BOARD CHARTER

1. Introduction and Purpose of Board Charter

   The Board Charter (the "Charter") designates the various functions & duties of the Board, Board Committees and Individual Directors of Evergreen Fibreboard Berhad ("EFB" or the "Company") with the objective of streamlining and enhancing corporate governance practices in the realms of the Company's Values & Culture of Integrity, Transparency and Accountability .across the group.

   The Charter takes into consideration primarily the Principles and Recommendations (including Commentaries) of the Malaysian Code on Corporate Governance 2012 ("MCCG 2012") and the Listing Requirements of Bursa Malaysia Securities Berhad (Bursa's Listing Requirements") on corporate governance, besides incorporation portion of the Company's Articles of Association and better practices in the region.

   Whilst the Charter provides structured guidance, especially for new Directors to be brought up to speed with Board's culture, disposition as well as Boardroom activities, it should not be construed as an exhaustive reference document by Directors of the Company.

2. Interpretation

   In this Charter, "Board" means the Board of Directors of the EFB;

   "Bursa Malaysia" means Bursa Malaysia Securities Berhad;

   "Business" means the business of EFB and all its subsidiaries;

   "Independent Chairman" means the Chairman of the Board and is used in a gender-neutral sense;

   "Company Secretary(ies)" means the Board secretary(ies) or the person(s) normally exercising the functions of a Board secretary;

   "Group" means the EFB and its Subsidiaries;

   "Independent Director" is defined in accordance with Paragraph 1.01 of the Listing Requirements of Bursa Malaysia;

   "Listing Requirements" means the Main Market Listing Requirements of Bursa Malaysia Securities:

   "Management" means the management personnel of the EFB; and

   "Shareholders" mean the shareholders of the EFB.

3. Role of the Board and its primary responsibilities

   • The Board is collectively responsible for the proper stewardship of EFB's business and creation of a long term shareholders' value.
   • The primary responsibilities of the Board are:-,
     • reviewing and adopting a strategic plan, as developed by Management, taking into account the sustainability of the Group's business, with attention given to the environmental, social and governance considerations of the business;
     • overseeing the conduct of the Group's business, including monitoring Management's performance to determine whether the business is being properly managed;
     • identifying key business risks faced by the Group and ensuring the implementation of appropriate internal controls and mitigating measures to manage such risks;
     • succession planning – ensuring that all candidates appointed to the Board and Senior Management are of sufficient caliber and that there are programs to provide for the orderly succession of Senior Management;
     • overseeing the development and implementation of shareholder /stakeholder communication policy;
     • reviewing the adequacy and integrity of the Company's management information and internal control systems, ensuring there is a sound framework of reporting risk, internal controls and regulatory compliance; and
     • overseeing the Group's adherence to high standards of its Code of Conduct & Business Ethics, including the Code of Ethics for the Board members set out in Appendix A of this Charter.
   • In discharging the above responsibilities, Directors are expected to:-
     • be aware of the environment the Group is operating in;
     • exercise diligence and avoid undeclared conflict of interest situations;
     • understand their oversight role, including the exercise of independent and objective judgment in decision making;
     • commit and devote sufficient time and efforts in discharging their duties responsibly;
     • contribute actively in the Board's discussion and deliberations of issues by providing sound advice based on the Directors' experience and specific expertise they bring to the Board; and
     • attend regular training programs in order to be apprised of changes in regulatory requirements the Group is exposed to.
   • To ensure the direction and control of the Company/Group are in the hands of the Board, a formal Schedule of matters reserved for the Board's deliberation and decision is set out below. This is to ensure the direction and control of the Company / Group is in the hands of the Board of Directors.

   FORMAL SCHEDULE OF MATTERS RESERVED FOR THE BOARD

   The following summarizes the list of matters reserved for the Board's deliberation and decision:-

   1. On the Board Structure

      • Appointment and recommendation for removal of Directors.
      • Appointment and removal of Company Secretary (ies)
      • Establishment of Board Committees, their members and the specific terms of reference

   2. On the Board's Remuneration

      • Recommendation of Directors' fees for Non-Executive Directors to be approved by shareholders
      • Approval of remuneration packages, including service contracts, for Executive Directors

   3. Company's operations

      • Review and approval of EFB's strategic plans and annual budget (including capital expenditure budget);
      • Approval of capital expenditure exceeding prescribed thresholds based on the formalized limits of authority;
      • Approval of investment or disinvestment in EFB or any of its subsidiaries business, property or undertaking;
      • Approval of investment or disinvestment of a capital project which represents a significant diversification from the EFB's existing business activities;
      • Approval of major changes in the activities of EFB;
      • Approval of treasury policies and bank mandates;
      • Approval of limits of authority delegated to Executive Directors; and
      • Review identified key business risks faced by the Group and ensuring the implementation of appropriate internal controls and mitigating measures to manage such risks.

   4. Financial reporting

      • Approval of financial statements and their release (including financial reports for announcement to Bursa Malaysia Securities Berhad or the Securities Commission);
      • Approval of Directors' report, Corporate Governance Statement and Statement on Risk Management and Internal Control for inclusion in EFB's Annual Report;
      • Approval of interim dividends for payment and the recommendation of final dividends or other distribution for shareholders' approval;
      • Adoption of accounting policies in line with the Malaysian Financial Reporting Standards; and
      • Review the effectiveness of the Group's system of risk management and internal controls via the Audit Committee.

