Full Report Edit

BKAM3083 PERFORMANCE STRATEGY
Table of Contents
1.0 INTRODUCTION ............................................................................................................................ 2

2.0 OBJECTIVE OF THE STUDY ........................................................................................................ 3
3.0 OVERVIEW OF THE COMPANY ................................................................................................. 4
3.1 DIGI.COM BERHAD ........................................................................................................................ 4
3.2 MAXIS BERHAD ............................................................................................................................. 7
4.0 METHODOLOGY ......................................................................................................................... 12
5.0 ANALYSIS OF FINDINGS ........................................................................................................... 14
CONCLUSION ..................................................................................................................................... 45
REFERENCE........................................................................................................................................ 46
APPENDIX ........................................................................................................................................... 47
1.0 INTRODUCTION
On 29 March 2012, the Securities Commission (SC) released the Malaysian Code on
Corporate Governance 2012 (MCCG 2012), which is the first major deliverable of the
Corporate Governance Blueprint 2011 and supercedes the Malaysian Code on Corporate
Governance 20071. This new code on corporate governance focuses on clarifying the role of
the board in providing leadership, enhancing board effectiveness through strengthening its
composition and reinforcing its independence2. Besides, it sets out broad principles and
specific recommendations on structures and processes which companies should adopt in
making good corporate governance an integral part of their business dealings and culture. It
also encourages companies to put in place corporate disclosure policies that embody
principles of good disclosure. The objective of MCCG 2012 are to achieve excellence in
corporate governance through strengthening self and market discipline and promoting good
compliance in corporate governance culture and focusses on strengthening board structure
and composition.
The MCCG 2012 effective on 31 December 2012 whereas listed companies are required to
report on their compliance with the principles and recommendations of the MCCG 2012 in
their annual reports. Each company needs good corporate governance to ensure reduction of
risk, stimulation of performance, improved access to capital markets, ensure enhancement of
marketabilitu of goods and services, improved leadership and demonstration of transparency
and social accountability.
We will made comparisons of the two non-financial companies in Malaysia. Our group
choose Digi.Com Berhad and Maxis Berhad companies to review the disclosure of corporate
governance. Based on this two firms, we will identify either the companies are compliance or
not in the 8 broad principles followed by 26 corresponding recommendations that has been
stated on MCCG 2012. After that, we select which of the two companies are most comply
towards MCCG 2012. The company that comply most of the disclosure of corporate
governance is the company that have good corporate governance.
PwC Alert: Malaysian Code on Corporate Governance 2012

http://www.sc.com.my/general-section/corporate-governance/
2.0 OBJECTIVE OF THE STUDY
The objective of the study is to identify either the companies have good corporate
governance that ensures the well disclosure by effectively communicates detailed
information.
To classify the key principles of good corporate governance for listed companies
Annual Report towards their compliance accordance the Malaysian Code on
Corporate Governance 2012.
To investigate how far a company is complying with the corporate governance that
have been established.
To identify who is involved in corporate governance.
To view to what extent a company is successful.
3.0 OVERVIEW OF THE COMPANY
3.1 DIGI.COM BERHAD
DiGi.Com Berhad is the third largest mobile operator in Malaysia. Digi is offering mobile
voice, roaming and value-added services on both prepaid and contract bases. Digi is listed on
Bursa Malaysia Securities Berhad on 18 September 2000 and is part of the global
telecommunication provider, Telenor Group. Its mobile service operations are undertaken by
its wholly-owned subsidiary, DiGi Telecommunications Sdn Bhd. Digi commenced
operations in May 1995 when it launched its fully digital GSM1800 services, the first digital
mobile communications service in Malaysia. Digi is a company who providing a
comprehensive range of affordable, convenient and easy to use wireless services to simplify
and enrich the lives of its customers. Digi create value for their customers by selecting the
most appropriate cutting edge technology so that they benefit from products and services that
give them choice, convenience and control. Digi focuses on making it easy, keeping it
relevant and providing the best deals to ensure excellent customer experience in mobile and
internet services.
Besides, Digi provides mobile voice, Internet and digital services to 11 million customers in
Malaysia. Through its mission of 'Internet for All', Digi is committed to driving Malaysia's
growth by building a mobile Internet environment that enables true connectivity, creating
socio-economic development and aiding businesses to prosper. Digi continues to be a gamechanger in the Malaysian telecommunications industry with a solid history of innovative
products and services while being a leader in progressive and responsible business practices.
Digi vision is always 'Changing the Game' by constantly pushing boundaries, defining new
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standards, and ensuring continuous improvements in all parts of our business. Digi core
values is keep promises, make it easy, be respectful and be inspiring3.
In year 2010 annual report have show that Digi total profit for the year end of the 31
December is RM 1,597,248,000. The Digi has been award two merit award in the best
innovation and the best overall winner in Corporate Social Responsibilities categories in the
year 2007. On the year 2009, Digi has been recognized by Wall Street Journal Asia as
Malaysias most admired company for innovation for the third year running. Besides that, the
Asia 200 most admired companies survey named Digi number three in the overall ranking of
Malaysias top 10 companies. For the member of board of director is include three of the
Norwegian which is Jan EdwardThygesen, Hakon Bruaset Kjol and the chairman of Digi.com
Berhad. For the other three Malaysian which is Y.Bhg. Dato Ab Halim Bun Mohyiddin,
Y.Bhg Tan Sri Datu Amar LeoMoggie and Dato Saw Choon Boon.For the management team
for DiGi Malaysia have the HenrikClausen which is the Chief Executive Officer, Khor Choo
Lin for the corporate administration, AlbernMurty for themarketing, Ole Martin Gunhildsbu
for the technology, ZaitonHjIdrus for the corporateaffairs, TerheBorge for the finance,
Christian Thrane for the strategy and business transformation, Chan Nam Kiong for the
customer and channels and the Suriahni Hamidwhich is from the human resource
development.
Digis philosophy for corporate responsibility is to drive sustainability into every aspect of
their organisation in a responsible manner and this includes extending the benefits of their
businessto as many as possible.DiGi are primarily provide variety of mobile communication
services which include prepaidand postpaid plans. Digis customer are in the range of 15 to
65 years old people.DiGi Malaysia headquarters is located at D'House, Lot 10, Jalan Delima
1/1, Subang Hi-TechIndustrial Park, 40000 Shah Alam, Selangor. Digi has also allocate
twenty branches of Digicenter through nationwide.
http://www.digi.com.my/aboutus/corporate_overview/information.do
Vision, Mission and Values
Board of Directors
http://www.digi.com.my/aboutus/corporate_overview/board_of_directors.do
3.2 MAXIS BERHAD
Maxis Berhad is listed on Bursa Malaysia Securities Berhad on 19 November 20095. Maxis
Berhad is a leading communications service provider in Malaysia, enabling both individual
and business customers to connect and communicate anytime, anywhere and from any
device. Maxis has over 14 million service users currently. In 1993, Maxis has obtained
license to run a nationwide GSM 900 mobile network, which is a local fixed network and an
international gateway. Maxis starts its mobile businesses in august 1995 and commenced its
fixed line and international gateway operation in early 1996.
In 1999, Maxis introduced the popular prepaid brand "Hotlink", which currently has 9.5
million customers. In 2002, Maxis purchased Timecel, a rival mobile service provider, from
TimedotCom Berhad. Prior to the purchase, Maxis offered phone numbers beginning with
012, and TimeCell 017. Now, subscribers can choose between the two. On 27 April 2007, an
offer was made to buy out Maxis and privatise the company in preparation for expansions
into the Indonesian and Indian markets. The deal was offered by Ananda Krishnan, who
pledged Maxis RM17.46 billion (US$5.1 billion) in exchange for all remaining shares of the
company. The offer is to be formally made by Usaha Tegas, a company owned by Krishnan,
on 3 May 2007, while the Kuala Lumpur Stock Exchange suspends trading of the company's
shares until 3 May6. Under the urging of Prime Minister Datuk Seri Najib Tun Razak, Maxis
announce that it will re-list the company in Bursa Malaysia on 11 November 20097.
Nowadays, Maxis is providing a full set of services on various platforms to satisfy the
demand of telecommunications for individuals,small enterprises and large organizations, such
as mobile fixed line, prepaid line and internet broadband services. Besides that, Maxis was
http://www.maxis.com.my/en/aboutmaxis/investors/overview.html?icid=maxisbusiness:aboutmaxis:annualreport2013
6
E-Ling, Liaw (30 April 2007). "Malaysia's Maxis Receives Takeover Bid From Parent". The Wall Street Journal.
Retrieved 30 April 2007.
7
http://en.wikipedia.org/wiki/Maxis_Communications
first telecommunication company who launched the 3G services, such as 3G connect Card,
PC Webmail, Video Mail and 3G prepaid. The 3G services coverage is up to 740 sites across
Malaysia and still being increased. The 3G services of Maxis enable the users to enjoy the
internet access throughout Malaysia. In addition, Maxis has the customer service centre
throughout the country, which provide conveniencies to the customers for paying bills,
signing up, and reporting problems.
Maxis high-speed network footprint is the largest in the country that enabling every
Malaysian to enjoy their extensive range of data services such as mobile Internet browsing,
social networking sites, downloading applications as well as a portfolio of integrated mobile,
fixed and enterprise solutions. Beyond connecting people with their services, Maxis are
passionate about making a positive impact to the community in which their operate in.Maxis
Corporate Responsibility efforts aim to develop and enrich their community, customers and
partners, creating a fun place to work and advocating environmentally friendly practices8.
Maxis vision is admired for excellence. The core values of Maxis is positive, passionate and
collaborative.
Chairman of Maxis Berhad is Raja Tan Sri Dato Seri Arshad Bin Raja Tun Uda which also
Independent Non-Executive Director. The others Independent Non-Executive Director is
Robert William Boyle, Dato Mokhzani Bin Mahathir and Hamidah Naziadin. Besides, the
Non- Executive Director is Krishnan Ravi Kumar, Dr. Fahad Hussain S. Mushayt, Dr.
Ibrahim AbdulRahman H. Kadi, Augustus Ralph Marshall, Chan Chee Beng, Alvin Michael
Hew Thai Kheam and Morten Lundal.Maxis Berhad Malaysia headquater is located at Level
8, 10-23, Menara Maxis KLCC, Off Jalan Ampang 50088 Kuala Lumpur.
https://www.linkedin.com/company/maxis-communications-bhd
Visions and Values
http://www.maxis.com.my/en/about-maxis/our-company/vision-and-values.html
Board of Directors
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10
http://www.maxis.com.my/en/about-maxis/our-company/board-of-directors.html
10
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4.0 METHODOLOGY
Data Collection
The Process
We started our project by gaining a deeper understanding for the theories of corporate
governance. We also indirectly learned about how Digi and Maxis implement all the
corporate governances principle in reality. We have done the following step in order to
complete this report:
Choose a topic so as company and have group discussions
Firstly, our group members choose the company that we all are interested in and inform our
lecturer regarding our decision. We have chosen the telecommunication company which is
Digi and Maxis for our project. We choose both companies due to easy access to find
information. It is widely known in Malaysia and due to this matter; we can get a lot of
information regarding our issues. We divided the task equally in order to complete
successfully with the issues stated based on the syllabus. We searched more information and
read about the company detail in the internet to find the whether the company implement the
principle of corporate governance or not?
Make a research on finding the data
Secondly, we as a group has done research on the findings regarding the issues using the
internet sources, journals, articles and related books. We as a team ask the lecturer about
unclear and uncertainty issues and make reviews about the Digi Co. and Maxis Co. We work
as a team in observing and monitor from time to time to make sure that each of our group
members will know what is each member task, how to complete each tasks given, explained
if there are any uncertainty in the tasks given and help in many ways in order to run smoothly
the project.
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Submit a proposal to lecturer

