Sime Darby Property

Corporate Governance

Information related to our governance structure, our values, key policies and tools that support our business practices.

Governance in Sime Darby Property

OVERVIEW

Sime Darby Property (“the Group”) is committed to upholding high standards of integrity and good governance across its activities and business operations. The Group actively fosters a culture that places uncompromised integrity, transparency, accountability and professional business ethics as the foundation for the Group’s continuous growth, in achieving long term shareholder value, while aligning with the interest of stakeholders.

Good governance is one of the key pillars that drives the achievement of the Group’s objectives, provides the foundation for a high performing organisation and ensures the Group is well placed to respond to the ever-changing external environment.

The Group believes that good governance goes beyond just adhering to a set of legal or statutory requirements, even though these requirements form the basis or foundation of governance. It is about doing what is right, which is in line with Group’s T.E.A.M. values. This belief is important as the Group’s various stakeholders (internal and external) in today’s globalised and connected world expect the Group to go beyond expectations when it comes to its performance in the economic, legal, environmental and social spheres. Doing what is right requires the conviction of its people (from the Board to all employees), supported by effective policies, process and technologies.

To support the continuous operations and achievement of the Group’s governance objectives, the Group has established the required infrastructure that defines the working relationship between the Board, the Group’s Management and its other stakeholders (leadership, directions, accountability and communication), provides clarity to internal control mechanism (authority, control and transparency) that supports the achievement of the Group’s objectives and goals while ensuring adequate resources are in place to support and execute the governance framework. To support effective and good governance, the following infrastructure have been established:

1.	Board Charter	Effective Board leadership of the Board and Board Committees of Sime Darby Property
2.	Board Composition Policy	Guidelines for ensuring an optimal and diverse composition of the Board to enhance governance and performance
3.	Fit and Proper Policy	Fit and proper criteria for the appointment and re-election of Directors on the Boards of Sime Darby Property and its subsidiaries
4.	Management Roles and Responsibilities	Empowered Management team
5.	Independent Governance Functions	Independent governance functions to support the Board and Management in the implementation and validation of the respective governance frameworks
6.	Risk and Control Environment	Sound risk and control environment, which cover amongst others, areas such as risk management, culture and employee conduct, integrity, policies and procedures
7.	Stakeholder Communications	Transparent and timely communication with its stakeholders
8.	Constitution	Provides governance framework for Sime Darby Property that defines the roles and relationships between the company, its directors, shareholders and other stakeholders.

The Group governance framework at minimal, conform to the requirements, statutory provisions, guidelines, principles and practices as articulated in, amongst others:

Main Market Listing Requirements issued by Bursa Malaysia Securities Berhad
Companies Act 2016
Malaysian Code of Corporate Governance 2021.

The Group’s application and compliance to the Malaysian Code of Corporate Governance 2021 are reviewed annually (click here to view the latest Group’s Corporate Governance Report).

Board of Directors

BOARD RESPONSIBILITIES

The Group’s Board of Directors (“Board”) is ultimately responsible for providing effective leadership in delivering long-term success for the Group, as well as promoting and protecting the interests of its shareholders and stakeholders of the Group. The Board is collectively responsible for formulating and meeting the Group’s goals and objectives, strategic plans, corporate governance and significant policies. The Board directs, strategises and monitors the business and affairs of the Group and ensures that the Group operates ethically and with integrity, while remaining cognisant of the need for sustainable practices to manage the economic, environmental and social impact to address the long-term interests of the stakeholders.

In discharging its responsibilities, the Board provides expertise, thought leadership and advice, and champions good governance, high ethical standards and practices.

The Board is guided by a Board Charter which outlines the role, functions, composition, operation and processes of the Board and matters reserved for the Board as well as matters that the Board may delegate to the Board Committees and Management (click here to view the Board Charter).

The Board meets at least once every quarter in a financial year to fulfil its role, and as and when necessary to consider and deliberate urgent proposal or matters that require the Board’s review, consideration and/or approval.

Relevant members of the Senior Management attend Board meetings by invitation and report to the Board on matters pertinent to their respective areas of responsibility, to present new proposals or to brief on actions implemented pursuant to recommendations made by the Board.

The list of the Groups’ Board of Directors and their profile can be viewed on this link.

BOARD RESPONSIBILITIES

To support the Board in the effective discharge of its functions and responsibilities, the Board has delegated certain responsibilities to Board Committees. These Board Committees operate within their owned defined terms of reference approved by the Board. The Board Committees, through their respective Board Committee Chairman, report to the Board on matters considered, their salient views, recommendations, significant issues and findings that would require the Board’s attention and approval.

