Sustainability
Corporate Governance
may seek advice from the Singapore Institute of Directors
or external search consultants. Selections and nominations
are made based on the following guidelines:
•
Integrity;
•
Relevant expertise (sector and functional) and the
degree to which his or her skill set complements the
skill set of the other Board members;
•
Reputation and standing in the market; and
•
In the case of prospective Independent Directors,
independence based on the criteria in the Code.
Board Performance
Principle 5:
There should be a formal assessment of the effectiveness
of the Board as a whole and its Board committees and
the contribution by each director to the effectiveness
of the Board.
The Manager believes that the performance of the
Manager, and the Board, is reflected in the long term
success of Starhill Global REIT.
Reviews of Board performance are conducted once a
year. Directors are required to complete a questionnaire
evaluating the Board and the Audit Committee.
The questionnaire covers areas such as Board
composition, access to information, Board processes,
risk management, Board training and development
programme, understanding of the business, strategic
planning and any specific areas where improvements
may be made. Pursuant to the Board evaluation
process, the Board is satisfied that it has achieved its
performance objectives for FY 2014/15.
In cases where the Director(s) have multiple listed
board representations, the Board conducts an annual
review to ensure that they are able to and have been
devoting sufficient time to discharge their responsibilities
adequately. Each Director confirmed his ability to devote
sufficient time and attention to the affairs of the Manager
and Starhill Global REIT, having regard to all his other
listed company board representations and other principal
commitments. Notwithstanding that some of the Directors
have multiple board representations, the Board is satisfied
that each Director is able to and has been adequately
carrying out his duties as a Director of the Manager.
The Manager believes that contributions from each
Director go beyond his attendance at Board and
committee meetings. Contributions by an individual
Board member take other forms, including providing
objective perspectives of issues, facilitating business
opportunities and strategic relationships, and accessibility
to Management outside of a formal environment of
Board and/or Audit Committee meetings. A Director
of the Manager would have been appointed on the
principles outlined earlier in this statement, and on his/
her ability to contribute to the proper guidance of the
Manager in its management of Starhill Global REIT.
information flow between the Board and its committees
and between Management and non-executive Directors
and advising the Board on all governance matters.
The company secretary attends all Board and Audit
Committee meetings of the Manager to take minutes.
The appointment and removal of the company secretary
is a Board reserved matter.
(B) REMUNERATION MATTERS
Procedures for Developing Remuneration Policies
Principle 7:
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 own remuneration.
Level and Mix of Remuneration
Principle 8:
The level and structure of remuneration should be
aligned with the long-term interest and risk policies
of the company, and should be appropriate to attract,
retain and motivate (a) the directors to provide good
stewardship of the company, and (b) key management
personnel to successfully manage the company.
However, companies should avoid paying more than
is necessary for this purpose.
Disclosure on Remuneration
Principle 9:
Every company should provide clear disclosure of its
remuneration policies, level and mix of remuneration, and
the procedure for setting remuneration in the company’s
Annual Report. It should provide disclosure in relation to
its remuneration policies to enable investors to understand
the link between remuneration paid to directors and key
management personnel, and performance.
The remuneration of Directors and staff of the Manager
is paid by the Manager from the fees it receives from
Starhill Global REIT, and not by Starhill Global REIT itself.
As Starhill Global REIT does not bear the remuneration
of the Manager’s Board and staff, and the Manager is
a wholly-owned subsidiary of YTL Corp, the Manager
does not consider it necessary to have a remuneration
committee or to include a report on remuneration of its
Directors and key executives.
(C) ACCOUNTABILITY AND AUDIT
Accountability
Principle 10:
The Board should present a balanced and understandable
assessment of the company’s performance, position and
prospects.
