Statement of Governance​


Throughout the years, KWAP Board has ensured that KWAP’s business and affairs are in strict adherence to the principles of good corporate governance such as integrity, transparency and professionalism which are among key components contributing to the organisation’s continued progress and success towards achieving stakeholder’s objective.

To ensure the highest standards of integrity and business ethics, professionalism is embedded where applicable. Although KWAP is not required to abide by the Malaysian Code on Corporate Governance, The Board has adopted best practices on governance to ensure that the highest standards of corporate governance are practiced to protect and enhance stakeholder’s value.

Composition of the Board

KWAP is led and managed by experienced and skillful Board members with varied background from the Government, private sector, Bank Negara Malaysia and contributor’s representative, which are important for the overall strategic achievements of KWAP.

As specified by section 6 of the Retirement Fund Act 2007 (Act 662), the Board shall consist of the following members that shall be appointed by the Minister of Finance:

(i) a Chairman who shall be the Secretary General of Treasury, the Ministry of Finance;
(ii) a representative from Bank Negara Malaysia;
(iii) a representative from the Ministry of Finance;
(iv) the Chief Executive Officer who shall be an ex-officio member;
(v) three (3) representatives of the Government of Malaysia;
(vi) three (3) other persons from private sector with experience and expertise in business or finance; and
(vii) a representative of the contributories to the Retirement Fund other than the representative of the Government of Malaysia.

Chairman and Chief Executive Officer

As part of best practice, the roles of the Chairman and the Chief Executive Officer (CEO) should be separated. The Chairman of KWAP is primarily responsible for ensuring Board effectiveness and conduct while the CEO of KWAP, as duly appointed by the Board with the approval of the Minister of Finance, is responsible for the overall operations of the business and the implementation of policies and decisions made by the Board and the investment decisions made by the Investment Panel in accordance with the Act. The CEO is assisted by the management in managing day to day administration of KWAP and the administrative control of its employees.

Responsibilities and Accountabilities of the Board

The Board is established to administer and manage KWAP in such a manner as would further enhance the respective interests of the contributors as well as the stakeholders. The function of the Board is to formulate administration and management policies and procedure and to ensure that KWAP achieves its objectives with success and excellence.

The Board assumes a number of specific tasks such as overseeing the proper conduct of operations, identifying principle risks area and ensuring the proper implementation of appropriate systems to manage these risks as well as reviewing the adequacy and integrity of the internal control systems as specified in the Act and the Board Charter.



The Retirement Fund Act 2007 (Act 662) also requires the establishment of an Investment Panel to provide strategic directions on investment matters. It determines and approves investment policy and guidelines, policies on risk management, asset allocation and strategic directions on investment.


Composition of the Investment Panel

The Investment Panel shall consist of the following members who shall be appointed by the Minister of Finance:

(i) a Chairman who shall be the Chairman of the Board or such other person as may be appointed by Minister of Finance [Section 7(2)(a) of the Act];   
(ii) a representative from the Ministry of Finance;
(iii) the Chief Executive Officer of KWAP who shall be the Secretary; and
(iv) four (4) other persons from the private sector with experience and
expertise in business, investment, banking or finance.


Primary Duties and Responsibilities of the Investment Panel

The Investment Panel is generally responsible to approve inter-alia KWAP’s strategic directions on investment matters, investment policy and guidelines, asset allocation and investment proposals. In executing its function, the Investment Panel shall report its activities to the Board and shall act in accordance with the general policy that may be issued by the Board and subsequently approved by the Minister of Finance.



To assist the Board in discharging its duties, the Board has established various committees to oversee specific matters related to the operations of KWAP, namely the Audit Committee, Risk Management Committee, Remuneration Committee and Tender Board Committee. All Board Committees have its written terms of reference which are reviewed from time to time to ensure that they are relevant and up-to-date.



The Audit Committee was established to ensure establishment and enforcement of internal controls and systems at KWAP.


