The Board currently comprises 10 Directors. Of the 10, seven are INEDs, two
NINEDs, including the Chairman (representing the interest of Khazanah,)
and one ED, namely the President & Group Chief Executive Officer (GCEO).
INEDs make out more than 50% of the Board composition, exceeding MCCG
2012’s recommendation and the minimum number required under the Main
LR and the Green Book.
The high proportion of INEDs ensure effective check and balance on
the Board with INEDs acting as caretakers for minority shareholders,
providing unbiased perspectives and promoting constructive discussion
of Management’s proposal. The Board also ensures that it has appropriate
mix of diversity (including gender diversity), skills, experience and expertise
to enhance the Board’s decision making capabilities. This is fundamental
given the size and geographical presence of Axiata Group. The breadth of
skillsets and experience of the Board is also instrumental to guide Axiata
through the third phase of its transformation journey focused on redefining
Axiata and shaping the future of telecommunications in the region. More
specifically, putting in place a new growth strategy, driving continuous
business improvements and operating models, and building new and
stronger management teams, to become a ‘New Generation Telco’ by 2020.
A similar Board composition framework for Operating Companies (OpCos)
has been developed and refined over the years to ensure sufficient oversight
and connectivity with the Board, Corporate Centre (CC) and OpCos’ Board
and Management. Consistent with the framework and depending on the
requirements of the OpCos and local regulations, the Boards of major
OpCos, should comprise a maximum of nine members made-up of Axiata
INED, Group Management representatives, OpCos’ Chief Executive Officer
(CEO) and joint venture partners with good mix of skillsets and diversity
covering operations, strategy and finance.
Board Charter
The Board Charter sets out the roles and responsibilities of the Board. Axiata’s
Board Charter, which is periodically reviewed, takes into consideration
all applicable laws, rules and regulations as well as best practices. The
Board Charter covers inter-alia, the objectives of the Board, duties and
responsibilities, powers, roles of the Chairman, President & GCEO and Non-
Executive Directors (NED). It serves as a reference and primary induction
literature, providing Board members and Management insight into the
function of the Board. Board’s specific reserved matters covering areas such
as strategy and business planning, finance and controls, people, compliance,
support and assurance are entrenched in the Board Charter.
Axiata Board Charter is available online at
/
corporate/Board_Charter.pdf
Roles and Responsibilities of the Board
In support of the Board Charter, there is the Limits of Authority (LOA)
document. The LOA serves to optimise operational efficiency and outlines
high level duties and responsibilities of the Board and delegated day-to-day
management of the Company to the President & GCEO. This delegation
structure is further cascaded by the President & GCEO to the Senior
Leadership Team (SLT) within the Company’s CC. The President & GCEO and
the SLT remain accountable to the Board for the authority being delegated.
The LOA is subject to review from time to time and any revision is first tabled
to the BAC for recommendation before seeking the Board’s approval. For
the year 2015, the Board approved the updates and/or revisions to the LOA
covering; inter-alia, procurement, Information Asset Management, taxation,
secretarial, treasury (including Group Treasury Policy), human resources,
strategic business planning, legal and finance and controls.
The following paragraphs describe how the Board of Directors of Axiata
have discharged its key fiduciary duties and leadership functions and
responsibilities in 2015:-
i) Review and Approve Strategic and Annual Business Plan and
Budget
The Board plays a key and active role in the formulation and
development of the Company’s strategy. Annually, two off-site or
retreat sessions are held for discussions on key strategies and proposed
business plans for the following year. At the mid-year Board Strategy
Retreat in June 2015, the Board focused on Axiata’s Long Range Plan
covering four main areas crucial to Axiata’s future; namely, mobile data
leadership, digital services, convergence and financials. Discussions
during the mid-year retreat set the tone and provided direction in the
formulation of the Company’s strategy and business plans.
At the year-end Board Strategy Retreat in November 2015, the
proposedbusiness plan andbudgetwerepresentedby theManagement
of Axiata and the major OpCos. In this session, the Board deliberated
in detail on the Group’s annual strategy and business plan and provided
their feedback and guidance before subsequent approval was sought.
ii) Overseeing Conduct of Company’s Business
On a quarterly basis, execution of annual strategy and challenges
thereof are reported to the Board. Progress is monitored against the
agreed KPIs approved by the Board. Major OpCos are also invited to
present their performance on a rotational basis. This enables the Board
to receive first hand updates from the Management of the respective
major OpCos on their performance, key developments and/or issues
and prospects.
iii) Succession Planning
The Board through the BNC reviews candidates for key management
positions and formulates nomination, selection and succession policies
for members of the Board and the Group’s key management personnel.
The Board then deliberates on the BNC’s recommendations and pro-
actively provides guidance on talent management and succession
planning. In depth discussions on talent management and succession
planning are scheduled twice yearly in the Annual Board Meeting
Calendar and in 2015 were discussed in August and November.
Board succession planning occupied a lot of Board’s time in 2015, with
four of Axiata’s INEDs reaching the nine year mark in 2017. Replacing
all four Directors at the same time could be disruptive, therefore, a
structured and phased retirement plan was adopted by the Board
to ensure a smooth transition and continuity. One or two INEDs per
year will be refreshed in 2016-2018. The BNC has also endorsed the
appointment of a recruitment firm to look into potential candidates
axiata group berhad | annual report 2015
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