Annual Report 2020

8. Review and Adopting a Strategic Plan The Board and AC will review the operational and financial performance of AAGB as well as its subsidiaries, joint ventures and associates under the Group on a quarterly basis. Detailed reports on the airline and non-airline investee companies within the Group are tabled for review and deliberation. The Board will assess their performance against budget and the corresponding quarter of the preceding year. Furthermore, the Group’s budget and strategymeeting is chaired by the CEO of AAGB to chart the direction for the current and near-term period ahead. The CEO updates the Board quarterly on progress made in relation to the Group’s business plans, including changes and new initiatives, if any. 9. Remuneration and Succession Planning AAGB places a strong emphasis on the development and growth of its staff, fondly known as Allstars. This is evidenced by AAGB’s continuous commitment in grooming successors across the Group, in the spirit of One AirAsia. There is a Group Talent Policy in place to identify and build a robust Group talent pipeline. Talent reviews are conducted with senior management to map talent needs across the Group’s different locations and identify future leaders. The Group Talent function oversees structured talent entry and development initiatives, including leadership development programmes, coaching, cross-functional and cross-country assignments. Principle B: Effective Audit and Risk Management 1. Audit Committee The AC comprises two (2) Independent Non-Executive Directors and one (1) Non-Independent Non-ExecutiveDirector. It is chaired by Dato’ Mohamed Khadar bin Merican, who is an Independent Non-Executive Director and not the Chairman of the Board. AAGB has a policy which requires a former key audit partner to observe a cooling-off period of at least two (2) years before being appointed as a member of the AC. During the Financial Year, no member of the AC was a former key audit partner. In the annual assessment on the suitability, objectivity and independence of the external auditors, the AC is guided by factors as prescribed under Paragraph 15.21 of the MMLR as well as AAGB’s External Auditor Independence Policy. The composition of the AC is reviewed annually to ensure that the Chairman and members of the AC are financially literate and are able to carry out their duties in accordance with the terms of reference of the AC. The AC members are expected to update their knowledge continuously and enhance their skills. Based on the performance evaluation of the AC for the Financial Year, the Board is satisfied that the Chairman and members of the AC have discharged their responsibilities effectively. The AC’s report is set out on pages 147 to 150 of the Annual Report 2020. 2. Risk Management Committee The RMC of the Company comprises four (4) Non-Executive Directors with a majority of Independent Directors. It is chaired by Dato’ Abdel Aziz @ Abdul Aziz bin Abu Bakar, who is a Non- Independent Non-Executive Director of the Company. The RMC enables the Board to undertake and evaluate key areas of risk exposures. The primary responsibilities of the RMC are as follows: (a) Tooverseeandrecommend theEnterpriseRiskManagement (“ ERM ”) strategies, frameworks and policies of the Group; (b) To implement andmaintain sound ERM frameworks, which identify, assess, manage andmonitor the Group’s strategic, financial, operational and compliance risks; (c) To implement and monitor a Business Continuity Plan with procedures and systems to restore critical business functions in the event of unplanned disaster; and (d) To develop and inculcate a risk awareness culture within the Group. In fulfilling its responsibilities in risk management, the RMC is assisted by the Risk Management Department (“ RMD ”). The Company has established a structured process for risk management and reporting within the ERM Framework as follows: (a) The first line of defence is provided by senior management and business units, which are accountable for identifying and evaluating risks under their respective areas of responsibilities; (b) The second line of defence is provided by the RMD and RMC which are responsible for facilitating and monitoring the risk management process and reporting; and (c) The third line of defence is provided by the Group Internal Audit Department which provides assurance on the effectiveness of the ERM framework. 145 ANNUAL REPORT 2020