by S BIRRUNTHA / graphic by TMR

CAHYA Mata Sarawak Bhd (CMS) is looking to enhance its corporate governance, management accountability and proactively raise the group’s risk management capability. 

In a statement to the exchange yesterday, the Sarawak-based diversified group said this follows a review of financial and investment activities undertaken by its appointed independent financial advisor, KPMG Management and Risk Consulting Sdn Bhd. 

The review by KPMG found gaps in the contract management and bidding processes contributing to a project losses as well as a lack of monitoring by the associate’s board on the hedging transactions of a certain project which ended in losses due to adverse currency exchange movements. 

The report identified a lack of due diligence and stakeholder management on the joint venture partners’ risks of a project and the reporting structures by management to the board were not adhered to and complied with in a project. 

Hence, CMS noted it would also embark on a human capital transformation programme to build a culture of governance and growth across the group to strengthen the accountability and integrity at all levels of senior management. 

Key measures include strengthening risk oversight at board level on enterprise material risk and to provide updates on key projects in a timely manner so that the board will be continuously apprised of such risk exposure.

This also includes the setting up of an investment committee chaired by the group MD to review and recommend all proposals and investments to the board for information and approval as appropriate and timely, as well as setting up an independent group risk division to drive risk management throughout the company.