Corporate Governance

 

Sunshine Holdings PLC (SUN) is the holding company of three subsidiaries namely Sunshine Healthcare Lanka Limited, Sunshine Consumer Lanka Limited, Sunshine Wilmar (Pvt) Limited representing the business sectors, Healthcare, Consumer and Agriculture.

SUN believes that an important aspect of communication with stakeholders and other interested parties, is in compliance with best practice on corporate governance issued by the Institute of Chartered Accountants of Sri Lanka in 2023, the rules set out in Section 07 of the Listing Rules of the Colombo Stock Exchange and compliance with the Country’s Legislative and Regulatory requirements relevant to the Group.

The Group’s corporate governance framework provides the directors and the corporate management guidance on their responsibilities and duties. It defines the matters which require Board approval, delegation to management and requiring review by the Board sub-committee.

The SUN Corporate Governance Framework

 

The Board of Directors

The Company’s business and operations are managed under the supervision of the Board, which consists of members with experience and knowledge in the areas of business, in which the Company is engaged, with specific acumen in terms of commercial, financial and or technical expertise.

Board responsibilities and rights

The Board has the following powers to execute its responsibilities.

Strategic direction

The Board provides vision, strategic direction and stewardship to the business entities whilst transparency and accountability is maintained. The Board also reviews and monitors the Company’s activities.

Business performance

Reviews business results on a regular basis and guides the management by giving appropriate direction in achieving it’s goals.

Management of risks

With the consultation of the Audit Committee and Risk Review Committee, a risk management system was developed and periodically reviewed. Risk review committee report is depicted in Page 104. of this report. Further, the Board Audit Committee report is also given in Page 97.

Code of conduct and ethics

The Company communicates its code of conduct and ethics to all levels of the employees including its Board of Directors.

Financial performance of the Company

The Board meets at a minimum, once in three months to review the financial performance of the Company. The Quarterly Financial Statements are reviewed by the Audit Committee before recommending to the Board of Directors for adoption and release to the public. Final dividends and interim dividends are considered and recommended by the Board of Directors.

Investor rights and relations

The Company communicates periodically with its shareholders through the quarterly reports. The Annual Report provides a comprehensive assessment of the Company’s performance during the year.

Audit

An independent statutory audit is carried out annually and the appointment of auditors for the ensuing year is recommended to the shareholders at the Annual General Meeting.

Budget

The Board is responsible for approval of annual budgets, capital budgets and new projects. The performances are monitored and reviewed against budgets quarterly.

Corporate governance

Monitoring and reviewing Corporate Governance in accordance with the best practice framework issued by the Institute of Chartered Accountants of Sri Lanka.

Board balance

The Company maintains a Board balance of executive, non-executive and independent Directors as required under Listing Rules of the Colombo Stock Exchange. Together, the Directors with their wide experience in both the public and private sectors and diverse academic backgrounds provide a collective range of skills, expertise and experience, which is vital for the successful direction of the Group.

Composition of the Board

During the FY24/25 the Board consists of twelve (12) members. Nine (9) members are Non-Executive Directors (including the Chairman) and three (3) are Executive Directors. Seven (7) Non-Executive Directors are independent as defined under the Listing Rules of the Colombo Stock Exchange.

The Non-Executive Independent Directors are;

Mr A Cabraal
Mr R Mihular
Mr S Renganathan
Mr S Shishoo
Mr S Jain
Ms A Goonethilleke
Mr A Talwatte (Resigned w.e.f. 31 March 2025)

There is a distinct and clear division of responsibility between the Chairman and the Group Chief Executive Officer to ensure that there is a balance of power and authority. The roles of the Chairman and the Group Chief Executive Officer are separated and clearly defined. The Chairman is responsible for ensuring Board effectiveness and conduct whilst the Group Chief Executive Officer has overall responsibilities over the operating units, organisational effectiveness and implementation of Board policies and decisions.

Fit and proper assessment

The Group’s fit and proper assessment for Directors is in line with the guidelines set out in the Listing Rules and include criteria on honesty, integrity and reputation, competence and capability and financial soundness. The Chairman and Directors satisfied the fit and proper assessment criteria stipulated in the Listing Rules of the CSE.

Board induction and training

Directors are kept updated on relevant developments through formal sessions, distribution of reading materials and deep dives into specific aspects. Directors are also encouraged to attend sessions conducted by the Sri Lanka Institute of Directors. Many of the Directors also conform to the Continuing Professional Development requirements of the respective professional organisations.

