CONFLICT OF INTEREST POLICY
INTRODUCTION
Greater Bay Holdings Berhad (the “Company”) is committed to maintaining the highest of ethical standards and recognises that it must be always seen to be acting in accordance with highest standards of governance. Accordingly, the Company expects all directors, officers, managers, and employees to conduct themselves with integrity, impartiality and professionalism at all times, and to avoid any conflict of interest that may arise in the performance of their duties.
Proper identification and management of conflicts of interest ensures that business decisions are made in the best interests of the Company and the Company is protected from any consequent damage to its activities and reputation.
OBJECTIVES OF THE POLICY
The purpose of this Conflict of Interest Policy (this / the “Policy”) is to ensure that actual, potential and received conflicts of interest are identified and managed effectively.
This Policy applies to all directors, officers, managers, and employees of the Company (the “Relevant Person”). For the purpose of this Policy, employees include employees on contract terms, temporary staff (those on internship or secondment) and consultants engaged by the Company on a full-time basis. This Policy applies whenever an individual recognises, or should reasonably recognise, that a conflict of interest may arise from their current or future activities.
The Policy provides guidance on how to identify and declare all conflicts of interest, how to develop, implement and monitor actions to appropriately manage the conflict, and how to deal with breaches of this Policy. The scope of this Policy is relatively wide in its coverage of activities that may give rise to conflicts of interest. As it is not possible for the Policy to be all inclusive, all Relevant Persons must exercise reasonable judgement and comply with the spirit of this Policy and not just the letter of the Policy.
IDENTIFYING CONFLICTS OF INTEREST
In general, a conflict of interest would arise where a Relevant Person’s ability to perform his/her duties effectively and impartially is potentially impaired by personal interests, considerations, or relationships.
Generally, conflicts of interest may be described under the following broad categories:
Equity ownership in entities having a business relationship with the Company
This is where a Relevant Person holds shares in privately owned entities having a business relationship with the Company, either directly or indirectly (e.g. through a family member). This does not apply to shares held in publicly quoted companies which have a business relationship with the Company, unless such holding is considered to be material and the interest is likely to impair the objectivity of the Relevant Person concerned.
Directorship, partnership or other forms of beneficial interest in entities having a business relationship with the Company
This applies to situations where the Relevant Person holds a position or has an interest in entities having a business relationship with the Company. An example would be where a Relevant Person of the Company is a Director of a company supplying materials or providing services to the Company. Such situations would result in a conflict of interest.
Other employment, business appointments or undertakings
A conflict of interest may arise where the Relevant Person holds other part time employment or have other business appointments or undertakings. The Relevant Person is expected to devote his/her time, attention and commitment during work hours to his/her job duties. A conflict of interest may also arise where participation in any business activity outside working hours demands excessive time and attention from the Relevant Person, thereby depriving the Company of the Relevant Person’s best effort on the job or resulting in a negative impact on performance.
Personal relationships
A conflict of interest would exist if a family member of the Relevant Person has a reporting relationship with the Relevant Person. The Relevant Person should not be in the same department / division as a family member, and should not directly or indirectly supervise, or be in a position to influence the hiring, work assignments or assessments of the family member. A conflict of interest may arise if the Relevant Person has a family member with an interest (e.g. in the form of ownership, directorships, partnerships, employment, etc.) in entities which have a business relationship with the Company. An example would be where the spouse of an employee of the Company is working in a company supplying raw materials to the Company. This also applies to situations where a family member of an employee of the Company is working in a company directly or indirectly competing with the business of the Company.
Contractual dealings with employees
This refers to situations where the Company purchases or leases property, equipment, materials, etc. from the Relevant Person or enters into arrangements (other than employment or service contracts) with the Relevant Person. Such situations may give rise to a conflict of interest and should not occur except in exceptional circumstances where there are no other reasonable alternatives for the procurement of such purchase, property, equipment or material.
Dealings with competitors
If a Relevant Person (or family member of Relevant Person) has financial or other interests or any involvement in the business of a competitor, or holds a directorship in a competitor, such a situation gives rise to a conflict of interest. This does not apply to the holding of publicly quoted shares of competitor companies, unless such holding is considered to be material or substantial, and the interest is likely to impair the objectivity of the Relevant Person concerned.
