LAUGFS Holdings Limited ensures the adoption of the highest standards of Corporate Governance requirements recommended by the Code of Best Practices on Corporate Governance compiled by the Securities and Exchange Commission of Sri Lanka in collaboration with the Institute of Chartered Accountants of Sri Lanka and the principles of corporate governance set out in the Code on Corporate Governance in the United Kingdom.
The Board of Directors is fully responsible to its shareholders and statutory bodies and all other stakeholders of the Company to ensure that the Company is growing sustainably while creating a strong Corporate Governance environment and a framework in order to ensure investor protection and confidence.
The Company's Corporate Governance framework is structured clearly specifying the key elements of external and internal structures, while adopting the said Corporate Governance framework into the management systems, to ensure investor protection and deliver the maximum productive outcome to the shareholder value while ensuring the sustainable development of the Company.
The Board of Directors is responsible to the Shareholders, for creating and delivering long term sustainable shareholder value while practicing and maintaining business affairs and other activities of the Company, with the highest corporate ethical standards through the regulatory and legal framework in the best interest of all the stakeholders of the Company.
The Board of Directors provides entrepreneurial leadership and strategic direction to the management to develop short, medium and long term corporate business strategies, while reviewing and providing the necessary guidance on budget planning, reviewing of the system of human resource management , corporate governance, statutory compliance, assisting of internal audit and integrated risk management and approving and reviewing of major and substantial investment, which ensure the sustainable development of the Company, thereby ensuring investor protection and the best interest of other stakeholders. Such business strategies are subject to review by the Board from time to time as appropriate.
LAUGFS Holdings Limited has concentrated on the necessity of having and maintaining a mix of skills and professional experience as appropriate in the Board of Directors. The Board of Directors recognises and acknowledges its responsibility for the Company's system of internal control and for reviewing its effectiveness on a continuous basis with the recommendations made by the in-house Group Risk and Control Division. These said, internal control systems manage the risk of the Company's business activities and other affairs, and ensure that the financial information on which business decisions are made and published are reliable. Further, the Board ensures that they are fully satisfied with the integrity and accuracy of published financial information and the effectiveness of the financial controls and systems of risk management of the Company.
Members of the Board collectively and individually recognise their duty to comply with the legal and regulatory provisions applicable to the Company and the Board ensures that procedures and processes are in place to ensure that the Company and its subsidiaries comply with all applicable legal and regulatory provisions.
Directors are responsible to the Board for bringing independent and objective judgements, scrutinising the proposals and recommendations made by the corporate management on the issues of corporate and business strategy, performance, utilisation of resources and business conduct. The Board of Directors promote an environment whereby challenging contributions and Directors are encouraged, welcomed and combined with their independent analysis and opinion based on professional knowledge and experience.
Every member of the Board has the access to the advice and services of the Company Secretary for matters relating to Board procedures and any clarification on applicable rules and regulations. The Board was provided with all the necessary and timely information by way of board papers, information papers and reports in order to exercise decision making responsibilities in a more efficient and effective manner.
Members of the Board are obliged and responsible to disclose and determine whether they have any potential or actual conflict of interest arising from external associations, interests in material business matters and personal relationships and obligations, which might make undue influence on the independency and decisions of the members of the Board.
The Board of Directors make the maximum effort to review such conflict of interests, which may arise from time to time.
The Board of Directors, through the involvement of the Group Risk and Control Department, has taken all necessary measures and steps to assure that the systems designed to safeguard the Company's assets, maintain proper and accurate accounting records as per prevailing accounting standards and provide management information. Steps are further taken to ensure systems are in place and are functioning transparently in accordance with the required standards. The risk review programmes covering the internal audit function of the Company and its subsidiaries are monitored by the internal audit team of the company and subject to the direct supervision of the Chairman and the Managing Director.
The Company has introduced a Code of Conduct and Ethics requiring all employees to exercise honesty, objectivity and due diligence in performing their duties, maintain confidentiality of commercial and price sensitive information, work within applicable laws and regulation, safeguard company's assets and avoid conduct which will badly reflect on them or the company's image. The said Code of Conduct and Ethics address issues relating to conflict of interest situations, bribery and corruption, entertainment and gifts, accurate accounting and record keep, corporate opportunities, confidentiality, fair dealing, protection and proper use of company assets, compliance with laws and regulations, and encourages the reporting of any illegal or unethical behavior.The Board of Directors obtain independent professional advice where necessary on legal and regulatory issues, macro-economic forecasts and other relevant matters.
LAUGFS follows a comprehensive Enterprise Risk Management (ERM) framework, the COSO framework as well as IIA standards (Global Internal audit standards) and guidance to ensure that risks arising from their businesses fall within the approved risk parameters of the Group, and appropriate mitigation strategies are implemented.
These frameworks help the Group by providing components to establish the foundation for sound internal control within the company through directed leadership, shared values and a culture that emphasizes accountability for control.
We believe that effective risk management can be filled by way of a strong, robust, and pervasive risk management culture at all levels of the business. The purpose is to identify internal and external risks at a grass root level through to strategic level, which will bring impact to the Group of companies and to manage the risk profiles of their respective SBUs in line with their own business model.
The Group Risk and Control Division is constantly in search of internal and external threats which would impact the companies. The strategies the Company adopts to manage the risk depend on the type of risk and the severity of the risk. The Group reports on risk-related matters to the Audit Committee and to the Board. The Board is ultimately responsible for the identification and management of risk.
The Group Risk and Control Division undertakes a comprehensive risk assessment of all structural, operational, financial and environmental risks by using a Risk Register uniquely prepared for LAUGFS Group, assessing the impact and mitigation plans. The Risk Registers of each company along with the mitigation plan are presented for review to the top management and to the company/Group specific Audit Committees.
