Corporate Governance Report
(Cont’d)
DEALING WITH CONFLICT OF INTEREST
The Manager has instituted the following procedures to deal with potential conflicts of interest issues, which the Manager
may encounter, in managing LMIR Trust:
s 4HE -ANAGER WILL NOT MANAGE ANY OTHER REAL ESTATE INVESTMENT TRUST WHICH INVESTS IN THE SAME TYPE OF PROPERTIES AS
,-)2 4RUST
s !LL EXECUTIVE OFlCERS WILL BE EMPLOYED BY THE -ANAGER
s !LL RESOLUTIONS IN WRITING OF THE $IRECTORS IN RELATION TO MATTERS CONCERNING ,-)2 4RUST MUST BE APPROVED BY A MAJORITY
OF THE $IRECTORS INCLUDING AT LEAST ONE )NDEPENDENT $IRECTOR
s !T LEAST ONE THIRD OF THE "OARD SHALL COMPRISE )NDEPENDENT $IRECTORS AND
s )N RESPECT OF MATTERS IN WHICH THE 3PONSOR AND OR ITS SUBSIDIARIES HAVE AN INTEREST DIRECT OR INDIRECT ANY NOMINEES
APPOINTED BY THE 3PONSOR AND OR ITS SUBSIDIARIES TO THE "OARD TO REPRESENT ITS THEIR INTEREST WILL ABSTAIN FROM VOTING
)N SUCH MATTERS THE QUORUM MUST COMPRISE A MAJORITY OF THE )NDEPENDENT $IRECTORS AND MUST EXCLUDE THE NOMINEE
$IRECTORS OF THE 3PONSOR AND OR ITS SUBSIDIARIES
It is also provided in the Trust Deed that if the Manager is required to decide whether or not to take any action against
any person in relation to any breach of any agreement entered into by the Trustee for and on behalf of LMIR Trust with a
related party of the Manager, the Manager shall be obliged to consult a reputable law firm (acceptable to the Trustee) which
shall provide legal advice on the matter. If the said law firm is of the opinion that the Trust has a prima facie case against
the party allegedly in breach under such agreement, the Manager shall be obliged to take appropriate action in relation to
such agreement. The Directors shall have a duty to ensure that the Manager so complies. Notwithstanding the foregoing,
the Manager shall inform the Trustee as soon as it becomes aware of any breach of any agreement entered into by the
Trustee for and on behalf of LMIR Trust with a related party of the Manager and the Trustee may take any action it deems
NECESSARY TO PROTECT THE RIGHTS OF 5NITHOLDERS AND OR WHICH IS IN THE INTEREST OF 5NITHOLDERS !NY DECISION BY THE -ANAGER NOT
to take action against a related party of the Manager shall not constitute a waiver of the Trustee’s right to take such action
as it deems fit against such related party.
WHISTLE BLOWING POLICY
4HE !2# HAS PUT IN PLACE PROCEDURES TO PROVIDE WHISTLE BLOWERS WITH WELL DElNED AND ACCESSIBLE CHANNELS TO REPORT
on suspected fraud, corruption, dishonest practices or other similar matters relating to LMIR Trust or the Manager, and
FOR THE INDEPENDENT INVESTIGATION OF ANY REPORTS BY EMPLOYEES OR ANY THIRD PARTY AND APPROPRIATE FOLLOW UP ACTION
The aim of the whistle blowing policy is to encourage the reporting of such matters in good faith, with the confidence that
A WHISTLE BLOWER MAKING SUCH REPORTS WILL BE TREATED FAIRLY AND TO THE EXTENT POSSIBLE BE PROTECTED FROM REPRISAL
RELATED PARTY TRANSACTIONS
In general, the Manager has established procedures to ensure that all Related Party Transactions will be undertaken on an arms’
LENGTH BASIS AND ON NORMAL COMMERCIAL TERMS AND WILL NOT BE PREJUDICIAL TO THE INTERESTS OF ,-)2 4RUST AND THE 5NITHOLDERS
The Manager must demonstrate to the ARC that such transactions satisfy the foregoing criteria, which may entail obtaining
(where practicable) quotations from parties unrelated to the Manager, or obtaining one or more valuation from independent
PROFESSIONAL VALUERS IN ACCORDANCE WITH THE 0ROPERTY &UNDS !PPENDIX
The ARC reviews and approves all Related Party Transactions on a quarterly basis or, if the situation requires, as soon as the
Related Party Transactions arise. In addition to the foregoing, the following procedures will be undertaken,:
s FOR 2ELATED 0ARTY 4RANSACTIONS EITHER INDIVIDUALLY OR AGGREGATED DURING THE SAME lNANCIAL YEAR EQUAL TO OR EXCEEDING
BUT BELOW OF THE VALUE OF ,-)2 4RUST S NET TANGIBLE ASSETS NET ASSET VALUE THE !2# SHALL ONLY GIVE ITS APPROVAL
for such transactions if they are on normal commercial terms and are consistent with similar types of transactions
MADE BY THE 4RUSTEE WITH THIRD PARTIES WHICH ARE UNRELATED TO THE -ANAGER AND
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LIPPO MALLS INDONESIA RETAIL TRUST ANNUAL REPORT 2014