Thirdly, after the discussion regarding the project as a group, we make a proposal regarding
our project and sent it to our lecturer on 15th October 2014.
Find more articles and journals to affirm our research
Moreover, we also find more articles and journals or books that are related with the topic
which is corporate governance in order to support our reseach. All findings were related to
the issues of implimentation the principle that stated in the corporate governance for Digi Co.
and Maxis Co. With these materials, we make it as our references and our guideline in order
to complete our project successfully.
Method of collecting the data
SECONDARY DATA
We used annual report, articles, texts and academic journals written by researchers who have
previously collected relevant information to support their writings, and have credibility in this
discipline .It will enable us to observe different views, some arguing for and against the
materials in order for us to be unbiased in our analysis during the course of this task.
INTERNET
Based on internet, we are searching information through website Digi Co. and Maxis Co. The
Website we visit ishttp://new.digi.com.myandhttp://www.maxis.com.my/
Analysis all data that have been collected
We gather and collect all the informations from our collection about the how far they
implementation of corporate governances principle in both company which is Digi Co. and
Maxis Co. Then, we analyze them in our report. We try to discuss, examine and solve all the
problems that are uncertainty as a group. Lastly, we made a conclusion on our study.
Submit final report to lecturer
Lastly, we combine all the tasks given and prepared the final project for this topic and submit
it to our lecturer on 29th October 2014.
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5.0 ANALYSIS OF FINDINGS
Principle 1: Establish clear roles and responsibilities

1.1) The board should establish clear functions reserved for the board and those delegated
to management.
The respective roles and responsibilities of the board and management should be clearly set
out and understood to ensure accountability of both parties. The board together with the Chief
Executive Officer (CEO) should develop the descriptions for their respective functions. In
addition, the board should develop and agree with the CEO, the corporate objectives, which
include performance targets and long-term goals of the business, to be met by the CEO.
Regular review of the division of responsibilities should be conducted to ensure that the
needs of the company are consistently met.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
The board should establish clear functions reserved for
the board and those delegated to management.
Maxis and Digi were complied with this requirement. Maxis have established clear functions
for the board. The Board of Maxis will be reviewed periodically to ensure that any updates on
relevant laws and regulations are duly incorporated. The Board of Maxis will be reviewing,
adopting and monitoring the implementation of a strategic business plan for the group.
Besides that, the Board of Maxis will be overseeing the conduct of the Groups Business to
evaluate whether the business is being properly managed or not. The Board of Maxis also
will identify principal risks and ensuring the implementation of appropriate systems to
manage and mitigate the risks.
For the Digi, they also have established clear roles and responsibilities of the Board and their
management. The Boards role is to control and provide stewardship of Digis business and
affairs on behalf of shareholders. By pursuing its objective of creating long-term shareholder
14
value, the Board of Digi takes into account the interests of all stakeholders in their decision
making. Beyond the matters reserved for the Boards decision, the Board has delegated the
authority to achieve the corporate objective to the Chief Executive Officer (CEO) in
accordance with the Rules of Procedure for the CEO. The CEO remains accountable to the
Board for the authority that is delegated to him, and for the performance of the Group. The
Board of Digi has monitors the decisions and actions of the CEO, and the performance of the
Group to gain assurance that progress is being made towards the corporate objective, within
the limits it has imposed. The CEO is supported by the DiGi Management Team (DMT)
comprising of 6 members.
1.2) The Board should establish clear roles and responsibilities in discharging its fiduciary
and leadership functions.
The role of the board is to review, challenge and approve managements proposal on a
strategic plan for the company. The board brings objectivity and breadth of judgment to the
strategic planning process as they are not involved in day-to-day management of the business.
The board should satisfy itself that management has taken into account all appropriate
considerations in establishing the strategic plan for the company. The board is also
responsible for monitoring the implementation of the strategic plan by management.
RECOMMENDATION
The
Board
should
establish
clear
roles
DIGI.COM
MAXIS
BERHAD
BERHAD
and
responsibilities in discharging its fiduciary and

