Key ASIC Berhad (“KAB”)

Environmental, social, governance (ESG)

KAB is committed to integrating environmental, social, and governance considerations into our business strategy, operations, practices, and decision-making. Our ESG policy is guided by our values and our responsibility to our stakeholders, including our customers, employees, shareholders, and the communities that we operate in and our planet.

Environmental Responsibility:

•    Reduce greenhouse gas emissions: We plan to work towards reducing our greenhouse gas emissions by 50% by 2028 and achieve net-zero emissions by 2033.

•    Energy efficiency: We have been designing chips and products with ultra-low power technologies and we continue to pursue the next generation of ultra-low technology. We constantly improve the energy efficiency in our operations by implementing energy-efficient technologies and practices, such as upgrading to energy-efficient lighting, using low-power devices, ventilation, and air conditioning (HVAC) systems, and optimizing data centre cooling systems.

•    Renewable energy: We develop technologies that enable the use and development of renewable energy sources and we adopt the use of renewable energy as our principle.

•    Supply chain sustainability: We will work with our suppliers to promote sustainability and reduce the environmental impact of our supply chain. This will include selecting our suppliers that prioritize sustainability and environmental responsibility and working with suppliers to improve energy efficiency and reduce waste and emission.

•    Waste reduction: We will work to reduce waste and increase recycling in our operations. We will implement a comprehensive recycling program, using recycled materials in our products, and minimizing waste in our work processes.

•    Product sustainability: We will work to design products that are more sustainable and environmentally friendly. This can include using materials that are less harmful to the environment, designing products that are more energy-efficient, and extending the life of products through enhancing old design and reuse programs.

•    Employee engagement: We will engage employees in sustainability efforts by providing education and training on environmental issues, promoting sustainable practices in the workplace, and encouraging employee participation in sustainability initiatives.

Social Responsibility:

•    As a socially responsible company, we ensure our strategy and corporate development incorporate the development and advancement of support system for the society.

•    We will continue to invest in the development of leading-edge technological products that will elevate the quality of life and create high value jobs for the communities.

•    We will ensure fair and ethical treatment of all employees, including providing a safe and healthy workplace, respecting human rights, and promoting diversity and inclusion.

•    We will work to prevent and mitigate any negative impacts our business operations may have on local communities, including working with local stakeholders to identify and address their concerns.

•    We will promote responsible and sustainable products and services that meet the needs of our customers while minimizing environmental and social impacts.

Governance Responsibility:

•    We will maintain high standards of ethical conduct and transparency in our business practices, including preventing corruption and bribery, and ensuring full compliance with applicable laws and regulations.

•    We will maintain an effective and independent board of directors and adopt best practices in corporate governance and risk management.

•    We will regularly assess our ESG performance, set targets, and report on our progress in a transparent and timely manner.

We will integrate ESG considerations into our business strategy, decision-making, and operations, and will work collaboratively with our stakeholders to ensure a sustainable future.

Key ASIC Berhad (“KAB”)

Sustainability

At KAB, we are committed to promoting sustainability in all aspects of our operations. Our goal is to minimize our impact on the environment, promote the responsible use of natural resources, and contribute to a more sustainable future. To achieve this goal, we have established the following sustainability policy:

  1. Environmental sustainability: We will minimize our environmental impact by reducing our carbon footprint, conserving energy and water, and minimizing waste.

      •  We will promote the use of renewable energy sources and energy-efficient technologies in our operations, including the use of solar power, LED lighting, and high-efficiency cooling systems.

      •  We will reduce our greenhouse gas emissions by implementing strategies such as virtual meetings, carpooling, and reduction in unnecessary meetings.

      •  We will reduce water usage by implementing water-saving practices and technologies in our offices and manufacturing facilities.

      •  We will implement a waste reduction and recycling program, promoting the responsible disposal of electronic waste and minimizing the use of disposable products.

  2. Social sustainability: We will promote social sustainability by fostering a diverse and inclusive workplace, supporting our local communities, and upholding ethical business practices.

      •  We will provide a safe and healthy work environment for all employees, promoting equal opportunities and fair treatment.

      •  We will support local communities by promoting volunteerism and providing training and exposures to university students and internship programs and activities, and by partnering with local suppliers and service providers.

      •  We will maintain high ethical standards in all aspects of our business, upholding the principles of transparency, integrity, and accountability.

  3. Economic sustainability: We will promote economic sustainability by fostering long-term financial stability and growth, and by creating value for our customers, shareholders, and other stakeholders.

      •  We will invest in research and development to promote innovation and product development that supports sustainability.

      •  We will promote the use of sustainable materials and design practices in our chip designs, to reduce the environmental impact of our products.

      •  We will regularly assess our sustainability performance and set measurable targets for continuous improvement.

By implementing this sustainability policy, we aim to promote a more sustainable future for ourselves, our employees, our customers, and future generations.

KEY ASIC BERHAD (the “Company”)

Succession Planning Policy

Policy statement

A change in executive leadership is inevitable for all organizations and finding an immediate replacement at the time of need can be very challenging. Therefore, it is under this policy that the Company intended to be prepared for an eventual permanent change in leadership – either planned or unplanned – to insure the stability and accountability of the organization until such time as new permanent leadership is identified. The board of directors (the “Board”) shall be responsible for implementing this policy and its related procedures.

It is also the policy of the board to assess the permanent leadership needs of the organization to help ensure the selection of a qualified and capable leader who is representative of the community; a good fit for the organization’s mission, vision, values, goals, and objectives; and who has the necessary skills for the organization. To ensure that the organization’s operations are not interrupted while the Board assesses the leadership needs and recruits a new permanent key executive director (primarily the managing director), the board will appoint interim executive leadership through the recommendation from Nomination Committee as described below. The interim executive director shall ensure that the organization continues to operate without disruption and that all organizational commitments previously made are adequately executed, including but not limited to, loans approved, reports due, contracts, licenses, certifications, memberships, obligations to lenders or investors of the Company, and others.

It is also the policy of the Company to develop a diverse pool of candidates and consider at least three finalist candidates for its permanent key executive director position. The Company shall implement an external recruitment and selection process, while at the same time encouraging the professional development and advancement of current employees. The interim executive director and any other interested internal candidates are encouraged to submit their qualifications for review and consideration by the Nomination Committee according to the guidelines established for the search and recruitment process.

Procedures for succession – Key Executive Director

For a change in key executive director due to prolong illness or leave of absence and in the event the said director of the Company is no longer able to serve in this position (i.e., leaves the position permanently), the Board shall do the following:

Within five (5) business days appoint an interim executive director according to the recommendation by Nomination Committee.

Within fifteen (15) business days appoint an executive transition committee (the “Exco”), in the event that a permanent change in leadership is required. This committee shall be comprised of at least three members of the board of directors and one of the members must be from independent non-executive director position. It shall be the responsibility of this committee to implement the following preliminary transition plan:

i.     Communicate with key stakeholders regarding actions taken by the board in naming an interim successor, appointing a transition committee, and implementing the succession policy.

ii.    To become the authorised bank signatories for signing all cheque payments.

iii.   Consider the need for consulting assistance (i.e., transition management or executive search consultant) based on the circumstances of the transition.

iv.   Review the organization’s business plan and conduct a brief assessment of organizational strengths, weaknesses, opportunities, and threats to identify priority issues that may need to be addressed during the transition process and to identify attributes and characteristics that are important to consider in the selection of the next permanent leader.

v.    Establish a time frame and plan for the recruitment and selection process.

vi.   The Board should use similar procedures in case of an executive transition that simultaneously involves the executive director and other key management. In such an instance, the board may also consider temporarily subcontracting some of the organizational functions from a trained consultant or other organizations.

Procedures for Succession – Key Management Position

For a change in key management  position due to prolong illness or leave of absence and in the event the said employee is no longer able to serve in this position (i.e., leaves the position permanently), the CEO or the key executive director shall do the following:

i.      Assess the impact of the vacant position and if needed, immediately appoint existing employee(s) as he/she deems fit to temporary takeover the key roles until a suitable replacement is found.

ii.    Instruct the human resource department to immediately engage with advertisement and/or recruitment agent if no suitable candidate can be identified internally.

This policy shall be reviewed periodically and any amendment thereof shall get Board’s approval.

KEY ASIC BERHAD 200501024949 (707082-M)

BOARD CHARTER

 This Board Charter has been adopted by the Board of Directors (“Board”) of Key ASIC Berhad (“KAB” or “Company”) which collectively leads and is responsible for the success of the Company and its subsidiaries (“KAB Group”) by providing entrepreneurial leadership and supervision as well as direction of the management. The Board is the ultimate decision-making body.

2. Purpose

The Board Charter sets out the duties, responsibilities, functions and power of the Board and various Board Committees with the aim of enhancing corporate governance towards accountability, transparency, sustainability and enhancing business integrity.

