CORPORATE GOVERNANCE OVERVIEW STATEMENT

for the financial year ended 30 June 2024

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YTL Hospitality REIT (“YTL REIT” or “Trust”) was established on 18 November 2005 pursuant to a trust deed (as amended and restated) (“Deed”) entered into between Pintar Projek Sdn Bhd (“PPSB” or “Manager”) and Maybank Trustees Berhad (“Trustee”), as the manager and trustee, respectively, of the Trust. YTL REIT has been listed on the Main Market of Bursa Malaysia Securities Berhad (“Bursa Securities”) since 16 December 2005.

The Board of Directors of PPSB (“Board”) is firmly committed to ensuring that the Manager implements and operates good corporate governance practices in its overall management of the Trust and its subsidiaries (“YTL REIT Group” or “Group”).

In implementing its system of corporate governance, the Directors have been guided by the measures set out in the Guidelines on Listed Real Estate Investment Trusts (“REIT Guidelines”), the Malaysian Code on Corporate Governance (“Code”) and the Guidelines on Corporate Governance for Capital Market Intermediaries (“Corporate Governance Guidelines”) issued by the Securities Commission Malaysia (“SC”), and the Main Market Listing Requirements of Bursa Securities (“Listing Requirements”).

This statement details YTL REIT’s compliance with the Code and the applicable requirements under the Corporate Governance Guidelines during the financial year ended 30 June 2024.

PRINCIPLE A: BOARD LEADERSHIP AND EFFECTIVENESS

The Role of the Manager

YTL REIT is managed and administered by PPSB, with the primary objectives of:

(a)	providing unitholders of the Trust (“Unitholders”) with stable cash distributions with the potential for sustainable growth, principally from the ownership of properties; and
(b)	enhancing the long-term value of YTL REIT’s units (“Units”).

The Manager is required to ensure that the business and operations of YTL REIT are carried on and conducted in a proper, diligent and efficient manner, and in accordance with acceptable and efficacious business practices in the real estate investment trust industry in the countries in which the Trust owns assets, namely Malaysia, Japan and Australia. Subject to the provisions of the Deed, the Manager has full and complete powers of management and must manage YTL REIT (including all assets and liabilities of the Trust) for the benefit of its Unitholders.

The Board recognises that an effective corporate governance framework is critical in order to achieve these objectives, fulfil its duties and obligations and ensure that YTL REIT continues to perform strongly.

The general functions, duties and responsibilities of the Manager include the following:

(a)	to manage the YTL REIT Group’s assets and liabilities for the benefit of Unitholders;
(b)	to be responsible for the day-to-day management of the YTL REIT Group;
(c)	to carry out activities in relation to the assets of the YTL REIT Group in accordance with the provisions of the Deed;
(d)	to set the strategic direction of the YTL REIT Group and submit proposals to the Trustee on the acquisition, divestment or enhancement of assets of the Group;
(e)	to issue an annual report and quarterly reports of YTL REIT to Unitholders within 4 months and 2 months of YTL REIT’s financial year end and the end of the periods covered, respectively; and
(f)	to ensure that the YTL REIT Group is managed within the ambit of the Deed, the Capital Markets and Services Act 2007 (as amended) and other applicable securities laws, the Listing Requirements, the REIT Guidelines, the Corporate Governance Guidelines and other applicable laws.

Responsibilities of the Board

The Manager is led and managed by an experienced Board with a wide and varied range of expertise. This broad spectrum of skills and experience gives added strength to the leadership, thus ensuring the Manager is under the oversight and guidance of an accountable and competent Board. The Directors recognise the key role they play in charting the strategic direction, development and control of the Manager.

