Board Performance
Principle 5: There should be a formal annual assessment of the
effectiveness of the Board as a whole and its board
committees and the contribution by each director
to the effectiveness of the Board.
The NC assesses the performance and effectiveness of the Board as a
whole. The assessment process involves both a qualitative and quantitative
assessment. The qualitative assessment is undertaken by the independent
directors in the formof a discussion between themselves only. The quantitative
assessment involves scoring a pre-agreed weighted score card against
various criteria. This process ensures that the overall evaluation is undertaken
against a set of objective, quantitative and qualitative performance criteria
that had been proposed by the NC and approved by the Board.
An annual Board Evaluation Questionnaire is circulated and completed
collectively by members of NC to assess the overall effectiveness of
the Board. The performance criteria includes the evaluation of 1) the
size and composition of the Board, 2) the Board’s access to information,
3) the Board process, 4) the Board’s accountability and performance in
relation to discharging its principal functions and responsibilities and 5) the
Board’s standards of conduct. The collective evaluation is meant to provide
constructive feedback, to highlight areas of strength and weakness and
the Board acts on the evaluation to ensure continuous improvement of the
Board. Based on the overall assessment for FY2016, the Board was effective
as a whole.
Financial criteria such as return on assets, return-on-equity and the
Company’s share price performance vis-à-vis the Singapore Straits Times
Index and a benchmark index of its industry peers are also considered.
The Board, however, notes that the financial indicators set out in the Code
provide only a snapshot of the Company’s performance, and do not fully
reflect on-going risk or measure the sustainable long-term wealth and value
creation of the Company.
Individual director’s performance is evaluated annually and informally by the
NC and the Chairman. In assessing the individual director’s performance,
the NC takes into consideration the individual director’s industry knowledge,
functional expertise, contribution, attendance at meetings of the Board or
Board Committees and workload requirements.
To focus directors and in particular the independent director’s mind on
adding value to shareholders, the independent directors are encouraged to
own shares in the Company. Currently, only one of the independent directors
own shares in the Company.
Governance
Disclosure Guide
Guideline 5.1:
(a) What was the process
upon which the Board
reached the conclusion
on its performance for
the financial year?
(b) Has the Board met
its performance
objectives?
CORPORATE GOVERNANCE REPORT
36
ASL Marine Holdings Ltd.
Annual Report 2016
