Function & Conduct

Function & Conduct

Board responsibilities

The UOB (Malaysia) Board is committed to upholding good corporate governance which is integral to the Bank's growth and success. The Bank's corporate governance practices are guided by the principles and best practices as set out in Bank Negara Malaysia's Guidelines on Corporate Governance and the Malaysian Code on Corporate Governance.

The Board is responsible for providing strategic direction, entrepreneurial leadership and guidance, approving annual budgets, ensuring true and fair financial statements, monitoring financial performance, determining capital/debt structure as well as reviewing risk management framework and processes.

Board and Board Committee meetings are scheduled in advance and all directors are notified well before the start of the calendar year. When circumstances warrant it, ad-hoc meetings are held. To help directors access meeting materials as soon as they are available, papers are uploaded onto a secure portal, and directors can read from their tablet devices wherever they are.

All directors must notify the Bank in a timely manner of any change in interests or other appointments. Where a director has an interest in a matter being discussed, he/she is required to recuse himself/herself from the discussion and abstain from voting on the matter.

The Board meets at least four times a year. Directors' attendance at Board and Board Committee meetings in 2017 is set out in the table below.

Number of meetings attended in 2017
  Board of
Directors

Audit Committee

Risk Management Committee

Remuneration Committee Nominating
Committee

Dr Wee Cho Yaw

2 N/A N/A 1 1

Mr Ong Yew Huat
(Appointed to the Audit, Risk Management, Remuneration and Nominating Committees on 2 October 2017)

7 1 1 1 1

Mr Wee Ee Cheong

7 N/A N/A N/A 4

Dato' Jeffrey Ng Tiong Lip

7 5^ 4 N/A 4

Puan Fatimah Binti Merican

7 5 4 2^ 4^

Mr Robert Kwan Koh Wah
(Retired on 2 October 2017)

6 4 3^ 1 3

Mr Wong Kim Choong

7 N/A N/A N/A N/A

Number of meetings held in 2017

7 5 4 2 4

^ Chairman/Chairperson of Committee.

 

As a group, the directors have vast and varied experience in banking, finance, business and management, and the skills and expertise relevant to the business of the Bank. The directors also recognise the importance of training and development to keep abreast of prudential requirements and best practices.

For the year under review, they attended various training programmes related to their duties as directors including governance and risk management practices, updates on laws and legislations, anti-money laundering requirements, shariah governance and compliance requirements as well as the Bank's digital channels. Through the Bank's continuous development programme, new and existing directors receive training on topics that are relevant to the business of the Bank and which meet the objective of equipping directors with the relevant knowledge and skills to perform their role effectively.

Whenever a new director is appointed, he will, as part of the induction, meet with key senior executives and receive briefings on the key areas of the Bank’s business and risk management. Each new director also receives an induction package which contains, among other materials, the articles of directorship which enumerate a director's general duties and obligations, the Board Charter, terms of reference of the Board Committees, and guidance on directors' duties and relevant company policies.

Directors have unfettered access to Senior Management, the external auditor and information for the purpose of carrying out their duties. Prior to a meeting, directors are provided with comprehensive and timely financial, risk management and operational reports for their deliberation and to enable them to make informed decisions. Senior executives are present at meetings to provide additional information or clarification as required. Where relevant, professional advisers may be invited to brief the Board or Board Committees.

Whether individually or as a group, directors may seek independent professional advice in the course of discharging their duties at the Bank's expense.

While the Board is collectively responsible as steward of the Bank, it recognises the efficiencies and benefits of specialisation.  Hence, it has delegated certain duties to four Board Committees, namely the Nominating Committee, Remuneration Committee, Risk Management Committee and Audit Committee.

Board Charter
Click here for the Board Charter of UOB (Malaysia).

Constitution
Click here for the Constitution of UOB (Malaysia).

Board Committees

The Nominating Committee, Remuneration Committee, Risk Management Committee and Audit Committee have been constituted in accordance with Bank Negara Malaysia’s Guidelines on Corporate Governance. The roles and duties of each Board Committee are explained further in this section.

The main responsibilities of the Nominating Committee ("NC") include reviewing nominations for appointment and re-appointments as well as removal of directors, Shariah Committee members, CEO and key senior management officers and the company secretary. NC also oversees the overall composition of the Board and Board Committees.

Each year, NC assesses the effectiveness of the Board and Board Committees, as well as contribution and performance of each director to the effectiveness of the Board. It assesses the independence of each director annually based on the criteria in BNM's Guidelines on Corporate Governance. In order to promote independent oversight by the Board, an independent director of the Bank shall hold office for a maximum of 6 years or such other term as the NC deems fit but shall not exceed a total of 9 years. The NC also assesses the performance of Shariah Committee members, CEO, key senior management officers and the company secretary.

NC also ensures all directors receive an appropriate continuous development programme and oversees succession plans for the Board, CEO and key senior management officers.

The Remuneration Committee ("RC") provides a formal and transparent procedure for developing remuneration policy for directors, Shariah Committee members, CEO and key senior management officers and ensuring that compensation is competitive and consistent with UOB (Malaysia)'s culture, objectives and strategy.

The RC also supports the Board actively in overseeing the design and operation of the Bank's remuneration system, and recommends framework of remuneration for directors, Shariah Committee members, CEO and key senior management officers for the Board's approval.

The Risk Management Committee ("RMC") assists the Board in overseeing the establishment and operation of a robust risk management system, policies, processes and procedures to identify, monitor, control and report risks. The RMC also oversees senior management's activities in managing credit, market, liquidity, operational, compliance, legal and other risks, and to ensure that the risk management process is in place and functioning. It also reviews the Bank's framework in managing money laundering and terrorism financing risks.

RMC also examine whether incentives provided by the remuneration system take into consideration risks, capital, liquidity and the likelihood and timing of earnings, without prejudice to the tasks of the RC.

The Audit Committee ("AC") assists the Board by providing oversight of the Bank's financial reporting and the effectiveness and adequacy of the Bank's internal control system. It also reviews and updates the Board on all related party transactions, reviews the accuracy and adequacy of the chairman's statement in the directors's report, corporate governance disclosures and interim financial reports in relation to the preparation of financial statements.

The AC meets the external auditor to review the annual financial statements, nature and scope of the external audit and audit plan, significant changes in accounting standards and audit issues. The AC meets the external auditor separately in the absence of Management at least annually. In addition, the AC reviews the adequacy of the scope, functions and resources of the internal audit function in performing its duties independently. Significant audit findings are highlighted to the AC through audit reports and at the AC meetings. The AC also meets with the internal and external auditors as often as they deem appropriate to be apprised of matters which are under review.

Each quarter, the AC meets to review the financial statements before recommending them to the Board for approval. In reviewing the financial statements, the AC assesses the accounting policies and practices applied and any judgement made that may have a significant impact on the financial statements. AC meetings may involve discussions of accounting standards and accounting practices and developments, especially those that have an impact on the business of the Bank and its reporting obligations.

Another important duty of the AC is the review of fraud and whistleblowing cases reported to the Bank. Annually, the AC reviews the policy governing the management of whistleblowing cases.