3. Authority

This Board Charter is subject to the provisions of the Companies Act 2016 (“Companies Act”), the Constitution of Key ASIC Berhad (“KAB” or “Company”), the MAIN Market Listing Requirements (“MMLR”) of Bursa Malaysia Securities Berhad (“Bursa”), the Malaysian Code on Corporate Governance (“MCCG”) and any other applicable law or regulatory requirements.

4.Board Structure

(a) Board Composition and Balance

The Constitution of the Company specifies that the number of Directors shall be at least two (2) and (unless otherwise determined by ordinary resolution) not more than ten (10).

At least two (2) or one-third (1/3), whichever is higher, of the Board members shall comprise of Independent Directors and at least one (1) director of the Board is a woman. The Independent Directors shall provide independent and objective judgement and mitigate risks arising from conflict of interest or undue influence from interested parties. The Independent Directors shall assist to ensure that the interests of all shareholders are taken into consideration by the Board and that the relevant issues are subjected to objective      and impartial consideration by the Board.

The Chairman of the Board shall be an Independent Director. However, where the Chairman is not an Independent Director, the Board shall comprise a majority of Independent Directors to ensure balance of power and authority on the Board. The Chairman of the Board should not be a member of the Audit Committee, Nomination Committee or Remuneration Committee.

The Board may appoint a Senior Independent Director to whom shareholders’ concerns can be conveyed.

The Board shall undertake an assessment of the independence of its Independent Directors on an annual basis to examine the level of independence of the Independent Director and to ensure the Independent Director can continue to bring independent and objective judgment to board deliberations.

The tenure of service of Independent Directors should not exceed a cumulative term of nine (9) years or upon reaching the age of seventy (70) years old, whichever is earlier. An Independent Director who has served the company for nine (9) years may, subject to the shareholders’ approval through a two-tier voting process, continue to serve the Group in the capacity of Independent Director. However, the tenure of an Independent Director is limiting to not more than a cumulative period of twelve (12) years. After serving for twelve (12) years, an Independent Director may continue to serve on the board as a Non-Independent Director.

The Board shall consist of qualified individual with diverse experience, background, skill and knowledge to enable them to discharge their duties and responsibilities effectively. The Board shall assess and review its diversity, composition and size as a whole from time to time to ensure its appropriateness and effectiveness.

The Board shall at all times consider, promotes and welcomes diversity and gender mix in its composition and give due recognition to the financial, technical and business experience of the Directors.

(b) Appointment and Re-election of the Directors

(i) Appointment

The Board may exercise the power pursuant to the Constitution to appoint a person     who is willing to act to be a Director either to fill a casual vacancy or as an  additional Director upon due based on recommendation from the Nomination Committee.

(ii) Re-election and Re-appointment

The Director(s) appointed during the year is required to retire and seek election by shareholders at the following Annual General Meeting (“AGM”) immediately after their appointment. As required in the Constitution, one-third (1/3) of the Directors shall retire by rotation and seek for re-election at each AGM and that each Director shall submit himself / herself for re-election every three years. The Managing Director shall be subject to retirement by rotation.

The Nomination Committee conducts an annual assessment on the performance of each Director. The results of the review of individual Directors together with the recommendation by the Nomination Committee will be taken into account by the Board in determining the assessment of the Directors and also on the re-appointment/re-election of Directors by shareholders under the annual re-election provisions.

New Directorship

The Chairman of the Board and the Company Secretary shall be notified of any new directorship by any Board members. The notification shall include an indication of time that will be spent on the new appointment.

The number of directorships in listed corporations held by any Board Member at any one time shall comply with the MAIN Market Listing Requirements of Bursa Malaysia Securities Berhad (“Listing Requirements”).

All newly appointed Board members shall undergo a formal induction and continuous education programme to ensure that they understand:

  • Their roles and responsibilities;
  • The Board’s expectations in term of their knowledge contribution;
  • The nature of the Group’s business;
  • Current issues faced; and
  • Strategies adopted by the Group.

(iv) Director Training Requirement

The Board shall ensure compliance of Bursa Malaysia Mandatory Accredited Programme (“MAP”) for newly appointed directors and assess further training prorammes needs of the Directors on an on-going basis.

In addition to the MAP as required by the Bursa Malaysia Securities Berhad, the Directors shall continue to update their knowledge and enhance their skill through appropriate continuing education programmes and life-long learning. This will enable Directors to effectively discharge duties and sustain active participation in the Board deliberation.

The Board shall assess the training requirement of the Directors from time to time and each of the directors is advisable to attend at least one (1) workshop or seminar during a financial year.

Directors may request that training programmes on specific subjects be arranged in order to facilitate them in discharging their duties effectively.

(d) Annual Review of Directors

The Board shall undertake to review and evaluates its own performance on an annual basis to ensure Board effectiveness.

The Board via the Nomination and Remuneration Committee shall establish a set of criteria for the assessment of all Directors including independent Directors, In establishing these criteria, attention shall be given to the values, principles and skills required for the Group. These criteria will serve as a source of reference for prospective and incumbent Directors for the Board’s annual assessment and shall be reviewed regularly to maintain their relevance.

(e) Principal Duties and Responsibilities of the Board

The Board who oversees the business and affairs of the Company will assume the following responsibilities: -

  • Reviewing, adopting and monitoring strategic plans for the Group to ensure that the Group’s goals are clearly established;
  • Overseeing the conduct of the Company’s business;
  • Identifying risks and assume active role in ensuring the implementation of appropriate systems to manage or mitigate these risks;
  • Succession planning, including appointing, training, fixing the compensation of the key managements and to review the Succession Policy from time to time;
  • Ensuring measures and/or policies are in place to assess and oversee Management’s performance for strengthening the Group’s performance;
  • Developing and implementing an investor relations programme or shareholder communications policy for the Group; and
  • Reviewing the adequacy and integrity of the Group’s internal control systems and management information systems, including system for compliance with applicable laws, regulations, rules, directives and guidelines.

(f) Power Delegated to Management

The Board delegates the day-to-day management of KAB’s business to the Board Executive Committee, but reserves for its consideration significant matters such as the following:

  • Approval of financial results;
  • Declaration of dividends;
  • Risk appetite setting;
  • Credit policy;
  • Business (Acquisitions/Disposal);
  • Capital Expenditures;
  • Corporate Proposal; and
  • Budget.

5. Role of the Board Committee

 The Board may from time to time establish committees as it considers appropriate to assist in carrying out its duties and responsibilities. The Board delegates certain functions to the following committees to assist in the execution of its responsibilities: -

  (i) Audit Committee;
  (ii) Nomination Committee;
  (iii) Remuneration Committee;
  (iv) Option Committee; and
  (v) Sustainability Committee

The above Committees shall operate within the roles and responsibilities as set out in the terms of reference of each Committee. The Committees are authorized by the Board to deal, deliberate and carry out the matters delegated to them within their terms of reference. The Chairman of the respective Committees shall report the outcome of the Committee meeting to the Board accordingly and such reports or minutes will be included in the Board papers.

The terms of reference of the respective Board Committees are as attached to this Board Charter under the following Appendices: -

  (i) Appendix I – Terms of Reference of the Audit Committee
  (ii) Appendix II – Terms of Reference of the Nomination Committee
  (iii) Appendix III – Terms of Reference of the Remuneration Committee
  (iv) Appendix IV – Terms of Reference of the Option Committee
  (v) Appendix V – Term of Reference of the Sustainability Committee

6. Board Process and Meeting Procedures

The Directors may meet together for the dispatch of business, adjourn and otherwise regulate their meetings as they think fit. A Director may at any time and the Secretary shall on his requisition summon a meeting of the Directors.

 (a) Frequency

The Board shall schedule to meet at least four (4) times a year. However, additional meetings may be convened as and when deemed necessary as determined by the member of the Board.

 (b) Notice

The Notice of Board Meeting together with Board Papers or such relevant materials should be delivered at least five (5) business days in advance to all Directors and the parties being invited to the Board Meeting for their review in order to facilitate meaningful deliberation during the meeting

 (c) Quorum

Pursuant to the Constitution, the quorum of the Board Meeting may be fixed by the Directors (as the case may be) and unless so fixed at any other number shall be two (2). However, a Director shall not be count in the quorum present at a meeting in relation to a resolution on which he/she is not entitled to vote.

 (d) Attendance at Board Meeting

The office of a Director shall become vacant if a Director is absent from more than 50% of the total Board Meeting held during a financial year.

Management is invited to attend Board and Committee Meeting to provide inputs as and when necessary.

 (e) Voting

Question arising at a meeting shall be decided by a majority of votes. In the case of an equality of votes, the Chairman of the meeting shall have a second or casting vote. However, when two (2) Directors form a quorum, the Chairman of the meeting at which only such a quorum is present, or at which only two (2) Directors are competent to vote in the question at issue shall not have a casting vote.

A Board member is required to abstain from deliberations and voting in respect of any matter which may give rise to an actual or perceived conflict of interest situation.

 (f) Minutes

The Board shall record its deliberation, in terms of the issues discussed, and the conclusions thereof in discharging its duties and responsibilities.