While the responsibilities are delegated to respective Committees, the Board is still ultimately accountable for the final decision on all matters relating to the Group.

The Board Committees and their responsibilities are as follows:

BOARD

The Board Committees and their responsibilities are as follows:

Audit Committee (“AC”)

Terms of Reference

The AC comprises four (4) members, three (3) of whom are Independent Non-Executive Directors.

The AC oversees the Group’s financial reporting process and practices and reviews the Group’s business process and systems of internal controls, ensures implementation of an effective ethics programs across the Group, monitor compliance with established policies and procedures and assess the suitability, objectivity and independence of the Group’s internal and external audit functions.

Nomination and Remuneration Committee (“NRC”)

Terms of Reference

The NRC comprises four (4) members, all of whom are Independent Non-Executive Directors. All members are Non-Executive Directors.

The NRC assists the Board in fulfilling its responsibilities with regard to the appropriate size and balance of the Board, the required mix of skills, experience, knowledge and diversity of the Directors.

The NRC also ensures that there is sufficient succession planning and human capital development and recommends to the Board the remuneration framework for Non-Executive Directors, Executive Directors and key critical senior management positions.

The NRC undertakes the annual assessment of the effectiveness of the Board as a whole, its Committees and the contribution of each individual Director.

Risk Management Committee (“RMC”)

Terms of Reference

The RMC comprises five (5) members, three (3) of whom are Independent Non-Executive Directors. All members are Non-Executive Directors.

The RMC is primarily responsible for assisting the Board in overseeing the risk and compliance management framework. It supports the Board in fulfilling its responsibility in identifying significant risk and ensuring implementation of appropriate systems to manage the Group’s overall risk exposure. The RMC also reviews major investment and business proposals in line with the authority limits.

Board Tender Committee (“BTC”)

Terms of Reference

The BTC comprises four (4) members, two (2) of whom are Independent Non-Executive Directors. All members are Non-Executive Directors.

The BTC evaluates and reviews tenders valued above RM50 million up to RM300 million.

Board Sustainability Committee (“BSC”)

Terms of Reference

The BSC comprises five (5) members, four (4) of whom are Independent Non-Executive Directors. All members are Non-Executive Directors.

The BSC supports the Board in fulfilling its oversight responsibilities in relation to the Environmental, Social and Corporate Governance (“ESG”) strategy and framework for the Group and regularly assesses the adequacy and effectiveness of such strategy and framework.

The Group’s application and compliance to the Malaysian Code of Corporate Governance 2021 are reviewed annually (click here to view the latest Group’s Corporate Governance Report).

Management

The Group has established a clear organisation structure that sets out the reporting line, roles and responsibilities, accountability and authority from Board and Management to operational levels. At the operational level, Management has the responsibility to implement Board-approved frameworks, policies and procedures.

The Group’s Management team has been provided with powers (delegation from the Board) to manage the day-to-day operations of the Group. These powers to execute transactions for the Group is defined and formalised in the Group Policies and Authorities (“GPAs”), specifically the limits of authority or any other policy statements where required.

The Management, in the discharge of their duties and to ensure effective oversight over the Group’s business activities and day-to-day operations are also supported by various Management Committees such as the Group Management Committee, Governance Oversight Management Committee, Group Investment Committee and Group Tender Committee. The operations of these Management Committees are governed by their respective Terms of Reference.

The list of the Group’s Management and their profile can be viewed on this link.

Independent Governance Functions

The Board has established three (3) independent, dedicated governance functions to support the Board and Management in the implementation and validation of the respective governance frameworks and relevant controls.

The three (3) independent governance functions, their general responsibilities and reporting lines are as follows:

To ensure the appropriate degree of independence and objectivity:

The list of the Group’s Management and their profile can be viewed on this link.

The authority, function, roles and responsibilities of Group Corporate Assurance, Group Risk Management and Group Compliance Office as articulated in their respective Charter have been approved by the respective Board Committees for implementation.
The appointment, transfer or dismissal of both Chief Assurance Officer and Chief Risk, Integrity & Compliance Officer is subject to final approval of the Board, following recommendation of the Nomination and Remuneration Committee and Audit Committee or Risk Management Committee respectively.
The performance of both Group Corporate Assurance, Group Risk Management and Group Compliance Office and their respective Chiefs will be determined by the Audit Committee and the Risk Management Committee respectively.
Members of Group Corporate Assurance, Group Risk Management and Group Compliance Office do not have any business or operational line responsibilities.

