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We are committed to maintaining good corporate governance in accordance with the principles and guidelines set out in the Code of Corporate Governance released by the Council on Corporate Disclosure and Governance in 2005 (“CCDG Code”) and the Company has adopted a set of internal guidelines on corporate governance aligned with the CCDG Code. For more detailed information on the Company’s corporate governance practices, please refer to the Company’s Corporate Governance Report as set out in the Company’s Annual Report 2007 (pages 27 to 34).

The Company recognises the importance of strong corporate governance in the pursuit of continued and sustainable growth in the Group’s economic, social and environmental performance, and to ensure effectiveness of the Company’s CSR initiatives and activities.

The Board of Directors (the “Board”) has general oversight of the Company’s business, with its primary functions being the setting of corporate policy, providing guidance and approving strategic plans and direction for the Company, reviewing management performance, establishing and overseeing the framework for internal controls and risk management, and assuming the responsibility for good corporate governance. The Board comprises 8 members, all of whom are non-executive Directors, except for the Chairman and the Managing Director. There is a strong and independent element on the Board with 4 out of the 6 non-executive Directors considered to be independent, each viewed by the Board as being capable of maintaining his objectivity and independence at all times in the carrying out of his duties and responsibilities as an independent Director.

The responsibilities of the Board are carried out either directly by the Board or through committees established by the Board, which include the following:

(i) The Board Committee, comprising 5 Directors, the majority of whom are nonexecutive, which deliberates on operational matters requiring Board review.

(ii) The Audit Committee, comprising 4 non-executive and independent Directors, which assists the Board, inter alia, in providing an independent review of the effectiveness of the CDL Group’s financial reporting process and material internal controls, encompassing financial, operational, compliance and risk management controls. Such review is undertaken through a monitoring program involving internal and external audits.

(iii) The Nominating Committee, comprising 3 Directors, 2 of whom including the chairman are independent, which assists the Board in the recommendation and review of board appointments and re-appointments, determination of independence of each Director and identification of new directors who have the requisite knowledge, experience and skills to contribute effectively to the Board. The Nominating Committee also evaluates the Board’s performance as a whole on an annual basis, using objective and appropriate quantitative and qualitative criteria with quarterly performance indicators which include comparisons of the Company’s performance for the period under review against the Company’s performance for the corresponding period in previous years and also against industry peers and industry averages.

(iv) The Remuneration Committee, comprising 3 non-executive Directors, the majority of whom including the chairman are independent, which assists the Board in the review and recommendation for endorsement of the Board, a framework of remuneration and specific remuneration packages for each Director, including the Executive Chairman, the Managing Director and also for the Group General Manager. The Remuneration Committee in the performance of its review role, also ensures that remuneration policies of the Company are generally in line with the strategic objectives set by, and corporate values of, the Company. Such remuneration framework, which includes both fixed and variable components, takes into account, amongst other factors, the individual’s performance, the performance of the Group and industry practices.

Mr Kwek Leng Beng is the Executive Chairman of the Company and the Chairman of the Board. The holding of these dual roles by Mr Kwek Leng Beng, together with the strengths brought to these roles by a person of Mr Kwek Leng Beng’s stature and experience, has been considered by the Board. Taking into account also the internal controls in place to allow effective oversight by the Board to ensure appropriate balance and authority for the Board to exercise objective decision-making, the Board is of the view that there is no necessity to effect a separation of the role of the Chairman of the Board and the Executive Chairman, and these two roles may be performed by one person to facilitate the Group’s decision-making and implementation process.

As the most senior executive in the Company, Mr Kwek Leng Beng provides overall leadership and strategic vision for the CDL Group. He is assisted by his brother, Mr Kwek Leng Joo, the Managing Director of the Company, in charting broad direction, strategies and policies of the CDL Group.

The Company has adopted an Internal Code of Business and Ethical Conduct which crystallises the Company’s business principles and practices with regards to matters having ethical implications. The Code provides a communicable and understandable framework to all Directors and staff, incorporating and
emphasising the Company’s corporate values such as honesty, integrity, responsibility and accountability at all levels of the organisation and in the conduct of the Company’s relationships with its customers, suppliers and amongst employees, including situations where there are potential conflicts of interests.

Since 2006, the Company has also adopted a whistle-blowing policy and put in place procedures whereby staff of the Company can raise in confidence legitimate bona fide concerns on possible improprieties relating to accounting, financial reporting, internal controls and auditing matters without fear of reprisals. Within these procedures are arrangements for independent investigation of such matters raised, for appropriate follow up action to be taken and for reports to be made to the Audit Committee which has oversight responsibility of this policy. Such policy is communicated to all staff company-wide and its scope includes possible improprieties involving fraud or deliberate error in the recording, maintaining, preparation or audit of the Group’s financial records and statements, use of the Group’s assets, funds or property for illegal, improper or unethical purposes, acts of corruption or bribery, and improper actions or omissions which are likely to endanger employees, customers, suppliers and/or members of the public.

Since 2002, the Company has established a formal risk management framework, which is benchmarked against international risk management standards, to enable significant business risks within the Company’s property investment, development and management arm to be identified, assessed, evaluated, monitored and managed. Further enhancements to the framework were implemented in 2007 with the assistance of independent consultants to manage the strategic business risks which are reflective of the changes in markets, products and emerging best practices. The efforts of the Company in this area underline the importance of risk management in the Company’s business activities and as an essential component of its planning process. The Board’s overall responsibility in this area is supported by the Audit Committee which has general oversight of the Company’s risk management policy and procedures. For more information detailing the Company’s risk management process, please refer to page 2 of this section.

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