Committee Composition

Our Board has established four Board Committees comprising an Audit Committee (the "AC"), a Nominating Committee (the "NC"), a Remuneration Committee (the "RC"), and an Executive Committee (the "EC"). These committees function within clearly defined written terms of reference and operating procedures, which will be reviewed on a regular basis.

Committee Executive Audit Nominating Remuneration
Dr Diao Weicheng E - -
Mr Sun YanE - - -
Mr Li MeijinE - - -
Mr Teng Cheong KweeI -
Mr Chong Teck SinI -
Ms Alice Lai Kuen KanI -
: Chairperson
: Member
E: Executive Director
I: Non-Executive Independent Directors

Executive Committee

The EC comprises our Executive Chairman and the following Executive Directors:

  • Diao Weicheng Chairman
  • Sun Yan Member
  • Li Meijin Member

EC is formed for the purpose of supervising the Management of the Group's operations, as well as facilitating and streamlining the Group's decision making process. This Committee is delegated with the authority and responsibility for the operational management of the Group, within Limits of Authority delegated by the Board.

The principal responsibilities of the EC are as follows:

  1. making key decisions on the operational management and supervision of the Management of the Group's operation;
  2. managing acquisition, disposal and transfer of fixed assets within limits authorised by the Board;
  3. approving operational expenditure within authorised limits;
  4. entering into sale and purchase contracts in relation to shipbuilding and ship-trading within authorised limits;
  5. managing procurement in relation to shipbuilding contract expenditure within authorised limits;
  6. entering into operational contracts within authorised limits;
  7. obtaining borrowings and credit facilities within authorised limits;
  8. writing-off trade and non-trade receivables within authorised limits;
  9. granting credit limits to trade debtors within authorised limits; and
  10. reviewing the performance of the Company and the Group, deliberating on corporate strategies, group business and principal risks, addressing important operational and financial issues and making recommendations to the Board for approval.

Any decisions or transactions that exceed the above scope would require separate Board approval. The execution of any of the above transactions needs to be approved by the Chairman of the EC and any one other member of the EC.

Nominating Committee

The NC is responsible for making recommendations on all board appointments and re-nominations of Directors seeking re-election. The appointment and re-appointment of the Directors is then approved by the Board.

The NC is made up of the following members:

  • Mr Teng Cheong Kwee Chairman
  • Dr Diao Weicheng Member
  • Mr Chong Teck Sin Member
  • Ms Alice Lai Kuen Kan Member

Except for Dr Diao Weicheng, all the members of the NC, including the Chairman, are independent and non-executive.

The NC is guided by the written terms of reference, which set out the duties and responsibilities of the NC, and are approved by the Board. The principal responsibilities of the NC include, inter alia, the following:

  1. conducting an annual review of the size, composition and core competencies of and skills required by the Board and the Board Committees;
  2. making recommendations to the Board on the appointment of new Executive and Non-Executive Directors, including making recommendations on the composition of the Board generally and the balance between Executive and Non-Executive Directors appointed to the Board;
  3. reviewing, assessing and recommending nominee(s) or candidate(s) for appointment or election to the Board, having regard to his/her qualifications, competency and whether or not he/she is independent and in the case of a re-nomination, to his/her contribution and performance (e.g. attendance, preparedness, participation and candour);
  4. determining, on an annual basis, if a Director is independent;
  5. reviewing and approving any new employment of related persons and the proposed terms of their employment;
  6. reviewing the Board succession plans for directors, in particular, the Chairman and CEO;
  7. assessing the effectiveness of the Board as a whole and the contribution of each individual Director to the effectiveness of the Board, and to decide how the Board's performance may be evaluated and propose objective performance criteria;
  8. deciding whether or not a Director is able to and has been adequately carrying out his/her duties as a Director of the Company, particularly when he/she has multiple board representations and other principal commitments; and
  9. reviewing training and professional development programs for the Board on an annual basis.

When an existing Director chooses to retire or the need for a new Director arises, either to replace a retiring Director or to enhance the Board's strength, the NC, in consultation with the Board and the Management, evaluates and determines the selection criteria and any potential candidate, whether proposed by the Management or the Directors or identified through the NC's network of contacts or identified by way of an engagement of external professional search firms. The NC will meet or conduct telephone interviews with the proposed candidates to assess suitability and ensure that the candidates are suitable before nominating suitable candidates to the Board for approval and appointment as Directors.

New Directors are only appointed to the Board after the NC has reviewed and considered the skills, qualifications and experience of the nominated Director. The NC further considers factors such as the ability of the prospective candidate to contribute to the discussions of the Board and the Board Committees, taking into consideration the composition of the Board and the mix of expertise, skills and attributes of existing Directors. Further, the NC, in considering the re-appointment of a Director, evaluates such director's contribution and performance, such as his attendance at meetings.

Pursuant to its duties and responsibilities, the NC has conducted its annual review of the Independent Directors' independence and is of the view that Mr Teng Cheong Kwee, Mr Chong Teck Sin, Ms Alice Lai Kuen Kan and Mr Wang Puqu are "independent" in accordance with the Code.

Pursuant to the Article 91 of the Company's Articles of Association, one-third of the Directors for the time being is required to retire from office by rotation, such that all Directors shall retire from office once at least every three years. The Directors to retire in each year shall be those subject to retirement by rotation who have been longest in office since their last re-election or appointment and so that as between those persons who became or were last re-elected as Directors on the same day, those retiring shall (unless they otherwise agree among themselves) be determined by lot.