The Manager provides Unitholders with quarterly and
annual financial statements. The Board, with the support
of Management, is responsible for providing a balanced
and informed assessment of Starhill Global REIT’s
In the year under review, the number of Board and
Audit Committee meetings held and attended by
each Board member is as follows:
Board
Audit
Committee
No. of
meetings held
in FY 2014/15:
6
No. of
meetings held
in FY 2014/15:
6
Attended
Attended
Tan Sri Dato’
(Dr) Francis
Yeoh Sock Ping
5
NA
Mr Ho Sing
6
NA
Dato’ Yeoh
Seok Kian
6
NA
Mr Keith Tay Ah Kee
6
6
Dr Hong Hai
6
6
Mr Michael Hwang
6
5
Access to Information
Principle 6:
In order to fulfil their responsibilities, Directors should be
provided with complete, adequate and timely information
prior to board meetings and on an on-going basis so as to
enable them to make informed decisions to discharge their
duties and responsibilities.
Management provides the Board with regular updates
on financial results, market and business developments,
and business and operational information. Board papers
and agenda are provided to each Director in advance of
Board meetings so that Directors can review and consider
the matters being tabled beforehand. Management
provides the Board with management accounts of
Starhill Global REIT on a quarterly basis to enable the
Board to keep abreast of Starhill Global REIT’s financial
performance. In addition, as and when any significant
matter arises, Management promptly brings these matters
to the Board’s attention and provides the Board with the
relevant financial information.
Where necessary, senior members of Management
participate in Board meetings to provide additional
insights and to respond to any queries from Directors.
The Board has unfettered access to senior members of
Management and the company secretary at all times.
The Board also has access to independent professional
advice (legal, financial or otherwise) where appropriate
or necessary. The company secretary of the Manager
will render necessary assistance to the Board and will
ensure that the Board procedures are followed and that
applicable laws and regulations are complied with. Under
the direction of the Executive Chairman, the company
secretary’s responsibilities include ensuring good
performance, position and prospects, including interim
and other price-sensitive public reports, and reports to
regulators (if required). Management provides the Board
with management accounts on a quarterly basis and as
the Board may require from time to time to enable the
Board to make a balanced and informed assessment.
Financial reports and other material information are
disseminated to Unitholders through announcements to
SGX-ST via SGXNET, Starhill Global REIT’s website and
where applicable, press releases, of the performance,
position and prospects of Starhill Global REIT.
Risk Management and Internal Controls
Principle 11:
The Board is responsible for the governance of risk.
The Board should ensure that the Management maintains
a sound system of risk management and internal controls
to safeguard shareholders’ interests and the company’s
assets, and should determine the nature and extent of
the significant risks which the Board is willing to take in
achieving its strategic objectives.
Effective risk management is a fundamental part of
Starhill Global REIT’s business strategy. Recognising and
managing risk is central to the business and to protecting
Unitholders’ interests and value. The Manager has in place
an enterprise risk management framework and policies,
which have been approved by the Board that provide
a structured approach to identifying and managing the
material risks that could arise in the course of managing
Starhill Global REIT. The framework and policies are
monitored and reviewed by the Board as and when
appropriate, and major developments and significant
revisions to the framework or policies will be submitted
to the Board for approval. An independent consultant
also reviews the risk management framework and the
identified risks and control activities, and provide a report
to the Board once every two years. Material risks at both
the Manager and Starhill Global REIT levels are managed
through this risk management framework.
The Audit Committee has also been tasked by the Board
to include risk management within its oversight role.
This includes the review of material risks identified by
management with respect to the business operations of
the Manager, Starhill Global REIT and the assets of Starhill
Global REIT.
Application of the policies and protocol under the
framework in respect of Starhill Global REIT assets
and operations is further described in the section
“Risk Management” on page 66.
The Manager has put in place a system of internal controls,
compliance procedures and processes to safeguard
Starhill Global REIT’s assets and Unitholders’ interests,
manage risks and ensure compliance with high standards
of corporate governance. Financial risk management
is exercised in accordance with a robust policy. During
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74
STARHILL
GLOBAL
REIT
Annual
Report
FY 2014/15
