Page 11 - ar2012

Preamble
The Board of Directors of Hotel Royal Limited (the “Company”) is pleased to confirm that it has adhered to the
following corporate principles and guidelines tailored to the specific needs of the Company set out in the Code
of Corporate Governance 2005 (the “Code”). These principles and guidelines reflect the Board’s commitment in
having effective self-regulatory corporate practices to safeguard the interests of its shareholders and maximising
long-term success of the Company and Group.
The Board also considered certain corporate practices with reference to the revised Code of Corporate Governance
2012 issued on 2 May 2012 which is effective from financial year commencing on or after 1 November 2012.
The Board believes that these guidelines should be an evolving set of corporate governance principles, subject to
the specific needs of the Company and subject to modification when circumstances may warrant.
1. BOARD MATTERS
1.1 The Board’s Conduct of its Affairs
Principle 1: Every company should be headed by an effective Board to lead and control the company. The
Board is collectively responsible for the success of the company. The Board works with Management to
achieve this and the Management remains accountable to the Board.
The primary responsibilities of the Board of Directors encompass the following:
O To provide strategic direction and decision-making pertaining to the Group’s activities that are of significant
nature and approve periodic plans as well as major investments and divestments;
O To oversee the business and affairs of the Company, and working with management, establish strategic
directions and financial goals to be implemented by management as well as monitoring the performance of
management;
O To oversee the evaluation of the adequacy of internal controls, risks management, financial reporting and
compliance, and satisfy itself as to the sufficiency of such processes; and
O To be responsible for the overall corporate governance of the Group.
The Company requires the approval from the Board for material new investments or increase in investments in
businesses of subsidiaries, projects or fixed assets and any divestments or sales by any company in the Group.
Other aspects which require the approval of the Board include all material commitments to term loans and lines
of credit from banks and financial institutions by the Company.
Each Board member exercises equal responsibility in overseeing the business and affairs of the Company and
objectively takes decision in the interest of the Company.
The schedule of all Board and Board Committee meetings for the financial year is notified to all directors well in
advance. The Board meets quarterly and as and when deems necessary. To cater to urgent substantial matters, the
Board may convene meetings on ad-hoc basis. The Board of Directors held four meetings in total for the financial
year ended 31 December 2012.
The Company’s Articles of Association provides for the Board to conduct its meeting via teleconferencing or
videoconferencing on a timely basis when physical meeting is not possible. The Board and its sub-committees may
also make decision through circular resolutions in writing including by electronic means.
The Board is regularly updated on risk management, corporate governance and other major changes in the regulatory
requirements and financial reporting standards that are relevant to the Group.
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REPORT ON CORPORATE GOVERNANCE