Key elements of the Board’s stewardship responsibilities include:

•	Ensuring that the strategic plans for the YTL REIT Group support long-term value creation for the benefit of its stakeholders and include strategies on economic, environmental and social considerations underpinning sustainability;
•	Promoting good corporate governance culture within the YTL REIT Group which reinforces ethical, prudent and professional behaviour;
•	Overseeing the conduct of the YTL REIT Group’s businesses to evaluate and assess management performance to determine whether businesses are being properly managed;
•	Ensuring there is a framework of prudent and effective internal control and risk management systems which enable risks to be identified, assessed and managed;
•	Succession planning for the Board and senior management;
•	Overseeing the development and implementation of a Unitholder/stakeholder communications policy;
•	Reviewing the adequacy and integrity of the YTL REIT Group’s management information and internal control systems; and
•	Ensuring the integrity of the YTL REIT Group’s financial and non-financial reporting.

The Board is led by the Executive Chairman who is responsible for instilling good corporate governance practices, leadership and effectiveness of the Board.

There is a clear balance of power, authority and accountability between the Executive Chairman, Tan Sri (Sir) Francis Yeoh Sock Ping, and the Chief Executive Officer, Dato’ Mark Yeoh Seok Kah, between the running of the Board and the Group’s business, respectively. The positions of the Executive Chairman and the Chief Executive Officer are separate and clearly defined, and are held by different members of the Board.

The Executive Chairman is responsible for leadership of the Board in ensuring the effectiveness of all aspects of its role, and is primarily responsible for leading the Board in setting the values and standards of the Group, including good corporate governance practices, the orderly and effective conduct of the meetings of the Board and Unitholders, leading discussions, encouraging active and open participation, managing the interface and encouraging constructive relations between the Board and management, ensuring the provision of accurate, timely and clear information to Directors and effective communications with stakeholders and facilitating the effective contribution of Non-Executive Directors.

The Chief Executive Officer is responsible for, amongst others, overseeing the day-to-day running of the business, developing and implementing Board policies and strategies, making operational decisions, serving as the conduit between the Board and management in ensuring the success of the Group’s governance and management functions, ensuring effective communication with Unitholders and relevant stakeholders, providing strong leadership, i.e., effectively communicating the Board’s vision, management philosophy and business strategy to employees and keeping the Board informed of salient aspects and issues concerning the Group’s operations.

The Chief Executive Officer and Executive Directors are accountable to the Board for the profitability and development of the YTL REIT Group, consistent with the primary aim of enhancing long-term Unitholder value. The Independent Non-Executive Directors have the experience and business acumen necessary to carry sufficient weight in the Board’s decisions and the presence of these Independent Non-Executive Directors brings an additional element of balance to the Board as they do not participate in the day-to-day running of the YTL REIT Group.

The roles of Executive and Non-Executive Directors are differentiated, both having fiduciary duties to Unitholders. Executive Directors have a direct responsibility for business operations whereas Non-Executive Directors have the necessary skill and experience to bring an independent and objective judgment to bear on issues of strategy, performance and resources brought before the Board. The Executive Directors are responsible for the Manager’s operations and for ensuring that the strategies proposed by the executive management are fully discussed and examined, and take account of the long-term interests of the Unitholders.

In accordance with the Code, the Executive Chairman is not a member of the Audit Committee. The Audit Committee is chaired by an Independent Non-Executive Director and comprises solely Non-Executive Directors, with a majority being Independent Non-Executive Directors, in compliance with the Listing Requirements. This promotes objectivity in the Board’s deliberations and ensures there are effective checks and balances, as well as objective review by the Board of recommendations put forth by the Audit Committee.

In the discharge of their responsibilities, the Directors have established functions which are reserved for the Board and those which are delegated to management. Key matters reserved for the Board’s approval include overall strategic direction, business expansion and restructuring plans, material acquisitions and disposals, expenditure over certain limits, issuance of new securities, change in income distribution policy and capital alteration plans. Further information on authorisation procedures, authority levels and other key processes can also be found in the Statement on Risk Management & Internal Control set out in the Annual Report.

Board Meetings and Procedures

Board meetings are scheduled with due notice in advance at least four times a year in order to review and approve the interim and annual financial statements. Additional meetings may also be convened on an ad-hoc basis when significant issues arise relating to the Trust. Meetings of the Audit Committee are conducted separately from those of the main Board to enable objective and independent discussions. The Board met five times during the financial year ended 30 June 2024.

