The Board recognises the importance of good corporate governance and supports the principles and best practices promulgated in the Malaysian Code of Corporate Governance ('the Code') to enhance business prosperity and maximise shareholders' value. As such the Board places priority on implementing a high standard of corporate governance and plays a primary role in ensuring that good corporate governance is being practiced. Set out herewith are the corporate governance practices that were in place during the financial year ended 30 June 2006:-

A. BOARD OF DIRECTORS

(i) Duties of Board of Directors

The Board of RB Land Holdings Berhad takes full responsibility for the performance of the Group. The Board guides the Company on its short and long term goals, providing advice and devising strategies on management and business development issues while providing balance to the management of the Company. The Board is responsible for the following:-

• Reviewing and adopting a strategic plan for the Group;
• Overseeing the conduct of the Company's business to evaluate whether the business is being properly managed;
• Identify principal risk and ensure the implementation of appropriate systems to manage these risks;
• Succession planning, including appointing, training, fixing the compensation of and where appropriate, replacing senior management;
• Developing and implementing an investor relations programme or shareholder communications policy for the Company; and
• Reviewing the adequacy and the integrity of the Company's internal control systems and management information systems, including systems for compliance with applicable laws, regulations, rules, directives and guidelines.

(ii) Board Composition

For the financial year ended 30 June 2006, the Board had a composition of 6 Directors comprising:-

• One Executive Chairman,
• One Executive Director,
• One Non-Independent Non-Executive Director; and
• Three Independent Non-Executive Directors

The Directors are professionals in the fields of property development, engineering, finance, business management and experienced senior civil administrators. The information of all the Directors is set out on pages 15 to 17 of RB Land Holdings Annual Report 2006.

The Executive Chairman is primarily responsible for the orderly conduct and working of the Board, for the day to day running of the business and implementation of Board policies, strategies and decisions. He is assisted by the Executive Director in fulfilling some of these roles.

The Non-Executive Directors bring a wide range of business experience and expertise to the Board's discussion and decision-making. Independent Non-Executive Directors who are independent of the management and free from any business or other relationship that could materially interfere with the exercise of their independent judgment represents more than one third of the Board.

The Board held four meetings during the financial year to control and monitor the development of the Group. Besides Board meetings, the Board also exercises control on matters that require Board's approval through circulation of Directors' Resolutions.

In order to enable the Board to act effectively the Audit Committee was established.

In relation to the two other committees proposed by the Code on Corporate Governance, the Remuneration Committee and the Nomination Committee, the Board due to its small size has decided to put in place other measures and controls to give effect to the purpose of this two other committees. It shall continuously review the necessity of the formation of the two committees.

a. Directors Remuneration

The Board, half of which comprise of Independent Non-Executive members, will be directly responsible for setting the policy framework and for making recommendations to the Board on remuneration packages and benefits extended to the Executive Directors with a view to attract, retain and motivate them. Remuneration package of Non-Executive Directors will be a matter to be decided by the Board as a whole with the Director concerned abstaining from deliberations and voting on decisions in respect of his individual remuneration.

Directors’ fees paid to Directors during the financial year would have to be approved by the shareholders at the Annual General Meeting. Listed herewith is the breakdown of the fees paid to the Directors and the salary/emoluments paid to the Executive Chairman and Executive Director.

REMUNERATION RECEIVED BY THE DIRECTORS OF COMPANY FROM THE RB LAND HOLDINGS BERHAD GROUP FOR THE FINANCIAL YEAR ENDED 30 JUNE 2006

SALARY BAND	EXECUTIVE DIRECTORS	NON-EXECUTIVE DIRECTOR
(RM)	(Number of Directors)	(Number of Directors)
Less than 50,000	–	4
50,001 - 100,000	–	–
100,001 - 150,000	–	–
150,001 - 200,000	–	–
200,001 - 250,000	–
250,001 - 300,000	1	–
300,001 - 350,000	–	–
350,001 - 400,000	–	–
400,001 - 450,000	–	–
450,001 - 500,000	–	–
500,001 - 550,000	–	–
550,001 - 600,000	–	–
600,001 - 650,000	1	–
650,001 - 700,000	–	–

 

			OTHER EMOLUMENTS
	FEES	SALARY	(BONUS, BENEFITS IN KIND, ETC)
	(RM)	(RM)	(RM)
Executives	–	531,600	340,590
Non-Executives	54,000	–	–

For security and confidentiality reasons, the details of Directors' remuneration are not disclosed with reference to Directors individually.

b. Nomination of Directors

The Board will be directly responsible for making recommendations for any appointments to the Board. In making these recommendations the Board will consider the required mix of skills, expertise and experience of each candidate.

