Role of the ChairmanThe Chairman of the Board shall be appointed from one of its representatives to the Board and shall be entitled to a second or casting vote at any meeting of the Board or at any general meeting of the Company.
The Chairman carries out a leadership role in the conduct of the Board and its relations to shareholders and other stakeholders. The Chairman is primarily responsible for:
- ensuring the adequacy and integrity of the governance process;
- maintaining regular dialogue with the MD over all operational matters and consulting with the remainder of the Board members promptly over any matters that give him or her cause for major concern;
- functioning as a facilitator at meetings of the Board to ensure that no member, whether executive or non-executive, dominates discussion; that appropriate discussions take place and that relevant opinions amongst members are forthcoming. The Chairman ensures that discussions result in logical and understandable outcomes;
- ensuring that all Directors are enabled and encouraged to participate at Board meetings. This includes ensuring that all relevant issues are on the agenda and that all Directors receive timely and relevant information tailored to their needs and that they are properly briefed on issues arising at Board meetings;
- ensuring that Executive Directors look beyond their executive functions and accept their full share of responsibilities on governance;
- guiding and mediating Board actions with respect to organisational priorities and governance concerns;
- undertaking the primary responsibility for organising information necessary for the Board to deal with items on the agenda and for providing this information to Directors on a timely basis; and
- performing other responsibilities assigned by the Board from time to time.
Role of the Executive and Non-Executive DirectorsExecutive Directors are, as employees, involved in the day-to-day management of the Company.
Non-Executive Directors can be further classified as:
- Those who have no direct or indirect pecuniary interest in the Company other than their Directors’ emoluments and their “permitted” shareholdings in the Company;
- Those who are not employees of the Company or affiliated with it in any other way and are not involved in the day-to-day running of business but may have pecuniary interest in the Company, whether direct or indirect; or
- Those who are not employees of the Company but are standing as nominees for substantial shareholders.
The Companies Act, 1965 makes no distinction between Executive and Non-Executive Directors in terms of the legal duties that are imposed on Directors.
Non-Executive Directors may act as a bridge between Management and shareholders. They provide the relevant checks and balances, focusing on shareholders’ and other stakeholders’ interests and ensuring that high standards of corporate governance are applied.
Role of the Independent Non-Executive DirectorIndependent Directors are essential for protecting the interests of shareholders and can make significant contributions to the Company’s decision making by bringing in the quality of detached impartiality. Since an Independent Director has no conflict of interests in the discharge of his or her duties, he or she ought to approach any approval that is being sought at the Board’s level for a transaction or any matter with a watchful eye and with an inquiring mind.
An Independent Director is especially important in areas where the interests of Management, the Company and/or the shareholders diverge, such as executive performance and remuneration, related party transactions and audit.
It is important to bear in mind the Listing Requirements emphasise that even if a person does not fall within any of the disqualifying indicators spelt out in Paragraph 1.01 of the Listing Requirements, both the Director and the Board must give effect to the spirit, intention and purpose of the definition. There must be a conscious application of the test of whether the said Director is able to exercise independent judgment and act in the best interests of the Company.
The attributes of collegial yet independent decision-making that must be vested in the Independent Director would be determined in part by the character of the individual and that of the whole ethos of the Board.
Role of the MDThe position of MD in essence is to ensure the effective implementation of the Company’s strategic plan and policies established by the Board, to manage the daily conduct of the business to ensure its smooth operations, supervision and management of the Company subject to such directions and instructions from the Board.
The MD is accountable to the Board for the achievement of the Company’s goals and objectives and observance of Management’s limits.
At each of its scheduled meetings, the Board should expect to receive from or through the MD:
- summary reports on the performance and activities of PMHB and specific proposals for strategic investment, tender participation, capital expenditure acquisitions and disposal (if any);
- such assurances as the Board considers necessary to confirm that Management’s limits are being observed;
- report to the Board annually on the MD succession planning process; and
- report to the Board annually on the Company’s program for developing Management talent.
The MD is expected to act within all specific authorities delegated to him by the Board.
Generally, the MD is responsible to the Chairman/ Board for the following, with regards to the Company and PMHB:
- executive management of the business covering, inter-alia, the development of a strategic plan, an annual operating plan and budget, performance benchmarks to gauge Management’s performance and the analysis of management reports;
- developing long term strategic and short term profit plans, designed to ensure that the Company’s requirements for growth, profitability and return on capital are achieved;
- directing and controlling all aspects of the business operations in a cost effective manner;
- effectively oversees the human resource of the organisation with respect to key positions and ensures the general well-being of employees, determination of remuneration as well as terms and conditions of employment for Senior Management in consultation with the Board, if required, and the issues pertaining to discipline of employees;
- effectively represents the interest of the Company/ PMHB with major clients, government and their agencies, and industries at large, to ensure general goodwill towards the Company/ PMHB and cooperation in planned development;
- assures the Company that its corporate identity, products and services are of high standards and are reflective of market environment;
- provides assistance to the Board in discharging its duties and
- assists the Chairman in organising information necessary for the Board to deal with the agenda and for providing this information to Directors on a timely basis.
Role of the Alternate DirectorA Director of the Company shall be entitled at any time, and from time to time to appoint any person to act as his or her alternate and to terminate the appointment of such person and in that connection the provision of the Articles of Association shall be complied with.
The alternate director shall be entitled while holding office to receive notices of meetings of the Board and to attend and vote as a Director at any such meetings at which the Director appointing him or her is not present and generally to exercise all the powers, rights, duties and authorities as well as to perform all functions of the Director appointing him or her.
The Alternate Director shall also be entitled to exercise the vote of the Director appointing him or her, at any meetings of the Board and if the Alternate Director represents more than one (1) Director, the Alternate Director shall be entitled to one (1) vote for every Director he or she represents.
Tenure of DirectorsPursuant to the Company’s Articles of Association, one third of the Directors must retire annually but shall be eligible for re-election.
The Company shall ensure that the Directors, MD and Finance Director (or its equivalent), has the character, experience, integrity, competence and time to effectively discharge their respectively roles.
The tenure of the Executive Directors is tied to their executive office.
The assessment criteria for the independence of directors shall also include tenure. The tenure for an Independent Director to serve on the Board is nine (9) years.
The nine (9) years can be consecutive or cumulative service of nine (9) years. Independent Directors, who has served the Company for nine (9) years, may continue to serve the Company in the capacity of a Non-Independent Director.
The Board shall make a recommendation and provide strong justification to the Shareholders in deciding that an Independent Director can remain as an Independent Director after serving a cumulative term of nine (9) years for approval by the Shareholders.