Minutes shall be distributed to Board members and shall be approved by the Chairman of the meeting at which the proceedings are held or by the Chairman of the next succeeding meeting.

 (g) Access to Information and Independent Professional Advice

All Directors have the same right of access to all information pertaining to the Company whether as a full or in their individual capacity, in furtherance of their duties and responsibilities as Directors in the Company. The Management should supply accurate and complete information to the Board in a timely manner to enable the Board to discharge its duties effectively.

All Directors should have access to the advice and services of the Company Secretary.

The Board collectively, and each Director individually, has the rights to seek independent professional advice at the Company’s expenses, subject to the approval by the Board.

7. Directors’ Remuneration

Remuneration Committee is responsible to recommend the remuneration packages for the Executive Director(s) taking into consideration of the individual performance, seniority, experience and scope of responsibilities that is sufficient to attract and retain the Directors needed to run the Company successfully.

The determination of remuneration packages of Non-Executive Directors should be a matter for the Board as a whole and the individual concerned should abstain from discussing their owing remuneration. Fees payable to the Non-Executive Directors shall be a fixed sum and shall not be payable by a commission on or percentage of profits or turnover.

The Board shall determine the remuneration packages taking into consideration the recommendations of the Remuneration Committee. The Remuneration Policy can be found in Appendix III.

8. Roles of the Chairman

The role of the Chairman and the Managing Director/Chief Executive Officer shall be distinct and separated to ensure a balance of power and authority.

The responsibilities of the Chairman should include leading the Board in the oversight of management, amongst others, includes the following roles and responsibilities: -

  • Providing support and guidance to Senior Management Offices to assist and facilitate management succession planning;
  • Grooming and mentoring Senior Management Offices to achieve consistently high levels of professionalism and excellent performance;
  • Chairing the Board Executive Committee meetings;
  • Providing leadership to the Board and is responsible for the developmental needs of the Board;
  • Ensuring that guidelines and procedures are in place to govern the Board’s operation and conduct;
  • Ensuring the smooth functioning of the Board and the Governance structure and inculcating positive culture in the Board;
  • Ensuring that procedures and processes are in place to facilitate effective conduct of business by the Board;
  • Chairing Board meetings and ensures the following:
        • All relevant issues are on the agenda of Board meetings;
        • Board debates strategic and critical issues;
        • Board receives the necessary management reports relating to the Company’s business on a timely basis;
        • All directors are able to participate openly in discussions at Board meetings
        • Providing leadership to the Board and is responsible for the developmental needs of the Board;
        • Chairing general meetings of the Company and provide clarification on issues that may be raised by shareholders; and
        • Encouraging active participation and allowing dissenting views to be freely expressed.

9. Roles of Managing Director/Chief Executive Officer (“CEO”)

The Managing Director/CEO shall focus on the business operation and day-to-day management of the Company. Amongst others, the responsibilities of the Managing Director/CEO shall include the following: -

  • Developing the business direction and strategies of the Company;
  • Ensuring that the Company’s business strategies and policies are effectively implemented;
  • Providing the direction for the implementation of short and long term business plans;
  • Providing strong leadership ie. Effectively communicating a vision, management philosophy and business strategy to employees;
  • Keeping the Board well informed of salient aspects and issues concerning the Company operations and ensuring that adequate management reports are submitted to Board members;
  • Responsible for the effective management of the Company’s day-to-day operations; and
  • Ensuring that there are adequate systems and controls to safeguard the interests of the Company and all stakeholders.

10. Roles of Independent Non-Executive Directors

An Independent Director shall provide the independent judgment and opinions during Board Meeting. Amongst others, includes the following roles and responsibilities: -

  • Providing independent and objective views (in the case of Non-Executive Directors who are Independent Non-Executive Directors), assessment and suggestions in deliberations of the Board;
  • Ensuring effective check and balance in the proceedings of the Board;
  • Mitigating any possible conflict of interest between the policy-making process and day-to-day management of the Company;
  • Constructively challenging and contributing to the development of the business strategies and direction of the Company;
  • Ensuring that there are adequate systems and controls to safeguard the interests of the Company and all stakeholders; and
  • Ensuring that the culture of accountability, transparency, integrity, professionalism and responsible conduct is consistently adhered to in the Company.

11. Company Secretary

The Company Secretary shall be a person who is qualified pursuant to Section 235(2) of the Companies Act, 2016 and competent in carrying his/her duties. The appointment and removal of the Company Secretary shall be decided by the Board of Directors.

The roles and responsibilities of a Company Secretary include, but are not limited to the following:

  (i) Manage all board and committee meeting logistics, attend and record minutes of all board and committee meetings and facilitate board communications;
  (ii) Ensure statutory records are kept and maintained in a proper manner, in compliance with all applicable laws and regulatory guidelines;
  (iii) Advise the board on its roles and responsibilities;
  (iv) Facilitate the orientation of new directors and assist in director training and development;
  (v) Advise the board on corporate disclosures and compliance with company and securities regulations and listing requirements;
  (vi) Manage processes pertaining to the annual shareholder meeting;
  (vii) Monitor corporate governance developments and assist the board in applying governance practices to meet the board’s needs and stakeholders’ expectations; and
  (viii) Serve as a focal point for stakeholders’ communication and engagement on corporate governance issues.

12. Supply of Information

All the directors, including Independent Non-Executive Directors, are allowed to access to information concerning the Company or other external information as they may feel necessary. Board papers and reports which include the Group’s performance and major operational, financial and corporate information will be distributed to the Directors with sufficient time prior to Board meetings to enable Directors to obtain further explanation, where necessary, in order to be properly briefed before the meeting.

The Directors may obtain independent professional advice in furtherance of their duties, at the Company expenses, if necessary.

13. Internal Control and Risk Management

The Board is responsible to maintain a sound system of internal controls to safeguard shareholders’ investment and Group’s assets. The Board shall recognize that such system is structured to manage rather than eliminate possibility of encountering risk of failure to achieve corporate objectives.

The Company outsourced its internal audit function to a consultancy firm which provides the Board with the level of assurance required on the adequacy and integrity of the system of internal control. The internal audit function adopts a risk-based approach and prepares its audit strategy and plan based on the updated risk profile of the Company.

The Audit Committee considers the report from the internal audit function and Management’s responses, before reporting and making recommendations to the Board in strengthening the risk management and internal control systems.

14. Financial Reporting

The Board is responsible to ensure that the financial statements are prepared in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirement of the Company Act, 2016 in Malaysia so as to present a balanced and fair assessment of the Group’s financial position and prospects. The Directors are  also responsible for keeping proper accounting records, safeguarding the assets of the  Company and taking reasonable steps to prevent and enable detection of fraud and other irregularities.

15. Investor Relations and Shareholders Communication

The Board shall ensure the important information are disseminated to shareholders, stakeholders and the public at large through timely announcement of events, quarterly announcement of financial results to all shareholders in line with Bursa Malaysia objectives of ensuring transparency and good corporate governance. Additional information is available from the Company’s website at www.keyasic.com. In addition, product information also available on the Company’s various websites.

16. Code of Ethics and Conducts

The Code of Ethics and Conducts shall be based on the following principles: -

  • Conflicts of interest;
  • Corporate opportunities;
  • Protection of confidential information;
  • Protection and proper use of company assets;
  • Compliance with laws, rules and regulations;
  • Trading on inside information;
  • Bribery and Corruption;
  • Money Laundering;
  • Preventing the Abuse of Power;
  • Compliance with this Code and reporting of any illegal or unethical behavior; and
  • Waivers and amendments.

This Code of Ethics and Conducts is to be observed by all employees, officers and directors of the Group. The Board shall review the Code of Ethics and Conducts periodically to ensure it remains relevant and appropriate.

17. Anti-Corruption and Whistle-Blowing

The Board must ensure that: -

(a) The following are established and maintained for the Company:
    (i) Policies and procedures on anti-corruption that are, at the minimum, guided by the Guidelines on Adequate Procedures issued pursuant to section 17A(5) of the Malaysian Anti-Corruption Commission Act 2009; and
    (ii) Policies and procedures on whistle-blowing;

(b) The policies and procedures in above are reviewed periodically to assess their effectiveness, and in any event, at least once every three (3) years; and

(c) Corruption risk is included in annual risk assessment of the Company.

17. Corporate Social Responsibilities

The Board shall ensure the Company commits towards good corporate social responsibility participation especially the areas on the workplace, the community and the market place including the conduct of various training programmes for the human capital development, the commitment on time and effort in educating and developing the next work generation through the KAB Internship Program and to continue to invest in the R&D and places importance on innovation to enrich the quality of its product and services in ensuring customer satisfaction.

18. Review of Board Charter

The Board Charter will be reviewed periodically and updated in accordance with the needs of the Company and any new regulation that may have an impact on the discharge of the Board’s responsibilities.

This Charter shall be made available at the Company’s website at www.keyasic.com.