Board appraisal

The Board evaluates its performance and that of its committees on an annual basis. Areas of assessment include appropriateness of the Board composition, mix of skills and ability to deliver strategic aspirations. The Chairman and Remuneration Committee are responsible for evaluating the performance of the Executive Directors and Committees through an annual self-evaluation of its own performance. The responses are submitted to the Chairman for discussion at a Board Meeting.

Strategy and performance monitoring

The Board formulates and steers the Group’s strategic direction, ensuring that specific areas of governance oversight are identified and addressed. The Board also approves policies and material processes which support the delivery of the Group’s strategy while overseeing and monitoring management’s implementation and execution of strategy.

Information shared with Board on a regular basis

Board deliberations in 2024/25

Matters relating to the external environment including political, macro-economic and social matters. Updates on the delivery of key projects. Performance against financial and operational targets and metrics. People-related developments including changes in headcount, health and safety and engagement initiatives. Key risk exposures. Developments in the competitive landscape. Legal, regulatory and compliance matters across the Group.

Overseeing the Group’s strategic direction and approval of the annual corporate plan and budgets. Approving the annual, interim and quarterly financial results and stakeholder communications. Approval of major capex projects and acquisitions. Reviewing and evaluating the Group’s risk exposures and scorings. Ensuring that appropriate governance structures, policies and procedures are in place.

Composition and attendance at meetings

The Board met quarterly to discharge its duties effectively. In addition, special Board Meetings are also held whenever necessary. A total of seven (7) meetings including the Annual General Meeting was held in the financial year ended 31 March 2025. The attendances of Directors at these Meetings were as follows;

Attendance – 7

Name of Director	No.	%
Mr A Cabraal	4	57
Mr V Govindasamy	6	86
Mr S Sathasivam	7	100
Mr R Mihular	7	100
Mr S Renganathan	6	86
Mr T Akbarally	3	43
Mr G Sathasivam	3	43
Mr S Shishoo	6	86
Mr S Jain	6	86
Ms A Goonetilleke	7	100
Mr A Deepthikumara	7	100
Mr A Talwatte (Resigned w.e.f. 31 March 2025)	3	43

Re-election of Directors

The provisions of the Company’s Articles require a Director appointed by the Board to hold office until the next annual general meeting and seek re-appointment by the shareholders at that meeting. The Articles call for one third of the Directors in office to retire at each Annual General Meeting. The Directors who retire are those who have served for the longest period after their appointment/re-appointment. Retiring Directors are generally eligible for re-election. In addition, a newly appointed Director is required to submit themselves for retirement and re-election at the Annual General Meeting immediately following his appointment.

Directors remuneration

The objectives of the Company’s policy on Directors remuneration is to attract and retain Directors of the caliber needed to direct the group successfully. In the case of the Executive Director, the component parts of the remuneration are structured so as to link rewards to corporate and individual performance. Performance is measured against profits and other targets set from the Company’s annual budget and plans, and from returns provided to shareholders. In the case of Non-Executive Directors, the level of remuneration reflects the experience and level of responsibilities undertaken by the Non-Executive Director concerned.

The Remuneration Committee recommends to the Board the frameworks of the Executive Director’s remuneration and the remuneration package for the Executive Director and Senior Management team. It is, nevertheless, the ultimate responsibility of the entire Board to approve the remuneration of the Executive Directors. The Director’s remuneration is disclosed in Note No. 41.1.a of the Financial Statements.

Delegation of Board authority – Board Committees

The Board in discharging its duties, establishes various Board Committees. The function and terms of reference of the Board Committee are clearly defined and where applicable, comply with the recommendations of the code of best practice on corporate governance. The group has five Board sub committees,

• Audit Committee
• Related Party Transactions Review Committee
• Nomination and Governance Committee
• Remuneration Committee
• Investment Committee
• Risk and Compliance Review Committee

However, the Board of Directors are collectively responsible for the decisions taken on the recommendation by Board Sub Committees.

Audit Committee

The Audit Committee provides oversight on the Financial Statements and other related information prepared for presentation for external financial reporting, review the work of the internal audit function and ensures that the external auditor carries out their statutory duties in an independent and objective manner. It also assists the Board in ensuring a sound system of internal control. The Committee has full access to the auditors both internal and external who, in turn, have access at all times to the Chairman of the Committee. The Committee meets with the external auditors without any executives present except for the Group Secretaries, at least once a year. The report on the Audit Committee is presented on page 97 and the duties of the Audit Committee are included therein.