leadership functions.
Maxis and Digi were complied with this requirement. For the Maxis Company, there are
several matters they need approval from the Board, except where they are expressly delegated
by the Board to a Committee, the Chairman, Chief Executive Officer (CEO) or another
nominated member of the Management team. For the Digi, The Board plays an active role in
the development of Digis strategy. They also need approval first from the Board before they
are wanted to implement or to do a new strategy for the company.
15
For the Maxis Company, two of the requirements they need approval from the Board is
approval of strategic directions of the company, approval of annual budgets, including major
capital commitments and capital expenditure budgets.
For the Digi Company, two of the requirements are they need approval from the Board is
appointment to the positions of CEO and CFO. They also need approval of strategic,
ambitions and targets from the Board.
1.3) The Board should formalise ethical standards through a code of conduct and ensure
its compliance.
A key role of the board is to establish a corporate culture which engenders ethical conduct
that permeates throughout the company. The board needs to formalise and commit to ethical
values through a code of conduct and ensure the implementation of appropriate internal
systems to support, promote and ensure its compliance. The code of conduct should include
appropriate communication and feedback channels which facilitate whistleblowing. The
board should periodically review the code of conduct. A summary of the code of conduct
should be made available on the corporate website.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
The Board should formalise ethical standards through
a code of conduct and ensure its compliance.
Both companies were complying with this requirement. Both companies were stated that their
ethical standards on their organizations.
Maxis were stated that the Groups Code of Business Practice Declaration which is
periodically reviewed by the Board applies to all Directors and all employees of the Group
who are required to affirm, on a yearly basis, their commitment to observing its prescriptions.
It serves as documentation of the Directors and employees commitment to do business in a
manner that is efficient, ethical, effective and fair, and is meant to be a reference point for all
16
Directors and all levels of employees as well as for all parties that engage in business
dealings with the Group. Maxis also sets out and identify the appropriate communication and
feedback channels which facilitate whistle-blowing. By using whistle-blowing, they can call
or SMS to Ethics hotline number, email to ethics@maxis.com.my, send letters or documents
to the Ethics Hotline Office.
For the Digi, the Board has adopted and implemented a code of conduct which reflects
DiGis vision and core values of integrity, respect, trust and openness. It provides clear
direction on conducting business, interacting with the community, government and business
partners, and general work place behaviour. It also includes guidance on disclosure of
conflict of interests, maintaining confidentiality and disclosure of information, good practices
and internal controls, and the duty to report where there is a breach of the Code. Digi also had
separated to the 5 channels in order for them to conduct of an ethics. Digi was implement the
whistle-blowing policy, supplier conduct principles, anti-corruption policy, trading on insider
information and lastly compliance framework.
Digi established a whistle-blowing policy to provide an avenue for employees, suppliers,

tenants and customers to voice their grievances and raise their concerns about any
malpractices involving Digi without any fear of repercussions. Besides that, The Supplier
Conduct Principles (SCP) outlines the standard for ethical and business conduct expected
of suppliers and contractors in their relationship with Digi. Compliance of the SCP is
monitored through a supply chain management system.
Moreover, the policy on anti-corruption applies to the Board and employees of Digior others
with the authority to act on behalf of Digi. The policy clearly states that bribes are strictly
prohibited and staff should never offer, give, ask or accept any form of bribe. Digi has zero
tolerance towards bribery and corruption. For the trading on insider information, Notices on
the closed period for trading in Digis shares are sent to Directors, principal officers and
relevant employees on a quarterly basis. Digis Compliance framework outlines the
requirements for training and awareness, risk assessment and monitoring. It also identifies the
parties responsible for implementing the framework, establishes communication channels for
raising concerns and seeking guidance, and sets out clear investigation and disciplinary
procedures to ensure that actions taken are fair and appropriate.
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1.4) The board should ensure that the companys strategies promote sustainability.
The board should formalise the companys strategies on promoting sustainability. Attention
should be given to environmental, social and governance (ESG) aspects of business which
underpin sustainability. Balancing ESG aspects with the interests of various stakeholders is
essential to enhancing investor perception and public trust. The board should ensure the
company discloses these policies and their implementation in the annual report and the
corporate website.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
The board should ensure that the companys strategies
promote sustainability.
Both of the companies were complying to this requirement. Maxis were promote
sustainability with attention given to environmental, social and governance aspect of the
Groups Business. The Board were approved Maxis Corporate Responsibility framework
which clearly outlines Maxis CR Mission, strategic pillars, philosophies and governance
structure for adoption. For the Digi, the Board is mindful of the importance of building a
sustainable business, therefore takes into consideration its environmental, social, and
governance impact when developing Digis corporate strategy.Digis Sustainability strategy
focuses on issues that are of high importance to its stakeholders, and key to its long-term
growthand success. These issues are addressed through four focusareas, namely
Empowerment through Connectivity, Ethical andResponsible Business, Climate Change and
Environment, and Best on People.
1.5) The board should have procedures to allow its members access to information and
advice.
The board should have access to all information pertaining to the company. Management
should supply accurate and complete information to the board in a timely manner to enable
the board to discharge its duties effectively.
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RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
The board should have procedures to allow its
members access to information and advice.
These to company were complying with this requirement. The Board of Maxis has
unrestricted and immediate access to Management and all information on the affairs of the
Group. At the request of the Board, the Management is obliged to supply all relevant
information relating to the business and operations of the Group and governance matters,
including customer satisfaction and quality surveys, market share and market reactions in a
timely manner to enable the Board to discharge its duties effectively. They will be prepared a
set of paper to the Board in the annual general meeting which is the Board meets at least four
times a year with additional meetings convened on an ad-hoc basis as and when the Boards
approval and guidance are required.
For Digi Company, The Board recognises that the decision making process is highly
dependent on the quality of information provided. Therefore, every director has access to all
information on DiGi through attend the meeting. It has stated that if CEO, CFO and members
of the senior management who attend Board and Committee meetings by invitation have to
report and update on areas of the business within their responsibility to give Board members
thorough insights into the business. Board and Committee of papers are prepared for each
item in the agenda and are issued to the Directors at least seven (7) days before the Board and
Committee meetings.
1.6) The board should ensure it is supported by a suitably qualified and competent
company secretary.
The board regularly consults the company secretary on procedural and regulatory
requirements. The company secretary also plays an important role in supporting the board by
ensuring adherence to board policies and procedures. Therefore, the board should appoint a
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suitably qualified and competent company secretary who can support the board in carrying
out its roles and responsibilities.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
The board should ensure it is supported by a suitably
qualified and competent company secretary.
The company secretary of Maxis Company who facilitates overall compliance with the
MMLR and Companies Act 1965 and other relevant laws and regulations which is will
supported the Board of Maxis Company. In performing this duty, the Company Secretary
should carries out the task such as statutory duties as specified under the Companies Act
1965 and MMLR. Besides that, the company secretary also need to attend Board and Board
Committee meetings and ensuring that the Board meetings are properly convened and
proceedings are properly recorded.
For the Digi Company, The Company Secretaries play an advisory role to the Board in
relation to the Companys constitution, Boards policies and procedures, and compliance with
the relevant regulatory requirements, codes or guidance and legislations. The Board is
regularly updated and advised by the Company Secretaries who are qualified, experienced
and competent on new statutory and regulatory requirements, and the resultant implications
to Digi and the Directors in relation to their duties and responsibilities. The Company
Secretaries, who oversee adherence with board policies and procedures, brief the Board on
the proposed contents and timing of material announcements to be made to regulators.
1.7) The board should formalise, periodically review and make public its board charter.
The board charter sets out the boards strategic intent and outlines the boards roles and
responsibilities. The board charter is a source reference and primary induction literature,
providing insights to prospective board members and senior management. It will also assist
the board in the assessment of its own performance and that of its individual directors.
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In establishing a board charter, it is important for the board to set out the key values,
principles and ethos of the company, as policies and strategy development are based on these
considerations. The board charter should also include the division of responsibilities and
powers between the board and management, the different committees established by the
board, and between the chairman and the CEO. The board charter should set out processes
and procedures for convening board meetings. The board should periodically review and
publish the board charter on the corporate website.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
The board should formalise, periodically review and

make public its board charter.
For this requirement, Maxis Company not complies with this requirement. Maxis Company
didnt show the board should formalise, periodically review and make public its board
charter. But for the Digi, The Board is guided by the principles contained in the Code and by
the Boards Charter and a Delegation Authority Matrix, which set out the practices and
processes in the discharge of its responsibilities. The Rules of Procedure for the Board and
the Delegation Authority Matrix are reviewed and revised, as and when required, to ensure an
optimum structure for efficient and effective decision making in the organisation.
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Principle 2 : Strengthen composition

