alley C Mid V ity Contents 2 CorporateCorporate InformationInformation CorporateCorporate Overview 3 z Corporate Structure 4 - 5 z BusinessBusiness OperationsOperations 6 z Top 10 Properties byby ValueValue 7 - 1010 z ProfileProfile ooff DiDirectorsrectors 11 - 12 z Profile of Key Senior Management Business Review 13 - 18 z Management Discussion and Analysis 19 - 21 z Sustainability Statement 22 - 25 z Corporate Social Responsibility Governance 26 - 40 z Corporate Governance Statement 41 - 44 z Audit Committee Report 45 - 46 z Statement on Risk Management and Internal Control 47 - 150 Reports and Financial Statements 151 - 154 Shareholding Statistics 155 - 158 Notice of Fifty-Third Annual General Meeting Proxy Form 2 Corporate Information BOARD OF DIRECTORS Tan Sri Abu Talib bin Othman Tony Tan Choon Keat Chairman/Independent Non-Executive Director Non-Independent Non-Executive Director Dato’ Seri Robert Tan Chung Meng Tan Kai Seng Group Managing Director Independent Non-Executive Director Tan Boon Seng Yeoh Chong Swee Executive Director Independent Non-Executive Director Tan Boon Lee Chua Seng Yong Executive Director Alternate to Dato’ Seri Robert Tan Chung Meng Daniel Yong Chen-I Tan Yee Seng Executive Director Alternate to Tan Boon Seng Tan Lei Cheng Tan Jian Hong Aaron Non-Independent Non-Executive Director Alternate to Tony Tan Choon Keat COMPANY SECRETARY PRINCIPAL BANKERS Tina Chan Lai Yin (MAICSA 7001659) HSBC Bank Malaysia Berhad (807705-X) No. 2 Leboh Ampang 50100 Kuala Lumpur, Malaysia REGISTERED OFFICE Telephone : 603-2070 0744 Telefax : 603-2070 1146 Level 32, The Gardens South Tower Mid Valley City Malayan Banking Berhad (3813-K) Lingkaran Syed Putra G(E)-016, Ground Floor, Mid Valley Megamall 59200 Kuala Lumpur, Malaysia Mid Valley City Telephone : 603-2289 8989 Lingkaran Syed Putra Telefax : 603-2289 8802 59200 Kuala Lumpur, Malaysia Telephone : 603-2289 0098 Telefax : 603-2282 5353 AUDITORS Hong Leong Bank Berhad (97141-X) PricewaterhouseCoopers (AF1146) Level 5, Wisma Hong Leong Level 10, 1 Sentral 18 Jalan Perak Jalan Rakyat 50450 Kuala Lumpur, Malaysia Kuala Lumpur Sentral Telephone : 603-2773 0280/0289 50706 Kuala Lumpur, Malaysia Telefax : 603-2715 8697 Telephone : 603-2173 1188 Telefax : 603-2173 1288 Public Bank Berhad (6463-H) Head Office, Menara Public Bank 146 Jalan Ampang REGISTRAR 50450 Kuala Lumpur, Malaysia Telephone : 603-2176 6000 Tricor Investor & Issuing House Services Sdn Bhd (11324-H) Telefax : 603-2163 9917 Unit 32-01, Level 32, Tower A Vertical Business Suite, Avenue 3 Bangsar South, No. 8, Jalan Kerinchi STOCK EXCHANGE LISTING 59200 Kuala Lumpur, Malaysia Telephone : 603-2783 9299 Main Market of Bursa Malaysia Securities Berhad (Bursa Telefax : 603-2783 9222 Securities) Email : [email protected] Date of Listing : 10 September 1981 Stock Name : IGB Stock Code : 1597 ANNUAL REPORT 2016 3 Corporate Structure BOARD OF DIRECTORS Executive (BOARD Committee OR (ExCo) DIRECTORS) Audit Group Committee Internal Audit Company (AC) (GIA) Secretary (CS) GROUP Nomination MANAGING Committee DIRECTOR (NC) (GMD) Dato’ Seri Robert Tan Chung Meng Remuneration Committee (RC) Risk Management Committee (RMC) Share