Nomination and Governance Committee

The Nomination and Governance Committee reviews the Board composition to ensure Board balance and adequacy of skills and experiences among the members of the Board. It recommends any new appointments to the Board. The report on the Nomination and Governance Committee is presented on page 95 and the duties of the Nomination and Governance Committee are included therein.

Remuneration Committee

The Remuneration Committee recommends to the Board, the remuneration policy and the remuneration to be paid to each executive director. The Remuneration Committee reviews the Group’s remuneration policy and the remuneration packages of executive employees of the Group. The report on the Remuneration Committee is presented on page 100 and the duties of the Remuneration Committee are included therein.

Risk and Compliance Review Committee

The Risk and Compliance Review Committee is responsible for overseeing the Group’s risk management framework and ensuring that key risks are identified, assessed, and appropriately mitigated. The Committee monitors the effectiveness of internal controls and compliance with applicable laws, regulations, and internal policies. It reviews reports from the risk management and compliance functions and ensures that appropriate actions are taken to address any identified issues. The Committee also supports the Board in fostering a culture of risk awareness and ethical conduct across the Group. It meets regularly to evaluate the adequacy of the Group’s risk appetite, emerging risks, and the effectiveness of the compliance program. The report on the Risk and Compliance Reviews Committee is presented on page 104 and the duties of the Risk and Compliance Reviews Committee are included therein.

Investment Committee

The role of the Investment Committee is to review capital expenditure budgets and new projects and make recommendations to the Board of Directors.

Related Party Transactions Review Committee

The Committee exercises oversight on behalf of the Board to ensure that all Related Party Transactions (RPTs, other than those exempted by the CSE listing rules on the RPTs) are carried out and disclosed in a manner consistent with the CSE Listing Rules.

Membership of Sub Board Committees is listed below.

	Appointment to The Board	Nomination and Governance Committee	Remuneration Committee	Audit Committee	Investment Committee	Related Party Transactions Committee	Risk and Compliance Review Committee
Executive
Mr S Sathasivam	13 June 2006				X
Mr A Deepthikumara	18 January 2024
Non Independent Non Executive
Mr V Govindasamy	8 February 2000	X			X
Mr G Sathasivam	9 August 2000
Mr T Akbarally	17 August 2022				X
Independent Non Executive
Mr A Cabraal	31 May 2017	X	X	X	X	X
Mr S Shishoo	18 December 2017
Mr S Jain	2 February 2022
Mr A Talwatte (Resigned w.e.f. 31 March 2025)	30 May 2016		X	X	X	X
Mr S Renganathan	27 May 2022	X	X	X		X	X
Mr M Mihular	6 April 2023		X	X	X	X	X
Ms A Goonetilleke	15 November 2023						X

Financial acumen

The Board comprises a Senior Chartered Accountant and he serves as members of the Audit Committee and Related Party Transaction Review Committee.

Supply of information

Directors are provided with quarterly reports on performance, minutes of quarterly meetings and such other reports and documents as necessary. The Chairman ensures all Directors are adequately briefed on issues arising at Meetings.

Digital transformation and IT governance

Technology-driven transformation is a key medium-to-long priority of the Group and key areas of focus included evaluating the potential opportunities and risks of disruption presented by technology and building effective, secure and agile infrastructure. The Board holds apex responsibility for governing technology and information and during the year, continued emphasis was placed on embedding ICT governance standards across the Group. The Group IT Services, supported by specialised resources across the Group supports the Board in discharging its IT-related duties and providing oversight on the management of technology assets.

Company secretaries

The services and advice of the Company secretaries are made available to Directors as necessary. The Company secretaries keep the Board informed of new laws, regulations and requirements coming into effect which are relevant to them as individual Directors and collectively to the Board.

Corporate Services (Private) Limited having their registered office at No, 216, De Saram Place, Colombo 10 are the Company secretaries since 1 April 2016.

Going concern

The Directors after making necessary inquiries and reviews including reviews of the Group’s budget for the ensuring year, capital expenditure requirements, future prospects and risks, cash flows and borrowing facilities, have a reasonable expectation of the Company’s existence in the foreseeable future. Therefore, the going concern basis is adopted in the preparation of the Financial Statements.