Risk and Control

RISK MANAGEMENT

The Group recognises that risks are an integral and unavoidable component of its business. These risks, which are characterised by threats and opportunities, are dynamic and ever present in the Group’s operating environments. The ever evolving and uncertain nature creates the need for the Group to manage risks in an informed and structured way.

The Group also accepts that embedding risk management within the Group’s operations is an integral part of good corporate governance as it provides insights, improves decision making and enhances outcomes. An embedded risk management process will also strengthen management accountability. The Group risk management practices is guided by the Group’s Enterprise Risk Management Framework, which has been designed and adapted to be in line with the principles of ISO 31000 for Risk Management.

Culture and Employee Conduct

Our Purpose

To be a Value Multiplier for people, businesses, economies, and the planet.

Our Vision

Advancing real estate as a force for collective progress, in harmony with the planet's resources.

Our Mission

To develop, own, and manage a thriving asset portfolio, creating value for all stakeholders.

Our Values

Code of Business Conduct (“COBC”)

The Group’s COBC encapsulates our beliefs, values and commitment to high standards of integrity and good governance. It is also the Group’s testament to our commitment to various areas such as our workplace, preservation and protection of the Group’s assets and information, fostering an open and honest communication, ethical conduct, interaction with counterparties, business partner, customers, environment & communities, working with Joint Venture partner & business alliances and when the Group deals with Government, regulators, political parties and non-government organisations.

It serves as a guiding document on the standards of behaviour that we expect from our employees and Board of Directors. The COBC applies to all our businesses and countries in which we operate.

To find out more about our COBC, you can download the document in the language of your choice by clicking on the icons below.

ENGLISH

BAHASA MALAYSIA

Integrity and Compliance

COMPLIANCE WITH LAW AND REGULATIONS

The Group is committed to complying with all laws and regulations which are applicable to all countries in which it operates. In conducting business, the Group also expects its suppliers, contractors, consultants, vendors or any other third party it has business relationships with to have the same commitment to comply with such laws and regulations where applicable.

PROHIBITION ON ILLEGAL AND CRIMINAL ACTIVITIES

The Group does not tolerate any criminal activities within its workplace.

ZERO TOLERANCE FOR BRIBERY AND CORRUPTION

The Group takes its legal and ethical responsibilities very seriously. The Group therefore has a zero-tolerance stance against any form of bribery and corruption in all our business dealings.

The Group strictly prohibits any attempt to influence business decisions directly or indirectly by offering, giving, soliciting or accepting bribes or facilitation payments in any form or through any other corrupt means. In short, all Directors and employees are strictly prohibited from committing or directing or instructing any form of bribery or corruption which benefit them or the Group directly, or indirectly.

The Group will protect employees from any adverse consequence arising from their refusal to give or accept bribes or engage in any corrupt practices. The protection is given even if such action (refusal) may result in the company losing its business or not meeting its targets.

The Group’s zero-tolerance stance against bribery and corruption is clearly articulated in our Code of Business Conduct and in the GPA on Anti Bribery and Corruption and communicated internally and externally through trainings, emails and reminders to all employees as well as physical posters and buntings located across our business premises to extend our communication to external parties.

The Group’s Anti Bribery and Corruption policy is supported by various related internal policies such as the Group’s Gift, Entertainment and Travel Policy, Sponsorship and Donation Policy, as well as the Conflict of Interest Policy, which are regularly reviewed to ensure that they remain up-to-date with our current business and legal landscape.

NO GIFT POLICY

Sime Darby Property is committed to conducting our business with integrity and strong professional relationships with all our counterparts and business partners based on merit and performance. We acknowledge that exchanging business courtesies such as gifts, entertainment and travel can foster relationships and goodwill with the relevant parties. However, the exchange of such courtesies may be open to abuse, misconstrued as a bribe and create the impression of an attempt to inappropriately influence business decisions.

To avoid such situations, Sime Darby Property has implemented a No Gift Policy which prohibits our employees from offering, giving, soliciting or accepting any form of gifts, regardless of its reasons or locations be it on our work premises or otherwise.

In the event you encounter such situations, you must politely refuse such requests or offers. Should you require further guidance or need any clarification on the above, please do not hesitate to contact Group Compliance Office at 03-7849 5586 or email at compliance@simedarbyproperty.com.