Committee (SC) Chief Executive Officer ExCo Managing CEO Group Chief Executive Senior (CEO) Chairman Director & CEO (Retail Financial Officer Director General Manager (Property (Hotel) (Hotel Management) Management) (Group CFO) (Construction) (Property Development) Chua Seng Yong Dato’ Eric Lim Antony Patrick Chai Lai Sim Lim Gik Chay Management) Goh Hong Seong Tan Boon Lee Hock Kheng Barragry 4 Business Operations Within Mid Valley City t $FOUSFQPJOU/PSUI5PXFS t $FOUSFQPJOU4PVUI5PXFS Outside Mid Valley City t .FOBSB*(# t .JE7BMMFZ$JUZ4PVUIQPJOU t )BNQTIJSF1MBDF .7$4PVUIQPJOU t .FOBSB5BO5BO (scheduled completion in 2017) *(#*OUFSOBUJPOBM4DIPPM t 1MB[B1FSNBUB *(#*4 t 5IF#PVMFWBSE4JHOBUVSF0óDF t 5IF(BSEFOT/PSUI5PXFS t 5IF"NQXBML t 5IF(BSEFOT4PVUI5PXFS EDUCATION PROPERTY INVESTMENT $PNNFSDJBM PROPERTY INVESTMENT 3FUBJM JOINT VENTURES IGB Real Estate Investment Trust (IGB REIT) t .JE7BMMFZ.FHBNBMM4PVUILFZ .7. t .JE7BMMFZ.FHBNBMM .7. 4PVUILFZ +PIPS#BISV t 5IF(BSEFOT.BMM 5(. mixed-use commercial development (scheduled completion in 2018) t !.FEJOJ +PIPS#BISV mixed residential and commercial real estate development t #MBDLGSJBST -POEPO mixed residential and commercial real estate development t $IBP1ISBZB3JWFS1SPKFDU #BOHLPL mixed residential and commercial real estate development ANNUAL REPORT 2016 5 Business Operations (continued) MALAYSIA t $JUJUFM&YQSFTT*QPI OVERSEAS t $JUJUFM&YQSFTT,PUB,JOBCBMV t $JUJUFM&YQSFTT1FOBOH t 4U(JMFT)FBUISPX t $JUJUFM.JE7BMMFZ t 4U(JMFT-POEPO t .J$BTB"MM4VJUF)PUFM t 4U(JMFT.BLBUJ .BOJMB t 5IF#PVMFWBSE)PUFM t 5IF$PVSU /FX:PSL t 5IF(BSEFOT)PUFMBOE3FTJEFODFT t 5IF5BOL4USFBN 4ZEOFZ t 5IF8FNCMFZ1FOBOH t 5IF5VTDBOZ /FX:PSL HOTEL PROPERTY DEVELOPMENT Projects completed in the past decade Current Projects Future Projects t 4JFSSBNBT8FTU t %BNBJ3FTJEFODF t ,VOEBOH/PSUI t 4FSJ.BZB t ,VOEBOH+BZB t -BCV t $FOEBOB t 4UPOPS t .J$BTB t -BNBO4JFSSBNBT8FTU t 5BNBO.FMBXBUJ t 4UPOPS t 65IBOU3FTJEFODF t 8BOHTB.BKV t )BNQTIJSF1MBDF t 0OF+FMBUFL t (BSEFO.BOPS t 4FSJ"NQBOH)JMJS t (3FTJEFODF t %BNBJ t 1BSL.BOPS t 5ISFF5VO3B[BL 6 Top 10 Properties by Value Age of Date of Group net building acquisition/ book value Description/Existing use Location/Address Tenure (Years) revaluation RM’000 1 * 910-room Renaissance Kuala Corner of Jalan Sultan Ismail and Freehold 20 23-03-2012 688,861 Lumpur Hotel (RKLH) Jalan Ampang, Kuala Lumpur 2 31.5-acre vacant land for HS(D) 493555 PTD 208568 and Leasehold - 03-09-2013 607,911 proposed mixed commercial HS(D) 493556 PTD 208569 expiring development at Southkey, Mukim Plentong Daerah 2100 Johor Johor Bahru 3 Shopping complex known as Mid Valley City, Lingkaran Syed Leasehold 10 28-12-2004 508,654 TGM together with Putra, 59200 Kuala Lumpur expiring 4,128 car parking bays 2103 4 Proposed commercial PT 15 HS(D) 105028 Section 95A Leasehold - 28-12-2004 501,327 development under construction Kuala Lumpur expiring known as MVC Southpoint at 2103 Mid Valley City 5 Shopping complex known as Mid Valley City, Lingkaran Syed Leasehold 17 17-12-1999 383,318 MVM together with Putra, 59200 Kuala Lumpur expiring 6,102 car parking bays 2103 6 646-room Cititel Mid Valley Mid Valley City, Lingkaran Syed Leasehold 17 