Vtech 2007 Annual Report Download - page 20

VTech Holdings Ltd
Annual Report 2007
18
CORPORATE GOVERNANCE
PRACTICES
VTech Holdings Limited is incorporated
in Bermuda. The Company has its
primary share listing on The Stock
Exchange of Hong Kong Limited
(“the Hong Kong Stock Exchange“)
and London Stock Exchange Plc. The
primary corporate governance rules
applicable to the Company is the Code
on Corporate Governance Practices (the
“Code”) as set out in Appendix 14
to the Rules Governing the Listing
of Securities on The Stock Exchange
of Hong Kong Limited (the “Listing
Rules”). Throughout the year ended
31st March 2007, the Company has
complied with all the code provisions
of the Code and to a large extent, the
recommended best practices in the
Code except for the deviation from
code provision A.2.1 of the Code as
described below:
Under code provision A.2.1 of the
Code, the roles of chairman and chief
executive offi cer should be separate
and should not be performed by the
same individual. Mr. Allan WONG Chi Yun
has the combined role of Chairman
and Group Chief Executive Offi cer.
The Board of Directors (the “Board”)
considers that this structure will not
impair the balance of power and
authority between the Board and the
management of the Group as the non-
executive directors form the majority of
the Board of which four out of seven
are independent. The Board believes
the appointment of Mr. Allan WONG to
the posts of Chairman and Group
Chief Executive Offi cer is benefi cial
to the Group as he has considerable
industry experience.
The Company is not subject to
the Combined Code on Corporate
Governance under the Listing Rules
of the Financial Services Authority in
the United Kingdom (the “UK Listing
Rules”) that applies to United Kingdom
incorporated companies.
DIRECTORS’ SECURITIES
TRANSACTIONS
The Company has adopted the Model
Codes as set out in Appendix 10
of the Listing Rules and Annex 1 to
Rule 9 of the UK Listing Rules regarding
securities transactions by directors
and senior management in relation to
the accounting period covered by the
Annual Report. After specifi c enquiry,
all directors of the Company confi rmed
that they have complied with the
required standard of dealings set out
therein throughout the year.
BOARD OF DIRECTORS
The Board currently comprises
three executive directors and four
independent non-executive directors.
The names and brief biographies are
set out on page 20 of this report.
Due to personal reasons, Mr. Albert
LEE Wai Kuen resigned as Deputy
Chairman with effect from 1st April
2007. The non-executive directors are
high calibre executives with diversifi ed
industry expertise and bring a wide
range of skills and experience to
the Group. They bring independent
judgement on issues of strategy,
performance, risk and people through
their contribution at Board meetings.
The Board considers that four non-
executive directors, being the majority
of the Board, are independent in
character and judgement and they also
meet the independence criteria set out
in Rule 3.13 of the Listing Rules. All
non-executive directors are appointed
for a specifi c term of three years and
all directors are required to submit
themselves for re-election at least once
every three years under the Company’s
Byelaws. In accordance with the
Company’s Byelaws, each new director
appointed by the Board shall hold
offi ce until the next following annual
general meeting and thereafter the
directors will be subject to retirement
by rotation.
The Board has received from each
independent non-executive director
a written annual confi rmation of
independence pursuant to Rule 3.13 of
the Listing Rules.
The Board’s focus is on the formulation
of business strategy and policy, and
control. Matters reserved for the Board
are those affecting the Company’s
overall strategic policies, fi nances and
shareholders. These include: preliminary
announcements of interim and fi nal
results, dividend policy, the annual
budgets, major corporate activities such
as material acquisitions and disposals,
and connected transactions.
Four Board meetings at approximately
quarterly interval are scheduled for
2007/08 with other meetings as necessary
to deal with urgent matters. All Directors
have access to the advice and services of
the Company Secretary and independent
professional advice may be taken by the
Directors as required.
The attendance of individual members of the Board and other Board Committees
during the fi nancial year is set out below:
Meetings attended/Eligible to attend
Audit Remuneration
Board Committee Committee
Executive Directors
Allan WONG Chi Yun 4/4 – –
Albert LEE Wai Kuen 4/4 – –
Independent Non-Executive Directors
Raymond CH’IEN Kuo Fung 3/4 2/2 1/1
William FUNG Kwok Lun 2/4 1/2 0/1
Michael TIEN Puk Sun 3/4 2/2 1/1
Patrick WANG Shui Chung 2/4 – –
BOARD COMMITTEES
The Board has established four
committees with specifi c responsibilities
as described below. The terms of
reference of the Remuneration
Committee, Nomination Committee
and Audit Committee are posted on the
Company’s website.
Remuneration Committee
The Remuneration Committee is
chaired by Mr. Michael TIEN Puk Sun
with Mr. Raymond CH’IEN Kuo Fung
and Mr. William FUNG Kwok Lun as
members, all of whom are independent
non-executive directors. It is responsible
for reviewing and recommending all
elements of the executive directors and
senior management remuneration. The
fees of the non-executive directors are
determined by the Board.
The Remuneration Committee met
once during the year and reviewed the
Group’s remuneration policy and the
remuneration package of the executive
directors and senior management.
Corporate Governance Report
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