The board should have transparent policies and procedures that will assist in the selection of
board members. The board should comprise members who bring value to board deliberations.
2.1) The board should establish a Nominating Committee which should comprise
exclusively of non-executive directors, a majority of whom must be independent.
The Nominating Committee is charged with the responsibility to oversee the selection and
assessment of directors.
An effective Nominating Committee will contribute towards
ensuring that board composition meets the needs of the company. The chair of the
Nominating Committee should be the senior independent director identified by the board.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
2.1 The board should establish a Nominating
Committee which should comprise exclusively of nonexecutive directors, a majority of whom must be
independent.
Based on recommendation 2.1, Digi company establish their members of the Group
Nomination and Remuneration Committee which are comprise of Non-Executive Directors
and Non-Independent. Thus, from 1 of the total 7 members of the Group Nomination and
Remuneration Committee are Independent Directors. While, Maxis Berhad, their members of
the Group Nomination and Remuneration Committee also comprise of Non-Executive
Directors and Non-Independent in which3 of the total 5 members of the Group Nomination
and Remuneration Committee are Independent Directors.
Based on analysis in annual report, both company, Digi and Maxis had comply with this
principle. Thus, in Digi, all members of the Committee are Non- Executive Directors except
one person who is Non-Independent Non- Executive Director which is HakkonBruasetKjol.
In Maxis also has a majority of whom are independent, where three persons are independent
while another two are Non-Executive Director whose are Dr. Ibrahim Abdulrahman H. Kadi
and Chan Chee Beng.
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2.2) The Nominating Committee should develop, maintain and review the criteria to be
used in the recruitment process and annual assessment of directors.
The Nominating Committees responsibilities include assessing and recommending to the
board the candidature of directors, appointment of directors to board committees, review of
boards succession plans and training programmes for the board. In assessing suitability of
candidates, considerations should be given to the competencies, commitment, contribution
and performance. The Nominating Committee should facilitate board induction and training
programmes. The nomination and election process of board members should be disclosed in
the annual report. The board should establish a policy formalising its approach to boardroom
diversity. The board through its Nominating Committee should take steps to ensure that
women candidates are sought as part of its recruitment exercise. The board should explicitly
disclose in the annual report its gender diversity policies and targets and the measures taken
to meet those targets.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
2.2 The Nominating Committee should develop,
maintain and review the criteria to be used in the

recruitment
process
and
annual
assessment
of
directors.
For Digi company, there also state that they develop, maintain and review the criteria to be
used in the recruitment process and annual assessment of directors. On the Terms of
Reference of the Group Nomination and Remuneration Committee is in line with this
recommendation. Furthermore, the criteria on the recruitment process and annual assessment
of Directors is contained in the Policy and Procedures Manual on Fit and Proper Test for Key
Responsible Persons.
For Maxiscompany, the Board makes clear at the outset its expectations of its new Directors
in terms of their time commitment as recommended by the Code. Moreover, the criteria on
the recruitment process and assesses the suitability of candidates, taking into account the
23
required mix of skills, knowledge, expertise and experience, professionalism, integrity,

competencies, time commitment and other qualities of the candidates, before recommending
their appointment to the Board for approval.
Based on the above assessment in 2013, the evaluation process is led by the Nomination
Committee Chairman and supported by the Company Secretary. The evaluation process is
conducted via questionnaires to review the effectiveness of the Board and its Committee. The
Nomination Committee reviews the outcome of the evaluation and recommends to the Board
on areas for continuous improvement. In Maxis, the criteria on which assessment of the
Boards effectiveness is carried out is developed, maintained and reviewed by the NC. They
include, inter alia, Boards and Board Committees composition, Boards roles and
responsibilities, performance which comprises strategy planning and performance, risk and
human capital management, Board communications and conduct of the Board and Board
Committees.
2.3) The board should establish formal and transparent remuneration policies and
procedures to attract and retain directors.
Fair remuneration is critical to attract, retain and motivate directors. The remuneration
package should be aligned with the business strategy and long-term objectives of the
company. Remuneration of the board should reflect the boards responsibilities, expertise and
complexity of the companys activities.
The board should establish a Remuneration Committee to perform this function. The
Remuneration Committee should consist exclusively or a majority of, non-executive
directors, drawing advice from experts, if necessary. Companies without a Remuneration
Committee should have board policies and procedures on matters that would otherwise be
dealt with by the Remuneration Committee. Board remuneration policies and procedures
should be disclosed in the annual report.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
2.3 The board should establish formal and transparent
remuneration policies and procedures to attract and

retain directors.
24
In Digi, the Board has established formal and transparent remuneration policies for the Board
and its Committees and the procedures for policies. Non-Executive Directors remuneration
reflects the experience, expertise and level of responsibilities undertaken by the NonExecutive Director. The Board is of the view that the current remuneration level suffices to
attract, retain and motivate qualified Directors to serve on the Board. While, in Maxis, the
component parts of remuneration for the Executive Directors are structured so as to link
rewards to corporate and individual performance. In the case of Non-Executive Directors, the
level of remuneration reflects the experience, expertise and level of responsibilities
undertaken by the particular Non-Executive Director concerned. A Remuneration Framework
has been established and is subject to review every 3 years for both company.
25
Principle 3 : Reinforce independence

3.1) The Board should undertake an assessment of its Independent Directors annually.
Independent directors bring independent and objective judgment to the board and this
mitigates risks arising from conflict of interest or undue influence from interested parties.
The existence of independent directors on the board by itself does not ensure the exercise of
independent and objective judgment as independent judgment can be compromised by,
amongst others, familiarity or close relationship with other board members.
Therefore, it is important for the board to undertake an annual assessment of the
independence of its independent directors. When assessing independence, the board should
focus beyond the independent directors background, economic and family relationships and
consider whether the independent director can continue to bring independent and objective
judgment to board deliberations. The Nominating Committee should develop the criteria to
assess independence. The board should apply these criteria upon admission, annually and
when any new interest or relationship develops.
The board should disclose that it has conducted such assessment in the annual report and in
any notice convening a general meeting for the appointment and re-appointment of
independent directors.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
3.1 The Board should undertake an assessment of its
Independent Directors annually.
For Digi, the Group Nomination and Remuneration Committee undertakes assessment of all
Directors annually via the Board Effectiveness Assessment exercise. Besides that, the Board
through the Nomination Committee assesses the independence of Independent NonExecutive Directors annually using the Level of Independence of Directors evaluation,
which takes into account the individual Directors ability to exercise independent judgment at
all times and to contribute to the effective functioning of the Board. On the other hand, the
26
assessment of the independence of each of its Independent Non-Executive Directors in Maxis

is undertaken twice a year according to set criteria as prescribed by the MMLR.
3.2) The tenure of an Independent Director should not exceed a cumulative term of nine
years. Upon completion of the nine years, an Independent Director may continue to serve
on the Board subject to the directors re designation as a Non-Independent director.
The assessment criteria for independence of directors should also include tenure. Long tenure
can impair independence. For this reason, tenure of an independent director is capped at nine
years. The nine years can either be a consecutive service of nine years or a cumulative service
of nine years with intervals. An independent director who has served the company for nine
years may, in the interest of the company, continue to serve the company but in the capacity
of a non-independent director.
RECOMMENDATION
3.2 The tenure of an Independent Director should not
DIGI.COM
MAXIS
BERHAD
BERHAD
exceed a cumulative term of nine years. Upon

