Governance and Corporate Responsibility

  • Corporate Governance Overview

    • Corporate governance is a system of rules, practices, and processes by which a company is directed and controlled.
    • It primarily involves the relationship between the board of directors, shareholders, and other stakeholders.

  • Role of the Board of Directors

    • The board of directors runs the company on behalf of the shareholders.
    • Directors must act within their legal powers and promote the company's success, aligning their actions with shareholder interests.

  • Statutory Duties of Directors (Section 7.1 of Company's Act 2006)

    1. Act Within Powers
    • Directors must only operate within their legal authority.
    1. Promote Company Success
    • Directors must prioritize actions that benefit the company, avoiding detrimental decisions.
    1. Exercise Independent Judgment
    • Decisions should be made based on sound reasoning rather than external pressures.
    1. Diligence
    • Directors must employ reasonable skill, care, and diligence in their roles.
    1. Avoid Conflicts of Interest
    • Personal interests should not interfere with duties to the company.
    1. Do Not Accept Benefits from Third Parties
    • Acceptance of bribes or similar advantages is prohibited.
    1. Declare Interests in Transactions
    • Any personal interests in company activities must be disclosed.

  • Long-Term Planning

    • Directors should aim for long-term success rather than short-term gains.
    • This includes cultivating beneficial relationships and understanding the impact of business decisions.
    • Foster good community relations and protect the environment.

  • Financial Responsibilities

    • Directors must prepare financial statements in compliance with local and international standards.
    • Statements must be accurate and free from material misstatements due to error or fraud.
    • Implementation of internal controls and segregation of duties is necessary to prevent fraudulent activities and errors.

  • Compliance with Laws and Regulations

    • Directors are responsible for ensuring the company adheres to local and relevant laws governing business conduct.

  • Going Concern Principle

    • The "going concern" status indicates that the business will continue its operations for the foreseeable future, not expected to cease operations imminently.
    • Directors must assess and report on the company's ability to continue as a going concern, based on financial health and management's plans.

  • Balanced Assessment of Company Position

    • Directors should provide a fair and understandable evaluation of the company's financial and operational status to stakeholders.