HOSPITALITY, ENTERTAINMENT AND TRAVEL

The Group recognises that provision of reasonable and modest corporate hospitality, business entertainment and business travel is a legitimate way of building and fostering good business and corporate relationship.

If such hospitality, entertainment or travel are offered and provided by the Group to third parties, the Group will be sensitive to the recipient organisation’s policies in this area, ensure what is offered is reasonable and modest in nature, and not intended to be used to improperly cause undue influence on any party in exchange for some future benefit or results. Most of all, the offer will be for a legitimate purpose and complies with laws and regulations in the countries which the offer is made and duly authorised in accordance with the Group’s policies and authorities before it is transacted.

Directors and employees are prohibited from accepting business travel (accommodation, entertainment and transportation) offered by third parties. The Group will bear all cost of business travel to avoid the perception of improperly causing undue influence on any party in exchange for some future benefit or results.

Directors and employees are also prohibited from soliciting any form of entertainment from counterparties or business partners, directly or indirectly. Should an invitation for social events or entertainment is received and before it is accepted, Directors and employees must ensure that they are not lavish or exceed the approved monetary limits. They must also not be a regular feature that can influence the business decision making process or indecent and put the Director or employee in a position of conflict or adversely affect the Group’s reputation.

CORPORATE GIFT, BUSINESS ENTERTAINMENT, CORPORATE HOSPITALITY AND BUSINESS TRAVEL PROVIDED TO PUBLIC OFFICIALS

The Group will exercise due care and caution in dealing with Public Officials as bribery and corruption laws in most countries are stringent and does not differentiate or specifically be explicit on what can be provided to public officials that will not be considered a bribe.

Provision of corporate gift, business entertainment, corporate hospitality and business travel to Public Officials or their family members may attract attention of relevant anti-corruption agencies and authorities as it can be considered at minimal, a red flag for bribery and corruption.

As such, corporate gift, business entertainment, corporate hospitality and business travel offered to public officials by the Group will need to comply with the stringent policy and approval requirements of the Group.

SPONSORSHIP AND DONATIONS

The Group is committed to be a responsible corporate citizen by contributing to worthy causes and providing support to organisations and/or individuals who share our goals and values. Sponsorship or donation can be in the form of contribution in cash, in kind or in services to support an event, activity, person or organisation.

The Group also recognises that seeking and receiving sponsorship or donation from external parties, even when done legitimately and with good intention, may run the risk of being misconstrued as bribery and corruption.

Therefore, the Group will only seek for and accept donation or sponsorship only in very exceptional cases or in circumstances where such donation or sponsorship does not benefit the Group and/or its employees directly.

Every sponsorship or donation that the Group makes (monetary or otherwise) shall:

Comply fully with applicable laws and legislation, which include Anti-Bribery and Corruption legislation in the countries which we operate in and are given through legal and proper channels.
Be justified, reasonable in value and frequency, and not in exchange for advantage or benefit or will place the Group in situations where it can lead to a conflict of interest.
Be made after making the necessary enquiries and due diligence and in an open and transparent manner. This is to ensure that the actual beneficiaries are not linked to political parties, public officials or their families as this can be seen in a way to influence official decision to benefit the company.
Not be made to private individuals or private accounts or individuals or organisations that could prove harmful to the Group’s reputation or if their purpose or activities may be in conflict with our values and objectives.

POLITICAL CONTRIBUTION

Political contribution refers to contributions, in cash or otherwise, that is made directly to political parties, political candidates or indirectly to persons or parties connected to or associated with them as a charity or otherwise.

In respect of political contribution, the Group is committed to comply with all applicable laws and regulations with regards to political contributions in the countries that the Group operates in.

All corporate political contributions, monetary or otherwise, are strictly regulated and must be approved by the Board prior to them being incurred regardless of value.

CONFLICT OF INTEREST

The Group recognises that conflict of interest when it occurs, can have significant impact to the Group. A conflict of interest arises when personal interest, financial or otherwise, interferes with objectivity in performing duties or exercising judgement on behalf of the Group.

As such, the Group’s policy is to avoid being placed in a position of conflict at all times. Should an employee find themselves in a position of conflict, the conflict must be resolved in accordance to the prescribed conflict of interest procedures as defined in the GPA on Conflict of Interest. This includes, but not limited to, formal disclosure of the conflict to immediate superior and/or other relevant personnel within the Group using prescribed form or online platform and take appropriate steps to remove themselves from or mitigate the conflict of interest position.

ACTING IN GOOD FAITH
The Group expects all reports or concerns to be raised in good faith, with reasonable grounds supporting the concerns. Where allegations are proven to be malicious, we will not hesitate to take appropriate action against the parties responsible.