completion of the nine years, an Independent Director
may continue to serve on the Board subject to the
directors re designation as a Non-Independent
director.
In Digi, although term limits could help to ensure that new ideas and perspective would be
available to the Board, they pose the disadvantage of losing experienced Independent
Directors who over time have developed detailed insight in Digis operations and therefore,
provide an increasing contribution to the effectiveness of the Board as a whole. The Board
therefore viewed that imposing a fixed term limit for Independent Directors does not
necessarily assure their independence and objectivity.
Digi not comply on this principal as they does not have term limits for Independent Directors
as the Board believes that continued contribution provides benefit to the Board and Digi as a
whole. The Board is of the view that there are significant advantages to be gained from the
27
long-serving Directors who provide invaluable insight and possess knowledge of Digis
affairs.
Hence, in Maxis, they comply with this principle as recommended by the Code, the tenure of
Directorship should form also part of the assessment criteria for independence of a Director.
The relevant process and procedures have been provided for in the Board Charter and terms
of reference of the NC. In the event that shareholders approval is sought to enable an
independent director to retain his designation as an independent director after having served a
tenure of nine years, the NC is tasked to assess and assist the Board in recommending and
providing justification for shareholders consideration and approval in such instances. The
Independent Directors also meet the criteria of independence.
3.3) The Board must justify and seek shareholders approval in the event it retains as an
Independent Director, a person who has served in that capacity for more than nine years.
The shareholders may, in exceptional cases and subject to the assessment of the Nominating
Committee, decide that an independent director can remain as an independent director after
serving a cumulative term of nine years. In such a situation, the board must make a
recommendation and provide strong justification to the shareholders in a general meeting.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
3.3 The Board must justify and seek shareholders
approval in the event it retains as an Independent

Director, a person who has served in that capacity for
more than nine years.
In Digi, based on the recommendation by the Nomination Committee, the Board

recommended that Dato Ab Halim bin Mohyiddin continues to act as Independent NonExecutive Director of Digi subject to shareholders approval at Digis forthcoming 17th
AGM as he has fulfilled the criteria under the definition of Independent Director as stated in
28
the MMLR. Digi comply with this principle as following an assessment conducted by the
Board through the Nomination Committee, the Board viewed that Dato Ab. Halim bin
Mohyiddin who has served as an Independent Non-Executive Director of Digi for more than
9 years remains objective and independent in expressing his views and in participating in
deliberations and decision-making in the Board and the Committees. The length of his service
on the Board does not in any way interfere with his independent judgment and ability to act
in the best interests of Digi.
On the other hand, Maxis comply in the event that shareholders approval is sought to enable
an independent director to retain his designation as an independent director after having
served a tenure of nine years, the NC is tasked to assess and assist the Board in
recommending and providing justification for shareholders consideration and approval in
such instances. The Independent Directors also meet the criteria of independence.
3.4) The positions of Chairman and CEO should be held by different individuals, and the
Chairman must be a non-executive member of the Board.
There should be a separation of the positions of the Chairman and the CEO to ensure
accountability and facilities division of responsibilities between them. The chairman is
responsible in leading the board in the oversight of management, while the CEO should focus
on the business and day-to-day management of the company. It should be clearly defined in,
the board charter.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
The positions of Chairman and CEO should be held by
different individuals, and the Chairman must be a nonexecutive member of the Board.
Based on recommendation 3.4, Digi company stated in a statement of corporate governance

that there should have a clear division of responsibility between the Chairman and the CEO
to ensure that there is a balance of power and authority, such that no one individual has
29
unfettered powers over decision making. The positions of Chairman and CEO are held by
two different individuals. Mr SigveBrekke, Non-Independent on-Executive Director, as a
Chairman, is responsible to lead the Board with a keen focus on governance and compliance,
and ensuring its effectiveness. He engages directly with the CEO to monitor performance and
oversees the implementation of strategies. Besides, Mr SigveBrekke, will set agendas for the
meetings of the Board that focuses on the strategic direction and performance of Digi.
However, Mr. Henrik Clausen, as the CEO is responsible for the day-to-day management of
Digis operations and business as well as implementation of the Boards policies and
decisions. Mr. Henrik Clausen is not a Board member of DiGi.Com Berhad. This is to ensure
there is a clear distinction between the roles of CEO and the Board, and to prevent conflicts
of interest.
For Maxis, there also state that there should have distinct roles and responsibilities of the
Chairman of the Board and the CEO to ensure there is a clear and proper balance of power
and authority. Besides, the Chairman should not previously a CEO of the Company. Raja
Tan Sri Dato Seri Arshad Bin Raja TunUda, Independent Non-Executive Director, as a
Chairman is responsible to ensure the effective conduct of the Board and all Directors, both
Executive and Non- Executive. Mr Arshad also should encourage participation and
deliberation by all Board members to enable the wisdom of all the Board members to be
tapped and to promote consensus building as much as possible. Mr Morten Lundal are
responsible over the Groups operational and business units, organisational effectiveness and
implementation of Board policies, directives, strategies and decisions.
Digi and Maxis comply with this principle. There is a clear division of responsibility between
the Chairman and the CEO to ensure that there is a balance of power and authority, such that
no one individual has unfettered powers over decision-making. Based on the annual report,
the positions of Chairman and CEO are held by two different individuals in both by the
company. Besides that, the Chairman for DiGi and Maxis also non-executive members of the
Board, which shows that both companies, comply with the recommendation 3.4.
30
3.5) The Board must comprise a majority of Independent Directors where the Chairman of
the Board is not an Independent Director.
Recommendation 3.5 stated that if the Chairman is not independent, then the majority of the
board should be independent, however, the Chairman can either be Independent or NonIndependent. A chairman who is an independent director can provide strong leadership by
being able to ensure the boards priorities more objectively. If the Chairman is not an
Independent director, then the board should comprise a majority of Independent directors to
ensure balance of power and authority on the board.
RECOMMENDATION
The Board must comprise a majority of Independent
DIGI.COM
MAXIS
BERHAD
BERHAD
Directors where the Chairman of the Board is not an

Independent Director.
The Board of DiGi.com Berhad, chaired by SigveBrekke, comprises 7 Directors, four are
Non-Independent Non-Executive Director and another three are Independent Non-Executive
Director. The Independent Non-Executive Directors are only 43% of the Board, where the
Chairman of the Board is regarded as a Non-Independent director pursuant to
recommendation 3.5 of the MCCG 2012. The Board of Maxis Berhad, chaired by Raja Tan
Sri Dato Seri Arshad Bin Raja TunUda, that comprises 11 Directors, four of them is an
Independent Non-Executive Director, six is Non-Executive Director and one is an Executive
Director who is also the CEO. The Independent Non-Executive Directors are only 37% of the
Board and the Chairman of Maxis Berhad is an Independent Director. Therefore, both of the
companies did not comply with the recommendation 3.5 of MCCG 2012. Digi and Maxis
Berhad does not comprise a majority of Independent Directors. The company Independent
Directors are below 50% of the Board.
31
Principle 4: Foster commitment
The Director should devote sufficient time to carry out their responsibilities, regularly update
their knowledge and enhance their skills.
4.1) The Board should set out expectations on time commitment for its members and
protocols for accepting new directorships.
In recommendation 4.1, stated that the Directors should devote sufficient time to carry out
their responsibilities. The board should obtain this commitment from its members at the time
of appointment. Directors should notify the chairman before accepting any new directorship.
The notification should include an indication of time that will be spent on the new
appointment.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
The Board should set out expectations on time
commitment for its members and protocols for