Internal control

The Board is responsible for the Company’s internal controls and for reviewing their effectiveness. Internal control is established with emphasis placed on safeguarding assets, making available accurate and timely information and imposing greater discipline on decision making. It covers all controls, including financial, operational and compliance control and risk management. It is important to state, however, that any system can ensure only reasonable and not absolute, assurance that errors and irregularities are prevented or detected within a reasonable time.

Communication with stakeholders

Shareholders are provided with quarterly Financial Statements and the Annual Report which the Group considers as its principal communication with them and other stakeholders. These reports are provided to the Colombo Stock Exchange and also published in media. Shareholders may bring up concerns they have, either with the Chairman or the Group Chief Executive Officer as appropriate. Sunshine Holdings PLC’s website www.sunshineholdings.lk and websites of listed companies within the Group serve to provide a wide range of information on the Group. The Company has reported a fair assessment of its position via the published audited Financial Statements and quarterly accounts. In preparation of these documents, the Company has complied with the requirements of the Companies Act No. 07 of 2007 and in accordance with the Sri Lanka Financial Reporting Standards.

Corporate governance disclosure

The Company has published quarterly financial statements with the necessary explanatory notes as required by the rules of the Colombo Stock Exchange and the Securities and Exchange Commission of Sri Lanka to all stakeholders. Any other financial and non-financial information, which is price sensitive or warrants the shareholders and stakeholders’ attention and consideration is promptly disclosed to the public.