The Directors are fully apprised of the need to determine and disclose potential or actual conflicts of interest which may arise in relation to transactions or matters which come before the Board. In accordance with applicable laws and regulations, the Directors formally disclose any direct or indirect interests or conflicts of interests in such transactions or matters as and when they arise and abstain from deliberations and voting at Board meetings as required.

The Directors have full and unrestricted access to all information pertaining to the business and affairs of the YTL REIT Group to enable them to discharge their duties. At least one week prior to Board meetings, all Directors receive the agenda together with a comprehensive set of Board papers containing information relevant to the business of the meeting. This allows the Directors to obtain further explanations or clarifications, where necessary, in order to be properly briefed before each meeting.

Board papers are presented in a consistent, concise and comprehensive format and include, where relevant to the proposal put forward for the Board’s deliberation, approval or knowledge, progress reports on the YTL REIT Group’s operations and detailed information on corporate proposals, major fund-raising exercises and significant acquisitions and disposals. Where necessary or prudent, professional advisers may be on hand to provide further information and respond directly to Directors’ queries. In order to maintain confidentiality, Board papers on issues that are deemed to be price-sensitive may be handed out to Directors during the Board meeting.

The minutes of the Board and/or Board committee meetings are circulated and confirmed at the next meeting. Once confirmed, the minutes of the Board committee meetings are subsequently presented to the Board for notation.

Company Secretary

The Board is supported by a professionally-qualified and competent Company Secretary. The Company Secretary, Ms Ho Say Keng, is a Fellow of the Association of Chartered Certified Accountants, a registered member of the Malaysian Institute of Accountants and an affiliate member of the Malaysian Institute of Chartered Secretaries and Administrators, and is qualified to act as Company Secretary under Section 235(2)(a) of the Companies Act 2016.

The Company Secretary ensures that Board procedures are adhered to at all times during meetings and advises the Board on matters including corporate governance issues and the Directors’ responsibilities in complying with relevant legislation and regulations. The Company Secretary works very closely with management for timely and appropriate information, which will then be passed on to the Directors.

In accordance with the Board’s procedures, deliberations and conclusions in Board meetings are recorded by the Company Secretary, who ensures that accurate and proper records of the proceedings of Board meetings and resolutions passed are recorded and kept in the statutory register at the registered office of the Manager.

During the financial year under review, the Company Secretary attended training, seminars and regulatory briefings and updates relevant for the effective discharge of her duties. The Company Secretary carries out ongoing reviews of existing practices in comparison with any new or amended measures introduced in the Listing Requirements, REIT Guidelines and/or legislation, regulations and codes applicable to the governance of YTL REIT and updates the Board accordingly.

Board Charter

The Board’s functions are governed and regulated by the Constitution of the Manager and the laws, rules and regulations governing companies in Malaysia, including the Companies Act 2016, Listing Requirements and REIT Guidelines. The Board has a Board Charter, a copy of which can be found under the “Governance” section on the Trust’s website at www.ytlhospitalityreit.com.

The Board Charter serves several important functions, including as a primary reference to the Board of its role, fiduciary duties and responsibilities, its governance processes and legal framework within which it operates and as an induction tool for new Directors. The Board Charter clearly identifies the respective roles and responsibilities of the Board, Board committees, Directors and management and the issues and decisions reserved for the Board.

The Board Charter was most recently updated and adopted on 5 September 2024 to set out, amongst others, the applicability to the Board of the new Conflict of Interest Policy (detailed below) and the Code of Conduct & Business Ethics for the YTL Group of Companies (“YTL Group”) and to establish a policy which limits the tenure of the Independent Non-Executive Directors to nine years without further extension.

The Board Charter is reviewed as and when changes arise and updated in accordance with the needs of the Manager and any new regulations that impact the discharge of the Board’s responsibilities.

