Fit & Proper Policy

1. PURPOSE
This Fit and Proper Policy (the “Policy”) serves as a guidance for EPMB’s Nomination Committee (“NC”) and Board (“Board”) in discharging their responsibilities in terms of the nomination, assessment and re-election of Board members in compliance with the Main Market Listing Requirements (“MMLR”) of Bursa Malaysia Securities Berhad and taking into consideration the recommendations under Malaysian Code on Corporate Governance.
2. BOARD MEMBERSHIP CRITERIA
The NC has been entrusted with the responsibilities inter alia to propose candidates to the Board and committees of the Board (“Board Committees”) of EPMB and to recommend the appointment and remuneration of Executive Directors, Non-Executie Directors (including Independent Directors) and Senior Management of the EPMB, to the Board for their final decision and approval. When determining the qualifications of any candidate for the new appointment of Director, NC shall take into account all of the following criteria and any other criteria which the NC deems necessary. Such candidates must have the following qualities:-
2.1 Character and Integrity
Probity
  • have the highest level of integrity, ethical character, honesty, diligence, independence of mind and fairness.
  • is compliant with legal obligations, regulatory requirements and professional standards.
  • have not been obstructive, misleading or untruthful in dealings with regulatory bodies or a court.
  • is free from any business or other relationship which could materially pose a conflict of interest or interfere with the exercise of his judgement when acting in the capacity of a Director or Senior Management which would be disadvantageous to the company or its interests.
Financial integrity
  • should be financially literate and able to manage his/her debts or financial affairs prudently.
  • demonstrates ability to fulfil personal financial obligations as and when they fall due.
  • have not been subjected to a judgment debt which is unsatisfied, either in whole or in part whether in Malaysia or elsewhere.
  • have not filed for bankruptcy or been adjudicated a bankrupt or had assets sequestered in any jurisdiction, and
Personal integrity, honesty and ethical behaviour
  • have not perpetrated or participated in any business practices which are deceitful, oppressive, improper (whether unlawful or not) or which otherwise reflect discredit on his professional conduct.
  • service contracts (i.e. in the capacity of management or Director) have not been terminated in the past due to concerns on personal integrity.
  • have no concurrent responsibilities or interest which would contribute to a conflict of interest situation or otherwise impair the ability to discharge duties and responsibilities as Director of company and/or its subsidiaries.
  • have not abused other positions (i.e. that he has held) in a manner that contravenes principles of good governance and professional ethics.
  • have not contravened any requirements imposed by authorities or bodies, whether in Malaysia or elsewhere or failed to uphold any professional or ethical standards issued, or have abetted another person to breach such requirements, professional or ethical standards
Reputation
  • is of good repute in the financial and business community.
  • have not been the subject of civil or criminal proceedings or enforcement action, in managing or governing an entity or have been notified of any impending proceedings or of any investigations, which might lead to such proceedings.
  • have not been reprimanded by the Securities Commission Malaysia, Bursa Malaysia Securities Berhad, Suruhanjaya Syarikat Malaysia, Bank Negara Malaysia or any other regulatory authorities both local or abroad.
  • have not been substantially involved in the management of a business or company which have failed, where that failure has been occasioned in part by deficiencies in that management.
  • have not contravened any provision made by or under any written law designed to protect members of the public against financial loss due to dishonesty, incompetence or malpractice.
2.2 Character and Integrity
Qualifications, training and skills
  • have the necessary education, skills, experience, ability and commitment to carry out the role and have a good understanding of business strategy and technical requirements of the business particularly in automotive and/or supply chain and/or finance and/or manufacturing industry, corporate governance and board operations.
  • have the appropriate level of physical and mental fitness.
  • keeps knowledge current based on continuous professional development.
  • possesses general management skills as well as understanding of corporate governance and sustainability issues.
Relevant past performance or track record
  • should devote sufficient time to carry out his/her responsibilities as a Director which includes regularly enhance their knowledge and skills.
  • expected to have active participation in, meetings of the Board and the Board’s committees of which he/she is a member.
2.3 Time and Commitment
Ability to discharge role having regard to other commitments
  • are able to devote time as a Board member, having factored other outside obligations including concurrent board positions held by the director across listed issuers and nonlisted entities (including not for profit and charitable organisations); and
  • The directorships held by any Board member at any one time shall not exceed five (5) in listed companies
Participation and contribution in the Board
  • exhibit open mindedness to the views of others and ability to make considered judgment after hearing the views of others.
  • demonstrate willingness to devote time and effort to understand the businesses and exemplifies readiness to participate in events outside the boardroom.
  • manifest passion in the vocation of a Director; and
  • exhibit ability to articulate views independently, objectively and constructively.
Further, NC shall also consider the additional criteria on independence as described below for the Independent Director position
  • Such candidates must fulfil the criteria set out in the definition of “independent directors”as prescribed by the MMLR;
  • Such candidates must free from any business or other relationship which could affect his/her independence nature and interfere his/her judgement;
  • Such candidates’ background and other activities must qualify him/her to serve as independent director; and
  • Such candidates must be capable and have the ability to advise on matters involving conflict of interest.
3. ASSESSMENT/EVALUATION PROCESS
(a) The assessment/evaluation process of the above criteria may include the following:-
  • At NC’s discretion, review the candidate’s resume, curriculum vitae and other biographical information confirming the candidate’s qualifications.
  • The candidates shall authorise EPMB to conduct legal, financial and other background searches which may cover previous employment verification, professional reference checks, education confirmation and/or criminal record and credit checks. The information collected through the assessment is strictly for the use of this assessment only.