Appendix I

KEY ASIC BERHAD 200501024949 (707082-M)

AUDIT COMMITTEE

TERMS OF REFERENCE

PRIMARY PURPOSES

The Audit Committee shall:

(a) provide assistance to the Board in fulfilling its fiduciary responsibilities relating to the corporate accounting and practices for the Company and all its wholly and majority owned subsidiaries ("Group");

(b) improve the Group’s business efficiency, the quality of the accounting function, the system of internal controls and audit function and strengthen the confidence of the public in the Group's reported results;

(c) maintain through regularly scheduled meetings, a direct line of communication between the Board and the external auditors as well as internal auditors;

(d) enhance the independence of both the external and internal auditors’ function through active participation in the audit process;

(e) strengthen the role of the independent Directors by giving them in-depth knowledge on the operations of the Company and the Group through their participation in the Committee; and

(f)act upon the Board of Directors request to investigate and report on any issues or concerns in regard to the management of the Group. 

COMPOSITION

The Audit Committee shall be appointed by the directors from among themselves which fulfills the following requirements:

(a) the Audit Committee shall compose of no fewer than three (3) members;

(b) all the Audit Committee members must be non-executive directors, with a majority of independent directors;

(c) the Chairman of the Audit Committee shall be an independent director and shall not be the Chairman of the Board;

(d) at least one (1) member of the audit committee: -

    (i) must be a member of the Malaysian Institute of Accountants; or

    (ii) if he is not a member of the Malaysian Institute of Accountants, he must have at least three (3) years’ working experience and: -
        (aa)     he must have passed the examinations specified in Part I of the 1 Schedule of the Accountants Act 1967; or
        (bb)     he must be a member of one of the association of accountants specified in Part II of 1 Schedule of the Accountants Act 1967; or

    (ii) fulfils such other requirements as prescribed or approved by Bursa Malaysia Securities Berhad.

(e) no alternate director shall be appointed as an Audit Committee member;

(f) the chief executive officer shall not be a member of the Audit Committee; and

(g) A former key audit engagement partner of the Company’s external auditors’ firm is required to observe a cooling-off period of at least three (3) years before he or she could be appointed as a member of the Committee. 

AUTHORITY

The Audit Committee shall in accordance with the procedure determined by the Board and at the cost of the Company: -

(a) have explicit authority to investigate any matter within its terms of reference;

(b) have the resources which are required to performs its duties;

(c) have full and unrestricted access to any information pertaining to the Company;

(d) have direct communication channels with the external auditors and person(s) carrying out the internal audit function;

(e) be able to obtain independent/external professional or other advice and to secure the attendance of outsiders with relevant experience and expertise if it considers this necessary; and

(f) be able to convene meetings with the external auditors, the person(s) carrying out the internal audit function or activity, or both, excluding the attendance of the other directors and employees of the Company, whenever deemed necessary.

FUNCTION AND DUTIES

The function of the Audit Committee are as follows: -

1. Review the following and report the same to the Board of Directors:

  (a) with the external auditor, the audit plan;

  (b) with the external auditor, his evaluation of the system of internal controls;

  (c) with the external auditor, his audit report;

  (d)the assistance given by the employees of the Company to the external auditor;

  (e) the adequacy of the scope, functions, competency 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 audit programme, processes or investigation undertaken and whether or not a appropriate action is taken on the recommendations of the internal audit function;

  (g) the quarterly results and year end financial statements, before 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 interests situation that may arise within the Company or the Group including any transaction, procedure or course of conduct that raises questions of management integrity;

(i) any letter of resignation from the external auditors of the Company; and

(j) whether there is reason (supported by grounds) to believe that the Company’s external auditor is not suitable for re-appointment;

2. To consider the appointment of the external auditors, the audit fee, any questions of resignation or dismissal and on whether there is reason (supported by grounds) to believe that the Company’s external auditor is not suitable for re-appointment.

3. To discuss with the external auditor before the audit commences, the nature and scope of the audit (including reviewing the audit plan) and thereafter report the same to the Board.

4. To carry out any other function that may be mutually agreed upon by the Committee and the Board which would be beneficial to the Company and ensure the effectiveness discharge of the Committee’s duties and

5. The Committee actions shall be reported to the Board of Directors with such recommendations as the Committee deemed appropriate.

6. To report to the Bursa Malaysia Securities Berhad ("Bursa Malaysia”) on any matter reported by it to the Board of the Company which has not been satisfactorily resolved resulting in a breach of the Bursa Malaysia’s listing 

RETIREMENT AND RESIGNATION

In the event of any vacancy in the Audit Committee. The Company shall fill in the vacancy within three (3) months.

PROCEDURE OF AUDIT COMMITIEE

The Audit Committee may regulate its own procedures, in particular:

(a) the calling of meetings;

(b) the notice to be given of such meetings;

(c) the voting and proceedings of such meetings;

(d) the keeping of minutes; and

(e) the custody, production and inspection of such minutes.

MEETINGS

1. The committee shall meet at least four (4) times in a year or more frequently as circumstances required with due notice of issues to be discussed and shall record its conclusions in discharging its duties and

2. The quorum shall consist of a majority of independent directors and shall not be less than two (2).

3. Upon the request of any member of the Committee, the external auditors or the internal auditors, the Chairman of the Committee shall convene a meeting of the Committee to consider any matters which should be brought to the attention of the directors or

4. The external auditors and internal auditors have the right to appear and be heard at any meeting of the Committee and shall appear before the Committee when required to do so by the Committee.

5. The Committee may invite any Board member or any member of management or any employee of the Company who the Committee thinks fit to attend its meetings to assist and to provide pertinent information as

6. The Company must ensure that other directors and employees attend any particular Audit Committee meeting only at the Audit Committee’s invitation, specific to the relevant

7. Minutes of each meeting shall be signed by the Chairman of the meeting at which the proceedings were held and kept as part of the statutory record of the Company upon confirmation by the Board and a copy shall be distributed to each member of the Audit

8. The minutes shall kept by the Company at the Registered Office or the principal place of business in Malaysia of the Company, and shall be open to the inspection of any member of the committee without

SECRETARY

The Company Secretary or other appropriate senior official shall be the Secretary to the Audit Committee.

Appendix II

KEY ASIC BERHAD 200501024949 (707082-M)

NOMINATION COMMITTEE

TERMS OF REFERENCE

1.  Composition

The members, including the Chairman, of the Nomination Committee shall be appointed by the Board. Its members shall comprise exclusively of Non-Executive Directors, a majority of whom are independent and shall consist of not less than two (2) members.

The Chairman of the Nomination Committee shall be the Senior Independent Non-Executive Director or an Independent Non-Executive Director identified by the Board.

2.  Quorum of Meetings

A minimum of two (2) Nomination Committee members present in person shall constitute the quorum.

3.  Frequency of Meetings

The Nomination Committee shall meet at least annually or at such other frequency as the Chairman may determine.

4.  Others

Except in the case of any emergency, reasonable notice of every meeting shall be given in writing and the notice of each meeting shall be served to the Nomination Committee personally or by sending it via fax or by email or through post or by courier.

Participants may be invited by the Nomination Committee from time to time to attend the meetings depending on the nature of the subject under review.

The Company Secretary or any other person whom the Nomination Committee deem fit shall act as the Secretary of the Committee and shall be responsible for sending out notices of meetings and preparing and keeping the minutes of meetings.

5.  Functions of the Nomination Committee

The Nomination Committee should: -

(a) Recommend to the Board, candidates for all directorships to be filled by the shareholders or the Board after considering the candidates' -
  - skills, qualifications, knowledge, expertise and experience;
  - professionalism;
  - integrity; and
  - in the case of candidates for the position of Independent Non-Executive Directors, to evaluate the candidates' ability to discharge such responsibilities/functions as expected from Independent Non-Executive Directors;

(b) Consider, in making its recommendations, candidates for directorships proposed by the Chief Executive Officer and within the bounds of practicability, by any other senior executive or any director or shareholder;

(c) Assess and recommend to the Board, directors to fill the seats on Board Committees;

(d) Undertake an annual review of the required mix of skills, experience and diversity (including gender diversity) and other qualities of Directors, including core competencies which Non-Executive Directors should bring to the Board and to disclose this forthwith in every Annual Report;

(e) Assist the Board to introduce a criteria and to formulate and implement a procedure to be carried out by the Nomination Committee annually for assessing the effectiveness of the Board as a whole, the Board Committees and for assessing the contributions of each individual Director;

(f) To ensure that the Directors to retire by rotation to be in accordance with the Constitution of the Company;

(g) To ensure that the process carried out in the evaluation and assessment be properly documented;

(h) To conduct assessment of the independent directors who have served the Board for a period of twelve (12) years and above and to recommend to the Board whether the independent director should remain independent or be re-designated;

(i) To ensure that all Directors undergo appropriate induction and continuous training programmes to enhance their performance; and

(j)To report to the Board on Board and key management succession

6.  Retirement and Resignation

In the event of any vacancy in the Nomination Committee, the Company shall fill in the vacancy within three (3) months.

7. Variation

 The above Terms of Reference may be determined and/or varied by the Company's Board of Directors at any time and from time to time.

