We are guided by a framework that establishes a clear responsibility, authority and governance structure

We operate within the framework of a clearly defined mandate that is aligned with the national development objectives of the Government, our ultimate shareholder.

Our Governance and Risk Management Framework (GRMF) serves as a guide for the effective management of risks, and to inculcate a culture of good corporate governance and risk management throughout the institution.

The GRMF comprises a Risk Management Policy, Schedule of Matters for the Board, Limits of Authority for the Management, Code of Conduct as well as Policies and Procedures, which guide our employees in their actions and behaviours.

Dato’ Shamshun Baharin B. Mohd Jamil, Deputy Chief Commissioner (Prevention) of MACC and Tan Sri Azman at the CIP signing

Supporting Malaysian and international best practices

Khazanah is a signatory and a member of several initiatives that further enhances governance and accountability as an institution including:

  1. Signatory of the United Nations-supported Principles for Responsible Investment (UNPRI), where we subscribe to the six principles that provide options for incorporating Environmental, Social and Governance (ESG) elements into our investment practice.
  2. Member of the International Forum of Sovereign Wealth Funds (IFSWF), where we actively collaborate with other sovereign wealth funds (SWF) to strengthen the SWF community and promote a deeper understanding of SWF roles and responsibilities.
  3. Member of FCLTGlobal (Focusing Capital on the Long Term), where we contribute to efforts in developing and encouraging a longer-term focus in business and investment decision-making.
  4. Signatory of the Malaysian Anti-Corruption Commission’s (MACC) Corporate Integrity Pledge, which underlines our firm commitment to integrity and good governance.

The Board of Directors governs our operations. It consists of representatives from the Government and the corporate sector with diverse professional backgrounds and expertise. Dato’ Sri Mohd Najib Tun Abdul Razak, the Prime Minister of Malaysia and Minister of Finance, is the Chairman of our Board.

The Board meets regularly and is ultimately accountable and responsible for Khazanah’s overall governance – this includes both performance and conformance matters. A Board Charter sets out the roles and responsibilities of the Board in overseeing the management of Khazanah.

The Board is assisted by three subcommittees – the Executive Committee (EXCO), the Audit and Risk Committee (ARC) and the Nomination and Remuneration Committee (NRC). The five-member EXCO comprises four Non-Executive Directors and an Executive Director, the four-member ARC consists of four Independent Directors and the four-member NRC comprises three Non-Executive Directors and an Executive Director. The NRC was newly established in December 2017 to assist the Board in the nomination, appointment and renewal of Khazanah’s Board members and Khazanah’s Managing Director, the appointment of Khazanah’s management positions of Executive Directors, including review of remuneration package, as well as other human resource management matters.

Khazanah upholds rigorous standards of transparency and accountability in our governance framework that establishes a clear responsibility, authority and governance structure. These perimeters guide our overall operations. Internal systems and controls in the form of policies, procedures and guidelines on matters ranging from risk management and investment approvals to corporate values and ethical standards further strengthen our governance practice.

We comply with statutory public disclosure requirements concerning our investments, divestments, and capital-raising exercises.

Not withstanding the same, we make appropriate disclosures of our performance and operations, be they required by law and the relevant authorities or voluntary dissemination of information to our stakeholders, including the public, across various platforms and forums.

Our accounts are audited by an independent external auditor, and the audited financial statements are submitted to the Companies Commission of Malaysia. Financial data are disclosed to our shareholders (Minister of Finance, Inc), Bank Negara Malaysia and the Department of Statistics on a regular basis.

We have shared key information to the Public Accounts Committee (PAC) and have been audited by the National Audit Department. We also made public key information on our official website and through annual publications including The Khazanah Report.

Stakeholder engagement remains a priority for us. Various outreach programmes are organised for media analysts and fund managers, government agencies, parliamentarians and civil society organisations, to inform them of our operations, activities and performance. This is intended to enhance their understanding about Khazanah.

In our ongoing efforts to further enhance our governance and accountability framework, we also support and contribute to initiatives and best practises that promote good governance, strong risk management, and long-term sustainability, at both domestic and international levels.

Commitment to institutional good governance
Khazanah is a signatory of the Malaysian Code for Institutional Investors and a member of the Institutional Investor Council Malaysia (IIC). We fully support the six principles of the Code and our full Statement of Compliance is publicly available through our website. The following summarises the principles of the Code and our compliance with the respective principles:

  1. Institutional investors should disclose the policies on their stewardship responsibilities
    Our GRMF provides a clear responsibility, authority and governance structure for Khazanah. The framework guides all our investments activities and business conduct.
  2. Institutional investors should monitor their investee companies
    Khazanah’s investment portfolios are actively monitored and managed by the respective investment teams, in accordance with our Statements of Practice for Management and Monitoring. This includes the development of Value Creation Plans and monitoring of performance against targets.
  3. Institutional investors should engage with investee companies as appropriate
    We are guided by a Five-Point Engagement Framework in our collaborative investment approach with our investee companies. The framework helps us to monitor the progress of the companies while empowering them to become high-performing entities.
  4. Institutional investors should adopt a robust policy on managing conflicts of interest which should be publicly disclosed
    Khazanah has robust policies and processes in place in managing conflicts, as outlined in our Staff Code of Conduct Handbook and the Supplier Code of Business Ethics. Both documents are publicly available through our website.
  5. Institutional investors should incorporate corporate governance and sustainability considerations into the investment decision-making process
  6. Institutional investors should publish a voting policy
    Khazanah is currently putting in place the relevant policies and frameworks for Principles 5 and 6.

Khazanah Nasional Consulting (Beijing) Company Limited

Khazanah opened the Beijing office in 2008 to build an investment presence in China and participate in the country’s growth story. The Beijing office was Khazanah’s first office established overseas. It also provides a platform for building closer bilateral economic ties between Malaysia and China.

An Overview of an Institution

Khazanah continues to grow as an institution, underpinned by a robust governance and accountability framework. Our Board of Directors, led by our Chairman, Dato’ Sri Mohd Najib Tun Abdul Razak, guides the efforts of our management in executing our mandate.

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