The Company is committed to a high standard of corporate governance with a view to assuring the conduct of management of the Company as well as safeguarding the interests of all shareholders. The corporate governance principles of the Company emphasize a quality Board for leadership and control of the Company, effective internal controls, transparency and accountability to all shareholders.
Roles and Responsibilities
The board of directors (the “Board”) assumes responsibility for leadership and control of, and for promoting the success of, the Company by directing and supervising the Group affairs. Principle responsibilities of the Board including, but are not limited to, the following:
- decide or consider matters covering major acquisitions and disposals, appointment of Directors and external auditors, and other significant operational matters.
- monitor and control the Group’s operation and financial performance through the determination of the annual budget and continuous review of performance results.
Each Director has a duty to act in good faith and in the best interests of the Company. The Directors, collectively and individually, are aware of their responsibilities and accountability to shareholders, for the manner in which the affairs of the Company are managed and operated.
Written procedures have been formally adopted in order to govern the delegation of daily management responsibilities to the senior management of the Group and the reservation to the Board of specifically identified matters. The procedures are reviewed by the Board periodically.
As at the date of this report, the Board consists of six Group Executive Directors, one Non-executive Director and four Independent Non-executive Directors. The composition of the Board of the Company is as follows:-
Group Executive Directors
Mr Horst Julius Pudwill (Chairman)
Prof Roy Chi Ping Chung JP (Vice Chairman)
Mr Joseph Galli Jr (Chief Executive Officer)
Mr Kin Wah Chan (Operations Director)
Mr Chi Chung Chan (Group Chief Financial Officer)
Mr Stephan Horst Pudwill (President of Strategic Planning)
Mr Vincent Ting Kau Cheung
Independent Non-executive Directors
Mr Christopher Patrick Langley OBE
Mr Joel Arthur Schleicher
Mr Manfred Kuhlmann
Mr Peter David Sullivan
The roles of Chairman and Chief Executive Officer of the Company have been segregated, with a clear division of responsibilities.
The role of Chairman comprises, but is not limited to, the following:
The role of Chief Executive Officer comprises, but is not limited to,the following:
Every Director is aware that, before accepting appointment as a Director, he must be able to give sufficient time and attention to the affairs of the Company.
Orientation which details the duties and responsibilities of directors under the Listing Rules, the Company’s Articles of Association, related ordinances and relevant regulatory requirements of Hong Kong is provided for every newly appointed Director. Presentations are, as necessary, given by senior executives of the Company and external professionals. Training and updates are offered to Directors as necessary to ensure that Directors are aware of the latest changes in the commercial and regulatory environment in which the Company conducts its business. All above-mentioned arrangements aim to assist the relevant Director to discharge his duties to the Company.
Appropriate Directors’ and Officers’ liability insurance cover has also been arranged to indemnify the Directors and Officers of the Group for liabilities arising out of corporate activities. The coverage and the sum insured under the policy are reviewed annually.
All Directors are subject to retirement by rotation at least once every three years pursuant to the Company’s Articles of Association and the Listing Rules. Any Directors appointed to fill a casual vacancy would be subject to election by shareholders at the first general meeting after their appointment. The biographical details and relevant relationships are set out on pages 28 to 31 of this annual report.
All the Independent Non-executive Directors meet the guidelines for assessing independence set out in Rule 3.13 of the Listing Rules. The Company has received an annual confirmation of independence from each of the Independent Non-executive Directors and still considers them to be independent.
The Board has adopted the provisions of the Model Code for Securities Transactions by Directors of Listed Issuers set out in Appendix 10 of the Listing Rules (the “Model Code”). Specific enquiries have been made with all Directors who have confimed that they have fully complied with the required standards as set out in the Model Code during the year ended December 31, 2010.
The Board has also adopted another code of conduct on terms no less onerous than the Model Code that applies to securities transactions of all relevant employees who may be in possession of unpublished price sensitive information in relation to the Company (the “Code for Securities Transactions by Relevant Employees”). No incident of non-compliance was noted by the Company during the year.
Both the Model Code and the Code for Securities Transactions by Relevant Employees have been published on the Company’s
The Board is committed to at least four scheduled meetings in a year and will meet more frequently as and when required. All members of the Board are given complete and reliable information in relation to the affairs of the Group, and receive the support from and access to the Company Secretary of the Company in respect of all meetings of the Board. Each Director is afforded access, on his request, to senior management of the Group and to independent professional advice on performing their duties at the Company’s expense. All Directors receive briefings and professional development training as necessary to ensure a proper understanding of the business of the Group and their responsibilities under statute and at common law.
