Ntegrator International Ltd. - Annual Report 2020

21 CORPORATE GOVERNANCE REPORT REMUNERATION MATTERS Principle 6: Procedures for Developing Remuneration Policies 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: Level and Mix of Remuneration 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. Remuneration Committee (RC) The RC comprises 3 members, all of whom are Independent Directors ( Provision 6.2 of 2018 Code ). The composition of the RC is as follows:- Lai Chun Loong (Chairman) Charles George St. John Reed Lee Keen Whye The role of the RC is to review and recommend to the Board a framework of remuneration for the Board of Directors and key executives of the Group. It determines specific remuneration packages and reviews the terms of service for each Executive Director and Key Management Personnel of the Company ( Provision 6.1 of 2018 Code ). It also approves guidelines on salary, bonus, and other terms and conditions for Senior Management. The RC’s review covers all aspects of remuneration, including but not limited to Directors’ fees, salaries, allowances, bonuses, and benefits-in-kind and termination terms (if any) to ensure they are fair ( Provision 6.3 of 2018 Code ). In its review, the RC ensures that the remuneration of the Directors and Key Management Personnel commensurate with their performance and value-add to the Group, giving due regard to the sustainability of performance, value creation and strategic objectives of the Company and/or the Group ( Provision 7.1 of 2018 Code ). The RC also reviews the Company’s obligations arising in the event of termination of the Executive Directors’ and Key Management Personnel’s contracts of service, to ensure that such contracts of service contain fair and reasonable termination clauses which are not overly generous. The Group’s remuneration policy comprises a fixed component and a variable component. The fixed component is in the form of a base salary. The variable component is determined, after taking into consideration the performance of the Group and the individual employee, as well as the general economic climate. In setting remuneration packages for Executive Directors and Key Management Personnel of the Group, the pay and employment conditions within the industry and in comparable companies are taken into account to maintain an appropriate and competitive level of remuneration that will attract, retain and motivate the Directors to provide good stewardship of the Company and Key Management Personnel to successfully manage the Company for the long term ( Provision 7.3 of 2018 Code ). The RC may seek external professional advice on compensation and other employment-related matters, as and when required. No external consultant was engaged in FY2020 ( Provision 6.4 of 2018 Code ). Executive Directors are on service contracts, which are subject to annual review. The RC is of the view that the Executive Directors’ service contracts are not excessively long or do not contain onerous removal clauses. The Executive Directors who are on service contracts which may be terminated by either party giving 3 months’ notice, do not receive Directors’ fees. Their remuneration packages comprise salaries, annual wage supplement and a share of profits based on the Group’s performance. The performance-related benefits are to align their interests with those of the shareholders and other stakeholders, for the long-term success of the Company, and link rewards to corporate and individual performance ( Provision 7.1 of 2018 Code ).