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PERENNIAL REAL ESTATE HOLDINGS LIMITED
Annual Report 2015
CORPORATE GOVERNANCE
The board of directors (“
Board
”) and the management
team (“
Management
”) of Perennial Real Estate
Holdings Limited (the “
Company
”, and together with
its subsidiaries, “
Perennial
”) believe in and are firmly
committed to observing high standards of corporate
governance to ensure the sustainability of Perennial’s
businesses and to safeguard the interests of the
Company’s shareholders (“
Shareholders
”). Perennial
focuses on developing and maintaining sound and
transparent policies and practices to reinforce its
corporate governance framework and to provide a firm
foundation for the growth of a trusted and respected
business enterprise.
This report sets out Perennial’s corporate governance
practices for the financial period from 28 October 2014
to 31 December 2015 (“
Period
”) with reference to the
Code of Corporate Governance 2012 (“
Code
”).
Where there are deviations from the principles and
guidelines of the Code, an explanation has been
provided in this report.
On 10 October 2014, the Shareholders approved the
corporate restructuring exercise where the Company was
transformed into an integrated real estate owner,
developer and manager, focusing mainly on China and
Singapore, through the acquisitions of effective interests in
several real estate entities and the disposal of the
entertainment business. The appointment of a new Board
was approved by the Shareholders on the same day.
The corporate restructuring exercise was completed
on 27 October 2014 and the new Board together with
a new Management team were appointed. Under the
directions of the new Board and Management,
Perennial shall ensure compliance with the Code, while
simultaneously achieving operational excellence and
delivering long-term strategic objectives.
THE BOARD’S CONDUCT OF AFFAIRS
(GUIDELINE 1)
Guideline 1.1 : Principal role of the Board
The Board oversees the business strategy and
direction of Perennial and is collectively responsible for
the long-term success of the group. The principal
functions of the Board are to:
• provide entrepreneurial leadership and decide on
significant matters relating to Perennial’s activities,
including decisions on strategic directions and
guidelines, approval of business plans and major
investment and divestment proposals;
• oversee the business and affairs of Perennial,
establish strategic objectives with the Management,
and review management performance;
• establish and maintain a guiding framework of
prudent and effective controls which in turn enables
risks to be assessed, managed and contained in
order to safeguard Shareholders’ interests and
Perennial’s assets;
• oversee processes for evaluating the adequacy of
internal controls, risk management, financial
reporting and regulatory compliance, and assess
the adequacy of such processes;
• establish Perennial’s values and standards
(including ethical standards), assume responsibility
for corporate governance and ensure that
obligations to Shareholders and other stakeholders
are understood and carried out;
• identify the key stakeholder groups and recognise
that their perceptions affect Perennial’s reputation;
and
• consider sustainability issues, e.g. environmental
and social factors, as a component of its strategic
formulation for Perennial’s businesses.
Guideline1.2 :Dischargeof dutiesand responsibilities
Directors must discharge their duties and responsibilities
in the best interests of Perennial at all times and they are
expected to make decisions independently and
objectively. Each Director brings to the Board his skills,
experience, insights and sound judgment, which together
with his strategic networks and relationships, serve to
further the interests of Perennial. Directors are collectively
and individually obliged to act in good faith and in the
best interest of Perennial for the creation of long-term
value for Shareholders. An annual performance
evaluation of the Board is undertaken whereby the Board
assesses each Director’s decisiveness and preparedness
to take a firm and independent stance on Board matters
and Company issues.
Guideline 1.3 : Delegation of authority by the Board
Various board committees, namely the Audit and Risk
Committee (“
ARC
”), Nomination Committee (“
NC
”),
Remuneration Committee (“
RC
”) and Corporate
Disclosure Committee (“
CDC
”) (collectively, the “
Board
Committees
”), have been established to assist the
Board in discharging its responsibilities in overseeing
Perennial’s businesses and enhancing the group’s
overall corporate governance. Each Board Committee
has been constituted with clear written terms of
reference. The terms of reference of the respective
Board Committees are disclosed on pages 158 and
159 of this report.
