Corporate Information Tan Sri Dato Mohd Hassan bin Marican Dato Hj. Mohd Ali bin Hj. Yasin Board Of Directors CHAIRMAN Tan Sri Dato Mohd Hassan bin Marican MANAGING DIRECTOR/ CHIEFEXECUTIVE OFFICER Dato Hj. Mohd Ali bin Hj. Yasin DIRECTORS Dato Sri Liang Kim Bang Datuk Siti Hadzar binti Mohd Ismail Dato Seri Dr. Hj. Zainul Ariff bin Hj. Hussain Dato Hamzah bin Bakar Mr. Harry K. Menon SECRETARY Fina Norhizah binti Hj. Baharu Zaman REGISTERED OFFICE Level 25, Menara Dayabumi Jalan Sultan Hishamuddin 50050 Kuala Lumpur Tel : 03-2273 8088 Fax : 03-2273 6602 Telex : Naline MA30325, MA 32449 Cable : MALAYASHIPKUALA LUMPUR Website : www.misc-bhd.com 18
Dato Sri Liang Kim Bang Datuk Siti Hadzar binti Mohd Ismail Dato Seri Dr. Hj. Zainul Ariff bin Hj. Hussain Dato Hamzah bin Bakar Mr. Harry K. Menon AUDITORS Ernst & Young Level 23AMenara Milenium Jalan Damanlela Pusat Bandar Damansara 50490 Kuala Lumpur PRINCIPAL BANKERS Bumiputra-Commerce Bank Berhad Malayan Banking Berhad Hongkong Bank Malaysia Berhad SHARE REGISTRAR Malaysian Share Registration Services Sdn Bhd 7th Floor, Exchange Square Bukit Kewangan 50200 Kuala Lumpur P.O. Box 13274 50804 Kuala Lumpur Tel : 603-2026 8099 Fax : 603-2026 3736 Website : www.klse.com.my STOCK EXCHANGE LISTING The Main Board of Kuala Lumpur Stock Exchange 1 9
Profile Of Directors Tan Sri Dato Mohd Hassan bin Marican Dato Hj. Mohd Ali bin Hj. Yasin TAN SRI DATO MOHD HASSAN BIN MARICAN, aged 50, is the President and Chief Executive Officer of Petroliam Nasional Berhad (PETRONAS). A F e l l o w of the Institute of Chartered Accountants in England and Wales, as well as a member of the Malaysian Institute of Accountants and the Malaysian Institute of Certified Public Accountants, he joined PETRONAS in 1989 as Senior Vi c e President of Finance and was appointed President and CEO in February 1995. Tan Sri Dato Mohd Hassan is a member of the PETRONAS Board of Directors, and is Chairman of three public listed companies under the Group, namely PETRONAS Dagangan Berhad, PETRONAS Gas Berhad and Malaysia International Shipping Corporation Berhad. He is also the Chairman of Engen Limited, South A f r i c a s leading oil refining and marketing company which is a subsidiary of PETRONAS. Beyond PETRONAS, Tan Sri Dato Mohd Hassan is a board member of the Malaysia-Thailand Joint A u t h o r i t y, which oversees petroleum development in the overlapping area between Malaysia and Thailand. He is also a member of the International Investment Council for the Republic of South Africa. DATO HJ. MOHD ALI BIN HJ. YASIN, aged 59, is the Vice-President of PETRONAS Logistics and Maritime Business and concurrently the Managing Director/Chief Executive Officer and Board Member of MISC, a subsidiary of PETRONAS. He sits on the Boards of two other public listed companies, namely NCB Holdings Bhd and Bintulu Port Holdings Bhd and various other non-listed boards of PETRONAS and MISC Group of companies. He is also the Chairman of the Malaysian Shipowners Association, committee member of the Domestic Shipping Licencing Board, UK and London P&I Clubs, Ship Classification Societies and represents MISC on the Grand Alliance Principal Committee. He is also the Chairman of the Remuneration Committee of Northport Corporation Berhad and a member of the Remuneration Committee of Bintulu Port Holdings Berhad. Prior to joining PETRONAS in March 1975, he has served for ten years as Head of Finance in major transport/haulage and manufacturing companies. A graduate of the then Dewan Latihan MARA(now University Technology MARA), he is a member of the Chartered Institute of Management Accountants, U.K. and the Malaysian Institute of Accountants. 20
Dato Sri Liang Kim Bang Datuk Siti Hadzar binti Mohd Ismail D a t o Seri Dr. Hj. Zainul A r i ff bin Hj. Hussain D ATO SRI LIANG KIM BANG, aged 66, is an Independent Non-Executive Director of MISC since 1995. He graduated from the University of Malaya, Singapore in 1961 with B.A. (Hons) degree and a Masters degree from the University of Cambridge (Trinity College), England. He joined the Sarawak Civil Service in 1961 and served in various capacities. He was in Public Administration from 1962 to 1963. He was Sarawak s State Financial Secretary from 1984 until his retirement in 1994. He is the Non-Executive Chairman of CMS Cement Sdn Bhd, CMS Steel Berhad, PPES Trading Sdn Bhd, Setri Sdn Bhd and WA B - L C D ASdn Bhd. He is also a Non-Executive Director of Cahya Mata Sarawak Berhad, PPB Group Berhad, PPB Oil Palms Berhad, Rashid Hussain Berhad, CMS Tr u s t Management Berhad and Bintulu Edible Oils Sdn Bhd. He is also a member of the MISC Board Audit Committee. D ATUK SITI HADZAR BINTI MOHD ISMAIL, aged 55, is an Independent Non-Executive Director of MISC since 6 July 1994. She graduated from the University of Malaya with an honours degree in