Compliance with Code of Best Practice on Corporate Governace – 2023

Subject	Rule/Code No.	Compliance Requirement	Compliance Status	Section	Page No
The Board of Directors	A 1	Company to be headed by an effective Board to direct and control the Company.	Complied	Profile of the Board	24 – 29
	A 1.1	Regular Board meetings and process of submitting information	Complied	Composition and attendance of the Board meetings	80
	A 1.2	Roles and Responsibilities of the Board	Complied	Board Responsibility	110
	A 1.3	Act in accordance with the laws of the country and obtain professional advice as and when required	Complied	Annual Report of the Board of Directors	05 – 08
	A 1.4	Access to advise and services of Company Secretary	Complied	Communication with stakeholders	243 – 247
	A 1.5	Bring independent judgment on various business issues and standards of business conduct	Complied	The Directors are permitted to get professional advice when necessary and the Directors of SUN group has obtained professional advice for certain matters during the year and coordinated through company secretaries.	95 – 105
	A 1.6	Dedicate adequate time and effort to matters of the Board and the Company	Complied	Dates of regular Board meetings and Board Sub-Committee meetings are scheduled at the beginning of the year and the relevant papers are circulated a week prior to the meeting giving sufficient time for review. There is provision to circulate papers closer to the meeting on an exceptional basis.	05 – 08
	A.1.7	Calls for resolutions	Complied	Any Director can call for a resolution to be presented to the Board if deemed necessary.	–
	A 1.8	Board Induction and Tranning. The Chairman is responsible for following;the effective participation of both executive and non-executive directors, their contribution for the benefit of the group, balance of power between executive and non-executive directors and control of group’s affairs and communicate to stakeholders.	Complied	Directors recognise the need for continuous training and expansion of their knowledge and skills to effectively discharge their duties and are encouraged to attend sessions of the Sri Lanka Institute of Directors and other corporate forums on relevant matters. As independent professionals, many of the Directors also conform to Continuing Professional Development (CPD) requirements of their respective professional organisations. Board members are also given insights in to regulatory changes that may impact the industry at Board meetings. Audit Committee members receive updates on regulatory and compliance changes relating to matters entrusted to the Committee on a quartaly basis to ensure that they are updated on regulatory requirements impacting reporting and risk management processes. They are also given insights in to organisation wide initiatives to strengthen internal controls, risk management and financial reporting processes at the same meetings.	95 – 96
Chairman and Group Chief Executive Officer	A 2	Chairman and Group Chief Executive Officer’s division of responsibilities to ensure a balance of power and authority	Complied	The Chairman does not involve himself in day-to-day operations of the Group and acts as an independent Non-Executive Director. The Group Chief Executive Officer executes powers given by the Chairman and the Board to run the operation	04 – 08
Chairman’s Role	A 3	Facilitate the effective discharge of Board functions	Complied	The Chairman is responsible for conducting meetings effectively and he preserves order and implements Board decisions taken	04 – 08
	A 3.1	Ensure Board proceedings are conducted in a proper manner	Complied	The Chairman is responsible for following; Development of an appropriate agenda for Board meetings with the Company Secretaries Sufficiency of information in Board papers and timely availability of the same Induction programmes for newly appointed Directors to acquaint them with their duties and responsibilities and Corporate Governance structure of the Group Effective participation of Executive and Non-Executive Directors Directors are encouraged to seek additional information necessary to engage in discussion of agenda items and to request inclusion of matters of concern on the agenda Sufficient balance of power between Executive and Non-Executive Directors Views of directors are obtained and the minutes reflect the deliberations of the Board Board’s control of the affairs of the Company and its obligations to shareholders and stakeholders	04 – 08
Financial Acumen	A 4	Availability of financial acumen within the Board	Complied	Corporate Governance Report	78 – 85
Board Balance	A 5 and A 5.1	Non-Executive Directors	Complied	Nine (9) out of Eleven (11) are Non-Executive Directors	79
	A 5.2	Independent Non-Executive Directors	Complied	Eight (8) out of Nine (9) Non-Executive Directors are independent	80
	A 5.3	Independent Non-Executive Directors	Complied	All independent Non-Executive Directors are in fact free of any business with the group and are not involved in any activity that would affect to their independence	80
	A 5.4	Annual Declaration	Complied	Submitted the declarations as prescribed	05 – 08
	A 5.5	Determination of independence of the Directors	Complied	The independence of Directors is determined based on declarations submitted by the Non-Executive Directors	94 – 96
Supply of Information	A 6.1	Provide appropriate and timely information to the Board	Complied	Directors are provided quarterly performance reports, minutes of review meetings and other relevant documents in advance to the Board meeting	84
	A 6.2	Adequate time for effective conduct of Board meeting	Complied	The minutes, agenda and reports for the Board meeting are provided well before the meeting date	84
Appointments to the Board	A 7	Formal and transparent procedure for Board appointments	Complied	Nomination committee makes recommendations to the Board on new Board appointments	81
	A 7.1	Nomination Committee to make recommendations on new Board appointments	Complied	Nomination committee makes recommendations to the Board on new Board appointments	95 – 96
	A 7.2	Assessment of the capability of the Board to meet strategic demands of the Company	Complied	Profile of the Board of Directors	24 – 29
	A 7.3	Disclosure of New Board member profile and interests	Complied	Profile of the Board of Directors	24 – 29
Re-election	A 8 – 8.2	Board members should be subject to election, and re-election by shareholders	Complied	Re-election of Directors	95 – 96
Appraisal of Board performance	A 9 – 9.3	Existence of Board evaluation methods and execution	Complied	The Chairman and Remuneration Committee evaluates the performance of the Executive Directors	100 – 101
Disclosure of information in respect of Directors	A 10 – 10.1	Profiles of Directors Directors’ interests Board meeting attendance Board committee memberships	Complied	– Profile of the Board Members Membership of sub-committees and attendance at Board and Subcommittee meetings Remuneration paid to directors Board seats held by each Director in listed and unlisted companies Names of listed and non listed companies in Sri Lanka in which they serve as directors names of Board committees in which the director serves as chairman or a member number of board meetings and committee meetings of the Company attended during the year	24 – 29 79 – 83 227 24 – 29 24 – 29 78 – 83 78 – 83
Appraisal of GCEO	A 11 – 11.2	Appraisal of the Group Cheif Executive Officer against the set strategic targets	Complied	Evaluation is done by the Chairman and Remuneration committee based on the financial and non-financial targets set with the discussion of the committee.	78 – 84
