KENANGA ANNUAL REPORT 2020

62 3 1 2 4 5 6 7 HOW WE ARE GOVERNED WHERE WE STAND Over the years, Kenanga Investment Bank Berhad ( “KIBB” ) and Its Group of Companies ( “Kenanga Group” or “the Group” ) have consistently made its stand and position in relation to good corporate governance abundantly clear, in not only what we say, but also in what we do. Kenanga Group’s commitment to compliance, ethics and integrity continued to be evident in the year 2020 despite the wave of changes the COVID-19 pandemic brought and the many challenges that camewith it for most. In this regard, KenangaGroup was well positioned to embrace the transformation necessary in furtherance to its digital strategy. In addition, Kenanga Group’s long-standing emphasis on raising awareness and instilling a culture of compliance complemented these initiatives. In 2020, as majority of employees shifted to working from home, Kenanga Group continued its commitment to ensuring that its clients and stakeholders were served and engaged while our values of ethics and integrity in our business and operations remain a priority. WHAT WE DO AND OUR STRUCTURE Group Regulatory and Corporate Services ( “GRCS” ) carries out the fundamental role of advocating that the compliance philosophy which is fortified by principles and standards of ethics and integrity is adopted all across Kenanga Group. In the continuous efforts of doing so, GRCS provides support to the various departments, divisions and subsidiaries within Kenanga Group towards ensuring that the business and operations are conducted in line with good corporate governance. GRCS consists of the following six (6) departments which cohesively functions to ensure the roles and functions of GRCS are executed timely: • Group Compliance; • Group Financial Crime Intelligence; • Group Prudential Supervision and Regulatory Affairs; • Group Legal; • Group Company Secretarial; and • Group Business Ethics and Integrity ( “GBEI” ). Each department collectively serves to counsel on and steer Kenanga Group’s business and operational entities to adhere to the applicable laws, regulations and guidelines issued by regulators, and policies, procedures and controls adopted internally. GRCS reports directly to the Board of Directors ( “Board” ) of KIBB considering the significant nature of the role and functions GRCS performs. This will ensure proper and adequate oversight in relation to the matters GRCS oversees. FURTHER DEVELOPING AND ENHANCING THE ETHICS AND INTEGRITY FRAMEWORK GRCS executed various programs in line with the philosophy of good corporate governance in the interest of Kenanga Group and all it clients and stakeholders. These programs encapsulated diverse areas, emphasising on a holistic and an all-inclusive approach. As was in the previous years, the endeavours by GRCS in 2020 received the full support of the Board of Directors and the Senior Management. It is evident that both the Board of Directors and Senior Management appreciate and recognise that there should not be any compromise on standards of compliance, ethics and integrity notwithstanding the changes adopted within Kenanga Group to comply with the standard operating procedures in light of COVID-19. • Compliance with the Guidelines on Adequate Procedures Section 17A of the Malaysian Anti-Corruption Commission Act 2009 ( “MACCA” ) was made effective on 1 June 2020 and GRCS, with GBEI taking the lead, continued with the measures that were first initiated in 2019 to ensure Kenanga Group’s compliance with the said provision that imposes ‘corporate liability’ on corrupt acts. One of the fundamental measures that was taken was to assess and engage the various departments, divisions and subsidiaries across Kenanga Group towards complying with requirements as stipulated under Guidelines on Adequate Procedures that was issued pursuant to section 17A(5) of the MACCA ( “Guidelines” ). In this regard, a total of 86 requirements were adopted internally based on an extensive jurisdictional benchmark and comparative analysis including references to the 2010 UK Bribery Act Adequate Procedures issued by the Transparency International UK and the ISO 37001 Anti-Bribery Management System published by the International Organization for Standardization as guidance for conduct of assessment. These requirements encapsulated a wide range of key areas and included undertaking the necessary initiatives as control measures in relation to the areas that warrant specific attention. The goal of achieving internal compliant status in respect of all 86 requirements was achieved before section 17A of the MACCA came into effect. ETHI CS AND COMPL IANCE STATEMENT