Creative 2009 Annual Report Download - page 6

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6
CREATIVE฀TECHNOLOGY฀LTD฀AND฀ITS฀SUBSIDIARIES
CORPORATE GOVERNANCE
– For the financial year ended 30 June 2009
PRINCIPLE 2: BOARD COMPOSITION AND BALANCE (cont’d)
The independent non-Executive Directors are Mr Lee Kheng Nam, Mr Ng Kai Wa and Mr Lee Gwong-Yih.
The Board is of the view that the current Board, with independent non-Executive Directors making up at least one-third of the
Board, provides for a strong and independent element on the Board capable of exercising objective judgement on corporate affairs
of the Group. No individual or small group of individuals dominates the Board’s decision-making.
PRINCIPLE 3: CHAIRMAN AND CHIEF EXECUTIVE OFFICER
The Company has the same Chairman and Chief Executive Officer (“CEO”), Mr Sim Wong Hoo. The Company believes that the
independent non-Executive Directors have demonstrated high commitment in their role as Directors and have ensured that there
is a good balance of power and authority. As such, there is no need for the role of the Chairman and CEO to be separated.
Mr Sim Wong Hoo is a substantial shareholder of the Company with a shareholding of approximately 33.78%. With his substantial
shareholding, his interest is aligned with the Company and that of the other shareholders.
PRINCIPLE 4: BOARD MEMBERSHIP
The Nominating Committee (the “NC”) consists of three members, two of whom are independent non-Executive Directors. The
Chairman of the NC, Mr Ng Kai Wa, is an independent non-Executive Director. The other two members are Mr Sim Wong Hoo,
an Executive Director, and Mr Lee Kheng Nam, an independent non-Executive Director.
The principal functions of the NC are, among other matters, to recommend all Board and Board Committee appointments, re-
appointments or re-elections, to determine the independence of each Director, and to identify new Directors who have the diversity
of experience and appropriate knowledge and skills to contribute effectively to the Board.
New Directors are at present appointed by way of a Board resolution, after the NC approves their appointment. The Company’s
Articles of Association provides that all Directors except Executive Directors are to retire at least once every three years by
rotation, if they are appointed by the Company at a general meeting, and a newly appointed Director must submit himself for re-
election at the next Annual General Meeting. The retiring Director is nonetheless eligible for re-election by shareholders at every
Annual General Meeting. Accordingly, Mr. Lee Kheng Nam and Mr. Lee Gwong-Yih will, on the date of the Annual General
Meeting, retire as Directors. The NC recommends their re-appointments as Directors at the Annual General Meeting to be held
on 29 October 2009.
PRINCIPLE 5: BOARD PERFORMANCE
A review of the Board’s performance will be undertaken collectively by the Board as a whole. The Company believes that the
Board’s performance is ultimately reflected in the performance of the Group. The Board, through the delegation of its authority
to the NC, ensures that the Directors appointed to the Board possess the relevant necessary background, experience, knowledge
and skills so as to enable each Director to bring to the Board an independent and objective perspective to contribute to the
effectiveness of the Board.
The Company believes that apart from the Directors’ fiduciary duties (i.e. acting in good faith, with due diligence and care, and
in the best interests of the Company and its shareholders), the Board’s key responsibilities are to set strategic directions and to
ensure that the long term objective of enhancing shareholders’ wealth is achieved.
PRINCIPLE 6: ACCESS TO INFORMATION
In order to ensure that the Board is able to fulfill its responsibilities, management provides the Board members with regular
updates of the performance and financial position of the Group including quarterly updates. Management staff and the Company’s
auditor, who can provide insight into the matters for discussion, are also invited from time to time to attend such meetings. The
Company Secretary attends all Board meetings and ensures that all Board procedures are followed. The Company Secretary,
AR09 pg1-64_Final.indd 6 10/2/2009 10:38:05 AM