Business Conduct, Ethics & Whistleblowing

Following the amendment to the Board Charter on 5 September 2024, the Directors will observe and adhere to the Code of Conduct & Business Ethics going forward, replacing the Code of Ethics for Company Directors issued by the Companies Commission of Malaysia.

The Manager is also guided by the corporate culture of its parent company, YTL Corporation Berhad (“YTL Corp”), which has an established track record for good governance and ethical conduct. Key guidance is contained in the Code of Conduct & Business Ethics of the YTL Group, which also sets out the whistleblowing policy and procedures, and the YTL Group’s Anti-Bribery & Corruption Policy, as detailed in the following section. A copy of the Code of Conduct & Business Ethics can be found on the Trust’s website at www.ytlhospitalityreit.com.

The Code of Conduct & Business Ethics sets out the acceptable general practices and ethics for the YTL REIT Group and includes policies and measures to address conflicts of interest, abuse of power, corruption, insider trading, money laundering and data protection. On 5 September 2024, the Code of Conduct & Business Ethics was updated to codify existing environmental, social and governance policies and general practices that apply across the YTL Group.

Training modules and other methods of communication are employed on an ongoing basis to familiarise employees of the Manager with their duties and obligations in this area. Training carried out during the financial year under review focused on areas including anti-bribery and corruption, as well as a cybersecurity refresher course.

Anti-Bribery and Corruption Policy (“ABC Policy”)

The objective of the ABC Policy is to further enforce the YTL Group’s Code of Conduct & Business Ethics in order to ensure that all Directors and employees understand their responsibilities in compliance with the YTL Group’s zero tolerance for bribery and corruption within the organisation. This is in line with the corporate liability provision in Section 17A of the Malaysian Anti-Corruption Commission Act 2009 (“MACC Act”) which came into force on 1 June 2020. A copy of the ABC Policy can be found on the Trust’s website at www.ytlhospitalityreit.com.

The ABC Policy outlines the YTL Group’s strategies in identifying, preventing and managing bribery and corruption issues. The policies and procedures put in place are guided by the Guidelines on Adequate Procedures issued pursuant to Section 17A(5) of the MACC Act. The ABC Policy applies to all Directors, managers and employees of the Manager in dealing with external parties in the commercial context. The policy is reviewed at least once every three years and amended as needed to ensure that it continues to remain relevant, appropriate and effective to enforce the principles highlighted therein and to ensure continued compliance with the prevailing law.

A comprehensive implementation plan has been established to communicate and disseminate the ABC Policy on an ongoing basis throughout the YTL Group through online training modules and other communication methods, and has been a highly effective component of the overall anti-bribery and corruption risk management process.

Directors and employees of the YTL Group in Malaysia are required to read and understand the ABC Policy and the Code of Conduct & Business Ethics, successfully complete the online training modules to reinforce their understanding of the policy and sign the YTL Group’s Integrity Pledge in acknowledgement of their obligations and responsibilities.

Compliance with the ABC Policy continues to be monitored closely, both on an ongoing basis and in conjunction with the annual assessment of the Group’s corruption risks. The annual risk assessment is carried out to identify the corruption risks to which the Group is exposed and the appropriateness of the mitigation measures established to minimise the exposure to these risks.

Sustainability Governance

The Board oversees governance of the YTL REIT Group’s sustainability matters which includes setting its environmental, social and governance (“ESG”) strategies, priorities and targets, overseeing the progress of ESG strategy and performance and reviewing and addressing the YTL REIT Group’s material ESG risks and opportunities. Further information can be found in the Managing Sustainability section in the Annual Report and the YTL Group Sustainability Report 2024 which will be published later this year and will be available for download at www.ytl.com/sustainability.

The Manager’s key methods for communicating its sustainability strategies, priorities and targets as well as performance against these targets to internal and external stakeholders include the Annual Report of the Trust, the YTL Group Sustainability Report, which is issued annually, and the YTL Group’s Sustainability website at www.ytl.com/sustainability.

The Directors are kept apprised of the key ESG issues relevant and specific to the YTL REIT Group through briefings from management on performance, targets and operational updates, and also stay abreast with more general developments in the ESG arena through training programmes, further details of which are set out in the section below on Board Commitment.

