ST Engineering Annual Report 2020

CORPORATE GOVERNANCE Independent and Non-Executive Directors Quek See Tiat (Chairman) Song Su-Min Non-Independent and Non-Executive Directors LG Ong Su Kiat Melvyn Quek Gim Pew Non-Independent and Executive Director Vincent Chong Sy Feng For the Board to discharge its duties objectively over risks and internal control, Management of ST Engineering meets with the Board and Board Committees frequently during the year: RSC met 5 times in 2020 a) Sustainability Oversight The RSC oversees the Group’s sustainability matters. Details on sustainability governance can be found in the Sustainability Report on page 75. b) Risk Governance The RSC assists the Board in its risk governance responsibility. RSC’s role is one of oversight of the responsibilities delegated to management to ensure that there is a system of controls in place for identifying and managing risks in order to safeguard stakeholders’ interests and the Company’s assets. The RSC is supported on risk related matters by the Risk and Assurance (R&A) function headed by Head, R&A working with Chief Risk Officers (CROs) of the respective businesses and management team. The R&A function is key to making sure that ST Engineering manages its risks, complies with legal and regulatory requirements where it operates and has the right governance and controls in place. Specifically, the R&A function is to: • work with Management to strengthen in-line controls and governance, risk management and compliance (GRC) culture; • provide assurance to Management that the Group is conducting its business in compliance with all relevant and material regulations, customer requirements and internal procedures; and • ensure continued effectiveness of GRC frameworks, policies and procedures in Singapore and overseas business units. The Head, R&A reports to Group CFO. The R&A function provides leadership in the implementation of a Group- wide Enterprise Risk Management (ERM) framework that allows risks to be identified, assessed, monitored and managed by the business managers. Enterprise Risk Management Framework The Group adopts an ERM framework to identify, assess, monitor and manage key business risks in the short, medium and long term. The ERM framework sets out a common and consistent understanding of risks and risk tolerance limits across the Group. The framework allows the Board and Management to have a shared understanding of the risk philosophy and overall appetite for risk as they establish the strategies and objectives. ACCOUNTABILITY AND AUDIT Risk Management and Internal Controls (Principle 9) The Board is responsible for the governance of risk and ensures that Management maintains a sound system of risk management and internal controls, to safeguard the interests of the Company and its shareholders. The Board received a written assurance from the Group President & CEO and the Group CFO that the financial records have been properly maintained and the financial statements give a true and fair view of the Company's operations and finances. Risk and Sustainability Committee (RSC) is established to ensure the Management has adequate oversight over the awareness and handling of risks and sustainability matters. Risk and Sustainability Committee / ST ENG I NEER I NG 118