Duties and Responsibilities of Audit Committee

The following are the duties and responsibilities of Audit Committee:

(i) To recommend and review financial regulations, accounting regulations, policies and practices;

(ii) To review and discuss the nature and scope of internal and external audit plans and ensure co-ordination of approach between the internal and external auditors;

(iii) To review the financial statements of the Retirement Fund (Incorporated) with management and the auditors prior to them being approved by the Board;

(iv) To discuss problems and reservations arising from the interim and final audits and any matter the auditor may wish to discuss (in the absence of management where necessary);

(v) To review the external auditor’s audit observations and management’s response;

(vi) To consider major findings of internal investigations and management’s response;

(vii) To direct any special investigations to be carried out by the internal auditor and review the internal auditor’s findings;

(viii) To consider any related party transactions that may arise within the Retirement Fund (Incorporated);

(ix) To provide independent assessment of the adequacy and reliability of the risk management processes and system of internal controls and compliance with risk policies, laws, internal guidelines and regulatory requirements;

(x) To review changes to Financial Procedures; and

(xi) To consider other issues as defined by the Board.


KWAP’s external auditor is the Auditor General of Malaysia as determined by Statutory Bodies (Accounts and Annual Reports) Act 1980 [Act 240].



Risk Management Committee was established to assist the Board in discharging its functions with regards to risk management.

Duties and Responsibilities of Risk Management Committee

The following are the duties and responsibilities of Risk Management Committee:

(i) to formulate and carry out the risk management strategies and policies;

(ii) to assess and approve proposal on risk management policies and procedures in business and financial risk areas such as market risk, credit risk, strategic risk, and operational risk;

(iii) to determine risk appetite/tolerance/parameters to Board for adoption;

(iv) to assess/evaluate existing and new policies, controls and recommend to the Board for final changes, approval and adoption;

(v) to ensure the adequacy of risk management polices and systems and the extent to which these are operating effectively;

(vi) to ensure that the infrastructure, resources and systems are in place to identify, measure, monitor and control risks;

(vii) to determine KWAP’s risk exposures and risk management activities;

(viii) to formulate Business Continuity Management (BCM);

(ix) to recommend to the Board for any changes to the Risk Management Framework; and

(x) to consider other risk related issues as defined by the Board.



Remuneration Committee was established to assist the Board in discharging its functions with its primary responsibility to establish the relevant policy framework in determining the appointment and remuneration of the management and staff of KWAP and recommend to the Board the performance related remuneration of the respective staff.


Duties and Responsibilities of Remuneration Committee

The following are the duties and responsibilities of Remuneration Committee:

(i) To recommend the minimum requirements on the skills, experience, qualifications and other core competencies of employees;

(ii) To recommend and review terms and conditions of employment and service of employees;

(iii) To recommend and review code of conduct and discipline of employees;

(iv) To recommend the mechanisms for the formal assessment on the effectiveness of employees;

(v) To recommend the promotion of employees;

(vi) To recommend the relevant policy framework in determining the remuneration (monetary and non-monetary) of employees;

(vii) To recommend service agreement structure/ principles for employees including retirement / termination benefits;

(viii) To review annually and recommend the overall remuneration policy of key management officers to ensure that rewards commensurate with their contributions to KWAP’s growth and profitability;

(ix) To review annually the performance of the management and recommend to the Board specific adjustment in remuneration and/or reward payments if any, reflecting their contribution for the year; and

(x) To consider other issues as defined by the Board.



Tender Board was established to assist the Board in discharging its functions with regards to evaluation of procurement proposals.


Duties and Responsibilities of Tender Board

The following are among the duties and responsibilities of Tender Board:

(i) To review the tenderer’s registration with the Ministry of Finance and Contractor Services Centre, tender invitation advertisement, tender specification, tender documents (if necessary), tender schedule prepared by the Tender Opening Committee, technical and financial evaluation reports etc.;

(ii) To ensure that the procurement process complies with all applicable procurement ethics, policies and procedures;

(iii) To review the tenderer’s technical and financial capabilities. During the tender evaluation, the technical proposal would be opened and evaluated first followed by the financial proposal;

(iv) To consider and recommend awards which are beneficial to KWAP, taking into consideration factors such as pricing, utilisation of products/ goods and/or services, delivery or completion period, maintenance cost as well as other relevant factors;

(v) To decide on re-tender process or to recommend any other procurement methods, if the Tender Board found that the procurement procedures are not in accordance with the regulations or suspect that there are irregularities in the tender process;

(vi) To consider and accept the tender provided that decision has been made by the Committee by at least a simple majority and is within the approved limit;

(vii) To consider and accept any quotations acknowledged by the Quotations Committee that exceeds the quotations limit; and

(viii) To consider other procurement issues as defined by the Board.