ESG risks are incorporated into the Board’s process for addressing and managing significant risks that may have a considerable impact on YTL REIT as they form part of the overall risk management framework, further details of which can be found in the Statement on Risk Management & Internal Control set out in the Annual Report.

Composition of the Board

With effect from 30 November 2023, Dato’ Ahmad Fuaad Bin Mohd Dahalan was re-designated as a Non-Independent Non-Executive Director, from Independent Non-Executive Director, previously. The Board currently comprises 8 Directors (excluding 2 Alternate Directors), of which 4 are executive members and 4 are non-executive members.

The Independent Directors currently comprise 37.5% of the Board. This is in compliance with the provisions of the Listing Requirements and the REIT Guidelines for at least one-third of the Board to be independent.

Board and Senior Management Appointments

The appointment of Directors is undertaken by the Board as a whole whereby the Executive Chairman and/or the Chief Executive Officer make recommendations on the suitability of candidates nominated for appointment to the Board and, thereafter, the final decision lies with the entire Board to ensure that the resulting mix of experience and expertise of members of the Board is sufficient to address the issues affecting the Manager. The Board is of the view that its current practice and procedures are suitable and appropriate to fulfil the needs of the Trust and to comply with the applicable Listing Requirements. As previously reported, the Board will continue to assess the necessity of delegating this function to a separate nominating committee and will do so if it is deemed appropriate at the relevant time.

The Directors understand the importance of having a diverse Board to leverage the varying perspectives, experience and expertise required to achieve effective stewardship and management, and this forms a key part of the periodic assessment of the Board’s composition.

In its deliberations, the Board assesses suitable candidates with due regard for diversity, taking into account the required mix of skills, experience, age, gender, ethnicity, time and commitment, background and perspective. Nevertheless, in identifying future candidates, the Board will also endeavour to utilise independent sources including external human resources consultants and specialised databases, as appropriate.

The Board recognises the importance of encouraging and developing female talent at all levels. There are currently two female directors on the Board comprising 25% of the Board. This is deemed to comply with the requirement under the Corporate Governance Guidelines.

Meanwhile, members of senior management are appointed by the Executive Chairman and/or the Chief Executive Officer based on relevant industry experience and with due regard for diversity in skills, experience, age, background and gender.

Board Remuneration

Directors’ remuneration is decided in line with the objective recommended by the Code to determine the remuneration for Directors so as to attract and retain Directors of the calibre needed to successfully carry on the Manager’s operations. The Executive Directors’ remuneration consists of basic salary, other emoluments and other customary benefits as appropriate to a senior management member. In general, the component parts of remuneration are structured so as to link rewards to the overall performance of YTL REIT. In the case of Non-Executive Directors, the level of remuneration reflects the contribution, experience and responsibilities undertaken by the particular non-executive concerned.

As previously reported, the Board has continued to assess the need to delegate this function to a separate committee and concluded that its current practice and procedures remain suitable and appropriate to fulfil the needs of the Trust and are in compliance with the Listing Requirements. In this context, it is pertinent to note that the Directors and senior management are remunerated by the Manager and not by YTL REIT.

The following tables provide an overview of the remuneration of the Directors for the financial year ended 30 June 2024:-

Notes:-
Details of the remuneration of individual directors and members of senior management are not disclosed as the Directors and senior management are remunerated by the Manager and not by YTL Hospitality REIT.

Board Commitment

The Directors are fully cognisant of the importance and value of attending seminars, training programmes and conferences in order to update themselves on developments and changes in the REIT industry, as well as wider economic, financial and governance issues to enhance their skills, knowledge and expertise in their respective fields. The Board will continue to evaluate and determine the training needs of its Directors on an ongoing basis.