(iii) Re-election of Directors

One third of the Board members (including the Executive Chairman) are required to retire at least once in every three years at the Annual General Meeting and be subject to re-election by shareholders. Newly appointed Directors shall hold office until the next following Annual General Meeting and shall then be eligible for re-election by shareholders.

The Articles of Association has been amended to provide for all Directors to submit themselves for re-election by shareholders at least once in every three years. All current serving 6 Directors will, by the coming Annual General Meeting, have presented themselves for re-election at least once over the past 2 years.

(iv) Directors' Access to Information and Advice

The Board members have access to the advice and services of the Company Secretary and all information in relation to the Group whether as a full Board or in their individual capacity to assist them in the furtherance of their duties. Where necessary, the Directors may engage independent professionals at the Group's expense on specialised issues to enable the Board to discharge their duties with adequate knowledge on the matters being deliberated.

(v) Directors' Training

The Group acknowledges the fact that continuous education is vital for the Board members to gain insight into the state of economy, technological advances in our core businesses, latest regulatory developments and management strategies. Therefore, the Directors are encouraged to evaluate their own training needs on a continuous process and to determine the relevant programmes, seminars and briefings that would enhance their knowledge to enable the Directors to discharge their responsibilities more effectively. All of the Directors
have attended the Directors' Mandatory Accreditation Programme prescribed by Bursa Securities. During the financial year ended 30 June 2006, the Directors had attended a specially arranged full day briefing entitled “New Wave of Change in Financial Reporting Standards” conducted by BDO Binder.

B. BOARD COMMITTEES

(i) Audit Committee

The terms of reference of the Audit Committee and the Report of the Audit Committee comprising the following are set out on pages 19 to 21 of RB Land Holdings Annual Report 2006.

• Composition of Audit Committee
• Terms of Reference of Audit Committee
• Number of Audit Committee Meeting held during the financial year
• Summary of activities of the Audit Committee in discharge of its function during the financial year
• The existence of an Internal Audit Function

C. SHAREHOLDERS' COMMUNICATION AND INVESTOR RELATIONS POLICY

The annual report, announcements through the Bursa Securities, circulars are the substantial means of communicating with all the shareholders.

All queries from shareholders and members of public received through e-mails, phone calls or written requests are handled by the Corporate Services Department who reports directly to the Executive Director and Executive Chairman.

The Annual General Meeting and Extraordinary General Meetings are major opportunities to meet individual shareholders, to encourage shareholders to participate through questions on the progress and performance of the Group and to talk to them informally before and after meeting.

Shareholders and members of public are invited to access the Bursa Securities' website at announcements.bursamalaysia.com to obtain the latest information of the Group.

D. ACCOUNTABILITY AND AUDIT

(i) Internal Control

The Board acknowledges its responsibility for establishing a sound system of internal control to safeguard shareholders' investment and Group's assets, and to provide reasonable assurances on the reliability of the financial statements. In addition, equal priority is given to internal control of its business management and operational techniques. While the internal control system is devised to cater for particular needs of the Group and the risk which it is exposed, such controls by their nature can only provide reasonable assurance but not absolute assurance against material misstatement or loss.

(ii) Financial Reporting

In presenting the annual financial statements and quarterly financial announcements of its results, the Board of Directors has ensured that the financial statements present a balanced and understandable assessment of the Company and Group's position and prospects.

The Responsibility Statement by the Directors pursuant to the Bursa Securities' Listing Requirements is set out on page 32 of RB Land Holdings Berhad Annual Report 2006.

(iii) Relationship with Auditors

The External Auditors were also invited to brief the Audit Committee on specific issues. The Company maintains a transparent relationship with the auditors in seeking their professional advice and towards ensuring compliance with the accounting standards.

During the financial year under review, as mentioned earlier a professional services firm was appointed as internal auditors to review the key internal control systems of the Group's business activities. This is to assist the Audit Committee and the Board in forming their opinion for the Statement on Internal Control Requirements of the Bursa Securities issued by the Task Force on the Internal Control set up by the Bursa Securities.

COMPLIANCE STATEMENT

The RB Land Holdings Berhad Group has complied substantially with the Best Practices contained in the Code during the financial year ended 30 June 2006.

The Code recommends the appointment of a Senior Independent Non-Executive Director to whom concerns may be directed. The Board has not appointed any Independent Non-Executive Director to fulfil that role, given Independent Non-Executive Directors forms half of the Board composition and they can collectively fulfil this role.

Presently, due to the small size of the Board, the Board has yet to establish a nomination and remuneration committee. These functions are presently being carried out by the Board collectively and it shall continuously review the necessity of the formation of these committees.