Creative 2014 Annual Report Download - page 8

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CREATIVE TECHNOLOGY LTD AND ITS SUBSIDIARIES
The independent non-Executive Directors are Mr Lee Kheng Nam, Mr Ng Kai Wa and Mr Lee Gwong-Yih.
Mr Lee Kheng Nam has served as an independent director on the Board for more than nine years. The Board had conducted a
rigorous review on Mr Lee Kheng Nam’s status and determined Mr Lee Kheng Nam an independent director of the Company.
The Board is of the view that Mr Lee Kheng Nam’s more than nine years of service has not affected his objectivity. He has
continued to demonstrate ability to exercise strong independent judgement and act in the interests of the Company. Further, having
gained in-depth understanding of the business of the Group, Mr Lee Kheng Nam provides the Company with the experience and
knowledge of the industry. His contributions will be valuable to the Company.
The Board is of the view that the current Board, with independent non-Executive Directors making up at least half 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 Ofcer (“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 33.09%. With his substantial
shareholding, his interest is aligned with the Company and that of the other shareholders.
Mr Lee Kheng Nam is the Lead Independent Director. As the Lead Independent Director, he leads and encourages dialogue between
independent directors and provides feedback to the Chairman and CEO. As the Lead Independent Director, he is also available as
the alternate channel for shareholders, should shareholders fail to resolve concerns through the normal channels of the Chairman
and CEO, Chief Financial Ofcer or when such normal channels are inappropriate.
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.
When a Director has multiple board representations, such director has to ensure that sufcient time and attention is given to
the affairs of the Company. On the issue of multiple board representations, the Board is of the view that it should be left to the
judgement and discretion of each Director. As such, the NC and the Board have decided not to set any maximum number of listed
company board representations that any director may hold. The NC is satised that sufcient time and attention are being given
by all the Directors to the affairs of the Company.
The Board does not have a practice of appointing alternate directors. There were no alternate directors in this nancial year.
The Board has adopted a process for the selection, appointment and re-appointment of directors to the Board. The NC reviews
the compositions of the Board periodically. It assesses and shortlists candidates for a position on the Board when a need arises.
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 Gwong-Yih will, on the date of the Annual General Meeting, retire as Director. The NC
recommends his re-appointment as Director at the Annual General Meeting to be held on 29 October 2014.
PRINCIPLE 5: BOARD PERFORMANCE
A review of the performance of the Board as a whole and its board committees and each individual director will be undertaken
by the NC. The Company believes that the Board’s performance is ultimately reected in the performance of the Group. The
CORPORATE GOVERNANCE
For the nancial year ended 30 June 2014
PRINCIPLE 2: BOARD COMPOSITION AND BALANCE (cont’d)