All the Directors have undergone training programmes during the financial year ended 30 June 2024. The conferences, seminars and training programmes attended by one or more of the Directors covered the following areas:-

PRINCIPLE B: EFFECTIVE AUDIT AND RISK MANAGEMENT

Integrity in Financial Reporting

The Directors are responsible for ensuring that financial statements of the Trust are drawn up in accordance with applicable approved accounting standards in Malaysia, the REIT Guidelines and the Deed. The Statement of Directors’ Responsibilities made pursuant to paragraph 15.26(a) of the Listing Requirements is set out in the Annual Report.

In presenting the financial statements, the Manager has used appropriate accounting policies, consistently applied and supported by reasonable and prudent judgments and estimates, to present a true and fair assessment of the Company’s position and prospects. Interim financial statements are reviewed by the Trustee and the Audit Committee and approved by the Directors prior to release to the relevant regulatory authorities.

Audit Committee

The Manager has in place an Audit Committee which comprises three Non-Executive Directors, the majority of whom are independent, in compliance with the Listing Requirements, namely Datuk Mark Victor Rozario, Dato’ Ahmad Fuaad Bin Mohd Dahalan and Dato’ Zainal Abidin Bin Ahmad. The Chairman of the Audit Committee is Datuk Mark Victor Rozario, in accordance with the recommendations of the Code that the chairman of the Audit Committee should not be the chairman of the Board.

The members of the Audit Committee possess a wide range of necessary skills to discharge their duties, and are financially literate and able to understand matters under the purview of the Audit Committee including the financial reporting process. The members of the Audit Committee also intend to continue to undertake professional development by attending training to keep themselves abreast of relevant developments in accounting and auditing standards, practices and rules.

The Audit Committee holds quarterly meetings to review matters including the YTL REIT Group’s financial reporting, the audit plans for the financial year and recurrent related party transactions, as well as to deliberate the findings of the internal and external auditors.

The Audit Committee met six times during the financial year ended 30 June 2024. Full details of the composition and summary of the work carried out by the Audit Committee during the financial year can be found in the Audit Committee Report set out in the Annual Report. This information and the terms of reference of the Audit Committee, which were updated and approved by the Board on 31 July 2023 to include the expanded scope of the Audit Committee in dealing with COI situations, are available under the “Governance” section on the Trust’s website at www.ytlhospitalityreit.com.

The Audit Committee has established formal and professional arrangements for maintaining an appropriate relationship with the Trust’s external auditors, HLB Ler Lum Chew PLT (“HLB”). The external auditors also attend each Annual General Meeting (“AGM”) in order to address clarifications sought pertaining to the audited financial statements by Unitholders.

The Audit Committee’s Auditor Independence Policy guides its assessment of the suitability, objectivity and independence of the external auditors. The policy includes, amongst others, a cooling off period of three years before a former audit partner of the external audit firm may be appointed as a member of the Audit Committee, and additional assessment criteria based on information presented in the Annual Transparency Report of the external auditors, in line with the Code. None of the Audit Committee members were formerly audit partners of the Trust’s external auditors.

Details of the audit and non-audit fees paid/payable to HLB for the financial year ended 30 June 2024 are as follows:-

	Trust RM’000	Group RM’000
Statutory audit fees paid/payable to HLB	108	138
Non-audit fees paid/payable to HLB	6	6
Total	114	144

Risk Management & Internal Control

The Board acknowledges its overall responsibility for maintaining a sound system of risk management and internal control to safeguard the investment of the Unitholders and the assets of the YTL REIT Group, and that these controls are designed to provide reasonable, but not absolute, assurance against the risk of occurrence of material errors, fraud or losses.

Details of the YTL REIT Group’s system of risk management and internal control are contained in the Statement on Risk Management & Internal Control and the Audit Committee Report as set out in the Annual Report.

Conflicts of Interest and Related Party Transactions

The Deed provides that the Manager, the Trustee and any delegate of either of them shall avoid conflicts of interest arising or, if conflicts arise, shall ensure that the YTL REIT Group is not disadvantaged by the transaction concerned. The Manager must not make improper use of its position in managing the YTL REIT Group to gain, directly or indirectly, an advantage for itself or for any other person or to cause detriment to the interests of Unitholders.

