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Statement on Corporate GovernanceESOS CommitteeThe primary functions of the ESOS Committee are asfollows:-1. Administer the ESOS Scheme in accordance withthe ESOS Bye-Laws;2. Construe and interpret the ESOS Bye-Laws andoptions granted under it, to define the terms thereinand recommend to the Board to establish, amendand revoke rules and regulations relating to theESOS and its administration to expedite and makethe ESOS fully effective in accordance with the Bye-Laws; and3. Determine all questions of policy and expediencythat may arise in the administration of the ESOSincluding eligibility of the employees of the Groupand the method or manner in which the grants aremade to and exercised by eligible employees inaccordance with the Bye-Laws.During FY09, the ESOS Committee met four times wherekey activities were as follows:-• Reviewed and endorsed documents to administerand/or implement Axiata’s Long Term Performance-Based ESOS approved by Axiata shareholders on24 March 2009 (Axiata ESOS);• Reviewed and approved the process flow for grantingof options to eligible employees of the Group;• Reviewed the underlying principles in determining theindividual performance rating to be adopted todetermine the number of options to be offered toeligible employees;• Reviewed and approved the proposal on the effectivedate of the Axiata ESOS and approve subsequentgrant dates taking into consideration the performanceof Axiata in meeting the ESOS Grant PerformanceThreshold and in relation to each grant of options, oninter-alia, the exercise prices, high grant quantum,grant valuation methodology and assumptions andnumber of options to be offered to EDs of Axiata;and• Reviewed and approved the proposed Long TermIncentive (LTI) for Executive Officers of foreign OpCosof the Group.DIRECTORS’ REMUNERATIONAxiata provides a level of remuneration which attracts,retains and motivates EDs of the highest calibre tomanage Axiata successfully. To maximise the effectivenessof the remuneration policy, careful consideration hasbeen given to link the remuneration package with interalia,corporate and individual performance as well asrelative shareholders’ returns and the value of similarpackage at comparable companies. For NEDs, theirremuneration reflects the experience, expertise and levelof responsibilities undertaken by the NED concerned.The BRC reviews and recommends the total remunerationpackage of the EDs for the Board’s approval and it is theresponsibility of the Board as a whole to approve thetotal remuneration package of the EDs. The remunerationof the EDs consists of salary, bonus, benefits-in-kind, EPFcontributions and share options respectively. The EDsare not entitled to monthly fees nor are they entitled toreceive any meeting allowance for the Board and BoardCommittee they attended.The performance of the EDs are measured based on theachievements of their respective annual KPIs. These KPIscomprise of not only quantitative targets such as annualtargeted revenue, EBITDA, PATAMI or Return on InvestedCapital (ROIC) and relative performance of the OpCosbut also qualitative targets which are strategic milestonesand initiatives that need to be achieved and implementedon areas such as strategy, innovation, businessdevelopment, synergy, human capital management andfinancial management, all of which are geared to enhancethe ‘state of preparedness’ of the Group for its mid andlong term future.The evaluation on the achievement of each of the KPIagainst an agreed performance standard is reviewed bythe BRC and the recommendations of the BRC aretabled for approval by the Board. The rewards accordedto the EDs for their achievement of their respective KPIscomprise of annual bonuses and long term incentive planin the form of options over the shares of the Company.In the case of stock options, its vesting is further subjectto further performance conditions.Annual Report 2009 • 075