31-12-2011 267,698 Putra, 59200 Kuala Lumpur expiring 2103 7 281-room The Tank Stream, 97-99 Pitt Street, Sydney, Freehold 2 06-07-2011 254,473 Sydney Australia 8 234-room Cititel Express Penang 123 Nordin Street, 10300 Pulau Freehold 2 19-09-2007 198,825 and 415-room The Wembley Pinang and 183 Jalan Magazine, Penang 10300 Pulau Pinang 9 330,000 square feet (sf) office 207 Jalan Tun Razak Kuala Freehold 23 31-01-2002 178,265 space at Menara Tan & Tan Lumpur 10 344.0 hectares vacant land Lot 15256 Mukim of Labu, Freehold - 31-01-2002 168,879 approved for mixed residential District of Seremban, Negeri and commercial real estate Sembilan development * The sale of RKLH was completed on 20 January 2017. ANNUAL REPORT 2016 7 Profile of Directors TAN SRI ABU TALIB BIN OTHMAN (Malaysian, male, aged 78) Chairman/Independent Non-Executive Director Board Appointment : 18 July 1995 Board Committee(s) : Chairperson of NC and RC, and a member of AC Academic/Professional : Tan Sri Abu Talib qualified as a Barrister-at-law from Lincoln’s Inn, United Kingdom. Qualification and Experience He has served in various capacities in the Judicial and Legal Service of the Malaysian Government. He was the Attorney-General of Malaysia from 1980 until his retirement in 1993. He is the Chair of the Board of Governors of IGBIS, the education division of IGB. He also sits on the Boards of several public companies. Public Company : CYL Corporation Berhad Directorship(s) KAF Investment Funds Berhad MUI Continental Berhad DATO’ SERI ROBERT TAN CHUNG MENG (Malaysian, male, aged 64) Group Managing Director Board Appointment : 30 May 2001 Board Committee(s) : A member of ExCo, RC, RMC and SC Academic/Professional : Dato’ Seri Robert Tan has vast experience in property development, hotel construction, retail design Qualification and Experience and development as well as corporate management with more than 30 years’ experience in the property and hotel industries. After studying Business Administration in the United Kingdom, he was attached to a Chartered Surveyor’s firm for a year. He had developed a housing project in Central London before returning to Malaysia. His stint in the property industry began with IGB in 1995 when he was Joint Managing Director and subsequently appointed GMD in 2001, a position he currently holds today. He has been involved in various development projects carried out by IGB, in particular Mid Valley City. From inception to the realisation of MVM and TGM, he was actively involved in every stage of their developments. He is instrumental to the development and success of MVM and TGM, and more importantly, in retaining their positions as prime shopping hotspots in the Klang Valley. Public Company : IGB REIT Management Sdn Bhd (IGBRM), the Manager of IGB REIT (Managing Director) Directorship(s) Goldis Berhad (Goldis) (Executive Director) Wah Seong Corporation Berhad (WSCB) (Non-Executive Chairman) Tan & Tan Developments Berhad (Tan & Tan) Yayasan Tan Kim Yeow TAN BOON SENG (Malaysian, male, aged 61) Executive Director Board Appointment : 20 December 1990 Board Committee(s) : Chairperson of ExCo, and a member of RMC and SC Academic/Professional : Tan