accepting new directorships.
Digi company complied with recommendation 4.1 by incorporated towards the attendance
record of the Directors at Board of Directors and Board Committee meetings and in terms of
Protocol appointment of Director. The Board is satisfied with the level of time commitment
given by the Directors towards fulfilling their roles and responsibilities as Directors of
DiGi.com Berhad and Maxis Berhad. This is shown by the attendance record of the Directors
at Board of Directors and Board Committee meetings for financial year 2013 in the annual
report. In terms of protocol for appointment of Director of DiGi, Directors are to notify the
Chairman before accepting any new directorships notwithstanding that the Main Market
Listing Requirement (MMLR), that allows a Director to sit on the boards of five (5) listed
issuers. The notification includes an indication of time that will be spent on the new
appointment as Director. This information will be shared with the Board together with the
quarterly update by individual Directors on their directorships and shareholdings in DiGi to
show its members commitment in devoting sufficient time to carry out their responsibilities.
32
Besides, meetings for the year are scheduled at the end of the preceding year to enable the
Directors to plan ahead and ensure that the Board and its Committee meetings are accounted
for in their respective schedules. It provides the scheduled dates for meetings of the Board
and Board Committees, and the Annual General Meeting, as well as the closed periods for
dealings in securities based on the targeted dates of announcements of the Companys
quarterly results.
For Maxis, the Board meets at least four times a year, with additional meetings convened on
an ad-hoc basis as when the Boards approval and guidance are required. Upon consultation
with the Chairman and the CEO, the notice given of the proposed dates of meetings during
the financial year, and standard agenda and materials will be tabled to the Board. Besides,
meetings are set before the beginning of the year to allow Directors to plan ahead and to
maximise their participation. In terms of accepting new directorships, all Board members will
notify the Chairman of the Board before made any decision. The notification includes an
indication of time commitment required under the new appointment as recommended by the
MCCG 2012. Therefore, it show that Maxis also complied with recommendation 4.1, by
incorporated towards the attendance record of the Directors at Board of Directors and Board
Committee meetings and all Board members will notify the Chairman of the Board before
accepting new directorships.
4.2) The Board should ensure its members have access to appropriate continuing
education programmes.
In recommendation 4.2, stated that the Directors should devote sufficient time to update their
knowledge and enhance their skills through appropriate continuing education programmes
and life-long learning to ensure Directors to sustain their active participation in board
deliberations.
33
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
The Board should ensure its members have access to
appropriate continuing education programmes.
For both of the company, which is Digi and Maxis, the Board takes a strong view of the
importance of continuing education for its Directors to ensure they are equipped with the
necessary skills and knowledge to meet the challenges of the Board.
For Digi, all the existing Directors has completed the Mandatory Accreditation Programme
(MAP). The Board continues to evaluate and determine the training needs of its members to
assist them in the discharge of their duties as Directors. The Company Secretary arranges for
the Directors attendance at the training programmes, which are conducted either in-house or
by external service providers. Digi are complied with recommendation 4.2. From the Annual
Reports, shows that the Company Secretary arrange for the Directors attendance at the
training programmes, which are conducted either in-house or by external service providers.
Same goes to Maxis, all Directors have attended and completed the Mandatory Accreditation
Programme (MAP) that had been prescribed by Bursa Malaysia. The Board has taken steps to
ensure that its members have ongoing access to appropriate continuing education programs.
The Company Secretary facilitates the organisation of internal training programmes and
keeps Directors informed of relevant external training programmes. All of the Directors have
undergone training during the financial year. Both of Directors of Digi and Maxis embrace
recommendation of 4.2 of the MCCG 2012 by attending conferences, briefings and
workshops to regularly update their knowledge and enhance their skills. Maxis also complied
with recommendation 4.2. In the Annual Reports, the Company Secretary facilitates the
organisation of internal training programmes and keeps Directors informed of relevant
external training programmes.
34
Principle 5: Uphold integrity in financial reporting
The board should ensure financial statements are a reliable source of information.
5.1) The Audit Committee should ensure financial statements comply with applicable
financial reporting standards.
In recommendation 5.1, stated to ensuring the companys financial statement is a reliable
source of financial information, the board must recognise the value of an effective Audit
Committee. The Audit Committee must ensure that the companys financial statements
comply with applicable financial reporting standards as this is integral to the reliability of
financial statements. Therefore, in recommendation 5.1, shows that the Audit Committee are
responsible towards their duties.
RECOMMENDATION
The
Audit
Committee
should
ensure
DIGI.COM
MAXIS
BERHAD
BERHAD
financial
statements comply with applicable financial reporting

standards.
The Audit Committee of Digi and Maxis ensures that shareholders are provided with a
balanced and meaningful evaluation of the companys financial performance, position and
future prospects, through the issuance of the Annual Audited Financial Statements as well as
corporate announcements of significant developments affecting the company in accordance
with Bursa Securities Main Market Listing Requirements.
The Audit and Risk Committee Chairman, Dato Saw Choo together with all Audit and Risk
Committee members meets on a quarterly basis, to review the integrity and reliability of
Digis financial statement in the presence of both external and internal auditors, prior to
recommending towards the Boards approval.
35
At Maxis, Robert William Boyle, as a Chairman of the Audit Committee and as a member of
the Remuneration and Nomination Committees, together with all members of the Committee
responsible to review the integrity and reliability of Maxiss financial statement in the
presence of both external and internal auditors, prior to recommending towards the Boards
approval. All members of an Audit Committee financially literate, interpret and understand
financial statements in order to effectively discharge their duties and responsibilities as
members of the Committee. They also responsible for ensuring that the financial statements
provide a true and fair view of the financial position of the Group and the Company as at 31
December 2013 and of their financial performance and cash flows for the financial year
ended 31 December 2013.
Digi and Maxis comply the recommendation of 5.1 accordance to Directors Responsibility
Statement in relation to financial reporting standards that tabled to the Audit Committee
during the presentation of annual Audited Financial Statements.
5.2) The Audit Committee should have policies and procedures to assess the suitability and
independence of external auditors.
The Audit Committee responsible to review and monitor the suitability and independence of
external auditors. The independence of external auditors can be impaired by the provision of
non-audit services to the company. Besides, the Audit Committee should establish policies
governing the circumstances under which contracts for the provision of non-audit services
can be entered into and procedures that must be followed by the external auditors. Therefore,
to provide support for an assessment on independence, the Audit Committee should obtain
written assurance from the external auditors confirming that they are, and have been,
independent throughout the conduct of the audit engagement in accordance with the terms of
all relevant professional and regulatory requirements.
RECOMMENDATION
DIGI.COM
MAXIS
BERHAD
BERHAD
The Audit Committee should have policies and
procedures to assess the suitability and independence

of external auditors.
36
Audit Committee of Digihas place policies covering the provision of non audit services,
which are designed to ensure that such services do not impair the external auditors
independence or objectivity. The external auditors provide mainly audit related services to
Digi. In March 2014, the Audit Committee assessed the independence of Messrs Ernst &
Young (EY) as external auditors of Digi as well as reviewed the level of non-audit services to
be rendered by Ernst and Young to Digi for financial year 2013. The Audit Committee was
satisfied with Ernst and Youngs technical competency and audit independence. During the
year, Ernst and Young charged DiGi RM304,000 (2012: RM311,000) for audit and
RM54,000 for nonaudit services (2012:RM53,000). DiGi complied with this recommendation
through the establishment of procedures to assess the suitability, independence and
performance of the external auditors. Besides, the Audit Committee obtains written assurance
from the external auditors which is Messrs Ernst & Young (EY) through the Independence
Auditors Report.
Apart from that, the Audit Committee of Maxis also has place procedures to assess the
suitability by reviewed with the external auditors, their terms of engagement, proposed audit
remuneration and the audit plan for the financial year to ensure that their scope of work
adequately covers the activities of the Group, reviewed the results and issues arising from the
external auditors review of the quarterly financial results and audit of the year end financial
statements and the resolution of issues highlighted in their report to the Committee, reviewed
the independence, suitability, objectivity and cost effectiveness of the external auditors before
recommending their re-appointment and remuneration to the Board, reviewed the level of
compliance of the external auditors with the Maxis External Audit Independence policy and
obtained written assurance from the external auditors confirming that they are, and have
been, independent throughout the conduct of the audit engagement. On February 2014, the
Audit Committee assessed the independence of Messrs PricewaterhouseCoopers (PwC) as
external auditors of Maxis as well as reviewed the level of non-audit services to be rendered
by PricewaterhouseCoopers to Maxis for financial year 2013. The Audit Committee was also
satisfied with the PricewaterhouseCoopers technical competency and audit independence.
For Maxis, it also complied through out procedures to assess the suitability, independence
and performance of external auditors have been established. And the Audit Committee obtain
written assurance from the external auditors, which is PricewaterhouseCoopers, through
Independence Auditors Report. Therefore, it shows that both of the company comply with
the recommendation of 5.2 in MCCG 2012.
37
Principle 6 : Recognise and manage risks