Analytical Economics and a Masters degree in Development Economics from William College, United States of America. She started her career with the Administrative and Diplomatic Service in 1971 as an Assistant Secretary in the Economic Planning Unit (EPU) in the Prime Minister s Department and subsequently held various other positions in the EPU. She is presently the Deputy Secretary General (Policy), Ministry of Finance. She sits on the Board of Inland Revenue Board, Securities Commission, Employees Provident Fund, Kontena Nasional Bhd, Malaysia Venture Capital Bhd and Malaysian Technology Development C o r p o r a t i o n. She is also a member of the MISC Board Audit Committee. DATO SERI DR. HJ. ZAINULARIFF BIN HJ. HUSSAIN, aged 57, is an Independent Non- Executive Director of MISC since 27 June 1998. He holds an MBAfrom Ohio University and a Ph.D in Public Policy from the University of Southern California Los Angeles, United States of America. He has served in various capacities in the Ministry of Agriculture, Selangor State Government, the National Institute for Public Administration (INTAN), Ministry of Education and Socio Economic Research Unit, Prime Minister s Department and Secretary General of the Ministry of National Unity and Social Development. Since 7 May 1998, he has served as Director General, Implementation Coordination Unit, Prime Minister s Department. He is also the Chairman of the MISC Board Audit Committee. 2 1
Dato Hamzah bin Bakar Mr. Harry K. Menon DATO HAMZAH BIN BAKAR, aged 59, is an Independent Non-Executive Director of MISC since 22 September 2000. He is a graduate of the Queen s University of Belfast (UK) and the University of Wisconsin, Madison (USA). His career started in 1968 with the Economic Planning Unit in the Malaysian Government, before he joined PETRONAS in 1980. He retired from PETRONAS in June 2000, after serving for 20 years in various capacities including as the Senior Vice President for Refining and Marketing business, Senior Vice President for Corporate Planning and Development and Chairman of several PETRONAS subsidiaries. Upon his retirement, he was appointed as a Special Advisor to the President of PETRONAS until May 2001. Currently, he serves as Director of Renong Bhd, CIMB Bhd, Scomi Group Bhd and several private limited companies. MR. HARRY K. MENON, aged 53, is an Independent Non-Executive Director of MISC since 30 August 2001. He is a fellow of the Institute of Chartered Accountants in England and Wales, as well as a member of the Malaysian Institute of Accountants and the Malaysian Institute of Certified Public Accountants. He spent 13 years in public practice as a partner of Hanafiah Raslan & Mohamad before joining Public Bank Berhad where he served as Executive Vice President. His most recent position was as Chief Operating Officer of Putrajaya Holdings Sdn Bhd. He is a Non-Executive Director of SPK-Sentosa Corporation Berhad, MESB Berhad, AKN Messaging Technologies Berhad and Symphony House Berhad. He is also a member of the MISC Board Audit Committee. 22
Statement Of Corporate Governance The Board of Directors of Malaysia International Shipping Corporation Berhad (the Board) is committed to the principles of corporate governance in the Malaysian Code of Corporate Governance and to ensuring that the highest standards of corporate governance is applied throughout the Group. THE BOARD An experienced and effective Board consisting of members with a wide range of financial, business and public service backgrounds leads and controls the Group. The Directors bring depth and diversity in expertise to the leadership of the challenging and highly competitive shipping and integrated logistic business. a. Composition i. The Board comprises the Chairman, who is a Non- Executive Director, an Executive Director who is the Managing Director/Chief Executive Officer and five Independent Non-Executive D i r e c t o r s. ii. The profile of the Board is provided on pages 20 to 22 of this Annual Report. The roles of the Chairman and Managing Director/Chief Executive Officer are separate with clearly defined responsibilities to ensure balance of power and iii. authority. The Chairman is primarily responsible for the orderly conduct and working of the Board whilst the Managing Director/Chief Executive Officer is responsible for the overall operations of the business and the implementation of the Board s strategies and policies. The Managing Director/Chief Executive Officer is assisted in managing the business on a day-to-day basis by the Management Committee, which he chairs and which meets twice a month. All the Non-Executive Directors are independent of management and free from any business or other relationships that could materially interfere with the exercise of their independent judgement. They have the calibre to ensure