The Board held six meetings during 2010. Attendance records of each Director are set out in the section “Board and Board Committee Meetings in 2010″ at the end of this report. The meeting agenda is set by the Chairman in consultation with members of the Board.
Minutes of the Board and Board Committee meetings with sufficient details of matters and concerns discussed are kept in safe custody by the Company Secretary of the Company, are sent to the Directors for record and are open for inspection by the Directors.
Proposed Board and Board Committee meeting dates for 2011 have been agreed in the last Board meeting held in 2010 to facilitate maximum attendance of Directors.
The Board has delegated various responsibilities to an Audit Committee, a Nomination Committee and a Remuneration Committee. Each of these committees has specific written terms of reference which deal clearly with their authority and duties, which have been published on the Company’s website (www.ttigroup.com). Other than the Nomination Committee, the majority of the members of each committee are Independent Nonexecutive Directors. This ensures the independence of views and opinions expressed by the Directors at the respective committee meetings. The committees report back to the Board on their activities and decisions on a regular basis. Attendance records of each Board Committee are set out in the section “Board and Board Committee Meetings in 2010″.
The Audit Committee is comprised of three Independent Nonexecutive Directors and is chaired by Mr Peter David Sullivan with effect from March 24, 2011, with other members being Mr Joel Arthur Schleicher and Mr Manfred Kuhlmann. Mr Christopher Patrick Langley OBE was a member of the Audit Committee until March 24, 2011. The Audit Committee has at all times complied with Rule 3.21 of the Listing Rules with a minimum of three members and each member of the Audit Committee has professional, financial, or accounting qualifications as required under the Listing Rules.
The main objectives of the Audit Committee is to ensure the effectiveness of the internal control system and compliance with the Group’s obligations under the Listing Rules and other applicable laws and regulations and to oversee the integrity of the financial statements of the Company.
The Audit Committee is also directly responsible on behalf of the Board for (i) the selection, oversight and remuneration of the Company’s external auditor, (ii) the assessment of the independence and qualifications of the external auditor, (iii) the
oversight of the performance of the Company’s external auditor and (iv) the maintenance of an appropriate relationship with the external auditor.
The Audit Committee held four meetings during 2010 to review with the Group Chief Financial Officer, other senior management and the external auditors, the Group’s significant financial matters, internal controls, the Company’s accounting principles and practices, risk management, financial reporting matters and findings of internal and external auditors.
The Nomination Committee is comprised of four members, and is chaired by Mr Horst Julius Pudwill (Chairman), with the other members being Mr Vincent Ting Kau Cheung (Non-executive Director), Mr Christopher Patrick Langley OBE and Mr Manfred Kuhlmann.
The main role and function of the Nomination Committee is to ensure a fair and transparent process of Board appointments, and in particular to assist the Board to identify suitable candidates and make recommendations for consideration of the Board and shareholders. Criteria of selecting and nominating of directors including, among other things, appropriate professional knowledge and industry experience, personal ethics, integrity and personal skills, and the ability to commit the appropriate time to the Board, are set out in a written policy for the Nomination Committee to adopt when considering nominating a potential candidate to the Board. The Nomination Committee also assesses the independence of the Independent Non-executive Directors.
The Nomination Committee held two meetings during 2010. The work performed by the Nomination Committee during 2010 included:
- review of the existing Nomination Policy
- recommendation to the Board about the re-election of retiring Directors at the 2010 Annual General Meeting
- review of the structure, size and composition of the Board of Directors of the Company
The Remuneration Committee is comprised of five members, and is chaired by Mr Vincent Ting Kau Cheung (Non-executive Director), with the other members being Mr Christopher Patrick Langley OBE, Mr Manfred Kuhlmann, Mr Joel Arthur Schleicher and Mr Peter David Sullivan.
The objectives of the Remuneration Committee is to assist the Board in developing and administering a fair and transparent procedure for setting policy on the overall human resources strategy of the Group and the remuneration of Directors and senior management of the Group, and for determining their remuneration packages, on the basis of their merit, qualifications, and competence, and having regard to the Company’s operating results, individual performance, and comparable market statistics.
The Remuneration Committee held two meetings during 2010. The Remuneration Committee, among other things, reviewed the existing Remuneration Policy during 2010.
