MESB BERHAD
Registration No. (199501008356 [Company No.: 337554-D])
REMUNERATION POLICY AND PROCEDURES FOR DIRECTORS AND
SENIOR MANAGEMENT
- Purposes and Objectives
The objective of the Remuneration Policy is to align and balance the interests of the Company’s Board of Directors, the Senior Management, the Company itself and its shareholders, and to attract, motivate and retain high-quality individuals in order to support the Company’s and its subsidiaries’ (“the Group”) long term strategy and objectives as well as to promote value creation within the Group.
The remuneration of the Directors and Senior Management shall reflect their responsibility for the management, performance and sustainable development of the Group, and shall take into account the size and complexity of the business. The arrangements shall otherwise be transparent and in line with the principles for good corporate governance. In this regards, the Nomination and Remuneration Committee is established to assist the Board of Directors of the Company (the “Board”) to develop and administer a fair and transparent procedure for setting policy on the remuneration of Directors and Senior Management, as well as reviewing and determining their remuneration packages. The Chief Executive Officer/Executive Director are responsible to recommend the level of remuneration Senior Management of the Group to the Nomination and Remuneration Committee. Thereafter, the Nomination and Remuneration Committee recommends to the Board on the appropriateness of the remuneration package of the Directors and Senior Management based on their assessment.
Directors, whether executive or non-executive, should abstain from discussion and from participating in decisions of their own remuneration packages.
- Key Remuneration Principles
2.1 The level of remuneration of Executive Directors and Senior Management officers shall be structured such that it is competitive and consistent with the Group’s culture, objectives and strategy. In determining their rewards and the level of remuneration, the experience, roles, responsibility and expertise of each director and senior management officer shall also be considered
In case for Executive Directors and Senior Management officers who report to the Chief Executive Officer (“CEO”) are evaluated by the CEO. Thereafter, the CEO recommends the remuneration package for the Executive Directors and Senior Management to the Nomination and Remuneration Committee.
2.2 The level of remuneration of non-executive directors should reflect the experience and level of responsibility of the non-executive directors, taking into account factors such as effort and time spent of the non-executive directors. The fees of the non-executive directors and remuneration payable to the non-executive directors are subjected to the Company’s shareholders’ approval
3. Remuneration Package
3.1 Remuneration for Executive Director and Senior Management
The remuneration package of the Executive Director and Senior Management officers consists of monthly fixed base salary, bonuses, allowances, incentive payments and benefits-in kind, such as company car and insurance.
3.2 Remuneration for Non-Executive and Independent Non-Executive Director
The Non-Executive and Independent Director’s remuneration consist of director fee and meetings allowance.
3.3 Key Components of Remuneration Package and benefits
3.3.1. Director Fee
The fee is set in order to attract and retain high caliber individuals by offering market competitive fees, taking into account the time that is required to fulfill the relevant role and responsibilities.
Director fee to the directors shall be by a fixed sum, and not by a commission on or percentage of profits or turnover and subject to annual shareholders’ approval at the general meeting.
3.3.2. Directors’ Meeting Allowance
Board and Board Committee members are entitled to any meeting allowance for Board and Board Committee Meetings they attend, eg. Board, Audit, Risk Management, Remuneration and Nomination Committees.
The allowance shall be fixed in sum and not by a commission on or percentage of profits or turnover. Any allowance paid to the Board shall be disclosed to its shareholders.
3.3.3. Fixed base salary and allowance
Base salary and allowance are reviewed annually. The annual review process takes into consideration competitive market positioning, market practice, as well as individual’s roles, responsibilities, qualification, experience, performance, needs and expectation of the individual. The previous service agreement entered by them are taken into account when setting and reviewing salary level.
3.3.4. Short-term incentives
Short term incentives consists of bonuses and other incentive payments. The short-term incentives payments shall be based on the individual’s performance, responsibility, market competitiveness and their performance in the relevant business division or business unit as well as overall Group’s performance.
3.3.5. Benefit in-kind
Benefits in-kind, such as company car, medical insurance, life insurance and other non-cash benefits to facilitate the work and wellbeing of the directors and senior management officers.