Appendix III 

KEY ASIC BERHAD 200501024949 (707082-M)

REMUNERATION COMMITTEE

TERMS OF REFERENCE

1.  Composition

 The members, including the Chairman, of the Remuneration Committee shall be appointed by the Board. Its members shall comprise exclusively or majority of Non- Executive Directors and shall consist of not less than two (2) members.

2.  Quorum of Meetings

A minimum of two (2) Remuneration Committee members present in person shall constitute the quorum.

3.  Frequency of Meetings

The Remuneration Committee shall meet at least annually or at such other frequency as the Chairman may determine.

4.  Others

Except in the case of any emergency, reasonable notice of every meeting shall be given in writing and the notice of each meeting shall be served to the Remuneration Committee personally or by sending it via fax or by email or through post or by courier.

Participants may be invited by the Remuneration Committee from time to time to attend the meetings depending on the nature of the subject under review.

The Company Secretary or any other person whom the Remuneration Committee deem fit shall act as the Secretary of the Committee and shall be responsible for sending out notices of meetings and preparing and keeping the minutes of meetings.

5. Functions of the Remuneration Committee 

The Remuneration Committee should: -

(a) Establish a formal and transparent procedure for developing a policy on Executive Directors’ remuneration and for fixing the remuneration packages of individual directors;

(b) To structure the component parts of the Executive Directors' remuneration so as to link rewards to corporate and individual performance; whereas, in the case of Non-Executive Directors, the level of remuneration should reflect the experience and level of responsibilities undertaken by the particular Non-Executive Director concerned;

(c) Ensure the levels of remuneration are sufficient to attract and retain the directors needed to run the Company successfully. The determination of remuneration packages of Non- Executive Directors, including Non-Executive Chairman is a matter for the Board as a The individuals concerned shall abstain from discussion of their own remuneration.

(d) Ensure that the Employees’ Share Option Scheme (“ESOS”) of the Company is fairly and properly administered and implemented in accordance with the ESOS By-Laws.

6.  Variation

The above Terms of Reference may be determined and/or varied by the Company's Board of Directors at any time and from time to time.

Appendix IV

KEY ASIC BERHAD 200501024949 (707082-M)

OPTION COMMITTEE

TERMS OF REFERENCE

 1.  Composition

The members, including the Chairman, of the Option Committee shall be appointed by the Board. Its members shall consist of not less than 2 members.

2.  Quorum of Meetings

 A minimum of two (2) Option Committee members present in person shall constitute the quorum.

3.  Frequency of Meetings

 The Option Committee shall meet at least annually or at such other frequency as the Chairman may determine.

4.  Others

Except in the case of any emergency, reasonable notice of every meeting shall be given in writing and the notice of each meeting shall be served to the Option Committee personally or by sending it via fax or by email or through post or by courier.

Participants may be invited by the Option Committee from time to time to attend the meetings depending on the nature of the subject under review.

The Company Secretary or any other person whom the Option Committee deem fit shall act as the Secretary of the Committee and shall be responsible for sending out notices of meetings and preparing and keeping the minutes of meetings.

5.  Functions of the Option Committee

The Option Committee should: -

(a) Assist the Board of Directors in discharging its responsibilities relating to the implementation of the ESOS in accordance with the relevant laws and regulations including the By-Law; and

(b) carry out functions relating to the Scheme assigned by the Board of the

6.  Variation

The above Terms of Reference may be determined and/or varied by the Company's Board of Directors at any time and from time to time.

Appendix V

KEY ASIC BERHAD 200501024949 (707082-M)

SUSTAINABILITY COMMITTEE

TERMS OF REFERENCE

1.  Composition

The members, including the Chairman, of the Sustainability Committee shall be appointed by the Board. Its members shall consist of not less than two (2) members.

2.  Quorum of Meetings

A minimum of two (2) Sustainability Committee members present in person shall constitute the quorum.

3.  Frequency of Meetings

The Sustainability Committee shall meet at least annually or at such other frequency as the Chairman  may determine.

4.  Others

Except in the case of any emergency, reasonable notice of every meeting shall be given in writing and the notice of each meeting shall be served to the Sustainability Committee personally or  by sending it via fax or by email or through post or by courier.

Participants may be invited by the Sustainability Committee from time to time to attend the meetings       depending on the nature of the subject under review.

The Company Secretary or any other person whom the Sustainability Committee deem fit shall act as the Secretary of the Committee and shall be responsible for sending out notices of meetings  and preparing and keeping the minutes of meetings.

5.  Functions of the Sustainability Committee

The Sustainability Committee should: -

(a) reviewing the implementation of the sustainability strategy and reporting to the Board on this implementation;

(b) reviewing the Company’s performance against its sustainability targets and ambitions;

(c) understanding and regularly reviewing the concerns and material risks to the business as perceived by key stakeholders; and

(d) ensuring that the Committee and the Board are kept up to date of any regulatory changes in relation to sustainability which impact the business of the Company and its sustainability strategy and implementation of this strategy.

6.  Variation

The above Terms of Reference may be determined and/or varied by the Company's Board of Directors at any time and from time to time.

Key ASIC Berhad (“Company”)

Code of Conduct and Ethics for Directors

1. Introduction

A director should recognise that, as a member of the board, he/she has individual and collective responsibility and the exercise of commercial judgement in the Company. Each director should endeavour to ensure that the Board of directors (“Board”) fulfils its key purpose of safeguarding and improving the Company’s prosperity.

This Code of Business Conduct and Ethics for Directors (“Code”) is intended to focus the Board and each director on areas of ethical risk, provide guidance to directors to help them recognize and deal with ethical issues, provide mechanisms to report unethical conduct, and help foster a culture of honesty and accountability. The Code is part of the Company’s commitment to promote ethical behaviour among the directors and enhance the high standards of personal integrity and professionalism of the directors.

While covering a wide range of business practices and procedures, these standards cannot and do not cover every issue that may arise, or every situation where ethical decisions must be made, but rather set forth key guiding principles and Company policies. Directors are encouraged to bring questions about particular circumstances that may involve one or more of this Code to the attention of the Chair of the Nomination Committee, who are primarily responsible to administer the Code.

All of our directors must conduct themselves according to the language and spirit of this Code and seek to avoid even the appearance of improper behaviour.

2. Conflicts of Interest

Our directors have an obligation to act in the best interest of the Company. All directors should endeavour to avoid situations that present a potential or actual conflict between their interest and the interest of the Company.

A “conflict of interest” occurs when a person’s private interest interferes in any way, or even appears to interfere, with the interest of the Company, including its subsidiaries and affiliates. A conflict of interest can arise when a director or a director’s family member takes an action or has an interest that may make it difficult for that director to perform his or her work objectively and effectively. Conflicts of interest may also arise when a director (or his or her family member) receives improper personal benefits as a result of the director’s position in the Company.

Although it would not be possible to describe every situation in which a conflict of interest may arise, the following are examples of situations where the rules are clear.

•  Accept any benefit, gift or entertainment that would be illegal or result in any violation of law;

•  Accept any gift of cash or cash equivalent (such as gift certificates, loans, stock, stock options) from persons or entities who deal with the Company in those cases where any such gift is being made in order to influence the directors' actions as members of the Board, or where acceptance of the gifts could create the appearance of a conflict of interest;

•  Accept or request anything as a “quid pro quo,” or as part of an agreement to do anything in return for the benefit, gift or entertainment;

•  Participate in any activity that you know would cause the person giving the benefit, gift or entertainment to violate his or her own employer’s standards.

The following are examples of situations which may constitute a conflict of interest. Situations such as these should be brought to the attention of the Chair of the Nomination Committee for review and clearance before any action is taken:

•  Competing with the Company in similar business.

•  Having an interest in a transaction involving the Company, a customer or supplier (other than as a director of the Company and not including routine investments in publicly traded companies).

•  Receiving a loan or guarantee of an obligation as a result of your position with the Company.

•  Engaging in any conduct or activities that disrupt or impair the Company’s existing or potential commercial relationships.

•  Accepting compensation, in any form, for services performed for the Company from any source other than the Company.

•  Either a director or a member of a director’s family receiving benefits, gifts or entertainment from persons or entities who deal with the Company where a benefit, gift or entertainment is intended to influence the director’s actions as a member of the Board, or where acceptance could create the appearance of a conflict of interest.

Situations involving a conflict of interest may not always be obvious or easy to resolve. Conflicts of interests involving the directors, or questions concerning potential conflicts, shall be brought to the Chair of the Nomination Committee, who may consult with the Company’s legal counsel as appropriate.

It shall be noted that the above conflict of interest principles and conduct does not apply to actions or transactions that are duly tabled and approved by the shareholders in accordance to the Listing rules of Bursa Malaysia.

3. Corporate Opportunities

Directors owe a duty to the Company to advance its legitimate interests when the opportunity to do so arises. Directors are prohibited from taking for themselves business opportunities that are discovered through the use of corporate property, information or position. No director may use corporate property, information or position for personal gain, and no director may compete with the Company. Competing with the Company may involve engaging in the same line of business as the Company, or any situation where the director takes away from the Company opportunities for sales or purchases of products, services or interests.