Directors’ Remuneration	B 1	Establishment of the Nomination and Remuneration Committee	Complied	Nomination and Remuneration committee report	95 – 96
	B 1 – 1.3	Membership of the Nomination and Remuneration Committee to be disclosed and should only comprise of Non-Executive Directors	Complied	Discussed under sub committees	94 – 105
Disclosure of Remuneration	B 3.1	Disclose the remuneration policy and aggregate remuneration	Complied	Discussed under sub committees	94 – 105
Relations with Shareholders	C 1 – C 1.1	Constructive use of the Annual General Meeting (AGM) and conduct of general meetings	Complied	A Form of Proxy accompanies the Annual Report, when they are dispatched to the shareholders and made all efforts to encrage the shareholders to participate for the AGM	246
	C 1.2	Separate resolution to be proposed for each item	Complied	The Company propose a separate resolution at the AGM on each significant issue	245
	C 1.3	All valid proxy appointments received for general meetings are properly recorded and counted.	Complied	The Chairman makes and announcement of the proxies received at the commencement of the General Meeting	245
	C 1.4	Heads of Board subcommittees to be available to answer queries	Complied	Sub-committee Chairman’s are present at the AGM	–
	C 1.5	Notice of Annual General Meeting to be sent to shareholders with other papers as per statute	Complied	A copy of Annual Report including financials, Notice of Meeting and the form of Proxy are sent to shareholders 15 working days prior to the date of the AGM	243
Communication with Shareholders	C 2.1 – C 2.7	The Board implement effective communication with shareholders	Complied	– Circulated through Notice of the Annual General Meeting – Investor relation officer are appointed and contacts details are disclose in the annual report, notice of the annual general meeting and the Company website	243 243
Major Transactions	C 3 – 3.3	Disclosure of all material facts involving any proposed acquisition, sale or disposal of assets	Complied	Major transactions of the Group were disclosed to all stakeholders through the Colombo Stock Exchange, print media, and the Company website	–
Accountability and Audit	D 1.1	Accountability and audit	Complied	The Board recognises its responsibility to present a balanced and understandable assessment of the Group’s financial position, performance and prospects in accordance with the requirements of the Companies Act No 07 of 2007. The Financial Statements included in this Annual Report are prepared and presented in accordance with Sri Lanka Accounting Standards	111
	D 1.2	Disclosure of interim and other price-sensitive and statutorily mandated reports to Regulators	Complied	Annual Report of the Board of Directors	05 – 08
	D 1.3	Declaration by CEO and CFO	Complied	The Group Chief Executive Officer’s and the Group Chief Financial Officer’s Responsibility Staitment	112
	D 1.4	Declaration by the Directors that the Company has not engaged in any activities, which contravene laws and regulations, declaration of all material interests in contracts, equitable treatment of shareholders and going concern with supporting assumptions or qualifications as necessary	Complied	Annual Report of the Board of Directors	05 – 08
	D 1.3 5	Statement of Directors’ responsibility	Complied	– Directors’ Responsibility report – Annual Report of the Board of Directors	111 – 112
	D 1.6	Management Review and Preview	Complied	TheLeadership Reports	18 – 34
	D 1.7	Serious loss of capital	Complied	– Annual Report of the Board of Directors – Staitment of Directors Responsibility	05 – 08
	D 1.8	Disclose the related party transactions	Complied	– Report of the Related Party Transactions Review Committee	103 – 105
Risk Management and Internal Control	D 2.1 D 2.2	Process of risk management and a system of internal control to safeguard shareholders’ investments and the Company’s assets.	Complied	– Report of the Risk and Compliance Review Committee – Report of the Audit Committee	105 – 107
Audit Committee	D 3.1	Audit Committee composition	Complied	Composition of Audit Committee	98 – 101
	D 3.2	Terms of reference, duties and responsibilities	Complied	Clearly documented to Audit Committee charter	98 – 101
	D 3.3	Audit Committee disclosures	Complied	Report of the Audit Committee	98 – 101
Risk Committee	D 4.1 – D 4.5	Risk Committee establishment, and their duties and responsibilities	Complied	Report of the Risk and Compliance Review Committee	105 – 107
Related Party Transactions Review Committee	D 5.1 – D 5.3	Related Party Transactions Review Committee establishment, and their duties and responsibilities	Complied	Report of the Related Party Transactions Review Committee	103 – 105
Institutional Investors	E 1	Shareholder voting	Complied	The Company makes every effort to maintain a regular and structured dialogue with institutional investors in order to improve their understanding of Company’s operations	223 – 246
	E 2	Evaluation of governance disclosure	Complied	Institutional investors are kept apprised of the Company’s governance practices through the Annual Report and new initiatives are highlighted at regular meetings to ensure that due weightage is given to good corporate governance.	239 – 242
Other Investors	F1	Investing/divesting decisions	Complied	Individual investors who directly invest on the shares of the Company are encouraged to obtain independent professional advice when investing on the shares of the Company	239 – 242
	F2	Shareholder voting	Complied	Individual investors also are encouraged to get adequate analysis or seek advice on investing/divesting decisions. Also, they are summoned to exercise their voting rights at the AGM	223 – 246
Internet of Things and Cyber Security	G	Internet of Things and Cyber Security	Complied	Group IT policies by which the Company is governed, comprehensively covers the process to identify connections to the Company’s network, cyber security risk identification and effectiveness of cyber security risk management	71
Sustainability: ESG Risk and Opportunities	H	Sustainability: ESG Risk and Opportunities	Complied	The Board regularly evaluate the strengths and weaknesses created by the ESG factors and opportunities in the Company’s business model, operations, short- and medium-term planning and in its long-term strategy to ensure that the Company remains resilient and able to deliver durable and sustainable value over the short, medium and long term in order to maintain the confidence and continued engagement of shareholders and all significant stakeholders	75 – 76
Special Considerations for Listed Entities	I	Establishment and Maintanance of Policies	Complied	Company has implemented the below mentioned policies and disclosed its existence and details of implementation on the Company website Policy on the matters relating to the Board of Directors Policy on Board Committees Policy on Corporate Governance, Nominations and Re-election Policy on Remuneration Policy on Internal Code of Business conduct and Ethics for all Directors and employees, including policies on trading in the Bank’s listed securities Policy on Risk management and Internal Controls Policy on Relations with Shareholders and Investors Policy on Environmental, Social and Governance Sustainability Policy on Control and Management of Company Assets and Shareholder Investments Policy on Corporate Disclosures Policy on Whistle blowing Policy on Anti-Bribery and Corruption	–