that the strategies proposed by the Management are fully deliberated and examined in the long term interest of the Group, as well as the shareholders, employees and customers. b. Board Meetings During the 12 months period ended 31 March 2003, six meetings of the Board were held. A majority of the Directors attended all the Board meetings held during their tenure. Details of attendance are provided on page 27 of this Annual Report. The agenda and a full set of papers for consideration are distributed well before meetings of the Board to ensure that Directors have sufficient time to study them and be properly prepared for discussion and informed decision-making. Minutes of the Board meetings which include a record of the decisions and resolutions of the Board meetings are properly maintained by the Company Secretary. 2 3
The Directors have access to the advice and services of the Company Secretary who is responsible for ensuring that Board meeting procedures are followed and that applicable rules and regulations are complied with. c. Appointment and Re-election of Directors The Corporation s Articles of Association require that at least one third of the Directors shall retire at every Annual General Meeting and that each Director, shall retire from office at least once every three years but shall be eligible for re-election. Directors who are appointed by the Board shall hold office until the next Annual General Meeting of the Corporation when they shall retire and be eligible for re-election by the shareholders. d. Nomination Committee The Board itself functions as a Nomination Committee. This Committee is empowered to bring to the Board its recommendations on the appointment of new Executive and Non-Executive Directors and the reelection of Directors who retire by rotation in accordance with the Corporation s Articles of Association. Approved recommendations are then further recommended by the Board to the shareholders at the Annual General Meeting for the shareholders approval. All members of the Committee participate in assessing, identifying, recruiting, nominating, appointing and orienting suitable candidates who can contribute effectively to the growth of the Corporation. Any Committee member who has interest in any matter raised by the Committee abstains himself from the deliberations and voting. The Committee also ensures that the Board has an appropriate balance of expertise and abilities. The effectiveness of the Board as a whole and the contribution of each Director are also assessed. 24
e. Mandatory Accreditation Programme All Members of the Board have attended the Mandatory Accreditation Training Programme (MAP) prescribed by RIAM, the training arm of KLSE. Directors are encouraged to attend continuous education programmes and seminars to keep abreast with developments in the market place. f. Directors Remuneration The Board, as a whole, recommends the remuneration of each Director to the shareholders for approval at the Annual General Meeting. The Directors concerned do not participate in the deliberations and voting on decisions in respect of their own remuneration packages. g. Remuneration Committee Matters concerning the remuneration of senior staff of the Group excluding members of the Management Committee are considered by the Management Development Committee. The Board itself decides on the remuneration policy and terms of conditions of service for the Group as well as the remuneration of members of the Management Committee. In effect MISC has a Remuneration Committee at two levels. Dialogue with Investors and Shareholders The Group values dialogue with investors and analysts. Briefing sessions are held for analysts twice a year on the Group s performance. Presentations are made as and when appropriate to explain the Group s strategy, performance and major developments. Any information that may be regarded as undisclosed material or price sensitive will not be disclosed in the presentation nor will it be given to any individual shareholder or shareholder group until after the announcement to KLSE has been made. The Annual General Meeting is the principal forum for dialogue with shareholders. At each Annual General Meeting, the Board presents the progress and performance of the business and shareholders are encouraged to participate in the question and answer session. ACCOUNTABILITYAND AUDIT a. Audit Committee The Audit Committee consist of four independent Non-Executive Directors with Dato Seri Dr. Hj. Zainul Ariff bin Hj. Hussain as Chairman. The composition and Terms of Reference of the Audit Committee are also provided on page 34 of this Report. The Audit Committee met five times during the financial year. A majority of the Committee members attended all meetings. Details of attendance are provided on page 27 of the Report. 2 5
