Ascendas REIT - Annual Report 2021

Corporate Governance The NRC has also reviewed and approved various matters within its remit via circulating papers. Under its terms of reference, the NRC’s scope of duties and responsibilities includes: (a) reviewing and making recommendations to the Board on the structure, size and composition of the Board and its Board committees and formulating succession plans for Directors; (b) reviewing the performance of the Board, Board Committees and individual Directors and the results of such evaluation annually; (c) considering annually and, as and when circumstances require, if a Director is independent; and (d) considering and making recommendations to the Board on the appointment and re-appointment of Directors. The NRC’s duties and responsibilities in relation to remuneration matters are set out on pages 124 to 130 of this Annual Report Board Composition and Renewal The Board, through the NRC, strives to ensure that there is an optimal blend in the Board of backgrounds, experience and knowledge in business and general management, expertise relevant to the Ascendas Reit Group’s business and track record, and that each Director can bring to the Board an independent and objective perspective to enable balanced and well-considered decisions to be made in the interests of the Ascendas Reit Group. The Board has a few members who have prior working experience in the sector that Ascendas Reit operates in. There is a structured process for determining Board composition and for selecting candidates for appointment as Directors. In undertaking its duty of reviewing and making Board appointment recommendations to the Board, the NRC considers different time horizons for purposes of succession planning. The NRC evaluates the Board’s competencies on a long-term basis and identifies competencies which may be further strengthened in the long-term to achieve Ascendas Reit’s strategy and objectives. As part of medium-term planning, the NRC seeks to refresh the membership of the Board progressively and in an orderly manner, whilst ensuring continuity and sustainability of corporate performance. The NRC also considers contingency planning to prepare for sudden and unforeseen changes. In reviewing succession plans, the NRC has in mind Ascendas Reit’s strategic priorities and the factors affecting the long-term success of Ascendas Reit. Board succession planning takes into account the need to maintain flexibility to effectively address succession planning and to ensure that the Manager continues to attract and retain highly qualified individuals to serve on the Board. The NRC aims to maintain an optimal Board composition by considering the trends affecting Ascendas Reit, reviewing the skills needed and identifying gaps, including considering whether there is an appropriate level of diversity of thought. The process ensures that the Board composition is such that the Board has capabilities and experience which are aligned with Ascendas Reit’s strategy and environment, and includes the following considerations: (a) the current size of the Board and Board Committees, composition mix and core competencies, (b) the candidate's/ Director's independence, in the case of an independent director, (c) the composition requirements for the Board and relevant Board Committees (if the candidate/Director is proposed to be appointed to any Board Committee), and (d) the candidate's/Director's age, gender, track record, experience and capabilities and such other relevant factors as may be determined by the Board, which would provide an appropriate balance and contribute to the collective skills of the Board. The Board supports the principle that Board renewal is a necessary and continual process, for good governance and ensuring that the Board has the skills, expertise and experience which are relevant to the evolving needs of the Ascendas Reit Group’s business. Board succession planning is carried out through the annual review by the NRC of the Board’s composition as well as when a Director gives notice of his or her intention to retire or resign. The outcome of that review is reported to the Board. The Board also has in place guidelines on the tenure of Directors. The guidelines provide that an ID should serve for no more than a maximum of two three-year terms and any extension of tenure beyond six years will be reviewed on a yearly basis up to a period of nine years (inclusive of the initial two three-year terms served) by the NRC in arriving at a recommendation to the Board. Annual Report 2021 121