Compliance with CSE Continuing Listing Rules – Section 7.6

Rule No.	Applicable Requirement	Compliance Status	Details	Page No
7.6 (i), (ii)	Names of persons who during the financial year were Directors and principal activities during the year	Complied	Report of the Board of Directors	24
7.6 a (iii), (iv)	Twenty largest Shareholders, float adjusted market capitalisation, public holding percentage, no. of public shareholders and minimum required public shareholding	Complied	Share Information	239
7.6 (v)	Directors’ and CEO’s (MD’s) holding in shares	Complied	Report of the Board of Directors	240
7.6. (vi)	Material foreseeable risk factors of the entity	Complied	Risk Management Framework	106
7.6 (vii)	Details of material issues pertaining to employees and industrial relations of the Entity	Complied	Human Capital	73
7.6 (viii)	Extents, locations, valuations, number of buildings of entity's land and investment properties	Complied	Notes to the Financials – 19 Property, plant and eqipments – 23 Investment property	156 and 175
7.6 (ix)	Number of shares representing the Entity’s stated capital	Complied	Report of the Board of Directors	198
7.6 (x)	Shareholder distribution schedule including percentage of total holding in given categories	Complied	Share Information	240
7.6 (xi)	Ratios and Market Price Information	Complied	Investor Information Decade at a glance	239
7.6 (xii)	Changes in Entity’s and subsidiaries fixed assets and market value of land	Complied	Notes to the Financials – 19 Property, plant and eqipments – 23 Investment property	237
7.6 (xiii)	If during the financial year the entity has raised funds either through a public issue, rights issue or private placement	N/A	N/A	–
7.6 (xiv)	Information in respect of Employee Share Ownership or Stock Option Schemes	N/A	N/A	–
7.6 (xv)	Disclosures pertaining to Corporate Governance practices in terms of Section 9 of the Listing Rules	Complied	Corporate Governance Report	78
7.6 (xvi)	Related party transactions exceeding 10% of Equity or 5% of total assets of the Entity as per audited financial statements, whichever is lower	Complied	RPTRC Report Notes to the Financials – 41.2 Transaction with group entties	228

Compliance with CSE Corporate Governance Principles – Revised Section 9 of the Listing Rules