6.1) The board should establish a sound framework to manage risks.
The board should determine the companys level of risk tolerance and actively identify,
assess and monitor key business risks to safeguard shareholders investments and the
companys assets. Internal controls are important for risk management and the board should
be committed to articulating, implementing and reviewing the companys internal controls
system. Periodic testing of the effectiveness and efficiency of the internal controls procedures
and processes must be conducted to ensure that the system is viable and robust. The board
should disclose in the annual report the main features of the companys risk management
framework and internal controls system.
RECOMMENDATION
DiGi Co. Bhd
The board should establish a sound framework to
Maxis Bhd
manage risks.
Digis board has the ultimate responsibility of approving the Risk Management framework
and policy as well as overseeing Digis Risk Management and Internal Control Framework.
The Board through its Audit & Risk Committee reviews the key risks identify on a regular
basis to ensure, as far as possible, the protection of its assets and its shareholders investment.
The Annual Report provides an overview on the Risk Management functions within Digi.
The Group in Maxis Co. has established a sound risk management framework and procedures
of internal control. The Group is subject to provide an ongoing process for identifying,
evaluating and managing the significant risks faced by the Group that may affect the
achievement of its business objectives and strategies. The Groups Statement on Risk
Management and Internal Control is set out on pages 62 to 66 of this Annual Report.
6.2) The board should establish an internal audit function which reports directly to the
Audit Committee.
The board should establish an internal audit function and identify a head of internal audit who
reports directly to the Audit Committee. The head of internal audit should have the relevant
qualifications and be responsible for providing assurance to the board that the internal
38
controls are operating effectively. Internal auditors should carry out their functions according
to the standards set by recognized professional bodies. Internal auditors should also conduct
regular reviews and appraisals of the effectiveness of the governance, risk management and
internal controls processes within the company.
RECOMMENDATION
DiGi Co. Bhd
The board should establish an internal audit function
Maxis Bhd
which reports directly to the Audit Committee.
In the Digicompanythe internal audit function carried out by the Assurance Department,
assists both the Board and the Audit & Risk Committee by conducting appropriate reviews of
key business processes to assess the adequacy and effectiveness of internal control and risk
management, compliance with regulations and the Groups policies and procedures. The
Assurance Departments practices and conduct are governed by the Assurance Charter, which
is subject to review and approval on an annual basis by the Audit & Risk Committee.
Maxiss Group has an independent internal audit function which reports directly to the
Committee, the primary responsibility of which is to provide independent and objective
assessment of the adequacy and effectiveness of the risk management, internal control and
governance processes established by Management and/or the Board within the Group. The
activities carried out by the Internal Audit department include among others, the review of
the adequacy and effectiveness of risk management and the system of internal controls,
compliance with established rules, guidelines, laws and regulations, reliability and integrity
of information
39
Principle 7 : Ensure timely and high quality disclosure

7.1) The board should ensure the company has appropriate corporate disclosure policies
and procedures.
The board should have internal corporate disclosure policies and procedures which are
practical and include feedback from management. These policies and procedures should
ensure compliance with the disclosure requirements as set out in the Bursa Malaysia Listing
Requirements. In formulating these policies and procedures, the board should be guided by
best practices.
RECOMMENDATION
DiGi Co. Bhd
The board should ensure the company has appropriate
Maxis Bhd
corporate disclosure policies and procedures.
Digiwas established and adopted the Corporate Disclosure Policy by effective and timely
communications between the stakeholders, institutional investors and the investing public at
large. Digi keeping the market informed of relevant information which includes appropriate
disclosure and transparency, enabling both existing and potential shareholders to evaluate its
business, performance and prospects. All information made available to Bursa Securities is
immediately available to shareholders and the market on the Investor Relations section of
Digis website which is www.DiGi.com.my.
For the Maxis, The Board has also established and adopted the Corporate Disclosure Policy
which inclusive of feedback from management as recommended by the Code and the policies
and procedures therein has been formulated with reference to the Best Practices published in
the Corporate Disclosure Guide issued by Bursa Malaysia.
7.2) The board should encourage the company to leverage on information technology for
effective dissemination of information.
Companies should consider wider usage of information technology in communicating with
stakeholders including establishing a dedicated section for corporate governance on their
website. This section should provide information such as the board charter, rights of
shareholders and the annual report.
40
RECOMMENDATION
DiGi Co. Bhd
7.2: The board should encourage the company to
Maxis Bhd
leverage on information technology for effective

dissemination of information.
Digis Leverage on information technology for effective dissemination of information is the

investor relations website. It also features in-depth information related to Digis financial
results as well as other relevant financial data. These include announcements to Bursa
Securities, media releases, investor briefings, quarterly results and annual reports. Others
leverage is Digi aims to provide sufficient information to shareholders and investors about its
activities,
Maxis will seek to leverage on the latest and most innovative information technology
available to promote more efficient and effective ways to communicate with both its
shareholders and stakeholders. The Companys Annual Reports, announcements to Bursa
Malaysia, media releases, a Corporate Governance section including the Board Charter and
Terms of Reference of the AC and NC and presentations relating to its quarterly financial
results has been made available on the Companys website.
41
Principle 8 : Strengthen relationship between company and shareholders

8.1) The board should take reasonable steps to encourage shareholder participation at
general meetings.
General meetings are an important avenue through which shareholders can exercise their
rights. The board should take active steps to encourage shareholder participation at general
meetings such as serving notices for meetings earlier than the minimum notice period.
The board should direct the company to disclose all relevant information to shareholders to
enable them to exercise their rights. The board should also consider adopting electronic
voting to facilitate greater shareholder participation.
The board can demonstrate their commitment to shareholders by ensuring that the company
publishes these measures on its corporate website.
RECOMMENDATION
DiGi Co. Bhd
The board should take reasonable steps to encourage
Maxis Bhd
shareholder participation at general meetings.
Digi was Encourage shareholder participation at general meetings. The Notice of Meeting of
the AGM is sent to shareholders at least 21 days ahead of the meeting date together with the
Financial Statements and agenda for the meeting with a memorandum providing information
to shareholders to assist them in deciding on how they should vote on each item of the
business. A full copy of the Notice of Meeting and Proxy Form are posted on DiGis website
and lodged with Bursa Securities. It is also advertised in a major local newspaper.
In every AGM, the Management Team presents a comprehensive review of Digis financial
performance for the year and outlines the prospects of Digifor the subsequent financial year.
Time is being set aside for shareholders queries. Where it is not possible to provide
immediate answers, Digi will undertake to provide shareholders with written answers after
the AGM. Copies of the review are posted on Digis Investor Relations website immediately.
Since 2006, Digis AGM has been open to the financial media to observe the proceedings.
The outcome of the AGM is announced to Bursa Securities on the same meeting day.
42
MaxissBoard has taken reasonable steps to encourage shareholder participation at general

meetings. In Companys Articles require 21 days notice for the AGM but the Company has
gone beyond the prescribed requirement to issue a notice with 28 days notice period.
Notices of the annual general meetings and the accompanying papers are provided to
shareholders within the prescribed time in accordance to the Bursa Securities Listing
Requirements. These notices are lodged with Bursa Securities. They are also placed in major
local newspapers in English, Bahasa Malaysia, Mandarin and Tamil languages.
In every annual general meeting, the management team presents a comprehensive review of
the Companys financial performance for the year and outlines its prospects for the following
financial year. Time is set aside for shareholders queries. Where it is not possible to provide
immediate replies, the Company undertakes to provide shareholders with written replies after
these annual general meetings. Copies of the review are posted on the Companys Investor
Relations website immediately after the close of the annual general meetings.
Shareholders who are unable to attend are allowed to appoint proxies in accordance with the
Companys Articles to attend and vote on their behalf.
8.2) The board should encourage poll voting.
The board is encouraged to put substantive resolutions to vote by poll and make an
announcement of the detailed results showing the number of votes cast for and against each
resolution. Companies are encouraged to employ electronic means for poll voting.
The chairman should inform shareholders of their right to demand a poll vote at the
commencement of the general meeting.
RECOMMENDATION
DiGi Co. Bhd
Maxis Bhd
The board should encourage poll voting.
Digi will adopt poll voting if there is/are substantive resolution(s) to be put forth for
shareholders approval at the general meetings going forward.
43
Maxiss Board considers electronic poll voting as a viable voting option for its shareholders.
The Chairman of Maxis would at the outset of general meetings inform the shareholders of
their right to request to vote by poll.
8.3) The board should promote effective communication and proactive engagements with
shareholders.
Direct engagement with shareholders provides a better appreciation of the companys
objectives, quality of its management and challenges, while also making the company aware
of the expectations and concerns of its shareholders. This will assist shareholders in
evaluating the company and facilitate the considered use of their votes. Board members and
senior management are encouraged to have constructive engagements with shareholders
about performance, corporate governance, and other matters affecting shareholders interests.
RECOMMENDATION
DiGi Co. Bhd
The board should promote effective communication
Maxis Bhd
and proactive engagements with shareholders.
Digicontinues to keep investors engaged through road shows, meetings, briefing,