In order to deal with any conflict-of-interest situations that may arise, any related party transaction, dealing, investment or appointment carried out for or on behalf of the YTL REIT Group involving parties related to the Trust must be executed on terms that are the best available to the Trust and which are no less favourable than an arm’s length transaction between independent parties.

The Manager may not act as principal in the sale and purchase of real estate, securities and any other assets to and from the YTL REIT Group. “Acting as principal” includes a reference to:

(a)	dealing in or entering into a transaction on behalf of a person associated with the Manager;
(b)	acting on behalf of a corporation in which the Manager has a controlling interest; or
(c)	the Manager acting on behalf of a corporation in which the Manager’s interest and the interests of its Directors together constitute a controlling interest.

In addition, the Manager must not, without the prior approval of the Trustee, invest any monies available for investment under the Deed in any securities, real estate or other assets in which the Manager or any officer of the Manager has a financial interest or from which the Manager or any officer of the Manager derives a benefit.

In dealing with any related party transactions that may arise, the Manager ensures that the provisions in the REIT Guidelines and the Listing Requirements pertaining to related party transactions are fully complied with in any applicable transactions.

In May 2024, the Board adopted a Conflict of Interest (“COI”) Policy which is intended to ensure that any actual or potential COI that a Director and key senior management may have is appropriately dealt with or managed. The policy applies to the Directors and key senior management of the Manager and the YTL REIT Group and sets out guidance in identifying COI situations, disclosure and recusal requirements and the measures to be taken to resolve, eliminate or mitigate conflicts. The policy also expands the scope of the Audit Committee’s review of COI situations and the measures taken to resolve, eliminate or mitigate any such conflicts.

To assist the Audit Committee in discharging its duties in this area, a ‘COI Declaration Form’ has been adopted together with the COI Policy for the purpose of identifying, evaluating, disclosure/reporting, monitoring, maintenance and management of COI situations.

Internal Audit

The Manager’s internal audit function is undertaken by the Internal Audit department of YTL Corp (“YTLIA”). YTLIA reports directly to the Audit Committee of YTL Corp and to the Board on matters pertaining to the Manager and the Trust.

The Head of Internal Audit, Mr Choong Hon Chow, is a member of the Malaysian Institute of Accountants and a Fellow of the Association of Chartered Certified Accountants (ACCA) UK. He started his career with the external audit division of a large public accounting firm before moving on to the internal audit profession in public listed companies and gained valuable and extensive internal audit experience covering many areas of diversified commercial businesses and activities. He has a total of 41 years of internal and external audit experience.

During the financial year ended 30 June 2024, YTLIA comprised 10 full-time personnel. The personnel of YTLIA are free from any relationships or conflicts of interest which could impair their objectivity and independence.

The internal audit function has adopted best practices in internal auditing and initiated a Gap Assessment based on the Global Internal Audit Standards in July 2024.

The activities of the internal audit function during the year under review included:-

•	Developing the annual internal audit plan and proposing this plan to the Audit Committee;
•	Conducting scheduled internal audit engagements, focusing primarily on the adequacy and effectiveness of internal controls and recommending improvements where necessary;
•	Conducting follow-up reviews to assess if appropriate action has been taken to address issues highlighted in audit reports;
•	Presenting significant audit findings to the Audit Committee for consideration;
•	Conducting reviews of recurrent related party transactions;
•	Conducting discussions with management in identifying significant concerns and risk areas perceived by management for inclusion in the internal audit plan; and
•	Conducting discussions with management to identify, analyse, assess and prioritise the internal and external corruption risks, for the purpose of establishing appropriate processes, systems and controls to mitigate the specific corruption risks exposure.

Further details of the YTL REIT Group’s internal audit function are contained in the Statement on Risk Management & Internal Control and the Audit Committee Report as set out in the Annual Report.

