TAN CHONG MOTOR HOLDINGS BERHAD
Annual Report 2014
17
CORPORATE GOVERNANCE STATEMENT
The Board of Tan Chong Motor Holdings Berhad (“Company”) recognises the importance of adopting high standards of
corporate governance in the Company in order to safeguard stakeholders’ interests as well as enhancing shareholders’ value.
The Directors consider corporate governance to be synonymous with four key concepts, namely transparency, accountability,
integrity as well as corporate performance.
As such, the Board seeks to embed in the Group a culture that aims to balance conformance requirements with the need to
deliver long-term strategic success through performance, without compromising on personal or corporate ethics and integrity.
This corporate governance statement (“Statement”) sets out how the Company has applied the 8 Principles of the Malaysian
Code on Corporate Governance 2012 (“MCCG 2012”) and observed the 26 Recommendations supporting the Principles
during the financial year. Where a specific Recommendation of the MCCG 2012 has not been observed during the financial
year under review, the non-observation, including the reasons thereof and, where appropriate, the alternative practice, if any,
is mentioned in this Statement.
Principle 1 - Establish clear Roles and Responsibilities of the Board and Management
The Board recognises the key role it plays in charting the strategic direction of the Company and has assumed the following
principal responsibilities in discharging its fiduciary and leadership functions:
reviewing and adopting a strategic plan for the Company, addressing the sustainability of the Group’s business;
overseeing the conduct of the Group’s business and evaluating whether or not its businesses are being properly
managed;
identifying principal business risks faced by the Group and ensuring the implementation of appropriate internal controls
and mitigating measures to address such risks;
ensuring that all candidates appointed to senior management positions are of sufficient calibre, including having in place
a process to provide for the orderly succession of senior management personnel and members of the Board;
overseeing the development and implementation of a shareholder communications policy; and
reviewing the adequacy and integrity of the Group’s internal control and management information systems.
To assist in the discharge of its stewardship role, the Board has established Board Committees, namely the Audit Committee,
Nominating Committee and Board Risk Management Committee, to examine specific issues within their respective terms
of reference as approved by the Board and report to the Board with their recommendations. The ultimate responsibility for
decision making, however, lies with the Board.
(i)
Board Charter
To enhance accountability, the Board has established clear functions reserved for the Board and those delegated to
Management. There is a formal schedule of matters reserved to the Board for its deliberation and decision to ensure
the direction and control of the Company are in its hands. Key matters reserved for the Board include, inter-alia, the
approval of annual budgets, quarterly and annual financial statements for announcement, investment and divestiture,
as well as monitoring of the Group’s financial and operating performance. Such delineation of roles is clearly set out
in Appendix B of the Board Charter (“Charter”), which serves as a reference point for Board activities. The Charter
provides guidance for Directors and Management regarding the responsibilities of the Board, its Committees and
Management, the requirements of Directors in carrying out their stewardship role and in discharging their duties
towards the Company as well as boardroom activities. Salient features of the Charter are published on the Company’s
website at
in line with Recommendation 1.7 of the MCCG 2012.
(ii) Code of Ethics
The Board has formalized a Directors’ Code of Ethics, setting out the standards of conduct expected from Directors.
The Directors’ Code of Ethics is contained in Appendix A of the Charter. To inculcate good ethical conduct, the Group
has established a Code of Conduct for employees, which has been communicated to all levels of employees in the
Group.
The Board has also formalised a Special Complaints Policy, which is equivalent to a whistle-blowing policy, with the aim
to provide an avenue for raising concerns related to possible breach of business conduct, non-compliance of laws and
regulatory requirements as well as other malpractices.
