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 a subsidiary of AIA Group Limited a company listed on the Stock Exchange of Hong Kong 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 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 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) 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.
(b) Board Committees
The Board has established a separate Audit Committee comprising three of its independent directors 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
The Board and Audit Committee are scheduled to meet four times a year. In the year 2016 and 2017, 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.
(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.
(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 basis, the Board will perform an assessment of the effectiveness of the Board, the Audit Committee and each Director. 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.
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 management, as well as knowledge of the Company and financial industry. Their wide experience in leadership and management positions have them in good stead to lead the Company.
(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 performance of the Company, including, with the assistance of the Exco, all day-to-day operations and administration of the Company.
(b) Board Directors
Mr Jacky Chan
Mr Chan is the Chairman of the AIA Singapore Board and Regional Chief Executive of the AIA Group, responsible for the Group’s businesses operating in Hong Kong and Macau, Singapore and Brunei, Indonesia, Philippines and Cambodia as well as the Group Agency Distribution. Prior to his appointment as Regional Chief Executive, Mr Chan was the Chief Executive Officer of AIA Hong Kong and Macau. During the span of his 30-year career with the AIA Group, Mr Chan has held several senior positions including, the Country Head of AIA China, Executive Vice-President – Distribution & Marketing of Nan Shan Life Insurance (Taiwan) and Senior Vice-President & Head of Life Profit Center of AIA – Asia (ex-Japan & Korea).
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 Group Chief Risk Officer, responsible for the Group’s Risk and Compliance functions. Prior to his current appointment, Mr. Nielsen was the Group’s Regional Chief Financial Officer, overseeing the Group’s financial planning, reporting and analysis, financial systems and operations, treasury and tax functions. He has more than 17 years’ experience in the finance and accounting profession, and his previous experience includes working with the Allianz Group and Deloitte & Touche, primarily serving insurance clients.
Mr Mitch New
Mr New is the AIA Group General Counsel and Company Secretary. He is responsible for the provision of legal services and company secretarial services for the Group and providing leadership to the legal and corporate governance functions within country operations. Prior to joining the AIA Group, Mr New was the Senior Vice-President & Chief Legal Officer (Asia) of Manulife Financial. In his over 14-year career with Manulife, Mr New held a number of senior positions with Manulife’s Asia and Canadian Divisions, including as Senior Vice-President & Chief Legal Officer (Canadian Division).
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 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).
Mr Ong Sim Ho
Mr Ong is an independent non-executive Director of the Company. Mr Ong is a lawyer with 19 years of private practice experience specialising in the areas of tax and trust law. He is also a Fellow Chartered Accountant in Singapore, an Accredited Tax Advisor with the Singapore Institute of Accredited Tax Professionals and a member of the Singapore Institute of Directors. Prior to being in private practice, Mr Ong was a legal counsel with the Inland Revenue Authority of Singapore. Mr Ong was an Independent Director of Prudential Assurance Singapore Limited from July 2006 to July 2007, and he subsequently joined the boards of Tokio Marine Life Insurance Singapore Ltd and Tokio Marine Insurance Singapore Ltd, and was appointed non-executive chairman of Tokio Marine Life Insurance Singapore Ltd from 2009 until mid-2016.
(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 the Company’s 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 2017, 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 it was appropriate and would 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 Henry Ho and Mr Ong Sim 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 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.
Updated in January 2018
