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Annual Report 2013
EXECUTIVES’ REMUNERATION
The Company adopts a remuneration strategy that supports a pay-for-performance philosophy. The Company has key
performance indicator to link with Company’s performance and shareholders’ returns. Executives participate in an annual
performance review process that assesses the individual’s performance and contributions.
The remuneration structure for the President and other key management personnel consists of the following components:
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SALARY
Fixed pay comprises basic salary and the Company’s contribution towards the Singapore Central Provident Fund where
applicable.
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BONUS
Bonus is paid based on the Company’s and individual’s performance.
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OTHER BENEFITS
Other benefits comprise of usage of Company’s car and other benefits-in-kind.
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STOCK OPTION
The COSCO Group Employees’ Share Option Scheme 2002, approved by members of the Company on 8 May 2002, had expired on
8 May 2012. The share options have been granted to align the president and key management’s interest with that of shareholders.
The options granted to them are made reference to the desired remuneration structure target and valued based on the Binomial
Valuation Model. Details of the share option scheme can be found in the “Directors’ Report” section of the Annual Report.
C. ACCOUNTABILITY AND AUDIT
ACCOUNTABILITY
Principle 10
The Board has overall responsibility to shareholders for ensuring that the Group is well managed and guided by its strategic
objectives. In presenting the Group’s annual and quarterly financial results to shareholders, the Board aims to provide
shareholders with a balanced and understandable assessment of the Group’s performance, position and prospects. Management
provides the Board with management accounts and other financial statements on a quarterly basis or as and when required by
the Board.
RISK MANAGEMENT AND INTERNAL CONTROLS
Principle 11
The Group maintains a robust and effective system of internal controls, addressing financial, operational, compliance and
information technology controls, and risk management systems, for all companies within the Group, but recognises that no
internal control system will preclude all errors and irregularities. The system is designed to manage rather than to eliminate the
risk of failure to achieve business objectives. The controls are to provide reasonable, but not absolute, assurance to safeguard
shareholders’ investments and the Group’s assets.
The Board is responsible for the governance of risk. The Board should ensure that Management maintains sound system of risk
management and internal controls to safeguard shareholders’ interests and the Company’s assets, and should determine the
nature and extent of significant risks which the Board is willing to take in achieving its strategic objectives.
Corporate Gover nance and Transparency
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