CapitaLand Integrated Commercial Trust - Annual Report 2021

from deliberations and abstain from voting on any matters that could potentially give rise to conflict. Accordingly, the foregoing is consistent with the intent of Principle 3 of the Code. Principle 4: Board Membership The Board has a formal and transparent process for the appointment and re-appointment of Directors, taking into account the need for progressive renewal of the Board. With effect from 25 October 2021, it has established the NRC, which makes recommendations to the Board on all appointments to the Board and Board Committees. All Board appointments are made based on merit and approved by the Board. The NRC comprises three non-executive Directors, two of whom (including the chairman of the NRC) are IDs. The NRC has met twice since its establishment in October 2021. The NRC has also reviewed and approved various matters within its remit via circulating papers. Under its terms of reference, the NRC’s scope of duties and responsibilities includes: (a) reviewing and making recommendations to the Board on the structure, size and composition of the Board and its Board Committees and formulating succession plans for Directors; (b) reviewing the performance of the Board, Board Committees and individual Directors and the results of such evaluation annually; (c) considering annually and, as and when circumstances require, if a Director is independent; and (d) considering and making recommendations to the Board on the appointment and re-appointment of Directors. The NRC’s duties and responsibilities in relation to remuneration matters are set out on page 184 of this Annual Report. Board Composition and Renewal The Board, through the NRC, strives to ensure that there is an optimal blend in the Board of backgrounds, experience and knowledge in business and general management, expertise relevant to the CICT Group’s business and track record, and that each Director can bring to the Board an independent and objective perspective to enable balanced and well-considered decisions to be made in the interests of the CICT Group. The Board has a few members who have prior working experience in the sector that CICT operates in. There is a structured process for determining Board composition and for selecting candidates for appointment as Directors. In undertaking its duty of reviewing and making Board appointment recommendations to the Board, the NRC considers different time horizons for purposes of succession planning. The NRC evaluates the Board’s competencies on a long term basis and identifies competencies which may be further strengthened in the long term to achieve CICT’s strategy and objectives. As part of medium-term planning, the NRC seeks to refresh the membership of the Board progressively and in an orderly manner, whilst ensuring continuity and sustainability of corporate performance. The NRC also considers contingency planning to prepare for sudden and unforeseen changes. In reviewing succession plans, the NRC has in mind CICT’s strategic priorities and the factors affecting the long-term success of CICT. Board succession planning takes into account the need to maintain flexibility to effectively address succession planning and to ensure that the Manager continues to attract and retain highly qualified individuals to serve on the Board. The NRC aims to maintain an optimal Board composition by considering the trends affecting CICT, reviewing the skills needed and identifying gaps, including considering whether there is an appropriate level of diversity of thought. The process ensures that the Board composition is such that the Board has capabilities and experience which are aligned with CICT’s strategy and environment, and includes the following considerations: (a) the current size of the Board and Board Committees, composition mix and core competencies, (b) the candidate’s/Director’s independence, in the case of an independent director, (c) the composition requirements for the Board and relevant Board Committees (if the candidate/Director is proposed to be appointed to any Board Committee), and (d) the candidate's/Director's age, gender, track record, experience and capabilities and such other relevant factors as may be determined by the Board, which would provide an appropriate balance and contribute to the collective skills of the Board. Annual Report 2021 181 Corporate Governance