Principle 6: The Board has a formal and transparent procedure for developing policies on director and executive remuneration, and for fixing the remuneration packages of individual directors and key management personnel. No director is involved in deciding his or her own remuneration. Principle 7: The level and structure of remuneration of the Board and key management personnel are appropriate and proportionate to the sustained performance and value creation of the company, taking into account the strategic objectives of the company. Principle 8: The company is transparent on its remuneration policies, level and mix of remuneration, the procedure for setting remuneration, and the relationship between remuneration, performance and value creation. Role and Composition of Remuneration Committee During FY2024, the RC comprises the following three Directors, all of whom are independent: Chong Wai Siak – Chairman (Independent) Koh Tee Huck Kenneth – Member (Independent) Fong Heng Boo – Member (Independent) Provision 6.2 The RC is guided by its terms of reference which is in line with the Code. The RC’s principal responsibilities are: Provision 6.1 (i) reviewing and making recommendations to the Board on: (a) a framework of remuneration for the Board and key executives; and (b) the specific remuneration packages for each Executive Director as well as for the key management personnel, and in doing so the RC considers all aspects of remuneration, including termination terms, to ensure they are fair; (ii) where external remuneration consultant is appointed, reviewing whether the remuneration consultant has any relationship with the Company that could affect his or her independence and objectivity; (iii) reviewing annually the remuneration of employees who are substantial shareholders of the Company, or are immediate family members of a Director, the CEO or a substantial shareholder of the Company and whose remuneration exceeds S$100,000 during the year; and (iv) administering the Company’s Employee Share Option Scheme, if any. Remuneration Framework The RC ensures that a formal and transparent procedure is in place for fixing the remuneration packages of individual Directors and key management personnel. Although the recommendations are made in consultation with the Chairman and CEO, the remuneration packages are ultimately approved by the entire Board. No Director will be involved in deciding his own remuneration. Each member of the RC shall abstain from voting on any resolution and making any recommendations in respect of his remuneration package. Provision 6.3 The RC also reviews the Company’s obligations arising in the event of termination of the Chairman and CEO, and key management personnel’s contracts of service, to ensure that such contract of service contain fair and reasonable termination clauses which are not overly generous. At the moment, the Company does not use any contractual provisions to reclaim incentive components of remuneration from Executive Directors and key management personnel in exceptional circumstances of misstatement of financial results, or of misconduct resulting in financial loss to the Company. If required, the RC will consider instituting such contractual provisions to allow the Company to reclaim the incentive components of the remuneration of the Executive Directors and key management personnel paid in prior years in such exceptional circumstances. RC’s access to Independent Advice Provision 6.4 36 KEONG HONG HOLDINGS LIMITED CORPORATE GOVERNANCE REPORT
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