The Managing Director, the General Manager Financial Services, the General Manager Internal Audit, the Head of Ship Management Audit and the External Auditors, as required, were in attendance at all the meetings. In addition to the duties and responsibilities set out in the Terms of Reference, the Audit Committee also acts as a forum for discussion on internal control issues and contributes to the Board s review of the effectiveness of the Company s internal control and risk management systems. The Audit Committee also conducts a review of the internal audit functions and ensures that no restrictions are placed on the scope of statutory audits and on the independence of the internal audit functions. The Audit Committee meets the external auditors to discuss the audit memorandum, the annual financial statements and audit findings. The Committee also meets the external auditors whenever deemed necessary. The minutes of the Audit Committee are formally tabled to the Board for noting and action, where necessary. b. Internal Control Information on the Group s internal control is presented in the Statement on Internal Control set out on page 29 of the Report. c. Relationship with External Auditors The Board ensures that there are formal and transparent arrangements for the maintenance of an objective and professional relationship with the external auditors. 26
DETAILS OF ATTENDANCE AT MEETINGS HELD IN THE FINANCIALYEAR ENDED 31 MARCH 2003 Board Of Board Meetings Board Audit Directors Committee (BAC) Maximum Maximum Meetings possible Meetings possible attended to attend attended to attend Tan Sri Dato Mohd Hassan bin Marican 6 6 Dato Hj. Mohd Ali bin Hj. Yasin 6 6 Dato Sri Liang Kim Bang 4 6 5 5 Datuk Siti Hadzar Mohd Ismail 3 6 4 5 Dato Seri Dr. Hj. Zainul Ariff bin Hj. Hussain 5 6 5 5 Dato Hamzah bin Bakar 5 6 Mr. Harry K. Menon 6 6 5 5 2 7
DIRECTORS REMUNERATION FOR THE FINANCIALYEAR ENDED 31 MARCH 2003 Board BAC BAC Annual Attendance Annual Attendance Fees Fees Fees Fees Total Tan Sri Dato Mohd Hassan bin Marican 60,000 2,400 62,400 Dato Hj. Mohd Ali bin Hj. Yasin Dato Sri Liang Kim Bang 36,000 1,600 8,400 1,600 47,600 Datuk Siti Hadzar binti Mohd Ismail 36,000 1,200 8,400 1,200 46,800 Dato Seri Dr Hj Zainul Ariff bin Hj. Hussain 36,000 2,000 12,000 1,600 51,600 Dato Hamzah bin Bakar 36,000 2,000 38,000 Mr. Harry K. Menon 36,000 2,400 8,400 1,600 48,400 Total 240,000 11,600 37,200 6,000 294,800 28
Statement On Internal Control INTRODUCTION The Malaysian Code on Corporate Governance requires the Board of Directors of public listed companies to maintain a sound system of internal control to safeguard shareholders investment and the Group s assets. The Board is committed to continuously improve the Group s system of internal control and is pleased to provide the following statement. RESPONSIBILITIES The Board has overall responsibility for the Group s system of internal control and for reviewing its effectiveness whilst the role of management is to implement the Board s policies on risk and control. It should be noted that the system of internal control is designed to manage rather than eliminate the risk of failure to achieve business objectives. Accordingly, internal controls can only provide reasonable and not absolute assurance against material misstatement or loss. The Board confirms that there is a continuous process for identifying, evaluating and managing the significant risks faced by the Group, which has been in place for the financial year under review. The process is regularly reviewed by the Board and is in accordance with the guidance as contained in the publication - Statement on Internal Control: Guidance for Directors of Public Listed Companies. RISK MANAGEMENT FRAMEWORK A Risk Advisory Group has been established to assist the Managing Director to:- review policies, procedures and guidelines related to risk management in line with market changes over time review positions and exposures to ensure compliance with Group policy and recommend corrective actions address issues arising from business lines and recommend solutions to management advise management on risk limits The Risk Advisory Group has identified the major risks for MISC Group as Credit Risk, Maritime Risk, Finance Risk and Country Risk. Under the guidance of the Risk Advisory Group, two Risk Profiling workshops were conducted during the year. The objective is to identify and prioritise major business risks of the company. The Credit Control Committee regularly reviews the credit risk and advises on appropriate measures to improve existing credit control procedures and practices and the quality of Trade Accounts Receivables. The Fleet Management Services Division is responsible to ensure various maritime-related risks are identified and all necessary measures are in place for MISC to comply with the mandatory international safety standards and management requirements at all ports globally where MISC operates. There are also comprehensive Safety Management System (SMS) manuals that are updated regularly incorporating the International Safety Management Code which standardise the applicable guidelines and procedures group-wide. 2 9