Rule No.	Applicable Requirement	Compliance Status	Details	Page No
9.2.1	Policies	Complied	The Company website contains policies	–
9.3	Establishment of Board Committees (a) Nominations and Governance Committee (b) Remuneration Committee (c) Audit Committee (d) Related Party Transactions Review Committee	Complied	Corporate Governance Report	78
9.3.2	Composition and disclosures	Complied	Board Committees Reports	96 – 105
9.3.3	Chairperson of Board Committees	Complied	Board Committees Reports	96 – 105
9.4.1	Meeting Procedures	Complied	Board Committees Reports	96 – 105
9.4.2	Communication and Relations with shareholders	Complied	Annual Report of Board of Directors	5 – 8
9.5	Policy on matters relating to the Board of Directors	Complied	Annual Report of Board of Directors	5 – 8
9.6.2	Chairperson and CEO	N/A	N/A	–
9.6.3	Senior Independent Director	N/A	N/A	–
9.6.4	Rationale for appointing a SID	N/A	N/A	–
9.7.1 – 9.7.3	Fitness of Directors and CEO	Complied	Nomination and Governance Committee Report	95 – 96
9.7.4	Annual declaration – Fit and Proper – Directors and CEO	Complied	Nomination and Governance Committee Report	95 – 96
9.7.5	Disclosures in the Annual Report	Complied	Nomination and Governance Committee Report	95 – 96
9.8.1	Minimum number of Directors	Complied	Annual Report of Board of Directors	05 – 08
9.8.2	Independent Directors (‘IDs’)	Complied	Nomination and Governance Committee Report	95 – 96
9.8.3	Determination of Independence	Complied	All independent Non-Executive Directors are in fact free of any business with the group and are not involved in any activity that would affect to their independence	–
9.8.5	Disclosure relating to Directors	Complied	Annual Report of Board of Directors	09 – 08
9.9	Alternate Directors	N/A	N/A	–
9.10.1	Disclosure relating to Directors	Complied	Annual Report of Board of Directors Directors Profiles	05 – 08
9.10.2	Market announcement of appointing new directors	Complied	Annual Report of Board of Directors	05 – 08
9.10.3	Market announcement for changing composition of Board of Directors and Board committees	Complied	Annual Report of Board of Directors	05 – 08
9.10.4	Disclosure relating to Directors profile	Complied	Directors Profiles	24 – 29
9.11.1-9.11.3	Nominations and Governance Committee (NGC)	Complied	NGC Report	95 – 96
9.11.4	Composition of the Nominations and Governance Committee	Complied	NGC Report	95 – 96
9.11.5	Function of the Nomination and Governance Committee	Complied	NGC Report	95 – 96
9.11.6	Annual report disclosure	Complied	NGC Report	95 – 96
9.12.1 – 9.12.5	Remuneration Committee	Complied	Remuneration Committee Report	100 – 101
9.12.6	Composition of Remuneration Committee	Complied	Remuneration Committee Report	100 – 101
9.12.7	Function of the Remuneration Committee	Complied	Remuneration Committee Report	100 – 101
9.12.8	Annual report disclosure	Complied	Remuneration Committee Report	100 – 101
9.13.1 – 9.13.2	Audit Committee and TOR	Complied	Audit Committee Report	97 – 100
9.13.3	Audit Committee Composition	Complied	Audit Committee Report	97 – 100
9.13.4	Audit Committee Functions	Complied	Audit Committee Report	97 – 100
9.13.5	Disclosure in the Annual Report relating to Audit Committee	Complied	Audit Committee Report	97 – 100
9.14. 1 – 9.14.2	Composition of the Related Party Transactions Review Committee (RPTRC)	Complied	RPTRC Report	102 – 103
9.14.3	Functions of RPTRC	Complied	RPTRC Report	102 – 103
9.14.4	RPTRC Meetings	Complied	RPTRC Report	102 – 103
9.14.5	RPTRC duties and actions	Complied	RPTRC Report	102 – 103
9.14.6	Shareholder approvals	Complied	There were no proposed transactions which required to obtain shareholder approvals.	–
9.14.7	Immediate Disclosures	Complied	There were no transactions which required for immediate disclosure.	–
9.14.8	The Report by the Related Party Transaction Review Committee and Annual report disclosures	Complied	RPTRC Report	102 – 103
9.14.8 (4)	An affirmative declaration by the Board of Directors	Complied	RPTRC Report	102 – 103
9.17	Additional disclosure	Complied	RPTRC Report	102 – 103

Compliance with Section 168 of the Companies Act No. 7 of 2007

Section No.	Requirement	Compliance	Page No.
168 (1) (a)	The nature of the business together with any change thereof	Complied	13 – 18
168 (1) (b)	Signed Financial Statements of the Company	Complied	117 – 236
168 (1) (c)	Auditors’ Report on Financial Statements	Complied	112
168 (1) (d)	Accounting policies and any changes therein	Complied	128 – 136
168 (1) (e)	Particulars of the entries made in the Interest Register	Complied	05 – 08
168 (1) (f)	Remuneration and other benefits paid to Directors of the Company	Complied	227
168 (1) (g)	Corporate donations made by the Company	Complied	05 – 08
168 (1) (h)	Information on Directorate of the Company at the end of the accounting period	Complied	25 – 29
168 (1) (i)	Amounts paid/payable to the External Auditor as audit fees and fees for other services rendered	Complied	142
168 (1) (j)	Auditors’ relationship or any interest with the Company	Complied	05 – 08
168 (1) (k)	Acknowledgment of the contents of this Report and signatures on behalf of the Board	Complied	05 – 08