• Provides independent oversight on both internal and external audit functions. It reviews audit scopes, monitors material control lapses, ensures unresolved findings are addressed, and follows up on timely remedial actions. It also assesses the independence and effectiveness of external auditors. • Monitors anti-corruption initiatives, including the Corruption Risk Management (CRM) and Organisational Anti-Corruption Plan (OACP). It reviews the effectiveness of whistleblowing cases investigated, fraud reports, and irregularities while ensuring conflicts of interest are disclosed and managed. • Evaluates external auditor appointments and independence, reviews their findings, and ensures that non-audit services do not compromise objectivity. It maintains open communication with external auditors and ensures management acts on their recommendations. • Oversee the implementation of Internal Capital Adequacy Assessment Process (ICAAP) and monitor the capital adequacy and capital management for the Bank. • Reviews related party transactions, ensuring they are conducted on arm’s length terms. It assesses significant transactions outside the normal course of business to avoid potential conflicts of interest. • Engages external expertise for specialised audits as needed, ensuring proper terms, scope, and reporting arrangements are established. It also reviews thirdparty opinions on internal control frameworks for enhanced governance. Key Focus Areas: • Key focus areas and activities of the BAEC during FY2024 can be found on pages 237-243 of this Report. BAEC Priorities for FY2025 The BAEC has identified the following priorities and key focus areas for FY2025: i. Sustainability and climate related disclosures and reporting requirements. ii. Review of reports focusing on emerging risks such as technology, cybersecurity, sustainability and Shariah compliance. iii. Continuous engagement with external auditors on financial disclosures and reporting as well on internal controls. iv. Fraud related matters as well as anti-bribery and corruption risk management. b) Board Risk Committee (BRC) No. of meetings 15 Attendance 100% BRC Key Roles: • Assists the Board in ensuring that a sound and robust risk management framework as expected by BNM is in place and effectively implemented. • Provides an independent oversight on the Management’s activities in managing credit risk, market risk, liquidity risk, non-financial risk (which includes legal risk, compliance risk, Shariah noncompliance risk, technology & cyber risk and business continuity risk), sustainability risk (including climaterelated risk) and other relevant risk and to ensure that the risk management process is in place and functioning for the Group. The BRC deliberated on 188 agenda items during FY2024, focusing on the following key areas: ✓ Risk Management & Compliance: Includes topics like Risk Appetite Statement (RAS), climate-related compliance (CRMSA, CCPT, CRST), risk and credit policies, fraud countermeasures and risk scenario analysis. ✓ Market and Credit Risk Policies: Encompasses reviews of ICAAP, liquidity management, administrative authority guidelines, and the Single Counterparty Exposure Limit. ✓ Financial and Investment Strategies: Covers economic outlook, fund transfer pricing, financial markets development and treasury matters. ✓ Operational Efficiency & Digitalisation: Focused on IT-related policies, digitalisation initiatives, outsourcing, and governance reports. ✓ Corporate Sustainability & ESG: Includes ESG plans, sustainability policies, and sponsorship/donation guidelines. Bank Islam Malaysia Berhad ◆ Integrated Annual Report 2024 218 Corporate Governance Overview Statement
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