The Group also has financial risk guidelines for managing the Group s currency, interest rate, market, credit, liquidity and cash flow risks. Country risk assessments where required, are made by leveraging on PETRONAS Group resources. Proper assessments would ensure that risk associated with doing business in a foreign country is properly assessed and managed. MISC benefited from being a part of the PETRONAS Group, which has an established Risk Management Committee, of which MISC s Managing Director is a member, which defines, develops and recommends risk management strategies and policies for the PETRONAS Group. In addition, the Risk Management Committee also coordinates group-wide risk management in terms of building risk management awareness and capabilities, monitoring the risk exposures and planning responses to potential major risk events. KEY PROCESSES The process of governing the effectiveness and integrity of the system of internal control is carried throughout the various areas as follows:- Senior management sets the tone for an effective control culture in the organisation through the company s shared values, developed to focus on the importance of these four key values:- Loyalty Integrity Professionalism Cohesiveness 30
The importance of the shared values is manifested in the Corporation s Code of Conduct for Officers and Staff which is issued to all staff upon joining. Employees are required to strictly adhere to the Code in performing their duties. Internal control procedures are documented in comprehensive standard operating procedures manuals with established guidelines on business planning, capital expenditure, financial operations, performance reporting, human resource and health, safety and environment. There is a clear Health, Safety and Environmental (HSE) policy and framework in place with continuous efforts made to ensure strict adherence to the specified standards and practices. Limits of Authority manual provides a sound framework of authority and accountability within the organisation and to facilitate quality and timely corporate decision making at the appropriate level in the organisation s hierarchy. There is a clear procedure for investment appraisal including equity investment or divestment and capital expenditure. Tender Committees are established to ensure tender evaluation exercises are conducted in an effective, transparent and fair manner. The Group performs comprehensive annual budgeting and forecasting exercise including development of business strategies for the next five years, and establishment of performance indicators against which business units and subsidiary companies can be evaluated. Variances against budget are analysed and reported internally on a monthly and quarterly basis and reported quarterly to the Board. The Group s strategic directions are also reviewed semi-annually taking into account changes in market conditions and significant business risks. The Board reviews quarterly reports from Management on the key operating performance, legal, environmental and regulatory matters. Financial performance is deliberated by the Management Committee and also tabled to the Board on a quarterly basis. The Board Audit Committee operating within its terms of reference and Management Audit Committee perform an important role in ensuring that there are effective risk monitoring and compliance procedures to provide the level of assurance required by the Board. The Internal Audit Division, reporting to the Board Audit Committee, performs scheduled reviews of operations and compliance with company s policies and procedures to assess effectiveness of internal controls. The Board Audit Committee reviews all reports from the Internal Audit Division and conducts annual assessment on the adequacy of Internal Audit Division s scope of work and resources. 3 1
