The structure and composition of the Board comply with the requirements of the Code, Revised BNM/GP1, Bursa Securities Listing Requirements and in particular the “Green Book on Enhancing Board Effectiveness” (Green Book) as part of the Government Linked Companies (GLC) Transformation Programme initiated by the Putrajaya Committee on GLC High Performance framework.

The Board comprises 10 members, with 2 Executive Directors and 8 Non-Executive Directors. Of the 8 Non-Executive Directors, 5 are Independent Directors. The Independent Directors constitute 50% of the Board composition, ensuring the required check and balance for making the Board independent, able and competent in discharging its duties and responsibilities. This balance between Independent and Non-Independent Directors acts as a safeguard in ensuring that the interests of the minority shareholders are not compromised.

Both the Board size and composition also meet the recommendations of the GLC Green Book and serves as a foundation for an effective and high performing Board to lead and control the Group.

The Code of Ethics as set out in the BNM/GP7 Guidelines on the Code of Conduct for Directors, Officers and Employees in the Banking Industry, the Companies Act 1965 and the Code of Ethics for Company Directors issued by the Companies Commission of Malaysia are constantly adhered to by the Directors of the Group. Amongst others, a Director must act with utmost good faith towards the company in any transaction and act honestly and responsibly in the exercise of his powers in discharging his duties.

The Board is the ultimate decision-making body of BCHB, except with respect to matters reserved for shareholders. It acts as an advisor to Management and defines and enforces standards of accountability, all with a view to enabling Management to execute its responsibilities effectively.

The duties and responsibilities of the Chairman and the Group MD/CEO are distinct and separate. The Chairman leads and oversees the Board and presides at all meetings of the Board and shareholders. The Chairman facilitates the flow of information between Management and the Board, and in consultation with Management, sets the agenda for each Board meeting. The Group MD/CEO leads BCHB's management and is accountable to the Board and ultimately to shareholders. The Group MD/CEO is primarily responsible for the day-to-day operations of BCHB’s business, strategic planning, budgeting, financial reporting and risk management.

The appointment and re-appointment of Directors in the Group are under the purview of the Nomination and Remuneration Committee, which is responsible for assessing and recommending the nomination of Directors to the respective Boards of the Group. This process is undertaken through a comprehensive evaluation of the skills, knowledge and experience of the Directors before a recommendation for the nomination to the respective Boards is made. In the case of Directors of the Boards of the Financial Institutions within the Group, BNM’s approval is sought prior to such appointment and/or re-appointment.

The Directors of the Group have met the criteria for appointment of Directors as set out by the Revised BNM/GP1 and the Bursa Securities Listing Requirements. All Independent Directors act independently of mind and in appearance, from Management, and do not participate in any business transaction that may impair their independent judgment and decision-making.

In accordance with the Revised BNM/GP1 and Bursa Securities Listing Requirements, Directors do not hold more than 10 directorships in listed companies and not more than 15 in non-listed companies. The Directors of BCHB further comply with the GLC Green Book which caps directorships in listed companies to 5 and non-listed companies to 10. The Group MD/CEO also complies with the Revised BNM/GP1 requirements which limit his directorships to not more than 5 in the Group. The list of directorships of Directors is submitted and confirmed by each Director and is presented to the Board on a quarterly basis.

The Board is kept abreast with various information on the business of the Group through regular Board meetings as well as the dissemination of pertinent reports. Board Meetings are conducted based on a structured agenda. The Board meets to discuss and determine the strategic business direction and is apprised of the financial performance of the Group. In addition, various reports from Board Committees are presented for the Board’s information by the respective Committees’ Chairmen. At the end of every quarter, the Board reviews and approves the Group’s quarterly results together with the release of the announcement to Bursa Securities, reviews Directors’ training programmes and Directors’ disclosures of directorships and shareholdings. Urgent or important business issues that affect the Group are deliberated and approved as and when required via Special Meetings. All deliberations at Board meetings, including dissenting views, are duly minuted as true records of the proceedings. The draft minutes are circulated to the Board Members prior to for their review and comments prior to the finalisation. Once confirmed, the minutes are signed by the Chairman of the meeting in accordance with the provisions of Section 156 of the Companies Act, 1965.

In line with the GLC Green Book, the Board meeting papers are targetted for dissemination to the Directors at least 7 days prior to the Board meetings to facilitate the Directors in discharging their duties effectively.

At the Board meetings, the Group MD/CEO provides comprehensive explanation of significant issues relating to the Group’s business while the Chief Financial Officer presents updates on the Group’s financial performance. The Chairman of the Audit Committee provides a summary of the audit reports deliberated at AC meetings for the Board’s notation. Significant audit findings by the Group Internal Audit Division are also escalated to the Board. In addition, the Head of Group Compliance reports the status of legal and regulatory compliance for all the operating entities in the Group, while the Head of Group Risk Management briefs the Board on the risk positions of the various activities undertaken by the Group. Any Director who has interest in any proposal or transaction recommended by Management is duty bound to declare his interest and abstains from deliberation and decision of the proposal. This process is duly recorded in the minutes of the proceedings.

Information on the Group is fully accessible by all Directors through the management team and the Company Secretary. Members of senior management are occasionally invited to attend Board meetings to present proposals relating to their respective businesses and operations, while the Company Secretary serves and advises the Board on matters relating to the affairs of the Board, including changes in statutory and regulatory requirements, compliance with requirements on training, quorum and attendance at Board meetings, and closed periods for dealing in securities.

There were 13 Board meetings held in 2008 and Directors’ attendance at meetings held in 2008 are as follows:

Directors’ training is an ongoing process to enhance Directors’ knowledge on the latest developments and key challenges in the financial sector, both in Malaysia and globally. Directors are encouraged to attend training programmes as well as conferences and seminars which are organised internally and by external parties. Whenever required, specific training programmes are arranged for Directors to facilitate them in discharging their duties.

New Directors are introduced to the Group’s business via an induction programme organised by Management. Heads of Divisions brief new Directors on their respective areas of responsibility to equip the Directors with the background knowledge of the Group as well as to provide them with a platform to establish initial interaction with Management. On a yearly basis, the Directors are also invited to attend the Group’s Annual Management Dialogue where the senior management brainstorm and discuss the current trends and future direction of the Group.

All Directors have attended the Mandatory Accreditation Programme as required by Bursa Securities Listing Requirements.

The level of remuneration of the Directors is sufficient to attract and retain Directors in the Group. The Nomination and Remuneration Committee has established the remuneration framework of Directors and key senior management of the Group. This includes fees and meeting allowances for Non-Executive Directors which are based on industry standards and set by reference to the responsibilities taken on by them. In order that it remains competitive and consistent with the culture, objective and strategy of the Group, the compensation framework of Non-Executive Directors are reviewed periodically to ensure that they remain market-competitive. The compensation packages of the Group MD/CEO and key senior management are based on KPIs that are linked to the Group’s and the individual’s performance.

External advisers or consultants may be engaged by the Nomination and Remuneration Committee to advise on specific areas where necessary. Remuneration of the Directors in office during the financial year is also disclosed in the Group’s Financial Statements.