announcements and AGMs. Digis uses can array of media channels to disseminate material
and price-sensitive information, for investor to make informed decisions.
Maxis have been actively promoting proactive engagements and communications with its
shareholders and stakeholders through the following channels:
Release of financial results on a quarterly basis;
Press releases and announcements to Bursa Malaysia and subsequently to the media; and
An online Investor Relations section and online Press Room, the Maxis Media Centre,
which can be accessed by shareholders and the general public via the Companys website at
www.Maxis Co.com.my.
44
CONCLUSION
In the nutshell, we have selected which of the two companies are most comply towards
MCCG 2012 which are DiGi.comBerhadand Maxis Berhad. Moreover, both companies,
DiGi.com and Maxis Berhad had complied almost all the disclosure of corporate governance.
Based on this two companies, we had analysed and identified that they had complied the
disclosure in the 8 broad principles followed by 26 corresponding recommendations that has
been stated on MCCG 2012. Furthermore, we found that the classification of the key
principles of good corporate governance for listed company Annual Report towards their
compliance accordance the Malaysian Code on Corporate Governance 2012. Thus, the
company that comply most of the disclosure of corporate governance is the company that
have good corporate governance.
45
REFERENCE
(2013). Annual Report. Bursa Malaysia website.
Corporate Governance. (n.d.). Retrieved from www.maxis.com.my: http://www.maxis.com.my/
Corporate Governance. (n.d.). Retrieved from www.digi.com.my: http://new.digi.com.my/
Malaysian
Code
on
Corporate
Governance.
(2012).
Retrieved
from
http://www.mia.org.my/new/downloads/circularsandresources/circulars/2012/21/MCCG_201
2.pdf
46
APPENDIX
PRINCIPLE
Principle 1 Establish clear roles and responsibilities
The board should establish clear functions reserved for the board and those
delegated to management.
The board should establish clear roles and responsibilities in discharging its
fiduciary and leadership functions.
The board should formalise ethical standards through a code of conduct and
ensure its compliance.
The board should ensure that the companys strategies promote sustainability.
The board should have procedures to allow its members access to information
and advice.
The board should ensure it is supported by a suitably qualified and competent
company secretary.
The board should formalise, periodically review and make public its board
charter.
Principle 2 Strengthen composition
The board should establish a Nominating Committee which should comprise
exclusively of non-executive directors, a majority of whom must be
independent.
The Nominating Committee should develop, maintain and review the criteria to
be used in the recruitment process and annual assessment of directors.
The board should establish formal and transparent remuneration policies and
procedures to attract and retain directors.
Principle 3 Reinforce independence
The board should undertake an assessment of its independent directors
annually.
The tenure of an independent director should not exceed a cumulative term of
nine years. Upon completion of the nine years, an independent director may
continue to serve on the board subject to the directors re-designation as a nonindependent director.
The board must justify and seek shareholders approval in the event it retains as
47
an independent director, a person who has served in that capacity for more than
nine years.
The positions of chairman and CEO should be held by different individuals,
and the chairman must be a non-executive member of the board.
The board must comprise a majority of independent directors where the
chairman of the board is not an independent director.
Principle 4 Foster commitment
The board should set out expectations on time commitment for its members and
protocols for accepting new directorships.
The board should ensure its members have access to appropriate continuing
education programmes.
Principle 5 Uphold integrity in financial reporting
The Audit Committee should ensure financial statements comply with
applicable financial reporting standards.
The Audit Committee should have policies and procedures to assess the
suitability andindependence of external auditors.
Principle 6 Recognise and manage risks
The board should establish a sound framework to manage risks.
The board should establish an internal audit function which reports directly to
the Audit Committee.
Principle 7 Ensure timely and high quality disclosure
The board should ensure the company has appropriate corporate disclosure
policies and procedures.
The board should encourage the company to leverage on information
technology for effective dissemination of information.
Principle 8 Strengthen relationship between company and shareholders
The board should take reasonable steps to encourage shareholder participation
at general meetings.
The board should encourage poll voting.
The board should promote effective communication and proactive engagements
with shareholders.
48

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BKAM3083 PERFORMANCE STRATEGY

1.0 INTRODUCTION ............................................................................................................................ 2

BKAM3083 PERFORMANCE STRATEGY

PwC Alert: Malaysian Code on Corporate Governance 2012

BKAM3083 PERFORMANCE STRATEGY

2.0 OBJECTIVE OF THE STUDY

To identify who is involved in corporate governance.

To view to what extent a company is successful.

BKAM3083 PERFORMANCE STRATEGY

3.0 OVERVIEW OF THE COMPANY

3.1 DIGI.COM BERHAD

BKAM3083 PERFORMANCE STRATEGY

BKAM3083 PERFORMANCE STRATEGY

Vision, Mission and Values

BKAM3083 PERFORMANCE STRATEGY

3.2 MAXIS BERHAD

BKAM3083 PERFORMANCE STRATEGY

BKAM3083 PERFORMANCE STRATEGY

Visions and Values

BKAM3083 PERFORMANCE STRATEGY

BKAM3083 PERFORMANCE STRATEGY

BKAM3083 PERFORMANCE STRATEGY

BKAM3083 PERFORMANCE STRATEGY

Submit a proposal to lecturer

BKAM3083 PERFORMANCE STRATEGY

5.0 ANALYSIS OF FINDINGS

Principle 1: Establish clear roles and responsibilities

The board should establish clear functions reserved for

the board and those delegated to management.

BKAM3083 PERFORMANCE STRATEGY

responsibilities in discharging its fiduciary and

BKAM3083 PERFORMANCE STRATEGY

The Board should formalise ethical standards through

a code of conduct and ensure its compliance.

BKAM3083 PERFORMANCE STRATEGY

Digi established a whistle-blowing policy to provide an avenue for employees, suppliers,

BKAM3083 PERFORMANCE STRATEGY

The board should ensure that the companys strategies

BKAM3083 PERFORMANCE STRATEGY

The board should have procedures to allow its

members access to information and advice.

BKAM3083 PERFORMANCE STRATEGY

The board should ensure it is supported by a suitably

qualified and competent company secretary.

BKAM3083 PERFORMANCE STRATEGY

The board should formalise, periodically review and

BKAM3083 PERFORMANCE STRATEGY

Principle 2 : Strengthen composition

An effective Nominating Committee will contribute towards

2.1 The board should establish a Nominating

BKAM3083 PERFORMANCE STRATEGY

2.2 The Nominating Committee should develop,

maintain and review the criteria to be used in the

BKAM3083 PERFORMANCE STRATEGY

required mix of skills, knowledge, expertise and experience, professionalism, integrity,

2.3 The board should establish formal and transparent

remuneration policies and procedures to attract and

BKAM3083 PERFORMANCE STRATEGY

BKAM3083 PERFORMANCE STRATEGY

Principle 3 : Reinforce independence

3.1 The Board should undertake an assessment of its

Independent Directors annually.

BKAM3083 PERFORMANCE STRATEGY

assessment of the independence of each of its Independent Non-Executive Directors in Maxis