STATEMENT ON CORPORATE GOVERNANCE

The Board of Directors of OCB is committed to ensuring that the appropriate standards of corporate governance are practised throughout the Group as a fundamental part of discharging its responsibilities to protect and enhance shareholders’ value and the financial performance of the Group and the Company.

A.      A.         DIRECTORS

The Board

The Company is headed by a Board of Directors which leads the Company. Currently, the Board has 6 members comprising a Chief Operating Officer (“COO”) cum Executive Director, 2 Executive Directors and 3 Non-Executive Directors (including the Chairman) all of whom are independent.

The Board is satisfied that the current Board composition fairly represents the ownership structure of the Company with appropriate representations of minority interest through the Independent Directors. The composition of the Board also reflects a fair mix of skills and experience in business development, finance, accounting, trading and food retailing which are vital to its stewardship of the Group.

There is clear and distinct division of responsibility between the Chairman, the COO cum Executive Director and the 2 Executive Directors. The Chairman is primarily responsible for the orderly conduct and effective running of the Board. The COO cum Executive Director has overall responsibility for the development and implementation of the Group’s broad strategies and plans as well as the Group’s business operations and organizational effectiveness. The 2 Executive Directors take charge of the management of the Group’s corporate and financial affairs, accounts and operations.

The Independent Non-Executive Directors fulfill an independent pivotal role in corporate accountability. They provide unbiased and independent views, advice and judgment in ensuring that the strategies proposed by the Management are fully discussed and examined taking into account the long term interest of not only the Group but also of all parties affected by the Group’s activities. Tan Sri Dato’ Nik Ibrahim Kamil, the Independent Non-Executive Chairman, assumes the role of Senior Independent Non-Executive Director.

The Board is principally responsible for reviewing and approving strategy plans, key business initiatives as well as major investment and making funding decisions for the Group. It also reviews financial performance, determines succession plans for senior management and ensures adequate and effectiveness of the Group’s internal control systems.

Board Meetings

The Board meets at least 5 times in a financial year with additional meetings convened when necessary. Meetings are scheduled early in the year. Due notice is given for all scheduled meetings and additional meetings. Where appropriate, decisions are taken by way of circular resolutions during the period between the scheduled meetings.

During the financial year ended 31 December 2010, the Board held 6 meetings. The attendance of the Directors at the Board meetings held are as follows:-

            *      Resigned on 27 January 2011

         * *   Appointed on 27 January 2011

Supply of Information

Board papers are forwarded to all Board members in advance of each meeting to give Directors sufficient time to deliberate on issues to be raised at the meeting. The agenda for each meeting are accompanied by the minutes of preceding meetings of the Board and Board Committees, reports on the Group’s financial performance, updates from all regulatory authorities  and relevant proposal papers (if any).

In addition, the Board has a Schedule of Matters reserved specifically for its deliberation and decision which includes the approval of strategic plan, acquisitions or disposals of investments, major corporate proposals, annual and quarterly financial results, key financial and operating policies, significant capital or operating expenditures and related party transactions.

Senior Management staff as well as advisers and professionals appointed to act for the Company on corporate proposals to be undertaken by the Company are invited to attend Board meetings to furnish the Board with their views and explanations on proposals tabled to the Board and to provide clarification on issues that may be raised by any Director.

All information within the Group are accessible to the Directors in furtherance of their duties as Directors and all Directors have access to the services of the Company Secretary.

Should the need arise, each Director has the right at the Company’s expense to seek external independent legal and other professional advice concerning any aspect of the Group’s operations or undertakings in order to fulfill their duties and responsibilities as Directors of the Company.

Appointments to the Board and Re-election 

The Company has in place a formal procedure for the appointment of new Directors. The Nomination Committee will review and consider all new nominees to the Board taking into account the required mix of expertise and experience and other core competencies the Directors should bring, before making a recommendation to the Board for appointment.

The Company’s Articles of Association provide that all Directors shall retire from office once at least in each 2 years but shall be eligible for re-election. The Articles also provide  that all newly appointed Directors shall hold office until the next Annual General Meeting and shall be eligible for re-election.

Directors’ Training and Education

On joining, all new Directors are given background information describing the Company and its activities. Site visits are arranged whenever necessary.