PRINCIPLE C: INTEGRITY IN CORPORATE REPORTING AND MEANINGFUL RELATIONSHIP WITH STAKEHOLDERS

Communication with Unitholders

The Manager values dialogue with Unitholders and investors as a means of effective communication that enables the Board to convey information about the YTL REIT Group’s performance, corporate strategy and other matters affecting Unitholders’ interests. The Board recognises the importance of timely dissemination of information to Unitholders and, accordingly, ensures that they are well informed of any major developments of YTL REIT. Such information is communicated through annual reports, the Trust’s various disclosures and announcements to Bursa Securities, including quarterly and annual results, and the corporate website.

Corporate information, annual financial results, governance information, business reviews and future plans are disseminated through the Annual Report, whilst current corporate developments are communicated via the Trust’s website, www.ytlhospitalityreit.com, in addition to prescribed information, including financial results, announcements, circulars, prospectuses and notices, which is released through the official website of Bursa Securities.

The Executive Chairman, Chief Executive Officer and/or the Executive Directors meet with analysts, institutional Unitholders and investors throughout the year to provide updates on strategies and new developments. However, price-sensitive information and information that may be regarded as undisclosed material information about YTL REIT is not disclosed in these sessions until after the requisite announcements to Bursa Securities have been made.

Whilst efforts are made to provide as much information as possible to its Unitholders and stakeholders, the Directors are cognisant of the legal and regulatory framework governing the release of material and sensitive information so as to not mislead its Unitholders. Therefore, the information that is price-sensitive or that may be regarded as undisclosed material information about the YTL REIT Group is not disclosed to any party until after the prescribed announcement to Bursa Securities has been made.

Conduct of General Meetings

The AGM is the principal forum for dialogue with Unitholders. The Board provides opportunities for Unitholders to raise questions pertaining to issues in the Annual Report and operational performance of YTL REIT for the financial year. The Notice of AGM is sent to Unitholders at least 28 days prior to the AGM in accordance with the Code, which also meets the criteria of the Listing Requirements and Companies Act 2016 which require the Notice of AGM to be sent 21 days prior to the AGM, thus allowing Unitholders to make adequate preparation.

The Executive Chairman, Chief Executive Officer and Executive Directors provide appropriate answers in response to Unitholders’ questions during the meeting thereby ensuring a high level of accountability, transparency and identification with YTL REIT’s strategy and goals.

The Directors are mindful of the recommendation under the Code that all directors must attend general meetings and fully appreciate the need for their attendance at all such meetings. All Directors attended the Company’s eleventh AGM held on 12 October 2023.

Extraordinary general meetings are held as and when required to seek Unitholders’ approval. The Chief Executive Officer and Executive Directors take the opportunity to fully explain the rationale for proposals put forth for approval and the implications of such proposals for the Trust, and to reply to Unitholders’ questions.

Where applicable, each item of special business included in the notice of the meeting is accompanied by an explanatory statement for the proposed resolution to facilitate full understanding and evaluation of the issues involved. All resolutions are put to the vote by electronic poll voting and an independent scrutineer is appointed to verify poll results. The results of the electronic poll voting are announced in a timely matter, usually within half an hour of the voting process to enable sufficient time for the results to be tabulated and verified by the independent scrutineer.

Where general meetings are held on a virtual basis, the Board utilises available platforms and technologies that support meaningful engagement with Unitholders by ensuring smooth broadcast of the general meeting and enabling interactive participation by Unitholders via facilities to submit questions before and during the general meeting. Questions posed by Unitholders are made visible to all meeting participants during the meeting.

The Manager engages professional service providers to manage and administer the Trust’s general meetings who have in place the necessary data privacy and protection and cybersecurity policies and procedures to safeguard the information of the Trust and its unitholders.

Minutes of general meetings are posted on the Trust’s website under the “Meetings“ page, which can be accessed at the link below, no later than 30 business days after the general meeting:

•   https://www.ytlhospitalityreit.com/meetings

The forthcoming twelfth AGM will be held on a fully virtual basis, the details of which can be found in the Notice of Annual General Meeting in the Annual Report.

This statement was approved by the Board on 5 September 2024.