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Annual Report 2015
CORPORATE GOVERNANCE
When reviewing the independence of the 4 NEDs, the Boards of the H-REIT Manager and the
HBT Trustee-Manager had considered the guidelines for independence set out in Guideline 2.3
of the 2012 Code and the Business Trusts Regulations 2005. The 4 NEDs are Ms Jenny Lim,
Mr Jimmy Chan, Mr Daniel Desbaillets and Mr Ronald Seah. For purposes of determination of
independence, the 4 NEDs have also provided declarations regarding their independence.
In considering the independence of Ms Jenny Lim and Mr Jimmy Chan, both of whom have served
on the H-REIT Manager Board and the HBT Trustee-Manager Board for more than nine years, the
Directors have given due consideration to the recommendation under Guideline 2.4 of the 2012
Code that the independence of any director who has served on the Boards beyond nine years be
subject to particularly rigorous review. Guided by relevant questions provided by the Nominating
Committee Guide issued by SID in 2015, the Boards noted observations/instances where Ms Lim
and Mr Chan had opined and commented on various acquisition deals, sought Management’s
clarification as well as challenged Management’s recommendations on matters pertaining to their
area of responsibilities, whether as a member on the Board or on the committees.
The Boards (with Ms Lim and Mr Chan abstaining respectively in respect of the deliberation
over their own independence) have concurred that Ms Lim and Mr Chan are independent,
notwithstanding they have served on the Boards beyond nine years, as they have continued
to demonstrate strong independence in character and judgement in the discharge of their
responsibilities as Directors of the Company. The Managers have also benefited from their years
of experience in their respective fields of expertise.
The Boards are cognisant of the new requirements introduced by MAS in relation to the
independence of Directors who have served on the Board of Directors for more than 9 years and
are taking steps to ensure compliance with MAS’ requirements which will take effect no later than
the first AGM relating to financial year ending on or after 31 December 2016.
H-REIT Manager / HBT Trustee-Manager Board Composition and Size
The composition of the H-REITManager Board and the HBT Trustee-Manager Board is determined
using the following principles:
•
the Chairman of the H-REIT Manager Board and the HBT Trustee-Manager Board should be
a non-executive Director of the H-REIT Manager and the HBT Trustee-Manager;
•
the H-REIT Manager Board and the HBT Trustee-Manager Board should comprise Directors
with a broad range of commercial experience including expertise in funds management
and the hospitality and real estate industries; and
•
while H-REIT Units remain stapled to HBT Units, in order to avoid any conflict between
H-REIT and HBT and to act in the best interest of CDLHT (a stapled group comprising the
H-REIT Group and the HBT Group) (the "
Stapled Group
"), each of the Directors of the
H-REIT Manager Board is also a Director of the HBT Trustee-Manager Board, and vice versa.
Accordingly, in order for the HBT Trustee-Manager Board to comply with the requirement
under Regulation 12 of the Business Trust Regulations 2005 for at least a majority of the
Directors of the board of the trustee-manager of a business trust to comprise Directors who
are independent from management and business relationships with the trustee-manager,
majority of both the H-REIT Manager Board and the HBT Trustee-Manager Board are
independent Directors.
Guideline 2.6
(a) What is the Board’s policy
with regard to diversity
in identifying director
nominees?
Please refer to the first
paragraph of the section
under the heading
"H-REIT Manager/ HBT
Trustee-Manager Board
Composition and Size".
(b) Please state whether the
current composition of the
Board provides diversity on
each of the following – skills,
experience, gender and
knowledge of the Company,
and elaborate with numerical
data where appropriate.
Please refer to the second
and third paragraphs of the
section under the heading
"H-REIT Manager/ HBT
Trustee-Manager Board
Composition and Size".
(c) What steps has the Board
taken to achieve the balance
and diversity necessary to
maximise its effectiveness?
Please refer to the
second paragraph of the
section under the heading
"H-REIT Manager/ HBT
Trustee-Manager Board
Composition and Size".
