Nomination of CEO & Executives

The Leadership Development and Compensation Committee shall nominate the suitable person(s) either internally or externally including the preparation of a succession plan relating thereto on the principle of considering the qualified person (s) either internally or externally. The Leadership Development and Compensation Committee may consider hiring professional consultants if required.

In Addition, the Company shall prepare the succession plan of the high level head of unit up by identifying the suitable persons to hold such positions, and shall utilize the human resource development and management system to prepare the subordinates for succession.

CEO & Executives Compensation

The Company’s compensation philosophy seeks to recognize and reward the executives’ performance in implementing the approved business plans and policies. The Leadership Development and Compensation Committee, as delegated by the Board, annually reviews and approves the Executives’ Compensation Policy, which incorporates the following key elements:

Pay for performance

  • Variable compensation is tied directly to the achievement of Company’s strategic direction.
  • Balanced scorecard is used to measure performance, comprising of financial, customer, internal process and learn & growth metrics.

Shareholder alignment

  • Appropriate performance metrics are selected for annual and long-term incentive plans that will support business strategies and enhance value for shareholder.
  • Ensure that appropriate success index is set for the company’s operational capability, goals, and stretch levels of performance.

Competitive compensation

  • Compensation benchmarking helps the Company attract and retain highly experienced and talented individuals.
  • A significant proportion of remuneration is linked to performance, both on an annual and long-term basis.

The compensation provides to CEO and Executives, as approved by the Board, consists of the following components:



Fixed compensation and benefits

Base Salary
The level of base compensation reflects each associate’s key responsibilities, job characteristics, experience and skill sets. It is paid in cash, monthly. Base compensation is reviewed annually, and any increase reflects merit based on performance, as well as market movements.

Benefits
The primary purpose of benefits is to establish a level of security for employees and their dependents with respect to age, health, disability and death. The provident fund, insurance plans, and other welfare provisions are in line with market practices and legislative requirements.

Performance-related variable compensation

Performance Bonus
Provides a variable level of remuneration dependent on short-term performance against the annual plan, as well as relevant market remuneration benchmarks. The performance bonus is tied to annual Key Performance Indicator (KPI) and weights the various scorecard measures in order to determine overall company and individual performance evaluations and bonus awards.

Value-Sharing Cash
Value-Sharing Cash drives fundamental performance and aligns the interests of shareholders and executives based on economic profit (or economic value added which measures the net operating profit after tax in excess of cost of capital). Part of the award is paid in cash provided that is positive in the current year. The remaining balance will be carried forward into cumulative bonus bank and at risk as it is subject to performance-related clawback and could be reduced as negative in the event of underperformance in the years.

For example, an Economic Value Bonus (EV) is one of the incentive awards under value-sharing cash scheme to motivate and compensate the executive in order to improve their long-term performance and the Company’s competitiveness. Under the EV scheme, the clawback provision stated that a positive performance will be added to individual EV bank, but negative one will be deducted from such a EV bank.

Value-Sharing Equity
Value-Sharing Equity focuses on a long-term incentive to reinforce the delivery of sustainable growth and increase shareholder value by fostering an ownership culture and retaining key talent. The company considers the allocation of the warrant to executives who possess high level of expertise and play a significant role in strengthening future business success. This allocation of warrant is conditional upon the achievement of predetermined performance targets over the performance period in order to drive long-term value creation based on key metrics i.e. absolute total shareholder return (TSR) and relative TSR. The compensation is based on three-year performance period and has three-year vesting period. Such award is also subjected to clawback policy in cases such as misconduct, resignation or termination of employment.