All Directors have attended the Mandatory Accreditation Programme prescribed by Bursa Malaysia Securities Berhad. The Directors are encouraged to evaluate their own training needs on a continuous basis and determine the relevant programmes, forum or conference to update and improve their knowledge and skills to keep abreast with regulatory requirements and business development.

Throughout the financial year under review, the Directors have individually attended various seminars, conferences and forums covering areas that included corporate governance, risk management and relevant industry and financial updates.

Directors’ Remuneration

The Remuneration Committee is entrusted with the role of recommending suitable policies in respect of salary packages for the Executive Directors. The current salary packages comprise a combination of basic salary and a variable performance incentive.

All Directors are paid a meeting allowance for attendance at each Board meeting. Similarly, members of the Board Committees are also paid a meeting allowance for each Committee Meeting they attended. The remuneration of the Non-Executive Directors is based on a standard fee as approved by the Company’s shareholders at the Annual General Meeting.

The aggregate Directors’ remuneration paid to the Directors of the Company for the financial year ended 31 December 2010 are disclosed in the financial statements.

B.         BOARD COMMITTEES

The Board has delegated specific functions and responsibilities to 3 Board Committees, namely the Audit Committee, the Nomination Committee and the Remuneration Committee in discharging its duties. These Committees which have their own respective written terms of reference, examine specific issues and report to the Board with their recommendations. Nevertheless, the ultimate responsibility for decision making lies with the Board.

Audit Committee

The Audit Committee currently comprises 3 Independent Non-Executive Directors. The terms of reference and a summary of the activities of the Audit Committee for the financial year ended 31 December 2010 are set out in the Audit Committee’s Report of the Annual Report 2010.

Nomination Committee and Remuneration Committee

The Nomination Committee is responsible for making recommendations to the Board on all new Board and Board Committee appointments.

The Remuneration Committee is responsible for reviewing succession planning as well as the remuneration policies and practices of the Group.

C.         SHAREHOLDERS

Communication with Shareholders and Investors

The Company recognises the importance of communications with its shareholders. It achieves this by way of communication channels such as announcements through Bursa Malaysia Securities Berhad, circulars, press releases, Annual Reports as well as through its general meetings. Through such channels, the Company is able to provide an overview of the Group’s performance and operation and to disclose material information.

In addition, the Company has a website, www.ocbb.com.my which provides an avenue for information to shareholders and investors at large.

The Annual General Meeting (“AGM”) remains the principal forum for dialogue with shareholders where they are accorded the opportunity to raise questions and seek clarification on the agenda items of the AGM and the performance of the Group. The Chief Operating Officer and Executive Directors and where appropriate, the Chairman of the Board, are available to respond to shareholders’ queries during the Meeting.

D.      D.         Accountability and Audit

Financial Reporting

In presenting the quarterly and annual financial statements, the Board takes due care and responsibility in presenting to present a balanced, clear and meaningful assessment of the Group's financial position, performance and prospects. The Audit Committee plays a crucial role in reviewing the information to be disclosed in the quarterly and annual financial statements to ensure accuracy, adequacy and compliance with appropriate accounting standards and other regulations.

Internal Control System

The Board acknowledges its responsibilities for the Group’s system of internal control covering not only financial controls but also operational and compliance controls as well as risk management. The internal control system involves each business and key management from each business. It should be noted that the system can only provide reasonable, and not absolute, assurance against material misstatement or loss.

The Group engages an external independent firm of professionals to provide the Audit Committee and the Board independent and objective reports on the Group’s management, records, accounting policies and controls. The scope of its internal audit function includes evaluation of the processes by which risks are identified, assessed and managed and assurance that controls which are implemented are appropriate and can effectively address acceptable risk exposures. The internal audit also ensures that recommendations to improve controls are followed through by the Management.

Relationship with the External Auditors

The Board has established formal and transparent arrangements to maintain an objective and professional relationship with the Company’s External Auditors, Messrs SJ Grant Thornton, in seeking its professional advice and ensuring compliance by the Company with the applicable accounting standards in Malaysia as well as the auditors’ professional requirements.

Messrs SJ Grant Thornton reports to the shareholders of the Company on its opinion which are included as part of the Group’s financial reports with respect to their audit on each year’s statutory financial statements.