Corporate Governance Overview Statement

Board Responsibilities

The board charter sets out matters reserved for the Board’s decision and outlines the Board’s roles and responsibilities. The schedule of matters for the Board’s decision includes amongst others, the overall Group strategy and direction; major policies, board and board committee appointments; approval of financial statements, corporate plans and budgets, material acquisitions and disposals of assets, and major investments. The Board charter includes the Board’s responsibilities on environmental, social and governance (“ESG”) matters which are pertinent and material to the Group and its stakeholders; as well as effective stakeholder communication and engagement.

The Board has oversight of the overall performance and control of the Group, setting and reviewing the strategic direction of the Group, and monitoring the implementation by management of that strategy. Specific responsibilities are delegated to several committees. These committees operate within Board-approved terms of reference, and have authority to examine issues and report to the Board with their findings and recommendations.

The roles of the Chairman and Group Managing Director are separate. The non-executive Chairman’s responsibilities include overseeing the governance process, provide board leadership on policy formation and decision-making, and ensure that appropriate steps are taken to provide effective communication with stakeholders. The Group Managing Director is responsible for overseeing the development and operations of the Group’s businesses, and implementing corporate strategies and objectives adopted and approved by the Board.

The Board sets the standards of conduct and personal behaviour to maintain a uniform set of values and ethics within the Group. An updated Group-wide code of ethics and conduct was approved by the Board in March 2024. A set of ‘Whistleblowing Policy and Procedures’ has been adopted by the respective business units throughout the Group, and is incorporated in the employee handbook. It is also available on the Company’s website: https://www.ppbgroup.com/index.php/governance-sustainability/ code-policies/whistleblowing-policy-and-procedures

Anti-bribery and corruption

The Board is responsible for the oversight of the Group’s Anti- Bribery and Corruption (“ABAC”) programme. It is committed to complying with anti-bribery and corruption laws in Malaysia and other countries in which the Group operates, and has approved the ‘Group ABAC Policy and Procedures’ (“ABAC P&Ps”) which applies to all directors and employees of PPB Group as well as business associates.

The ABAC P&Ps sets out PPB’s stance against bribery and corruption, managing conflicts of interest, policy on gifts, hospitality and entertainment, donations and sponsorship, handling facilitation payment requests and whistleblowing. It is communicated to all parties with whom the Group has business dealings, and is accessible to the public via the Group entities’ corporate websites. It may be viewed at the Company’s website: https://www.ppbgroup.com/index.php/governance-sustainability/ code-policies/anti-bribery-and-corruption-policy-and-procedures

The Company conducts an annual mandatory ABAC training session for its Directors and employees.

Pursuant to the dissolution of the Group Integrity Steering Committee, the Legal and Corporate Secretarial Department is tasked with overseeing the design, implementation, management, and continuous improvement of the ABAC programme and providing regular reports to the Board.

Governing Sustainability

The Board has oversight responsibility to deliver sustainable value to stakeholders through the principles, policies, objectives and strategies of the Group. In carrying out this responsibility, the Board is supported by the Sustainability Steering Committee (“SSC”) which was formed in 2017. The SSC is chaired by the Group Managing Director of PPB and comprises the Group Head of Sustainability, PPB’s department heads, as well as the chief executive and sustainability officers of the business units. The respective business units set, monitor and review ESG/sustainability targets, and report the performance/results achieved to the Board through the SSC.

Our updated Group Strategic Plan (2024-2028) includes sustainability goals, strategies and plans of the various business units. The Board has adopted a 5-year sustainability roadmap for the period from 2022 to 2026, which translates the Group’s vision and strategy into targets and initiatives to be achieved within the set timelines. The roadmap and plans are under the purview of the Board and the SSC.

Further details of the Group’s sustainability-related activities are set out in the 2024 Sustainability Report which is available on the websites of Bursa Malaysia (http://www.bursamalaysia.com) and PPB (https://www.ppbgroup.com).

Board and Committee meetings

The meetings of the Board and Board Committees held in FY2024 and attendance record are set out below:

# These Committees were dissolved with effect from 1 October 2024 and a combined Nomination and Remuneration Committee (“NRC”) was formed. There was no NRC meeting held in FY2024.

In exercising their duties, directors have access to Company information and the support of the company secretary. The company secretary also updates directors on statutory, regulatory and related governance requirements relating to the discharge of their duties and responsibilities.

Board Composition

The Board comprises a majority of independent directors; of the eight Board members at end-2024, five are independent. The remainder of the Board comprises two non-independent non-executive directors (one of whom is the Chairman), and the Group Managing Director.

The independent directors are able to carry out their duties and express their views unfettered by familiarity, or business or other relationships. They provide skills, competencies as well as broader views to enhance the Board’s effectiveness.

