Affin Bank Berhad | Annual Report 2020

207 STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL AFFIN BANK BERHAD 197501003274 (25046-T) | ANNUAL REPORT 2020 SYSTEMS OF INTERNAL CONTROLS • Code of Ethics - The Group’s Code of Ethics and Conduct sets out sound guiding principles and standards of good practice to be observed by all. - The Group has adopted and institutionalised Bank Negara Malaysia’s Code of Ethics for banking institutions in all its entities. It is the minimum code of conduct that is expected from all employees encompassing all aspects of its daily business operations. • Human Resources has in place various initiatives and training programs to address the human capital requirement, including knowledge management. • A performance-based appraisal system to evaluate and compensate/reward its employees accordingly is in place. Staff performance assessment is done annually. • Consequence Management (“CM”) - The Group has in place and adopts CM process in dealing with business or support units (or staff) whom fail to maintain its standard of internal control and compliance, to a level acceptable by the Board, GBAC and Management. - Current Policy and Process also links consequence of misconduct and disciplinary action vis-a-vis staff annual performance rating and compensation. • The recruitment process including screening process is in place. • The e-learning facility at Affin Bank and Affin Islamic Bank provides staff the freedom of time and space to learn and update their knowledge at their convenience while meeting the organisation’s needs for its employees who are spread across geography to be competent in key areas. ASSURANCE FROM MANAGEMENT a. The Board has received reasonable assurance from the President and Group Chief Executive Officer and Chief Financial Officer that the Group’s risk management and systems of internal control are operating adequately and effectively in all material aspects during the financial year under review based on Shariah requirements, Risk Management and Internal Control system adopted by the Group. b. Taking into consideration the assurance from the management and input from the relevant assurance providers, it is viewed that the Group’s risk management and systems of internal control are operating adequately and effectively to safeguard shareholders’ investments, customers’ interests and the company’s assets. REVIEW OF STATEMENT BY EXTERNAL AUDITORS a. The Statement on Risk Management and Internal Control has been reviewed by the external auditors for inclusion in the annual report for the financial year ended 31 December 2020. It is in line with Audit and Assurance Practice Guides (“AAPG”) 3 (Revised) by Malaysia Institute of Internal Auditors (“MIA”) and para 15.23 of the Bursa Malaysia Securities Berhad Main Market Listing requirements.