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Annual Report 2015
CORPORATE GOVERNANCE
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due to the highly competitive human resource environment for personnel with the requisite
knowledge, expertise and experience in the area of real estate investment trusts and
business trusts, disclosure of specific remuneration information may give rise to recruitment
and talent retention issues;
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the negative impact to H-REIT and HBT if members of the experienced and qualified
management team are poached, thereby affecting both the ability to nurture a sustainable
talent pool and the continuity of business and operations of H-REIT and HBT;
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there is no misalignment between the remuneration of the executive officers and the
interest of Stapled Security Holders, given that their remuneration is not linked to the gross
revenue of H-REIT or HBT and are paid out of the own assets of the Managers; and
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there is full and frank disclosure regarding the total amount of fees paid to H-REIT Manager
and HBT Trustee-Manager.
For each of H-REIT and HBT, there is no employee who is an immediate family member of a
director or the CEO.
In 2016, each of the H-REIT Manager Board and the HBT Trustee-Manager Board established
their respective NRC. Both NRC comprise three NEDs, two of whom, including the NRC chairman,
are independent. Please refer to the ‘Corporate Directory’ section of the Annual Report for the
composition of the NRC. The NRC’s responsibilities are set out in its written terms of reference
approved by the Boards. Pursuant to their terms of reference, NRC shall regularly review and
recommend to the Boards, their assessment of the performance of KMPs. The NRC shall also
take a holistic approach to the Managers’ remuneration policy by considering the contribution
and performance of KMPs in light of the performance of CDLHT and prevailing economic and
industry conditions. The Managers believe that the establishment of the NRCs will help to ensure
that the remuneration policies are more aligned with the interests of Stapled Security Holders.
Principle 10: Accountability
Accountability of the Board and Management of the H-REIT Manager and the HBT
Trustee-Manager
The H-REIT Manager Board and the HBT Trustee-Manager Board provide the Stapled Security
Holders with quarterly and full year financial results of the H-REIT Group, the HBT Group and the
Stapled Group. Unaudited results of the H-REIT Group, the HBT Group and the Stapled Group
for the first, second and third quarters are released to Stapled Security Holders within 45 days of
the end of each quarter whilst unaudited full year results of the H-REIT Group, HBT Group and the
Stapled Group are released within 60 days from the financial year end. In presenting the full year
and quarterly results of the H-REIT Group, the HBT Group and the Stapled Group, the H-REIT
Manager Board and HBT Trustee-Manager Board aim to provide the Stapled Security Holders
with a balanced and understandable assessment of the performance and financial position of
the H-REIT Group, the HBT Group and the Stapled Group, with a commentary at the date of
the announcement of the significant trends and competitive conditions of the industry in which
it operates.
For the financial year under review, the CEO and the Chief Financial Officer ("
CFO
") provided
assurance to the AC on the integrity of the quarterly unaudited financial statements of the
H-REIT Group, the HBT Group and the Stapled Group and the Board in turn provided a negative
assurance confirmation to the Stapled Security Holders in respect of the unaudited financial
statements for the first, second and third quarter in accordance with the regulatory requirements.
The Management provides monthly reports covering H-REIT Group and HBT Group’s financial
performance to all Directors, including the CEO.
Apart from the periodic updates provided by the Management, any member of the H-REIT
Manager Board or HBT Trustee-Manager Board may at any time seek further information from
and discuss the respective operations and performance with the Management.