4. Protection of Confidential Information

Directors should maintain the confidentiality of information entrusted to them by the Company, its customers, consumers or suppliers, except when disclosure is authorized or legally mandated. Confidential information includes all non-public information that might be of use to competitors, or harmful to the Company, its customers, consumers or suppliers, if disclosed.

5. Protection and Proper Use of Company Assets

Protecting Company assets against loss, theft or other misuse is the responsibility of everyone who acts for the Company, including directors. Loss, theft and misuse of Company assets directly impact our profitability. All of the Company’s assets should be used for legitimate business purposes.

6. Compliance with Laws, Rules and Regulations

The Company is strongly committed to conducting our business affairs with honesty and integrity and in full compliance with all applicable laws, rules and regulations. No director of the Company shall commit an illegal or unethical act, or instruct others to do so, for any reason when conducting business for the Company.

7. Trading on Inside Information

Using non-public, Company information to trade in securities, or providing a family member, friend or any other person with a “tip”, is illegal. All such non-public information should be considered inside information and should never be used for personal gain. Directors are required to familiarize themselves and comply with the Company’s policy against insider trading. Directors should contact the Company Secretary before engaging in any transaction involving Company securities.

8. Compliance with This Code and Reporting of Any Illegal or Unethical Behavior

Every director is expected to comply with all of the provisions of this Code. The Code will be strictly enforced and violations will be dealt with promptly. Violations of the Code that involve illegal behaviour will be reported to the appropriate authorities, after consulting with counsel.

Directors should promptly communicate any suspected violations of this Code to the Chair of the Nomination Committee. Any concerns relating to the Chair of the Nomination Committee should be communicated to the Chair of the Audit Committee. Violations will be investigated by or at the direction of the Nomination Committee, the Audit Committee or the Board as appropriate.

Directors should promote ethical behaviour and an environment in which the Company encourages employees to talk to supervisors, managers or other appropriate personnel about illegal and unethical behaviour and, when in doubt, about the best course of action in a particular situation. The Company will not tolerate any kind of retaliation for questions, reports or complaints regarding misconduct that were made in good faith.

9. Bribery and Corruption

Key ASIC Berhad is committed to acting professionally, fairly and with integrity in all its business dealings and relationships wherever it operates and in implementing and enforcing effective systems to counter bribery and corruption

Employees shall not offer, give, solicit or accept any bribes in order to achieve any business or personal advantage for themselves or others or engage in any transaction that contravene any applicable anti-bribery or anti-corruption laws.

10. Money Laundering

Money laundering is a process by which persons or groups try to conceal the proceeds of illegal activities or try to make the sources of their illegal funds look legitimate.

Employees should always ensure that they are conducting business with reputable customers, for legitimate business purposes and with legitimate funds. Employees need to be mindful of the risk of Key ASIC Berhad’s business being used for money laundering activities and if they suspect money laundering activities, they should report it to their respective Head of Department or the relevant person designated by the Company.

11. Preventing the Abuse of Power

The abuse and misuse of power or authority in the course of performing work can occur both with external stakeholders and internally among staff. The effects can be damaging to morale and to working relationships.

If occur any abuse of power or authority in the Company, employee should report it to their respective Head of Department or the relevant person designated by the Company.

12. Waivers and Amendments

The Code is subject to review from time to time by the Nomination Committee. Any waiver of any provision of this Code for any director may only be granted by the Board. Amendments to this Code must be tabled and approved by the Board only.

KEY ASIC BERHAD (the “Company”)

Gender Diversity Policy

1. INTRODUCTION

The Company recognises the important of workplace diversity and is committed and to the extent practicable, will address the recommendation and commentary of the Malaysian Code on Corporate Governance 2012 (“MCCG 2012”). recommends that the Board should establish a policy formalising its approach to boardroom and workplace diversity. The Board is pleased to set out below its policy and approach to gender diversity as stated below.

2. PRINCIPLES OF THE GENDER DIVERSITY POLICY

Diversity encompasses various areas such as gender, age, ethnicity and cultural background and the Board firmly believe that a well diversify workplace could benefit the Company to achieve:-

(a)          a good morale between the workforce that leads to a healthy work culture where employees motivate each other to perform at a higher level;

(b)          With a gender-diverse workforce, the company can expand its customer base and offer better services;

(c)           improved employment and career development opportunities for women;

(d)          A gender-balanced team brings with it greater industry knowledge and helps the company access more resources, as well as multiple channels of information; and

(e)          awareness in all staff of their rights and responsibilities with regards to fairness, equity and respect for all aspects of diversity.

3. RESPONSIBILITIES

A.     Boardroom Diversity

Through its Nomination Committee (“NC”), the NC will review and assess the Board composition on behalf of the Board and recommends the appointment of new Directors. In reviewing the Board’s composition, the NC will consider the benefits of all diversity aspects, in order to maintain an appropriate range and balance of skills, experience and background on the Board. In identifying suitable candidates for appointment to the Board, the NC will consider candidates on merit against objective criteria and with due regard for the benefits of diversity on the Board. NC will also take steps to ensure women candidate are sought as part of its recruitment exercise.

B.     Workplace Diversity

Workplace diversity will be the Board’s responsibility and assisted by the management team. The Board will adopt the following strategies in achieving its workplace diversity by:-

(a)          Create a team that prioritize and celebrates diversity;

(b)          identifying specific factors to take into account of the recruitment and selection processes to encourage diversity;

(c)           Family friendly working environment that take into account the role of women employee that also a mother to her own children;

(d)          Accommodating and recognising the importance cultural celebrations and sensitivity of different ethnic group of employees; and

(e)          Any other strategies that may be developed from time to time that the Board may think fit that help to promote workplace diversity.

4. MONITORING

The Board, through NC, will monitor the scope and applicability of this policy, from time to time on the progress of achieving the objectives.

5. REPORTING

Pursuant to the Main Market Listing Requirements of Bursa Malaysia Securities Berhad on the disclosure of Statement on Corporate Governance based on the MCCG 2012 in the Annual Report, the Board will disclose in the Annual Report its gender diversity policies and the proportion of women participation at Board level.

Key ASIC Berhad (“KAB”)

Remuneration Policy

Key ASIC Berhad (“Company”) has established a remuneration policy for the Directors and Senior Management to support and drive business strategy and long-term objectives of the Company and its subsidiaries.

Amongst others, the following are some of the criteria adopted by the Company and its subsidiaries in considering the remuneration of the Senior Management:-

•     The overall performance of the Company and its subsidiaries;

•     General economic situation;

•     Prevailing market practice;

•     Salary position against market;

•     Skills and experience; and

•     Individual performance

In this regard, the Remuneration Committee is responsible to implement the policies and procedures on the remuneration for the CEO whilst the Board is responsible for approving the policies and procedures which govern the remuneration of the employees including CEO and Senior Management of the Company to ensure the same remain competitive, appropriate and in alignment with the prevalent market practices and the Company attracts, retains and motivates the Directors and Senior Management who are with strong credentials, high caliber and astute insights to run the nosiness successfully.

The remuneration package is reflective of the individual Director’s and Senior Management’s experience and level of responsibilities and it is structured to link to corporate and individual performance. The Remuneration Committee is responsible for determining the level and make up of CEO’s remuneration and approved by the Board, with the presence of a majority of non-executive directors. The CEO however, does not participate in any way when determining their respective remuneration package.

All Directors are paid fixed monthly directors’ fees. In addition, the CEO also received other benefits-in-kind including but not limited to telecommunication facilities and other reimbursable/claimable benefits-in-kind as may be determined from time to time, for the purposes of carrying out their his duty as CEO. The determination of the monthly annual directors’ fee for Directors is a matter for the Board as a whole, depending on any additional responsibilities taken. The monthly directors’ fee payable to Directors is presented to the shareholders at the Annual General Meeting for their approval.

The Remuneration Policy of Directors and Senior Management was adopted by the Board.

Key ASIC Berhad (“KAB”)

Whistle Blower Policy

KAB is committed to operating in compliance with all applicable laws, rules and regulations, including those concerning accounting and auditing, and prohibits fraudulent practices by any of its board members, officers and/or employees.  This policy outlines a procedure for employees to report actions that an employee reasonably believes violate a law, or regulation or that constitutes fraud, corruption, bribery or blackmail, criminal offences or other practices.  This policy applies to any matter which is related to KAB’s business and does not relate to private acts of an individual not connected to the business of KAB.

If an employee has a reasonable belief that an employee or KAB has engaged in any action that violates any applicable law, or regulation, including those concerning accounting and auditing, or constitutes a fraudulent practice, the employee is expected to immediately report such information to the Chief Executive Officer (“CEO”). If the employee does not feel comfortable reporting the information to the CEO, he or she is expected to report the information to any one of the independent non-executive director.