  • The NC would also by way of formal or informal interview, assess inter alia the candidates’ integrity, wisdom, independence, character, ability to make independent and analytical judgment, teamwork ability, his/her understanding of the business environment and the willingness to devote adequate time and commitment to attend to the duties/functions of the Board.
(b) Annual assessment of existing Directors
  • Before the re-election of the Director (“Existing Director”) at the next Annual General Meeting. NC shall make and use all reasonable efforts to conduct an appropriate assessment on the Existing Director and give its best recommendation thereafter. The assessment will be based on the yearly assessment conducted.
  • In respect of yearly assessment, the Director or Key Officer Evaluation Form (the “Form”) would be circulated to all/part of the Directors for self-evaluation and completion. NC will thereafter discuss the findings and make necessary recommendations (such as re-election, re-appointment, etc.) to the Board. A copy of the Form is attached herewith as Appendix A. The Form will be reviewed and revised from time to time as and when necessary.
4. POLICY REVIEW
This Policy shall be kept under review, updated and be revised as and when required in accordance with the needs of EPMB, development of corporate governance practices, and/or any other applicable laws enforced at the time being. Any changes to the terms of the Policy shall be subject to the approval of the Board
Appendix A
DIRECTORS’ / KEY OFFICER’S EVALUATION FORM
The evaluation form provides ratings from one (1) to four (4), or ‘yes’ and ‘no’, with the indicators illustrated below, to be responded in relation to the nature of the questions:
4 
3 
2 
1 
Yes, always
Yes, most of the time
Yes, but seldom
No
or
4 
3 
2 
1 
Above average
Average
Below average
Poor
or
Yes 
No 
Yes
No
Where a particular criterion is deemed not applicable, it should be indicated as “Not Applicable” in the comment box. Name of Director / Key Officer :
Section A : Fit and Proper
1. Has not been questioned, publicly or privately, of his/her honesty, integrity, professional conduct or business ethics/practices which are deceitful, oppressive or improper
Yes 
No 
Comment :
2. Has shown willingness to maintain effective internal control systems and risk management practices
Yes 
No 
Comment :
3. Possesses relevant qualifications, knowledge, experience and ability to understand the technical requirements, risk and management of the company’s business
4 
3 
2 
1 
Comment :
Section B : Contribution and Performance
4. Probes management to ensure management has taken, and suggests management to take, into consideration the varying opportunities and risks whilst developing the strategic plan (this plan may or may not be in writing as long as minutes of meeting provide a discussion of such strategy)
4 
3 
2 
1 
Comment :
5. Probes management when there are red flags/concerns which could,amongst others,indicate possible non-compliance of regulatory requirements
4 
3 
2 
1 
Comment :
6. Provides logical honest opinions on issues presented and is not afraid of expressing disagreement on matters during the meeting, if any
4 
3 
2 
1 
Comment :
7. Received feedback from board and/or committee and incorporates feedback obtained into the decision-making process in an objective manner
4 
3 
2 
1 
Comment :
8. Defends own stand through constructive deliberations at board and/or committee meetings, where necessary
4 
3 
2 
1 
Comment :
9. Tackles conflicts and takes part in proposing solutions
4 
3 
2 
1 
Comment :
10. Offers practical and realistic advice to board and/or committee discussions
4 
3 
2 
1 
Comment :
11. Takes initiative to demand for additional information, where necessary
4 
3 
2 
1 
Comment :
12. Tests quality of information and assumptions
4 
3 
2 
1 
Comment :
13. Reviews and relates short-term concerns to long-term strategy
4 
3 
2 
1 
Comment :
14. Contributes to risk management initiatives
4 
3 
2 
1 
Comment :
15. Contributes personal knowledge and experience into the consideration and development of strategy
4 
3 
2 
1 
Comment :
16. Facilitates objective-oriented decision-making process
4 
3 
2 
1 
Comment :
17. Prioritises context of issues to be in line with objectives
4 
3 
2 
1 
Comment :
18. Effectively and proactively follows up on areas of concern
4 
3 
2 
1 
Comment :
19. Demonstrates willingness to devote time and effort to understand the company and its business and readiness to participate in events outside the boardroom, such as site visits
4 
3 
2 
1 
Comment :
Section C : Contribution and Performance
20. Acts in good faith and with integrity
4 
3 
2 
1 
Comment :
21. Well prepared at meetings and adds value to board and/or committee meetings
4 
3 
2 
1 
Comment :
22. Works constructively with peers, the company secretary and senior management
4 
3 
2 
1 
Comment :
23. Offers insight to matters presented with requisite knowledge and skills, and shares information
4 
3 
2 
1 
Comment :
24. Encourages others to get things done, is decisive and action-oriented
4 
3 
2 
1 
Comment :
25. Understands individual roles and responsibilities and ensures contribution is contemporary with developments
4 
3 
2 
1 
Comment :
26. Communicates effectively with shareholders
4 
3 
2 
1 
Comment :
27. Constructively challenges and contributes to the development of strategy
4 
3 
2 
1 
Comment :
28. Scrutinises the performance of management in meeting agreed goals and objectives, and monitors reporting of performance
4 
3 
2 
1 
Comment :
29. Satisfies himself/herself that financial information is accurate and financial controls and systems of risk management are robust and defensible
4 
3 
2 
1 
Comment :
Evaluation carried out by:
    ……………………………………………    
Name :
Designation :