If a Relevant Person has accepted employment with a competitor, this results in a conflict of interest during the period which the employee is still employed with the Company, especially if the employee is dealing with sensitive or confidential information. As such, the conflict of interest must be declared immediately upon acceptance of employment with the competitor to enable the Company to take the necessary actions to manage the conflict.
Involvement in activities where the Relevant Person concerned is the subject matter
A conflict of interest arises if a Relevant Person participates in activities where he / she is the subject of the discussion or where the decision involves him / her. An example of this situation is where an allegation is made against a Relevant Person through the whistle-blowing channel, and the Relevant Person is part of the team tasked with investigating the allegation.
Acceptance of meals or entertainment
The acceptance of meals or entertainment may affect a Relevant Person’s objectivity and judgement. It is the responsibility the Relevant Person to comply with gift policy as per the Anti-Bribery and Anti-Corruption Policy of the Company.
GENERAL RESPONSIBILITIES
- Comply with this Policy and other applicable policies and guidelines relating to the identification, documentation, escalation and management of conflicts of interest;
- Act with objectivity, integrity and independence, and exercise sound judgement and discretion;
- Avoid, wherever possible, situations giving rise to conflicts of interest as described in this Policy; and
- Notify or declare any conflict of interest (prior to any involvement or decision-making where there may be a conflict of interest) to the head of department (“HOD”), senior management (i.e. general manager), or director(s), in accordance with this Policy.
MANAGING CONFLICTS OF INTEREST
Any conflict of interest must be declared by filling up the Conflict of Interest Declaration Form (the “Form”). A sample of the Form is attached in Appendix 1. The declaration shall be made as and when the conflict arises and shall be made at the earliest opportunity (i.e. as soon as the Relevant Person becomes aware of the conflict).
The completed Form must be submitted to the immediate superior, as dictated below, for further escalation and resolution:
- In case of the HOD, the conflict must be declared to the senior management.
- In the case of senior management, the conflict must be declared and disclosed to the director(s).
- In the case of the director(s), the conflict must be disclosed to the Board of Directors and, where appropriate, duly recorded by the Company Secretary.
In addition to declaring the conflict of interest, appropriate steps must be taken to manage the conflict and to mitigate the impact of the conflict on the decision-making process. Ideally, the conflict should be avoided altogether, e.g. by relinquishing the interest that gives rise to the conflict. However, there are circumstances where it may not be practical to fully avoid the conflict, in which case, appropriate actions must be taken depending on the nature and severity of the conflict.
Where the conflict is not likely to arise frequently, and the impact of the conflict is minimal, the participation of the Relevant Person in the decision-making process may be restricted. Restriction may include, but is not limited to the following:
- Include or defer such decision-making (where conflict may exist) to senior management or director(s) whom have no conflict of interest in the matter.
- Limited participation in the decision-making in the matter (where conflict may exist).
- Limited access to information, sensitive documents or confidential information in the matter.
Where the conflict is on-going and could have serious implications, the person with the conflict should be removed from the process, which includes the following:
- Abstaining from any involvement whatsoever in the matter, including participation, decision-making or voting.
- Rearranging duties and responsibilities to a non-conflicting function but not to a person who is supervised by the Relevant Person with the conflict.
- Transferring the Relevant Person with the conflict to another project or another area of the Company.
MONITORING CONFLICTS OF INTEREST
The executive directors, senior management and HOD of the Company (the “Responsible Person(s)”) are responsible for monitoring conflicts of interest. Upon receiving the Conflict of Interest Declaration Form, the Responsible Person shall review the actions taken to address the conflict and decide, on a case-by-case basis whether such actions are appropriate and / or sufficient.
If the Responsible Person is of the view that actions taken by the person with the conflict or not sufficient to manage or address the conflict, the matter may be escalated upwards – HOD to senior management, senior management to the executive directors, directors to the Board of Directors – further recommendation and action.
In the event of a dispute between the Relevant Person with the conflict or his/her HOD or senior management, the matter may be esclated directly to the executive directors for a decision to be made. The Board of Directors may be consulted if there are any doubts with regards to a conflict of interest situation.
For conflicts of interest involving employees, Management shall maintain records of all conflict of interest declarations and any related documents regarding conflict of interest (including any mitigating actions taken). For conflicts of interest involving the directors, the Company Secretary shall maintain records of the declarations and any related documents.
BREACH OF POLICY
Failure to disclose a conflict of interest, provide complete and accurate information on the conflict or appropriately manage the conflict is a breach of this Policy and may result in disciplinary action being taken by the Company.