Prior to submission to the Board Audit Committee, the Internal Audit Division would submit the findings and recommendations on Internal Controls to the Management Audit Committee for review, response and implementation of corrective actions, and updates the Management Audit Committee on the status of the actions taken. The minutes of the Management Audit Committee meetings are also submitted to the Board Audit Committee. The Ship Management Audit Division, which reports regularly to the Management and Board Audit Committee, conducts regular audits on the physical and operational conditions of Group s vessels as well as matters pertaining to manning of vessels. The audits are designed to ensure vessels integrity and that maintenance is performed to enhance safety and reliability of vessels at all times. The audit also assesses crew discipline and competency. The Ship Management Audit Division would submit the findings and recommendations on corrective actions of each ship audited to the Fleet Management Services Division and conduct follow-ups on the status of the corrective actions. On a quarterly basis, the findings are analysed and compiled into quarterly reports and submitted to the Management Audit Committee for review, response and decisions on further actions. The Management Audit Committee is also updated on the status of the corrective actions. In addition, MISC s vessels are also subject to stringent audits and vettings to meet the various regulatory and commercial requirements. These include vettings by oil majors and audits by the Malaysian Maritime Authority and ship classification societies to maintain international safety management certification under the relevant Codes. 32
Information and Communication Technology (ICT) is extensively employed in MISC to automate work processes and to collect key business information. There is a clear IT guideline on ICT risk assessment and mitigation. The guideline spells out the risk management process by identifying the risk exposures, assessing and analysing the effect of the exposures and deriving a set of measures to manage and treat the identified risks. The Business Transformation Team is established as a change agent in ensuring MISC is well equipped with the latest and advanced technology in improving work and decision making processes. The Business Transformation Team has also been entrusted to manage change and organisational restructuring resulting from new systems and process roll-out throughout the Group. Progress of systems implementation is monitored and reported at the Business Integration Committee to ensure smooth implementation. The professionalism and competency of staff are enhanced through a properly planned training, development program and also a stringent recruitment process. A performance appraisal system of staff is in place, with established targets and accountability and is reviewed on an annual basis. Action plans are prepared to ensure that staff obtain the required skills to fulfil their responsibilities and that the company can meet its future management requirements. The Board does not regularly review the internal control system of its associated companies, as the Board does not have any direct control over their operations. Notwithstanding, the Group s interests are served through representation on the boards of the respective associated companies and receipt and review of management accounts and inquiries thereon. These representations also provide the Board with information for timely decision making on the continuity of the Group s investments based on the performance of the associated companies. There were no material losses incurred during the current financial year as a result of weaknesses of internal control. Management would also continue to take measures to strengthen the Group s control environment. Statement made in accordance with the resolution of the Board of Directors dated 27th May 2003. 3 3
Board Audit Committee Dato Seri Dr. Hj. Zainul Ariff bin Hj. Hussain Dato Sri Liang Kim Bang Datuk Siti Hadzar binti Mohd Ismail Mr. Harry K. Menon Terms Of Reference Of Board Audit Committee 1. CONSTITUTION The Board Audit Committee was established on 28 June 1993. 2. MEMBERSHIP The Committee shall be appointed by the Board from amongst its Directors and shall consist of not less than three members with the majority being independent Directors. At least one member of the Board Audit Committee must be a member of the Malaysian Institute of Accountants (MIA) or have at least 3 years working experience and have passed the examinations specified in Part 1 of the 1st Schedule of the Accountants A c t 1967 or be a member of one of the associations of accountants specified in Part II of the 1st Schedule of the Accountants Act 1967. No Alternate Director can be appointed a member of the Board Audit Committee. A quorum shall be two members. 3. CHAIRMAN OF BOARD AUDIT COMMITTEE The members of the Board Audit Committee shall elect a Chairman from among their number who shall be an independent Director. 4. ATTENDANCE AT MEETINGS The Managing Director, General Manager Financial Services, the Head of Internal Audit, the Head of Ship Management Audit and a representative of the external auditors shall normally attend meetings. However, at least once a year the Committee shall meet with the external auditors without any executive Board member present. The Company Secretary shall be the Secretary of the Committee. 5. FREQUENCY OF MEETINGS Meetings shall be held not less than three times a year. The external auditors may request a meeting if they consider that one is necessary. 6. AUTHORITY The Committee is authorised by the Board to investigate any activity within its terms of reference. It is authorised to seek any information it requires from any employee and all employees are directed to cooperate with any request made by the Committee. The Committee is authorised by the Board to obtain outside legal or other independent professional advice and to secure the attendance of outsiders with relevant experience and expertise if it considers this necessary. 34