PROTECTION FROM RETALIATION
Any party who retaliates against a whistleblower will be dealt with accordingly, up to and including legal action, where applicable.

VENDOR COBC AND VENDOR INTEGRITY PLEDGE

The Group strives to work, strengthen, and maintain a mutually beneficial relationship with all Vendors and Counterparties that share the same values and practices as the Group.

The Group recognizes that the values and business practices of the Counterparties may vary and will significantly impact the Group. As such we have developed the Group’s Vendor Code of Business Conduct (“Vendor COBC”) to provide clarity on our expectations with regards to the Group’s Vendors and Counterparties' behavior and conduct when working with, providing goods/services or entering any Business Transactions with the Group.

To confirm the understanding commitment and uphold the expected behaviors and compliances with all the applicable laws and regulations as articulated in the Vendor COBC, the Group’s Vendors and Counterparties are required to sign the Vendor Integrity Pledge (“VIP”) and Declaration of Interest Form to declare/disclose any potential or actual conflict of interest at the beginning of the procurement exercise as part of the Group’s procurement process. Post declaration of interest, any interest that has become a conflict has to be disclosed via the Conflict of Interest Form.

The Vendor COBC, VIP, Declaration of Interest Form and Conflict of Interest Form can be viewed and downloaded in the following links.

Vendor COBC

Vendor Integrity Pledge

Declaration of Interest Form

Conflict of Interest Form

Group Policies

GROUP POLICIES AND AUTHORITIES

The Group’s business activities are governed by a set of high-level Group policies, also known as the Group Policies and Authorities (“GPA”). The GPA is a key component of Sime Darby Property’s corporate governance framework as they serve as a tool by which the Board formally delegates functions and powers to the Management. All employees and Directors of Sime Darby Property Berhad are expected to understand their obligations and comply with the GPA.

The GPA covers a wide range of areas, including functional policies, ethics and conduct, protection of assets, key processes and limits of authority. The GPA also serves as the basis for supplementary policies, procedures and guidelines which may be developed by Business Units or support departments. The GPA is reviewed annually to ensure that the content remains up-to-date and relevant to the needs of the Group.

Whistleblowing

The Group expects its employees to operate at the highest standard of integrity as we work with business partners who share the same views and principles. Any breach of such principles and any offence committed against the Group’s interest is viewed seriously by the Group, which will result in immediate action against the parties responsible.

Sime Darby Property has in place a whistleblowing policy and has set up whistleblowing channels as an avenue for all stakeholders to report or raise any wrongdoing or misconduct. Wrongdoings include:

Fraud
Misappropriation of assets
Conflict of Interest
Sexual Harassment
Criminal breach of trust
Illicit and corrupt practices
Misuse of confidential information
Acts or omission which are deemed to be against the interest of the company, laws, regulations or public policies
Breaches of any Group policies and/or COBC
Giving false or misleading information
Deliberate concealment of any of the above matters or other acts of wrongdoing

Reports on offences and misconduct can be directed through the provided channels as follows:

Whistleblowing
e-Form

Toll Free Number (Malaysia)
1-800-88-2222

Telephone Hotline at
+603-78495789

Mobile Hotline at
+6019-2488909

Letters to: Whistleblowing Unit at P.O. Box 8077, Kelana Jaya 46781 Selangor.

Whistleblowing Email
gacchair@simedarbyproperty.com
whistleblowing@simedarbyproperty.com

The whistleblowing policy and channels does not cover pure grievances, including complaints about employment matters, which should be channeled to the appropriate authority within the Group such as the Human Resource Department.

The above channels also do not deal with product or customer service complaints as such complaints are to be channeled through dedicated sales and customer service representatives at each of our sales galleries. The Group has also established a dedicated hotline and email address to address such complaints which can be viewed on this link.

Stakeholder Management

The Group is committed to ensuring that its communication with its shareholders and various stakeholders, both internally and externally is effective, clear, transparent, timely, regular and with quality.

These communication and/or disclosures are made through various channels and platforms to keep its stakeholders informed of its business activities, strategies and financial performance. Examples of platforms and/or channels include formal announcements to Bursa Malaysia, disclosure on the corporate websites, briefing to analyst, annual reports, roadshows and social medias.

The Group also prepares its Integrated Annual Report, which provides useful information on the company’s performance, governance practices as well as the direction of the company. The Integrated Annual Report can be accessed through this link.