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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 regulatory obligations. This includes overseeing internal 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 also oversees major capital projects, investments, acquisitions and disposals.
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.
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) the annual operating and capital expenditure budgets and any material changes to them, and (c) annual financial statements.
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Board Committees
The Board has established a separate Audit Committee comprising three (3) of its independent directors with its own terms of reference.
On 25 March 2019, the Board established a Board Risk Committee which consists of five (5) directors, a majority of whom are independent. The Board Risk Committee has its own terms of reference.
The Board performs all the functions of the Nominating and Remuneration Committees as required under prevailing regulations.
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Meetings
The Board and its Committees are scheduled to meet four (4) times a year. Ad-hoc Board meetings may be called to deliberate and assess corporate proposals or business issues that require the Board’s immediate consideration/decision. In the year 2018, the Board and the Audit Committee met on all four (4) scheduled meetings. A Director who is unable to attend any meeting in person may participate via tele-conference.
The attendance of each Director for the meetings held in 2018 is as follows:
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Directors
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Board Meetings attended/held
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Audit Committee Meetings attended/held
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Jacky Chan
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4/4
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-
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Patrick Teow
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4/4
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-
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Jon Nielsen*
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3/4
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-
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Mitch New
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4/4
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-
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Liew Heng San
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4/4
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4/4
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Henry Ho
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4/4
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4/4
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Ong Sim Ho
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4/4
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4/4
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* Jon Nielsen resigned as a Director on 5 April 2019.
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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.
In evaluating the appointment of new Directors, the Board’s assessment on the candidate includes the candidate’s track record, experience, capabilities and skills. To ensure the candidate has the character, experience, integrity, competency and time to effectively discharge his role as a director, the Board will assess the fitness and propriety of the candidate in accordance with the Company’s Fit and Proper Policy. The following criteria are considered by the Board:
- Honesty, Integrity and Reputation
- Financial Soundness
- Competence and Capability
The Board will also assess : (i) the results of pre-employment screening checks against Prohibition Orders released by MAS, the MAS Control and Alert List and the Watch List released by the Office of Foreign Assets Control of the US Department of Treasury; and (ii) the results of pre-employment screening checks by appointed vendor to verify employment history, financial status, regulatory compliance, civil litigation, bankruptcy, business interest, directorship etc. to determine if the candidate is fit and proper for the proposed appointment.
In addition, the Board also conducts an assessment to determine whether the Director is independent in character and judgment, and whether there are relationships or circumstances which are likely to affect, or could appear to affect, the Director’s judgment.
Upon appointment, new Directors are advised of their legal and statutory responsibilities.
In accordance with the Constitution of the Company, newly appointed Directors shall hold office only until the next following Ordinary General Meeting of the Company, and shall then be eligible for re-election.
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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.
Newly-appointed Directors undergo an induction program within 3 months upon joining the Company. Senior management executives will conduct briefing sessions for the new Directors on the Company’s principal activities, its structure, strategic plans, business operations, risk management and governance matters. A Director’s Orientation Kit which includes key information of the Company, Board Charter, the Terms of Reference of Board Committees, duties and obligations of directors as well as rules and regulations is also given to the new Directors.
The Company will, from time to time, organizes talks, seminars and presentations both by internal senior executives and external professionals on topics relevant to the insurance industry, relevant new laws, regulations and changing commercial risks. Directors may also attend appropriate courses, conferences and seminars conducted by professional bodies. The Directors are also continually updated on developments affecting the insurance industry via material updates at Board and Board Committees’ meetings and circulation of industry-related and topical articles.
The Company will arrange and fund professional development programmes for all Directors as appropriate and maintain a record of the training and development received by the Directors.
Professional development programmes arranged by the Company for Directors in 2018 included the following:
- Anti-Money Laundering and Countering the Financing of Terrorism
- AIA Board of Directors Programme at the AIA Leadership Centre in Bangkok
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Board Matters
On an annual basis, the Board will perform an assessment of the effectiveness of the Board and Audit Committee and contribution by each Director. Each director evaluates the performance of the Board and Audit Committee as a whole by way of self-assessment questionnaires which are made against the pre-established criteria. The results of the performance evaluation will be shared with the Board on a consolidated basis. The consolidated results will also be tabled at a Board meeting for the Board’s review.
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. 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.
