenting views on the Chairmen’s Statement for the year in review.
Board Composition and Guidance (Principle 2 of the Code)
Mr Tan Tock Han resigned as a Director with effect from 18 May 2015. Before his resignation, Mr Tan Tock Han was an independent
non-executive Director, a member of the Audit and Risk Management Committee, the Nominating Committee and the Remuneration
Committee.
During FY2015, after taking into consideration the resignation of Mr Tan Tock Han, out of the six Directors, three were non-executive and
independent. The independence of each independent Director is reviewed annually by the Nominating Committee based on the provisions
relating to independence as set out in the Code. The Nominating Committee requires each independent Director to complete and execute
a form declaring and affirming his independence and confirming that there exist no conditions that would impair his independence.
This declaration of independence is tabled before the Nominating Committee and, if accepted, the Director’s independence is then
recommended by the Nominating Committee to the Board.
Taking into account the views of the Nominating Committee, the Board is satisfied that Mr Chow Yew Hon, Mr Lim Jun Xiong Steven and
Mr Chan Pengee, Adrian are independent in light of the provisions of the Code. This is in compliance with the Code which recommends
that independent Directors make up at least half the Board where the Chairman and the Chief Executive Officer (“CEO”) (or equivalent,
in our case, the Managing Director) is the same person, notwithstanding that this recommendation only comes into effect following the
end of the financial year commencing on or after 1 May 2016.
HONG FOK CORPORATION LIMITED
ANNUAL REPORT 2015
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