Remuneration Committee

The RC makes recommendations to the Board on the framework of remuneration, and the specific remuneration packages for each Director and key management personnel, including the CEO. The RC is made up of the following members:

  • Ms Alice Lai Kuen Kan Chairman
  • Mr Teng Cheong Kwee Member
  • Mr Chong Teck Sin Member

All the members of the RC, including the Chairperson, are independent and non-executive. The RC is guided by the written terms of references, which set out the duties and responsibilities of the RC, and are approved by the Board. The principal responsibilities of the RC include, inter alia, the following:

  1. recommending to the Board a framework of remuneration for the Directors and Executive Officers which covers all aspects of remuneration, including but not limited to directors' fees, salaries, allowances, bonuses, options and benefits-in-kind;
  2. determining specific remuneration packages for each Executive Director;
  3. recommending to the Board the remuneration of the Non-Executive Directors, which should be appropriate to the level of their respective contributions, taking into account factors such as effort and time spent, and the responsibilities of the Non-Executive Directors;
  4. determining the targets for any performance-related pay schemes in respect of the Executive Directors of the Group and to recommend to the Board the terms of renewal of their service contracts;
  5. reviewing the Company's obligations arising in the event of termination of the Executive Directors' and Executive Officers' service contracts.

The RC has access to appropriate expert advice regarding executive compensation matters, if required. The RC's recommendations will be submitted for endorsement by our Board. Each member of the RC refrains from voting on any resolutions, participating in any deliberation or making any recommendation in respect of the assessment of his remuneration. No Director is involved in deciding his own remuneration.

The remuneration packages of the Executive Directors are based on service contracts. The Non-Executive and Independent Directors are paid yearly directors' fees and these fees are subject to shareholders' approval at the AGM. In setting the remuneration packages of the Executive Directors, the Company takes into account the performance of the Group and that of the Executive Directors which are aligned with long term interest and risk policies of the Group.

The RC will be provided with access to expert professional advice on remuneration matters when necessary, and the expenses of such services shall be borne by the Company.

Audit Committee

The AC is made up of the following members:

  • Mr Chong Teck Sin Chairman
  • Mr Teng Cheong Kwee Member
  • Ms Alice Lai Kuen Kan Member

All the members of the AC, including the Chairperson, are independent and non-executive. The NC and the Board are of the view that the members of the AC collectively, and the AC Chairman, have the requisite qualification, recent and relevant financial management knowledge, expertise and experience to discharge their responsibilities properly.

The AC is guided by the written terms of references, which set out the duties and responsibilities of the AC, and are approved by the Board. The principal responsibilities of the AC include, inter alia, the following:

  1. reviewing, together with the internal and external auditors, the audit plan, their evaluation of the system of internal accounting controls, their letter to the Management and the Management's response. It is intended that the AC shall, at least once a year, have a separate session with the internal and external auditors without the presence of the Management;
  2. reviewing the quarterly, half yearly and annual results announcements before submission to our Board for approval, focusing in particular on changes in accounting policies and practices, major risk areas, significant adjustments resulting from the audit, compliance with accounting standards and compliance with the Listing Manual and any other relevant statutory or regulatory requirements;
  3. reviewing and reporting to the Board at least annually on the adequacy and effectiveness of the internal control procedures implemented by the Group, determining the scope of internal audit examinations and ensuring co-ordination between the internal/external auditors and the Management, and reviewing the assistance given by the Management to the auditors, and discussing problems and concerns, if any, arising from audits, and any matters which the auditors may wish to discuss (in the absence of the Management, where necessary);
  4. reviewing and discussing with the external auditors any suspected fraud or irregularity, or suspected infringement of any relevant laws, rules or regulations, which has or is likely to have a material impact on our Group's operating results or financial position, and the Management's response;
  5. considering and recommending to the Board on the proposals to the shareholders on the appointment, re-appointment and removal of the external auditors, matters relating to the resignation or dismissal of the auditors and approving the remuneration and terms of engagement of the external auditors;
  6. reviewing interested person transactions (if any) falling within the scope of Chapter 9 of the Listing Manual;
  7. reviewing potential conflicts of interests, if any;
  8. undertaking such other reviews and projects as may be requested by the Board, and reporting to the Board its findings from time to time on matters arising and requiring the attention of the AC;
  9. generally undertaking such other functions and duties as may be required by statute or the Listing Manual, or by such amendments as may be made thereto from time to time;
  10. reviewing and approving all hedging policies and instruments to be implemented by our Group, if any; and
  11. reviewing and approving the appointment of the Chief Financial Officer and Financial Controller to the extent that the finance and accounting function is appropriately resourced.

The AC has full authority to investigate any matter within its terms of reference, and will be given full access to and full co-operation from the Management and external and internal auditors and full discretion to invite any Director, Executive Officer or other employee of the Group to attend its meetings, and is given reasonable resources to enable it to discharge its functions properly and effectively. The AC also undertakes such further functions as may be agreed to by the AC and the Board from time to time.

For it to be able to perform its functions effectively, the AC meets with the external auditors and with the internal auditors, without the presence of the Management, at least annually for a review and discussion of any key issues raised.