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Social
Impact Report - Corporate Governance |
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One
of the key facets of our social responsibility system is the
corporate governance structure. Our system of corporate governance
is based on transparency, equity and efficiency focusing on
the need for consistent progress of the Company, and with a
view to laying a solid foundation for management and oversight.
Although government intervention in the form of prescriptive
legislation has not been forthcoming, the Company has endeavoured
to build a corporate governance practice based on OECD guidelines,
the Code of Best Practice on corporate governance by the Institute
of Chartered Accountants of Sri Lanka, and the combined code
on Corporate Governance, UK.
The environment in which our Company has to operate today is
increasingly international, complex and pressured. Under the
circumstances SLT’s objective has been to put in place
an effective system of checks and balances that govern the relationship
between the shareholders and the Board of Directors on the one
hand and the Executive Management and the Board of Directors
on the other.
The Board
The Board of Directors consists of one Executive Director who
is the CEO and nine Non-Executive Directors. The Board assumes
responsibility for the stewardship of SLT and is fully accountable
to the shareholders. The profiles of the Directors are given
on page 6 and 7 of this Report. Board responsibilities are discharged
directly or through the various committees. There have been
twelve regular meetings and two special meetings of the Board
during 2004.
The Board procedures have been established to deal with matters
which often have to be dealt with urgency, often between regular
Board meetings. Telephone conference meetings are held in which
as many Directors as possible could participate.
Matters reserved for the Board, a precedent to good governance
is firmly laid down and closely followed by the Board. All Directors
are subject to election by the shareholders at the first Annual
General Meeting except CEO and the Chairman, after their appointment,
and to re-election thereafter at intervals of no more than three
years. The Directors receive accurate, timely and clear information.
The Management provides such information and wherever necessary
Directors seek clarification or amplification.
The positions of Chairman and CEO are separate providing for
greater transparency in decision making. The CEO enjoys a clear
remit and specific responsibilities. With a view to allowing
flexibility, which is an important need considering the pressured
environment the Company has to operate, the Board wherever necessary
delegates authority to the CEO.
The Annual Business Plan which includes the capital expenditure
budgets are approved by the Board in advance and reviewed periodically
for necessary corrective action.
The Board ensures the presentation of balanced and understandable
assessment in all interim and other price sensitive and public
reports to the regulators as well as information required to
be presented in accordance with statutory requirements.
The Board has adopted systems to ensure checks and controls.
It also ensures that the requisite technology, systems, procedures,
and strategic planning are in place. Considerable care is taken
to make sure that proper audit controls, both internal and external
are in place and that these are controlled by persons who are
independent and competent.
Corporate Management Team
The day-to-day operations are carried out by a Corporate Management
Team headed by the Chief Executive Officer. While the Board
frames the policy and strategic objectives, autonomy is extended
to the Management Team which operates within the
broad parameters in accordance with the professional standards.
Board Committees
The Remuneration Committee comprises of the Chairman and the
CEO who decides on the remuneration of the Senior Management
which is performance related.
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