7. DUTIES The duties of the Committee shall include the following: review the following and report to the Board of Directors:- a. with the external auditors, the audit plan; b. with the external auditors, their evaluation of the system of internal controls; c. with the external auditors, their audit report; d. the assistance and cooperation given by the employees of the Corporation to the external auditors; e. the adequacy of the scope, functions and resources of the internal audit functions and that it has the necessary authority to carry out its work; f. the internal audit programme, processes, the results of the internal audits, processes or investigation undertaken and whether or not appropriate action is taken on the recommendations of the internal audit function; g. the quarterly results and year end financial statements, prior to the approval by the Board of Directors, focusing particularly on: i. changes in or implementation of major accounting policy changes; ii. significant and unusual events; and iii. compliance with accounting standards and other legal requirements; h. any related party transaction and conflict of interest situation that may arise within the Corporation or Group including any transaction, procedure or course of conduct that raise questions of management integrity; i. any letter of resignation from the external auditors; and j. whether there is any reason (supported by grounds) to believe that the Corporation s external auditors are not suitable for reappointment; and recommend the nomination of a person or persons as external auditors. 8. REPORTING PROCEDURES The Secretary shall circulate the minutes of meetings of the Committee to all Members of the Board. AUDIT COMMITTEE MEMBERS Dato Seri Dr. Hj. Zainul Ariff bin Hj. Hussain* (Chairman) Dato Sri Liang Kim Bang* Datuk Siti Hadzar binti Mohd Ismail* Mr. Harry K. Menon* Note: * Independent Non-Executive Directors 3 5
Management Committee MANAGING DIRECTOR / CHIEFEXECUTIVE OFFICER Dato Hj. Mohd Ali bin Hj. Yasin SENIOR GENERALMANAGER LINER LOGISTICS BUSINESS Abdul Aziz bin Meor Ngah SENIOR GENERALMANAGER FLEET MANAGEMENT SERVICES Nordin bin Mat Yusoff GENERALMANAGER CORPORATE PLANNING SERVICES Amir Hamzah bin Azizan GENERAL MANAGER LNG BUSINESS AND PETRONAS TANKERS SDN BHD Ahmad Zohri bin Ahmad Zohri GENERAL MANAGER TANKER BUSINESS Gunaseharan a/l R. Ganapathy GENERAL MANAGER BULK SERVICES Baharudin bin Mydin GENERAL MANAGER HUMAN RESOURCE Mohd Hisham bin Mohd Rapee GENERAL MANAGER FINANCIALSERVICES Noraini binti Che Dan 36
Dato Hj. Mohd Ali bin Hj. Yasin Abdul Aziz bin Meor Ngah Nordin bin Mat Yusoff DATO HJ. MOHD ALI BIN HJ. YASIN, aged 59, is the Vice-President of PETRONAS Logistics and Maritime Business and concurrently the Managing Director/Chief Executive Officer and Board Member of MISC, a subsidiary of PETRONAS. He sits on the Boards of two other public listed companies, namely NCB Holdings Bhd and Bintulu Port Holdings Bhd and various other non-listed boards of PETRONAS and MISC Group of companies. He is also the Chairman of the Malaysian Shipowners Association, committee member of the Domestic Shipping Licensing Board, UK and London P&I Clubs, Ship Classification Societies and represents MISC on the Grand Alliance Principal Committee. He is also the Chairman of the Remuneration Committee of Northport Corporation Berhad and a member of the Remuneration Committee of Bintulu Port Holdings Berhad. Prior to joining PETRONAS in March 1975, he has served for ten years as Head of Finance in major transport/haulage and manufacturing companies. Agraduate of the then Dewan Latihan MARA(now University Technology MARA), he is a member of the Chartered Institute of Management Accountants, U.K. and the Malaysian Institute of A c c o u n t a n t s. A B D U LAZIZ BIN MEOR NGAH, aged 51, is the Senior General Manager, Liner Logistics Business. He has over 27 years of experience in the shipping industry and he has served in various capacities in MISC including Director Liner International Services, Director Corporate Planning and Director Offshore Services. He was the Managing Director of Hanjin Lines, Malaysia before moving on to begin his own consultancy work