The Board acknowledges its responsibility for overseeing the preparation of the accounts of the Group which give a true and fair view of the Group’s state of affairs, results and cash flows for the year.
The Board will present a balanced, clear and understandable assessment of annual and interim reports, other price-sensitive announcements and other financial disclosures required under the Listing Rules, and reports to the regulators as well as information required to be disclosed pursuant to statutory requirements.
The Board is responsible for the effectiveness of the Group’s internal controls and approving and reviewing key internal control policies including delegated authorities, policy on market disclosure and investor relations, non-audit services and treasury management policy. In year ended December 31, 2010, the Board has reviewed the internal control systems of the Group. An internal control system is designed to provide reasonable, but not absolute assurance that material misstatement or loss can be avoided, and to manage and minimize risks of failure in operational systems.
The Board, and in particular the Audit Committee, conducts a continuous review of the effectiveness of the Group’s system of internal control that have been put in place. The reviews performed in 2010 included:
- The organization structure and delegated authorities
- The performance and adequacy of accounting and information systems
- The risk management process including formal risk assessment at the enterprise level
- The risk management functions and their performance indicators including discussions with senior management
responsible for day-to-day management of significant risks
- The effectiveness of the Company’s procedures relating to statutory and regulatory compliance
- The scope and quality of management’s ongoing monitoring of risks and system of internal control
The external auditors of the Group is Deloitte Touche Tohmatsu, and in 2010, Deloitte Touche Tohmatsu provided the following audit and non-audit services to the Group:
|Nature of Services||Amount (HK$ million)|
|External Audit Services||20.7|
|Taxation Consultancy Services||0.9|
|Other Consultancy Services||0.1|
The other services provided by Deloitte Touche Tohmatsu comprised professional services conducted under the terms of specified engagements.
To ensure the independence of the external auditors, the nature and ratio of annual fees to external auditors for audit services and non-audit services are subject to scrutiny by the Audit Committee. All non-audit services from external auditors are regulated by a Policy on Non-Audit Services published on the Company’s website (www.ttigroup.com).
To enhance independent reporting by external auditors of the Group, the Independent Non-executive Directors and the external auditors of the Group meet without the presence of the management of the Group every year.
The Company understands the importance of maintaining effective communication with its shareholders and investors. The Company holds regular meetings with institutional shareholders and analysts and encourages shareholders to attend the Annual General Meeting to communicate with Directors and managements of the Company directly.
The Company’s website (www.ttigroup.com) contains all of the Company’s circulars, announcements, notices and results of general meetings, annual and interim reports, and webcasts of results presentations at press conference which provides timely, efficient and accurate information to the shareholders and investors.
A Policy on Market Disclosure, Investor and Media Relations, published on the Company’s website (www.ttigroup.com), ensures that the Company complies with its disclosure obligations under the Listing Rules and other applicable laws and regulations, and that all shareholders and potential investors have an equal opportunity to receive and obtain externally available information issued by the Company.
The Company values feedback from shareholders on its efforts to promote transparency and foster investor relationships. Comments and suggestions are welcome and can be addressed to Investor Relations and Communication by mail or by email to the Company at firstname.lastname@example.org.
A summary of attendance of Board and Committee meetings in 2010are detailed in the following table:
|Meetings attended / Held in 2010|
|Number of meetings held during the year||6||4||2||2|
|Group Executive Directors|
|Mr Horst Julius Pudwill||6/6||2/2|
|Prof Roy Chi Ping Chung JP||5/6|
|Mr Joseph Galli Jr||6/6|
|Mr Kin Wah Chan||6/6|
|Mr Chi Chung Chan||6/6|
|Mr Stephan Horst Pudwill||6/6|
Mr Vincent Ting Kau Cheung
|Independent Non-executive Directors|
|Mr Joel Arthur Schleicher||6/6||4/4||2/2|
|Mr Christopher Patrick Langley OBE||6/6||4/4(1)||2/2||2/2|
|Mr Manfred Kuhlmann||6/6||4/4||2/2||2/2|
|Mr Peter David Sullivan||5/6||4/4||2/2|
|Dates of meetings||January 8, 2010||April 14, 2010||April 15, 2010||April 15, 2010|
|March 4, 2010||May 27, 2010||August 18, 2010||August 18, 2010|
|April 16, 2010||August 17, 2010|
|May 27, 2010||December 16, 2010|
|August 19, 2010|
|October 21, 2010|
(1) Mr Christopher Patrick Langley OBE ceased to be a member of the Audit Committee on March 24, 2011.