The RC makes recommendations to the Board on the framework of remuneration and the specific remuneration packages for each Director. The RC comprises Mr Daniel Loh Hong Chye (Chairman of RC), Mr Yeo Wee Kiong and Mr Sim Guan Seng. All members of the RC, including the Chairman, are independent. The RC holds at least one meeting in each financial year. The written terms of reference of the RC have been approved and adopted, and they include the following:– (a) reviewing and recommending to the Board a framework of remuneration for the Directors and key management personnel and determining specific remuneration packages of each Director. The RC shall cover all aspects of remuneration, including but not limited to Directors’ fees, salaries, allowances, bonuses, awards to be granted under the Company’s performance share scheme, and benefits in kind; (b) reviewing annually the remuneration, bonuses, pay increase and/or promotions of employees who are related to the Directors or substantial shareholders of the Company to ensure that their remuneration packages are in line with the staff remuneration guidelines and commensurate with their respective job scopes and level of responsibilities; (c) reviewing the Company’s obligations arising in the event of termination of service contracts entered into between the Group and its Executive Directors or key management personnel, as the case may be, to ensure that the service contracts contain fair and reasonable termination clauses which are not overly onerous to the Group; (d) if necessary, seeking expert advice within and/or outside the Company on remuneration matters, ensuring that existing relationships, if any, between the Company and its appointed remuneration consultants will not affect the independence and objectivity of the remuneration consultants; and (e) reviewing annually the remuneration package in order to maintain their attractiveness to retain and motivate the Directors and key management personnel and to align the interests of the Directors and key management personnel with the long-term interests of the Company. Provision 6.3 of the Code: RC to consider and ensure all aspects of remuneration are fair The RC considers all aspects of remuneration (including Director’s fees, salaries, allowances, bonuses, options, sharebased incentives and awards, benefits in kind and termination payments) in the review of remuneration packages for the Directors and executive officers with an aim to be fair and to avoid rewarding poor performance, before making any recommendation to the Board. The Independent Directors receive Directors’ fees in accordance with their contributions, taking into consideration factors such as effort and time spent and their responsibilities. The Directors’ fees are recommended by the RC and endorsed by the Board for approval by shareholders of the Company at the annual general meetings. Except as disclosed in this Annual Report, the Independent Directors did not receive any other remuneration from the Company. The terms of employment for the Managing Director, such as monthly base salary, annual wage supplement and benefits that commensurate with his position, is stipulated in the service agreement (“Service Agreement”). The Managing Director also participates in a profit-sharing scheme that is pegged to the Group’s profitability. The Managing Director does not receive Directors’ fees and there are no postretirement and severance benefits except the common practice of giving notice or salary in lieu of notice in the event of termination. The Service Agreement is valid for 3 years. Provision 6.4 of the Code: Expert advice on remuneration The members of the RC are familiar with executive compensation matters as they have prior experience in managing businesses and/or are holding other directorships. The RC has access to expert advice regarding executive compensation matters, if required. The Board did not engage any external remuneration consultant to advise on remuneration matters for FY 2024. Level and Mix of 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. Provision 7.1 and 7.3 of the Code: Remuneration of Executive Directors and key management personnel are appropriately structured to link rewards to performance 56 ANNUAL REPORT 2024 Corporate Governance Report
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