All reports and disclosures will be treated fairly and properly and addressed in an appropriate and timely manner. Follow up will be conducted promptly, and an investigation conducted.  In conducting its investigations, KAB will strive to keep the identity of the complaining individual as confidential as possible, while conducting an adequate review and investigation. 

KAB will not retaliate against an employee in the terms and conditions of employment because that employee:  (a) reports to a supervisor, to the executive director or the Board of Directors what the employee believes in good faith to be a violation of the law; or (b) participates in good faith in any resulting investigation or proceeding.

KAB may take disciplinary action (up to and including termination) against an employee who in management’s assessment has engaged in retaliatory conduct in violation of this policy.

Contact Lists

ANTI-BRIBERY & CORRUPTION POLICY (“ABC Policy”)

Key ASIC Berhad and its subsidiaries (“Key ASIC Group”) are committed to running our business operations on a foundation of integrity, transparency and honesty. Key ASIC Group adopts a zero- tolerance policy towards any forms of corruption and bribery in our businesses. Key ASIC Group and employees have to observe the anti-bribery and anti-corruption legislations and regulations in the countries where we have business activities in and undertake ourselves to not engage in any corrupt or improper practices. Key ASIC Group will devise and improve our processes continuously to prevent direct or indirect bribery, in order to safeguard, uphold our values and be in full compliance of this Anti- Bribery and Corruption Policy.

SECTION 1

1.0        PURPOSE

1.1       This ABC Policy is intended to:

• • (a) provide information and guidance the obligations of Key ASIC  Group and all parties working for/with/on behalf of Key ASIC Group (“Parties”) in observing and upholding our anti-bribery and corruption commitment which is an integral part of our business ethics and Group Standards of Conduct;
  • (b) set out guidance to all Parties in detecting potential corruption activities and to curb corruption practices; and
  • (c) to promote better corporate governance culture and ethical behavior amongst Key ASIC Group Directors and employees.

1.2       This ABC Policy may not provide definite answers to cover all situations. As such, we encourage you to reach out to us immediately when in doubt by contacting the HR Manager or your Head of Department.

2.0        DEFINITION

2.1      Corruption is a malpractice (wrongdoing) on the part of an authoritative party through illicit, dishonest and unethical means to obtain benefits or personal gains. Corruption activities includes soliciting, offering, receiving gratification in the form of cash, goods, services, personal favour directly or indirectly to influence decision and/or obtain an intended/ desirable outcome.

2.2      Bribery is an act of offering, promising, giving, accepting or soliciting any gratification as an inducement or a reward for authoritative party to show favour or disfavour or to perform or to abstain from performing or to aid in procuring, expediting, delaying, hindering or preventing the performance of any official duties. Bribery is essentially a form of corruption.

2.3      Gratification is defined in the Malaysian Anti-Corruption Commission (“MACC”) Act 2009 and summarized as money, donation, gift, loan, fee, reward, valuable security, property or interest in property whether movable or immovable, finance benefit, employment, agreement to provide employment, release, discharge of obligation or liability, forbearance to demand, service or favour of any description like protection or forbearance to charge, any forms undertaking, promise, rebate, discount, or any other similar advantage which are done/given/received corruptly.

3.0        APPLICABILITY

3.1       This ABC Policy is applicable to:

(a) All Key ASIC Group’s Directors and employees (including but not limited to part time, full time, contractual, permanent or probationers, interns, trainees, trainers); and

(b) All Key ASIC Group’s Business Partners (anyone whom Key ASIC Group has or intend to have business relationship or in any way associated with Key ASIC Group including but not limited to vendors, suppliers, contractors, sub-contractors, agents, customers etc.)

SECTION 2

THIS ABC POLICY covers the following areas:

1. 1. Donations and Sponsorship;

2. 2. Gifts;

3. 3. Hospitality;

4. 4. Political Contributions; and

5. 5. Facilitation Payment;

4.0        DONATIONS AND SPONSORSHIPS

4.1       Definition:

• • (a) Donation: shall refer to charitable contribution/humanitarian aid whether in the form of cash/cash equivalent/goods made out of care and concern for social causes.

  • (b) Sponsorship: shall refer to contribution of any kind in the form of services, monies, goods to support an event or organisation made to promote/enhance/strengthen business relationships.

4.2       Key ASIC Group adopts the measures and standards stated in Clause 4.2 and Clause 4.3 to ensure all donations and sponsorships made are in compliance with the laws of Malaysia.

4.3       Acceptance of sponsorships is only permissible for Key ASIC Group corporate events. However, sponsorships must be refused if acceptance could give rise to appearance/inference of corruption or association with illegal activities. All acceptance of sponsorships must be reported to Management and must be recorded accordingly.

5.0        GIFTS

5.1      Key ASIC Group strives to achieve the highest standard of integrity in the conduct of our business. As such, our Directors and employees (including their family members) are prohibited from directly or indirectly offering, accepting or soliciting for gifts whether in the form of monetary form (cash or cash equivalent) or in the form of discount, rebate or any other related matters to avoid bribery/conflict of interest as well as appearance of the same in all existing and potential business dealings which may be in violation of MACC Act 2009 and has detrimental effect on our corporate image.

5.2      We impose responsibility on our Directors and employees to achieve common understanding with our Business Partners and to ensure adherence in this regard.

5.2.1      Receiving Gifts 

5.2.1.1     Key ASIC Group acknowledges that gift-giving is a common business etiquette which denotes friendliness and respect. Therefore, it is no surprise that third parties may still persist in giving gifts (whether to individual Directors or employees) and rejection of the same will be construed as insensible or culturally deemed offensive.

5.2.1.2     When such situation arises, the individual Directors or employees are allowed to accept the gifts. However, all gifts received MUST be surrendered and declared to the management IMMEDIATELY where the management is expected to deal with the gifts in accordance with Key ASIC Group’s internal guidelines.

5.2.1.3     In principle, all gifts shall be rejected and if received, must be returned especially in the following circumstances:-

• • (a) gifts received during sensitive periods such as tender or biding exercise and related situations;

  • (b) gifts are given with the intention of causing undue influence to decision makers or appearance of the same;

  • (c) gifts are given with the expectation of gaining a return personal/corporate favour from the recipient;

  • (d) gifts are provided secretly or provided through third parties such as family members/friends of directors or employees; and/or

  • (e) acceptance of gifts under the circumstances is prohibited under any laws in Malaysia.

5.2.2      Providing Gifts

5.2.2.1     Key ASIC Group do not allow our Directors and employees (including their family members) to offer gifts to our Business Partners whether it is on behalf of Key ASIC Group or in their own personal capacities.

5.3     For avoidance of all doubts, kindly take note of the following:-

• (a) any premium/novelty items which carry company name, company logo or other relevant details printed on it which are given out equally to members of public or any third parties and serve as advertising or promotional purposes shall not constitute “gift”.

• (b) the practice of providing and receiving gifts differ among countries, regions, cultures and religions. As such, the degree of acceptability varies on a case-to-case basis and shall be subject to internal approvals.

6.0        HOSPITALITY

6.1     Key ASIC Group recognises the act of providing hospitality to our stakeholders is an acceptable social practice to promote and maintain cordial business relationship.

6.2     Hospitality is only regarded as improper/illegitimate if any of the following occurs:-

• • (a) to cause undue influence to decision makers; and/or

    • (b) done with the expectation of gaining a return personal/corporate favour from the recipient of hospitality; and/or

    • (c) the recognition of the fact that the act of offering and accepting would be improper under the circumstance such as the hospitality is also provided to family members of the Director or employee, or includes a vacation package etc.; and/or

    • (d) it is provided secretly; and/or

    • (e) it is prohibited under any laws in Malaysia; and/or

    • (f) the hospitality is considered lavish under reasonable social norm standard.

6.3     Examples of hospitality permissible by Key ASIC Group:-

• • (a) casual lunch meetings;

  • (b) accommodation/transportation for corporate meetings;

  • (c) corporate activities such as annual/company dinner, customer appreciation dinner, product launching events.

6.4     Key ASIC Group prohibits all Directors and employees (including their family members) from offering, accepting and soliciting hospitality inappropriately and/or excessively from any third parties (including our Business Partners) which potentially cause undue influence in their decision making process especially during sensitive periods.

6.5     All hospitality received and offered must be declared by our Directors and employees and to be documented in accordance to Key ASIC Group internal guidelines.

6.6     Prior to offering hospitality, approval must be obtained internally (which necessitate the performance of risk assessment, value threshold, frequency and obtaining approval mandate set out in Key ASIC Group internal guidelines).

7.0        POLITICAL CONTRIBUTIONS

7.1     Key ASIC Group will not make any contribution whether in the form of cash/cash equivalent, services and/or goods to any political parties for campaigns and routine activities.

7.2     In any event that any gift/sponsorship/donation is made to any political parties (who are our Customers) pursuant to Section 2 Clause 4, Clause 5 and Clause 6, it shall not be construed/implied as an indication of Key ASIC Group’s support to that political party’s ideology and/or an attempt to obtain any business/personal benefits.

