Corporate Governance The rights of CLCT’s creditors, which comprise of lending banks, are protected with a well-spread debt maturity, healthy interest coverage ratio and gearing ratio below the regulated limit. Regular internal reviews are also conducted to ensure that various capital management metrics remain compliant with loan covenants. ADDITIONAL INFORMATION Executive Committee The Board has also established an EC, which oversees the day-to-day activities of the Manager and CLCT. The EC is guided by its term of reference. In particular, the EC approves specific budgets for capital expenditure on development projects, acquisitions and enhancements/upgrading of properties within its approved financial limits. The EC also reviews management reports and operating budgets and awards contracts for development projects. The EC met two times in FY 2024. The members of the EC also meet informally during the year. Dealings with Interested Persons Review Procedures for Interested Person Transactions The Manager has internal control procedures to ensure that IPTs are in compliance with Chapter 9 of the Listing Manual and the Property Funds Appendix. The Manager would have to demonstrate to the ARC that such IPTs are undertaken at arm’s length, on normal commercial terms and are not prejudicial to CLCT and Unitholders’ interests, which may include obtaining (where practicable) third party quotations or valuations from independent valuers (in accordance with the Listing Manual and Property Funds Appendix). The procedures include the following: Interested Person Transactionsi Approving Authority, Procedures and Disclosure S$100,000 and above per transaction (which singly, or when aggregated with other transactionsii with the same Interested Person in the same financial year is less than 3.0% of CLCT’s latest audited net tangible assets/net asset value) • Management • Audit and Risk Committee Transactionii which: (a) is equal to or exceeds 3.0% of CLCT’s latest audited net tangible assets/net asset value; or (b) when aggregated with other transactionsii with the same Interested Person in the same financial year is equal to or exceeds 3.0% of CLCT’s latest audited net tangible assets/net asset value • Management • Audit and Risk Committee • Immediate Announcement Transactionii which: (a) is equal to or exceeds 5.0% of CLCT’s latest audited net tangible assets/net asset value; or (b) when aggregated with other transactionsii, iii with the same Interested Person in the same financial year is equal to or exceeds 5.0% of CLCT’s latest audited net tangible assets/net asset value • Management • Audit and Risk Committee • Immediate Announcement • Unitholdersiii i This table does not include the procedures applicable to IPTs falling under the exceptions set out in Rules 915 and 916 of the Listing Manual. ii Any transaction of less than S$100,000 in value is disregarded. iii In relation to approval by Unitholders for transactions that are equal to or exceed 5.0% of CLCT’s latest audited net tangible assets/net asset value (whether singly or aggregated), any transaction which has been approved by Unitholders, or is the subject of aggregation with another transaction that has been approved by Unitholders, need not be included in any subsequent aggregation. A summary of IPTs entered into within the financial year will be submitted by the Manager to the Trustee, and submitted by CLI IA to the ARC for review on an annual basis. The Manager maintains a register to record all IPTs entered into by CLCT (and the basis on which they are entered into, including quotations obtained to support such basis). All IPTs of S$100,000 and above are subject to regular periodic reviews by the ARC, which in turn obtains advice from CLI IA, to ascertain that the guidelines and procedures established to monitor IPTs, have been complied with. The review includes an examination of the nature of the transaction and its supporting documents or such other information deemed necessary by the ARC. ARC members with an interest in any IPT are required to abstain from the review and approval process in relation to that transaction. Details of all IPTs (except those under S$100,000) in FY 2024 are disclosed on page 162 of this Annual Report. Dealing with Conflicts of Interest The following principles and procedures have been established to deal with potential conflicts of interest which the Manager (including its Directors, KMP and employees) may encounter in managing CLCT: (a) the Manager is a dedicated manager to CLCT and will not manage any other REIT or be involved in any other real property business; (b) all resolutions at meetings of the Board in relation to matters concerning CLCT must be decided by a majority vote of the Directors, including at least one ID; (c) in respect of matters in which CLI and/or its subsidiaries have an interest, whether direct or indirect, any nominees appointed by CLI and/or its subsidiaries to the Board 72 CapitaLand China Trust
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