KENANGA ANNUAL REPORT 2017

STRENGTHENING ETHICS AND COMPLIANCE THROUGH EDUCATION AND AWARENESS Throughout the year, GRCS has propelled to strengthen the ethical and compliance values within the Group through various engagements and learning programmes involving all levels of employees. These initiatives extend outside of the customary education and awareness programmes conducted by GRCS. • Annual Regulatory Seminar 2017 The second Annual Regulatory Seminar held under the theme Embracing the Regulatory Landscape was approved by the Securities Industry Development Corporation (“ SIDC ”) as part of the Continuing Professional Education (“ CPE ”) programme for KIBB Group with the allocation of ten (10) CPE points. The Seminar was designed to provide the latest updates, developments and trends in legal and regulatory landscape and their impact to the Investment Banking business for attention of the members of the Board of Directors, Senior Management, Heads of Division and Department as well as Heads of Branch. In all, there was a total of one hundred and fourteen (114) present. Speakers to the one (1) day Seminar included representatives from the SC and Securities Industry Dispute Resolution Centre (“ SIDREC ”) who have provided meaningful insights of the SC’s regulatory expectations and SIDREC’s role in dispute resolution. • Fraud Awareness Campaign 2017 Towards achieving KIBB Group’s commitment to raise awareness on fraud offence and the strategy applied to create an anti-fraud culture within the Group, GRCS has organised a six (6)-week long duration of Fraud Awareness Campaign with events ranging from discussions, talks by distinguished speakers as well as fun-filled activities incorporating anti-fraud learning elements for all employees. The Campaign reached its peak with the Group’s Fraud Awareness Week (“ FAW ”) running from 13 November until 17 November 2017 coinciding with the International FAW organised by the Association of Certified Fraud Examiners (“ ACFE ”). The Opening Ceremony of the Group’s FAW was attended by the Chief Executive Officer of SIDC, Partnership Manager of Asia Pacific–ACFE, President and Chief Executive Officer of Institut Integriti Malaysia, Chief Regulatory Officer of Bursa Malaysia Berhad and Executive Director of Malaysian Investment Banking Association. Our participation in the FAW demarcated a visible statement in the commitment to prevent fraud hence bolster investors, regulators and the general public confidence vis-à-vis the Group’s integrity. With this initiative, we hope to portray a proactive role as an anti-fraud professional, which would initiate discussions amongst the capital markets participants and financial industry at large on the importance of fraud prevention to the society. MAINTAINING A HIGH LEVEL CORPORATE GOVERNANCE With a series of corporate governance codes and guidelines issued in recent years by the regulators and authorities to improve best practices aimed at strengthening Malaysian corporate culture, we have taken steps to drive and transform our corporate culture to be in line with these changes and standards: • Policy Document on Corporate Governance issued by BNM effective 3 August 2016; • Malaysian Code on Corporate Governance 2017 issued by the SC effective 26 April 2017; and • Third (3 rd ) edition of the Corporate Governance Guide issued by Bursa Malaysia Berhad on 14 December 2017. With regard to BNM’s Policy Document on Corporate Governance, GRCS in collaboration with Group Human Resource, has conducted a gap analysis on KIBB’s corporate governance standards and practices, Board operations, as well as remuneration framework. Arising from the gap analysis, certain action plans have been implemented, thus enhancing KIBB’s status of compliance to the eighty-one (81) standards stipulated in the Policy Document on Corporate Governance from 84% to 87%. The balance of the standards is on track for implementation in accordance with the timeline set by BNM. Kenanga Investment Bank Berhad 54 ethics and compliance statement