The Board has agreed that annual shareholders’ approval be sought to extend the tenure of any director who has served for more than nine years as an independent director. Mr Soh Chin Teck and En Ahmad Riza bin Basir’s tenures as independent directors were further extended at the 55th Annual General Meeting (“AGM”) of the Company in 2024. The then Nomination Committee (“NC”) and the Board were satisfied that Mr Soh and En Riza are able to exercise independent judgment and act in the best interests of the Company, and recommended the continuation of their tenures as independent directors beyond nine years for shareholders’ approval at the 55th AGM.

The Board strives to achieve a balance and mix of skills, experience and perspectives amongst its directors, to collectively bring a range of experience, business, financial and technical expertise for effective oversight of the Group’s businesses, and fulfil the Board’s duties and responsibilities.

Annual re-election of directors

In accordance with the Company’s Constitution, one third of the directors retire by rotation at the AGM every year, and are subject to re-election by members. No director shall serve for more than three years from his/her last election.

The NC also reviews annually the training undertaken by Directors and recommends topics which are relevant or of interest to the Board to keep abreast with business and regulatory developments.

The Company organised several training sessions and field visits in 2024 which Directors attended, and these included the following:

Training sessions:

• The outlook for global and regional markets and key takeaways of Malaysia Budget 2025.
• Briefing on waste, the circular economy and impact of consumerism.
• Update on cyber-security awareness, and implementation of the Malaysian Cyber Security Act 2024.
• Annual integrity training pursuant to the Group’s antibribery and corruption framework.

Field visits:

• Visited the Raja Musa peat swamp forest reserve in northern Selangor including a briefing on carbon capture.
• Visited an oil palm estate in Selangor which included a briefing on human rights and forced labour.

During the year, Directors had also progressively attended Bursa Malaysia’s mandatory programme on sustainability

In addition, the following Directors attended other training sessions during the year, and the topics included:

The criteria for evaluation of candidates for appointment as directors (and senior management positions) include their qualification, occupation, professional and business experience, and is subject to the Company/ Group’s requirements and operating environment. Prospective candidates are not discriminated based on gender, age, cultural background etc.

The Group recognises the importance of identifying and developing potential leaders and managers to fill key positions (whether on the board or senior management) in the Company and Group, from both internal and external sources. This is an on-going process based on the Group’s immediate and longer term needs in terms of skills, expertise, knowledge and experience.

Board evaluation

Candidates for board appointments are reviewed by the NC and evaluated in accordance with the Directors’ Fit and Proper Policy of the Company before recommendation to the Board. The then NC was chaired by Encik Ahmad Riza bin Basir, an independent director. During the year, the NC reviewed and recommended the appointment of Ms Wee Lay Hua as an Independent Director. The NC assessed the proposed candidate’s character, experience, integrity, competence and time commitment to discharge her role effectively as a director.

The NC reviews annually the Board size and composition, diversity (including gender diversity), as well as the mix of Directors necessary for the successful direction of the Company and Group’s businesses. The NC also conducted a Board assessment, and assessment of the independent directors for 2024 which covered their experience and expertise/knowledge in the following areas:

• Business knowledge
• Accounting and financials
• Corporate governance, risk management and internal controls
• Legal and regulatory
• Human capital
• Information technology knowledge
• ESG/sustainability matters

The assessment included a review of the directorships of each board member, and their performance and contribution to the Board and respective Board Committees during the year. The NC also assessed the performance of the Audit and Risk Committee in FY2024. Based on the NC’s review and recommendation, the Board is satisfied with the number and composition of its members, and is of the view that the Board and the Board Committees have discharged their respective duties and responsibilities effectively.

Gender diversity

There is presently no formal gender diversity policy. The Board is of the opinion that it is important to recruit and retain the best available talent, taking into account the mix of skills, experience, knowledge and independence, and based on the Group’s needs and operating environment. Nonetheless, the Board continues to review board gender diversity, and it will continue to be one of the factors to be considered in evaluating prospective candidates when a board vacancy arises.

Remuneration

The Board reviews the overall remuneration of executive and non-executive directors at intervals to attract and retain directors with the relevant experience and expertise.

The Group Managing Director’s remuneration is determined after taking into account his duties and responsibilities as Group Managing Director of PPB, his roles in various capacities in the main business units, his performance rating and the Group’s performance for the year. For non-executive directors, the remuneration reflects their roles and responsibilities, and the recommendation thereof is a matter for the Board as a whole subject to shareholders’ approval.

The individual directors’ remuneration paid/payable for FY2024 on a Group and Company basis are set out below:

The remuneration of the top five senior management of the PPB Group (excluding those who are also Directors of PPB) paid/payable for FY2024 on an aggregated basis in RM50,000 bands is as follows:

The Group senior management remuneration is commensurate with their duties and responsibilities, their work performance, and the performance of the respective business entity. The Board is of the opinion that the disclosure of the senior management’s names and remuneration components would not be in the best interest of the Group due to confidentiality, business and personal security concerns. The above disclosure is deemed sufficient to enable stakeholders to assess senior management remuneration vis-a-vis the Group’s performance.