Introduction The AIA Singapore Board (the Board) and the Executive Committee (the Exco) believe that strong corporate governance is essential for delivering sustainable value, enhancing a culture of business integrity and maintaining stakeholder confidence. As such, the Board and the Exco are committed to high standards of corporate governance and the implementation of good practices across all functions in the Company.
As a Singapore-incorporated insurer and an indirect wholly-owned subsidiary of AIA Group Limited, the Company is guided in its practices by all applicable corporate governance regulations and guidelines that authorities may issue from time to time, as well as internal best practices.
Board's Conduct of Affairs (a) Responsibility and Accountability The Board oversees and appraises the strategies, policies and performance of the Company, including the achievement of business plans and compliance with statutory and other obligations. This includes overseeing the control and accountability arrangements, capital structure and financial integrity, as well as adequacy and effectiveness of risk management, compliance, internal control policies and procedures.
The Board is accountable to stakeholders for the affairs of the Company. It meets these obligations by ensuring high standards of governance and setting the strategic direction for the Company. The Board maintains appropriate levels of review, challenge and guidance to management. It is also the ultimate decision making body for all matters considered material to the Company and provides leadership through the Chief Executive Officer, who has been delegated to act on behalf of the Board in the executive management of the Company.
(b) Board Committees The Board has its own charter and internal guidelines on matters reserved for its decision. Matters requiring Board approval include, but are not limited to, (a) contracts or transactions which are material strategically, or by reason of size, (b) major capital projects, investments, acquisitions and disposals, (c) the annual operating and capital expenditure and any material changes to them, and (d) annual financial statements. It has established a separate Audit Committee with its own terms of reference. The Board performs all the functions of the Nominating, Risk Management and Remuneration Committees as required under prevailing regulations.
(c) Meetings In 2015, the Board met on four (4)scheduled occasions. All Directors attended each of the meetings. The Audit Committee also met on four (4)scheduled occasions. All members of the committee attended each of the meetings.
In 2016, the Board and the Audit Committee have respectively met on two (2) out of the four (4) scheduled occasions thus far. All members of the Board and Audit Committee have attended each of their respective meetings.
(d) Appointment of Directors In performing the functions of the Nominating Committee, the Board reviews nominations for appointment and re-appointment of Directors and relevant senior management roles in accordance with MAS’ regulations and guidelines.
Mr Henry Ho joined as independent non-executive Director on 10 July 2015, Mr Patrick Teow joined as executive Director on 1 September 2015 and Ms Shulamite Khoo joined as non-executive Director on 23 February 2016. Mr Teow, who is also the Chief Executive Officer, took over from Mr Tan Hak Leh who resigned from the Board on 30 August 2015 and joined our Group Office as the Group Chief Risk Officer. Mr Simeon Preston stepped down as Director on 23 February 2016. Save for the aforementioned, all other members of the Board have been in place since 1 January 2012.
(e) Board Development The Directors are appropriately inducted and trained to enable them to discharge their roles effectively. They are also continually updated on the Company’s business, major industry, market and regulatory developments, accounting standards, as well as any other relevant information, and they participate in professional development to develop and refresh their knowledge and skills.
(f) Board Matters On an annual and collective basis, the Board will self-assess its own performance, effectiveness, processes, conflict of interests and directorships held. Directors may serve on a number of other boards, and are expected to set aside adequate time for their oversight of matters relating to the Company.
The remuneration policies and practices of the Company, including employee share schemes, are guided by the AIA Group, and do not create incentives for excessive or inappropriate risk-taking behavior. The independent non-executive Directors receive fees at market rates, and the Directors do not have immediate family members who are employees of the Company and whose remuneration exceeds S$50,000 during the year.
On remuneration disclosures, the Board considers them to be disadvantageous to the Company’s interests, given the sensitivity, competitive pressures locally and regionally, and unique disparities in compensation practices in the financial industry.
Board Composition The Board consists of seven (7) members, three (3) of whom are independent non-executive Directors. The Directors collectively possess a diversity of skills and core competencies such as actuarial, business, finance, insurance, investment, and human resources, as well as knowledge of the Company and financial industry.They have wide experiences in leadership and management positions, track records in the private and public sectors, and involved in strategies and operations in Singapore and regionally.
(a) Chairman and Chief Executive The roles of the Chairman and Chief Executive Officer are distinct with a clear division of responsibilities, as indicated in the Board charter. The Chairman plays the critical role of leading the Board in its responsibilities. With the support of the Chief Executive Officer and the Exco, he seeks to ensure that all Directors are properly briefed on issues arising at Board meetings and that they receive adequate and reliable information in a timely manner.
He is also responsible for ensuring that good corporate governance practices and procedures are followed.
The Chief Executive Officer reports to the Board and is responsible for the overall leadership, strategic and executive management and profit performance of the Company, including all day-to-day operations and administration. He discharges his responsibilities within the framework of the Company’s policies and routine reporting requirements, and is advised and assisted by the Exco.
(b) Board Directors
Mr Ng Keng Hooi Mr Ng is the AIA Group Regional Chief Executive and Chairman of the AIA Singapore Board. Mr Ng is responsible for the Group’s operation in Singapore, Brunei, Thailand, China, Indonesia and Taiwan. Before joining the AIA Group, Mr Ng was the Group Chief Executive of Great Eastern Holdings from December 2008 to September 2010. Prior to Great Eastern, Mr Ng was with Prudential for 20 years where he held various leadership positions. In his last position, he was a member of the Prudential Corporation Asia’s board and Regional Managing Director in charge of Singapore, Malaysia and Indonesia.