in areas of management turnaround, integrated logistics management and tax consultant on Customs and Excise issues. Abdul Aziz graduated with a Diploma in Accountancy from MARAInstitute of Technology (now University Technology MARA) and is a member of the Chartered Institute of Transport, United Kingdom and Malaysia Charter. NORDIN BIN MAT Y U S O F F, aged 44, is the Senior General Manager, Fleet Management Services. He joined PETRONAS in 1989 and has served in various capacities including Senior Manager, Engineering and Project Management of PETRONAS Tankers Sdn Bhd and Senior Quality A s s u r a n c e Engineer of PETRONAS Carigali Sdn Bhd. Prior to joining PETRONAS, he was attached to Malaysia Shipyard and Engineering (MSE) Sdn Bhd as Head of Quality Assurance. Nordin graduated from University of Glasgow, Scotland with a degree in Naval Architecture & Ocean Engineering and is a registered professional engineer with the Board of Engineers, Malaysia. 3 7
Amir Hamzah bin Azizan Ahmad Zohri bin Ahmad Zohri Gunaseharan a/l R. Ganapathy AMIR HAMZAH BIN A Z I Z A N, aged 36, is the General Manager, Corporate Planning S e r v i c e s. He sits on the Supervisory Board of the Scheme for Insurance of Large and Specialised Risk of Bank Negara Malaysia and also serves on the Boards of a number of subsidiaries of MISC Group of Companies. He is also a member of the Lloyds Asia Shipowners C o m m i t t e e. Prior to joining PETRONAS, he served the Shell Group of Companies for 10 years in various capacities including Head Financial Services and Manager Planning & Support at Sarawak Shell Berhad, Marketing Credit Accountant at Shell Singapore Pte Ltd., Corporate Finance Advisor at Shell Malaysia Ltd and Senior Treasury Advisor at Shell International Ltd., London. Amir Hamzah graduated with a Bachelor of Science degree in Management (majoring in Finance and Economics) from Syracuse University, New York. AHMAD ZOHRI BIN AHMAD ZOHRI, aged 50, is the General Manager, LNG B u s i n e s s. He joined PETRONAS in 1981 and has served in various capacities in the PETRONAS Group including MD/CEO, PETRONAS Maritime Services Sdn Bhd and Senior Manager Commercial and Shipping, Malaysia LNG Sdn Bhd. Prior to joining PETRONAS, he lectured in Nautical Studies at Akademi Laut Malaysia (ALAM) and University Putra Malaysia. Ahmad Zohri graduated from Liverpool Polytechnic, England with an honours degree in Nautical Studies and is a qualified mariner having served with Ocean Fleets Ltd., U.K. as Deck Officer on-board liner and tanker ships. GUNASEHARAN A / L R. GANAPAT H Y, aged 47, is the General Manager, Ta n k e r Business. He joined MISC s shore services in 1992 and was attached to Petroleum Services. T h r e e years later, he was made Project Manager of Petroleum Services and was later moved to head the Petroleum Business Unit in 2002. He is also responsible for the Chemical B u s i n e s s. Gunaseharan graduated with an MBAfrom University of Bath, U.K. and holds a Diploma in Management from the Malaysian Institute of Management. He has also completed the Qualifying Examination of the Institute of Chartered Shipbrokers, London. 38
Baharudin bin Mydin Mohd Hisham bin Mohd Rapee Noraini binti Che Dan BAHARUDIN BIN MYDIN, aged 52, is the General Manager, Bulk Services. He joined PETRONAS in 1975 and has served in various capacities within the PETRONAS Group including General Manager LPG and Petroleum Products Trading as well as Senior Manager Sales and Marketing, Malaysia LNG Sdn Bhd, Senior Manager Commercial, Malaysia LNG Tiga Sdn Bhd and Senior Manager Planning and Chartering, Petronas Tankers Sdn Bhd. Prior to assuming his current position, he was the Senior Manager Strategy and Business Development Corporate Planning Unit of MISC. Baharudin graduated from the National University of Malaysia (UKM) with a Bachelor of Arts degree in Economics and Management. MOHD. HISHAM BIN MOHD. RAPEE, aged 49, is the General Manager, Human R e s o u r c e. He joined PETRONAS in 1983 and has wide experience in Human Resource and Administration, having held senior managerial positions in human resource in PETRONAS Carigali Sdn Bhd, PETRONAS Tankers Sdn Bhd and PETRONAS Holding. Mohd Hisham graduated from the University of Malaya in 1975 with an honours degree in Arts (History). He is also a graduate of the Senior Management Development Programme INSEAD. NORAINI BINTI CHE DAN, aged 47, is the General Manager, Financial Services. Prior to joining MISC, she served Pernas International Holdings Berhad for 15 years in various capacities including Group General Manager Finance and Chief Financial Off i c e r. She graduated from University of Manchester with an honours degree in Economics. She is a member of the Malaysian Institute of Accountants and Malaysian Institute of Certified Public A c c o u n t a n t s. 3 9