Hap Seng Consolidated : CG Report for Financial Year Ended 31 December 2022

CORPORATE GOVERNANCE REPORT

STOCK CODE	:	3034
COMPANY NAME	: Hap Seng Consolidated Berhad
FINANCIAL YEAR	:	December 31, 2022

OUTLINE:

SECTION A - DISCLOSURE ON MALAYSIAN CODE ON CORPORATE GOVERNANCE

Disclosures in this section are pursuant to Paragraph 15.25 of Bursa Malaysia Listing Requirements.

SECTION B - DISCLOSURES ON CORPORATE GOVERNANCE PRACTICES PERSUANT CORPORATE GOVERNANCE GUIDELINES ISSUED BY BANK NEGARA MALAYSIA Disclosures in this section are pursuant to Appendix 4 (Corporate Governance Disclosures) of the Corporate Governance Guidelines issued by Bank Negara Malaysia. This section is only applicable for financial institutions or any other institutions that are listed on the Exchange that are required to comply with the above Guidelines.

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SECTION A - DISCLOSURE ON MALAYSIAN CODE ON CORPORATE GOVERNANCE

Disclosures in this section are pursuant to Paragraph 15.25 of Bursa Malaysia Listing Requirements.

Intended Outcome

Every company is headed by a board, which assumes responsibility for the company's leadership and is collectively responsible for meeting the objectives and goals of the company.

Practice 1.1

The board should set the company's strategic aims, ensure that the necessary resources are in place for the company to meet its objectives and review management performance. The board should set the company's values and standards, and ensure that its obligations to its shareholders and other stakeholders are understood and met.

Application	:	Applied
Explanation on	:	The board of directors ("Board") of Hap Seng Consolidated Berhad
application of the		("HSCB" or the "Company") is committed to foster a corporate
practice		governance culture that is grounded on the hallmarks of accountability,
		objectivity and transparency. As fiduciaries, the Board members are
		fully cognisant of the need to discharge their duties and responsibilities
		with unfettered judgment, due care and skill at all times.
		The Board is responsible for governing the business and affairs of the
		Company. The Board sets the strategic direction of HSCB and monitors
		the outcome of efforts to reach that direction. The Board institutes
		regular reviews and approves the objectives, strategies, business plans
		and monitors performance against established plans. The Business Plan
		2023 was approved by the Board during the Board meeting held 23
		December 2022. The Board has also established key performance
		indicators to define, measure and monitor the performance and
		progress towards achieving the Company's goals.
		In setting the "tone from the top", the Board is committed to drive
		ethics and HSCB's cultural values amongst employees. Honesty and
		integrity are key values as the Board believes that the success of HSCB's
		business is built on the foundations of trust and confidence.
		Board Committees are established by the Board to assist the Board with
		oversight functions in selected responsibility areas. Managing director
		of the Company ("Managing Director") and executive/senior
		management team ("Management") are responsible for implementing
		policies and strategies of the Board and overseeing HSCB's operations.
		The demarcation of responsibilities between the tripartite parties of the
		Board, Board Committees and Management is outlined in the board
		charter of HSCB ("Board Charter"). While the Board delegates its
		responsibility in accordance with the matters reserved in the board
		charter, the Board at all times exercises collective oversight function of
		the Board Committees and Management.
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Explanation for	:
departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below.

Measure:

Timeframe:

3

Intended Outcome

Every company is headed by a board, which assumes responsibility for the company's leadership and is collectively responsible for meeting the objectives and goals of the company.

Practice 1.2

A Chairman of the board who is responsible for instilling good corporate governance practices, leadership and effectiveness of the board is appointed.

Application	:	Applied
Explanation on	:	The Board is led by Mr. Thomas Karl Rapp, an independent chairman
application of the		("Chairman").
practice
		The Chairman is responsible for leading and ensuring effective conduct
		of the Board. In fulfilling this role, he amongst others carries out the
		following:
		• ensuring that appropriate procedures are in place to govern the
		Board's operations;
		• setting the agenda, style and tone of Board deliberations,
		facilitating effective review, analysis, discussions and contributions
		by each director with sufficient time allocated for discussion of
		complex and contentious issues, encouraging constructive debate
		so as to enable a sound decision-making process;
		• ensuring accurate and timely information, in particular about the
		performance of the Company, is furnished to Board members;
		• establishing a close relationship of trust with the Management,
		Managing Director and Board, providing support and advice while
		respecting executive responsibility and hence, fostering a
		constructive relationship or partnership with the Board and
		Management team;
		• leading efforts to address the Board's developmental needs; and
		• chairing of general meetings, and ensuring a smooth, open and
		constructive dialogue between the Board and the shareholders;
		and establishing and monitoring good governance practices in the
		Company.
		The responsibilities of the Chairman are set out in the Board Charter.
Explanation for	:
departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below.

Measure	:
	4

Timeframe:

5