Mr Patrick Teow Mr Teow is the Chief Executive Officer of the Company. Mr Teow has over 30 years of insurance experience, 24 years of which were in agency management positions in Singapore and more than 6 years’ experience in senior corporate leadership roles. Prior to joining AIA Singapore, Mr Teow was the Chief Executive Officer of AIA Group Agency Distribution where he was responsible for the overall growth, performance, business quality and profitability of agency distribution in AIA Group. Mr Teow joined the AIA Group in July 2013. Before then, Mr Teow was the Regional Chief Agency Officer of Prudential Corporation Asia.
Mr Jon Nielsen Mr Nielsen is the AIA Group Regional Chief Financial Officer. He is responsible for overseeing the AIA Group’s financial and accounting activities, including financial reporting, systems and operations and tax. He has more than 17 years’ experience in the finance and accounting profession, and his previous experience includes working as the Assistant Director of Accounting Policy in AIG, Deputy Head of Accounting Policy in Allianz Group and Senior Manager in Deloitte & Touche in the United States. He joined the AIA Group in August 2007 as Vice President, Finance, before becoming Senior Vice President, Finance in January 2010. In August 2010, he was promoted to his current role as Regional Chief Financial Officer.
Ms Shulamite Khoo Ms Khoo is the AIA Group Chief Human Resources Officer. She is responsible for the development of overall human capital strategies and their implementation across the AIA Group as well as leading and providing support to the human resources functions in country market operations. She is also responsible for the Group Corporate Security function. She joined the AIA Group in January 2011. Prior to joining the AIA Group, Ms. Khoo was Group Executive Vice President, Global Head of Human Resources and Group Executive Management of the AXA Group, based in Paris. Prior to joining AXA, she occupied various senior roles covering life insurance operations and human resources with Prudential Singapore and was Regional Head of Human Resources for Prudential Corporation Asia Limited based in Hong Kong. She is a Chartered Fellow of the Chartered Institute of Personnel and Development.
Mr Liew Heng San Mr Liew is an independent non-executive Director of the company. Mr Liew was formerly the Chief Executive Officer of Singapore’s Central Provident Fund Board from 2005 to 2010. Prior to that, Mr Liew was appointed Permanent Secretary of the Ministry of Law in Singapore in 2001 and served in the position until 2005. He was also the first Chief Executive Officer of the Land Transport Authority in Singapore from 1995 to 1998 before he was appointed Managing Director of the Economic Development Board from 1998 to 2000.
Mr Greg Seow Mr Seow is an independent non-executive Director of the Company. He currently sits on a number of boards and committees including Singapore’s Council for Estate Agencies. Mr Seow joined DBS Bank in 1999 and was appointed as Executive Chairman of DBS Asset Management Ltd where he held the position until 2006. Mr Seow previously also served various positions with the Government of Singapore Investment Corporation Pte Ltd and the Monetary Authority of Singapore.
Mr Henry Ho Mr Ho is an independent non-executive Director of the Company. He started his career with Citigroup and was with the group for 20 years in various capacities including Country Risk Officer for Citibank, Malaysia and his last role with Citigroup was as Chief Executive Officer of Citibank, Thailand. After leaving Citigroup, Mr Ho was General Manager of Saudi American Bank in Riyadh and had a brief tenure with Temasek Holdings Pte Ltd as Managing Director of the Investments unit. Mr Ho was also the President Director and Chief Executive Officer of PT Bank International Indonesia (January 2004 – March 2009) and subsequently, PT Bank Danamon Indonesia (March 2010 – February 2015).
(c) Board Independence The Board’s determination of the independence of its Directors is aligned with the MAS’ regulations and guidelines. None of the independent Directors of the Company has any business or significant financial interests with the Company or its subsidiaries. None of the Directors are also related to each other.
Audit Committee The Board has established an Audit Committee (AC) to oversee the internal and external audit processes, review the financial information of the Company, the financial reporting system and internal control procedures, as well as all related party transactions. As part of the oversight of the external audit process, the AC discusses the nature and scope of the external audit and matters that the external auditor may wish to discuss. The AC also reviews the external auditor’s management letter and ensures that the management will provide a timely response to any issues raised by the external auditor’s management letter. The AC acts as the key representative body for overseeing the Company’s relationship with the external auditor.
The AC reviews and monitors the effectiveness of the Internal Audit (IA) function. Within the context of AIA Singapore control framework, the IA function is an independent risk assessment function and is responsible for providing assurance to the Board regarding the adequacy and effectiveness of management’s systems of internal controls. The AC ensures that the IA function has adequate processes in place to ensure that recommendations raised in the reports are dealt with in a timely manner.
For the financial year ended 31 December 2014, the AC reviewed the amount of fees paid for audit and non-audit services provided by the external auditor, as well as length of tenure, and was of the view that they do not compromise the independence of advice given.
As whistle-blowing arrangements are centralized at Group Office, this is reviewed by the AIA Group Audit Committee.
Mr Liew Heng San (independent non-executive Director) is the chairman of the AC, with Mr Greg Seow and Mr Henry Ho as members.
Accountability As AIA Singapore is a private limited company and directly wholly-owned by AIA Company Limited, it is accountable to its Group Office and provides updates and reports on a regular basis. Updates to the Singapore Board on matters such as performance, position, risk management and significant events which have occurred are provided during Board meetings.
Internal Controls The Board receives on an annual basis the assurance from the Chief Executive Officer and Chief Financial Officer that the financial records have been properly maintained and the financial statements give a true and fair view of the Company’s operations and finances; and that the Company’s risk management and internal control systems are effective.
Related Party Transactions The Board regularly reviews all related party transactions to ensure that they are undertaken on an arm’s length basis, in accordance with MAS’ regulations and guidelines.