8.0        FACILITATION PAYMENT

8.1     Key ASIC Group implements a strict “No Facilitation Payment” policy. Facilitation payment is a payment made to authoritative personnel as an incentive/encouragement to complete some process or work speedily and efficiently.

8.2     Facilitation payment is only permissible in extreme circumstances where Key ASIC Group’s employees’ safety is at stake and such payment is mandatory to ensure thesafety of our employees. Upon occurrence of such incident, declaration of facilitation payment made must be declared to the Top Management and to be recorded in accordance to Key ASIC Group internal guidelines.

SECTION 3

9.0        RECRUITMENT OF EMPLOYEES

9.1         Key ASIC Group, provides equal opportunity for any qualified and competent individual to be employed by the Key ASIC Group of companies from multicultural and multiracial background, sourced from externally, locally and internationally. The recruitment of employees should be based on approved selection criteria to ensure that only the most qualified and suitable individuals are employed. This is crucial to ensure that no element of corruption is involved in the hiring of employees.

9.2        In line with this, more detailed background checks such as criminal, bankruptcy, financial (credit rating) and reference checks will be conducted when hiring employees for management positions, as they would be tasked with decision making obligations. Periodically, all employees are required to make self-declaration to the Human Resource Department on matters pertaining to conflict of interest, compliance and corruption.

10.0        APPOINTMENT OF BOARD MEMBERS / DIRECTORS

10.1       Directors who are not employees of Key ASIC Group are required to make a self- declaration on matters pertaining to conflict of interest, compliance and corruption to the Board Chairman when they are first appointed and subsequently, on an annual basis.

11.0        EMPLOYEES’ & DIRECTORS’ DECLARATION

11.1       All Key ASIC Group Directors and employees (existing/new recruits) shall undergo training and complete assessment on ABC Policy. It is mandatory for all Key ASIC Group Directors and employees to periodically declare strict compliance of this ABC Policy in the course of their employment/service.

12.0     MONITORING

12.1     Key ASIC Group shall conduct periodic audit/review to ensure compliance of this ABC Policy. The audit exercises may be conducted by Key ASIC Group’s Compliance officers or external consultants.

12.2     Non-compliance of this ABC Policy is equated to violation of the MACC Act 2009. Key ASIC Group adopt a stringent approach towards any misconduct in view of the seriousness of this matter. Any misconduct shall have the following consequences (whichever applicable):-

        i.  Employees : immediate suspension pending investigation, if found guilty,

outright dismissal.

        ii.  Directors : immediate suspension pending investigation at Group level, if

found guilty, termination of directorship.

        iii. Business Partners :    immediate suspension of all obligations under the contract. If

found true, termination of contract.

13.0    WHISTLEBLOWER POLICY

13.1     Key ASIC Group is committed to the values of accountability, transparency and impartiality in the conduct of our business and affairs. Key ASIC Group subscribes to open door policy for anyone to share concerns through appropriate means. In line with this, Key ASIC Group implements this “Whistleblower Policy” to encourage any parties to report any misconduct through this platform.

13.2     Key ASIC Group has adopted the highest professional standard of confidentiality and protection measures to ensure strict confidence of a whistleblower’s information and immunity against any forms of intimidation/harassment and/or detrimental actions taken against the whistleblower.

13.3     The information of alleged wrong doing can be classified in many ways: violation of Key ASIC Group policy/rules, regulation or threat to public interest/national security, as well as fraud and corruption.

13.4     All reports/complaints made in good faith shall be dealt with in a prompt manner, unescorted by fear of reprisal regardless of the outcome of the investigation.

We encourage all whistleblowers to provide information/suspicion of misconduct through Key ASIC Group’s E-mail: hr@keyasic.com.

14.0    RECORD KEEPING

14.1       All financial records and proper documentations trail of Key ASIC Group with Third Parties will be properly kept and we will have appropriate control measures in place to evidence, substantiate and justify for the business reason of any making of payments to, and receiving of payments from Third Parties.

14.2     All expenses and claims relating to any gifts or entertainment made to Third Parties will be subjected to rigorous screening process in accordance with Key ASIC Group’s internal reimbursement procedures in order to minimise the risk of financial outflow in contravention of anti-corruption or anti-bribery laws.

14.3     All documents, accounts and records relating to Business Transactions with Third Parties will be prepared and maintained with strict accuracy and completeness. No documents (as aforementioned) are to be kept “off-book” to facilitate or conceal any improper payments.

15.0    CONTINUOUS

15.1     Key ASIC Group is mindful of the importance to combat corruption and is resolute to continually enhance this ABC Policy to ensure its efficacy and effectiveness is maintained. Key ASIC Group will monitor compliance with the Policy and review the Policy regularly to ensure that it continues to remain relevant and appropriate. 

Directors' Fit and Proper Policy

Overview

The Directors' Fit and Proper Policy (‘Policy’) sets out the approach for the appointment and re-election of Directors of Key ASIC Berhad (‘KAB’ or ‘Company’) and its subsidiaries.

Purpose

The Policy serves as a guide to the Nomination and Remuneration Committee and the Board in their review and assessment of candidates that are to be appointed onto the Board and its subsidiaries as well as Directors who are seeking for re-election.

Fit and Proper Criteria

In accessing if a candidate meets the criteria under this policy, the board should consider the factors which includes but not limited to the following:

1. a) Character and integrity

(i) Probity

• • is compliant with legal obligations, regulatory requirements and professional standards;

• • has not been obstructive, misleading or untruthful in dealings with regulatory bodies or a court.

(ii) Personal integrity

• • has not perpetrated or participated in any business practices which are deceitful, oppressive improper (whether unlawful or not), or which otherwise reflect discredit on his professional conduct;

• • service contract (i.e. in the capacity of management or director) had not been terminated in the past due to concerns on personal integrity;

• • has not abused other positions (i.e. political appointment) to facilitate government relations for the company in a manner that contravenes the principles of good governance.

(iii) Financial integrity

• • manages personal debts or financial affairs satisfactorily;

• • demonstrates ability to fulfil personal financial obligations as and when they fall due.

(iv) Reputation

• • is of good repute in the financial and business community;

• • has not been the subject of civil or criminal proceedings or enforcement action, in managing or governing an entity for the past 10 years;

• • has not been substantially involved in the management of a business or company which has failed, where that failure has been occasioned in part by deficiencies in that management.

b) Experience and competence

(i) Qualifications, training and skills

• • possesses education qualification that is relevant to the skill set that the director is earmarked to bring to bear onto the boardroom (i.e. a match to the board skill set matrix);

• • has a considerable understanding on the business and workings of a corporation;

• • possesses general management skills as well as understanding of corporate governance and sustainability issues;

• • keeps knowledge current based on continuous professional development;

• • possesses leadership capabilities and a high level of emotional intelligence.

(ii) Relevant experience and expertise

• • possesses relevant experience and expertise with due consideration given to past length of service, nature and size of business, responsibilities held, number of subordinates as well as reporting lines and delegated authorities.

(iii) Relevant past performance or track record

• • had a career of occupying a high-level position in a comparable organization, and was accountable for driving or leading the organization’s governance, business performance or operations;

• • possesses commendable performance record as gathered from the results of the board effectiveness evaluation.

c) Time and commitment

(i) Ability to discharge role having regard to other commitments

• • able to devote time as a board member, having factored other outside obligations including concurrent board positions held by the director across listed issuers and non-listed entities (including not-for-profit organizations).

(ii) Participation and contribution in the board or track record

• • demonstrates willingness to participate actively in board activities;

• • demonstrates willingness to devote time and effort to understand the businesses and exemplifies readiness to participate in events outside the boardroom;

• • manifests passion in the vocation of a director;

• • exhibits ability to articulate views independently, objectively and constructively;

• • exhibits open mindedness to the views of others and ability to make considered judgment after hearing the views of others.

Assessment of Fitness and Propriety of Directors

1. 1. The fit and proper assessments on each director within the scope of this Policy shall be conducted by the Company both prior to initial appointments and at regular intervals of at least annually or whenever the Company becomes aware of information that may materially compromise a director’s fitness and propriety.

2. 2. The Company will consider the factors set out in criteria above in assessing a director’s fitness and propriety. The factors shall be assessed individually, as well as collectively, taking into account their relative importance. Failure to meet one factor on its own does not necessarily mean failure to meet the fit and proper criteria. The Company will consider the specific circumstances surrounding a director’s failure to meet specific factors, such as the lapse of time since the occurrence of events, other contributing factors and the significance of the event from the perspective of potential risks posed to the Company.

3. 3. The Company should exercise the assessment objectively in the best interests of the Company and the sound conduct of the Company’s business. In conducting the assessment, the Company should consider whether there have been material changes in the nature or scope of the responsibilities assumed by a director in which higher standards of competence or judgement are required in order to properly perform the duties associated with the said position.

Review of Policy

This policy and review process will be reviewed by Nomination and Remuneration Committee periodically or as and when necessary. Any amendments/revision required to the policy shall be recommended to the Board for approval.