   5. Others

      • The granting of power of attorney by EFB or its Subsidiaries;
      • Entering into any corporate guarantee and indemnity issued by EFB;
      • Recommendations for the changes in EFB's Memorandum and Articles of Association;
      • Change in financial year end of EFB or its Subsidiaries;
      • Purchase of own shares by EFB;
      • Issue of debt instruments by EFB or its Subsidiaries; and
      • Any other matters requiring the Board's approval under the limits of authority or regulatory requirements.

4. Board Structure

   1. Board balance and composition
      1. The Board shall be helmed by an Independent Chairman, appointed by the Board, and comprise of at least two members or one-third of the Board, whichever is higher and of who are Independent Non-Executive Directors ("IDs") in accordance with the Listing Requirements.
      2. The tenure of ID shall be for a cumulative term of nine (9) years since appointment as ID. The ID may continue to serve on the Board provided the ID is re-designated as a Non-Independent Director. Where the Board is of the view that the ID can continue beyond the 9-year tenure, it must be justified and to seek shareholders' approval.

         The Board shall also identify from amongst its members for inclusion in the Company's Annual Report a Senior Independent Non-Executive Director to who concerns of fellow Directors, shareholders or stakeholders may be conveyed.

      3. Whilst the Company's Articles of Association allows for no less than two (2) or more than nine (9) Directors, the Board shall examine and determine its size periodically in relation to the effective running of the Group's businesses.
      4. To enhance its effectiveness, the Board shall ensure its members have the relevant skills, experience, expertise and time commitment to address the Group's affairs. Accordingly, the Nominating Committee is appointed and entrusted by the Board to appraise candidates for directorship, including those who retire but offer themselves for re-election, before recommending to the Board. The Board is mindful of the need for boardroom diversity and in this context; the Nominating Committee takes into consideration gender, age, race and expertise diversity when recommending to the Board
      5. Directors shall not sit on the Boards of more than 5 (five) listed issuers and before accepting any new directorship, Director concerned shall notify the Chairman in writing, the notification of which shall include an indication of time that will be spent on the new appointment.
   2. Role of Chairman
      1. The Chairman shall be an Independent Non-Executive Director who assumes a leadership role in the Board and represents the same to shareholders of the Company. The Chairman is primarily responsible for the following:
         • chairing Board and shareholder meetings and ensuring the proceedings thereof comply with good conduct and practices. The Chairman may appoint his designate to chair such meetings if the need arises;
         • ensuring the adequacy and integrity of the Board governance processes;
         • consulting with the Board promptly over any matter that gives him cause for major concern;
         • managing Board communications and Board effectiveness;
         • ensuring timely dissemination of notice of meeting and agenda to Directors, including relevant Board papers and information pertaining to issues scheduled for discussion and/or approval at meetings;
         • acting as a facilitator at Board meetings and ensuring that no member, whether executive or otherwise, dominates the discussion. The Chairman shall also encourage Board members to participate in discussions and that relevant opinions amongst members are forthcoming, resulting in logical and understandable outcomes;
         • acts as the spokesperson for the Company; and
         • other responsibilities as assigned by the Board from time to time.
   3. Role of Chief Executive Officer "CEO" & Chief Operating Officer "COO" (including Executive Directors "ED")
      1. The CEO & COO serves as a conduit between Management and the Board and is responsible for the effective implementation of the Company's strategic plan and policies established by the Board, assisted by ED, in managing the daily operations of the Company.
      2. Generally, the CEO, assisted by the COO & ED, is responsible to the Board for the following:-
         • achievement of Company's goals and observance of Management authorities delegated by the Board;
         • developing long-term strategic and short-term business plans, designed to enable the Company's requirements for growth, profitability and return on capital are achieved;
         • directing and controlling all aspects of the business operations in a cost effective manner;
         • overseeing human capital with respect to key positions in the Group hierarchy and ensuring the general well-being of employees, including the determination of remuneration as well as terms and conditions of employment for Senior Management personnel and issues pertaining to discipline of all employees;
         • representing the Group's interest with major customers, government agencies, regulatory bodies and industries at large, to ensure general goodwill towards the Group and cooperation in planned development;
         • assuring that the Group's products and services are of high standards;
         • providing assistance to members of the Board and the Audit and Nominating Committees, as required, in discharging their duties; and
         • assisting the Chairman in organizing information necessary for the Board to deal with the agenda and for providing such information to Independent Directors on a timely basis.
      3. The Board shall receive the following from or through the CEO / COO for its scheduled meetings:-
         • reports on the performance and activities of the Group for the period under review, including explanations for significant fluctuations over the period; and
         • where appropriate, a briefing pertaining to risk management issues, challenges faced by the Group, changes to legislations that may affect the Group's operations, litigations and other salient events or issues affecting the Group.
      4. The CEO, COO and ED shall act within all specific authorities delegated to them by the Board.
      5. In discharging the above responsibilities, the CEO, COO and ED can delegate appropriate functions to any member of Senior Management, who shall report to the CEO/COO/ED.
   4. Role of Non-Executive Directors ("NEDs")
      1. There are 2 (two) categories of NEDs in the Company, namely Non-Independent Non-Executive Directors and Independent Non-Executive Directors.
      2. The roles of NEDs largely encompass the monitoring of company performance and contributing to the development of Company's strategy, clarified as follows:
         • Strategy: Constructively challenge and contribute to the development of the Company's Strategy.
         • Performance: Oversee the performance of Management in meeting agreed goals and objectives and monitor the reporting of performance.
   5. Company Secretary(ies)
      1. The appointment and removal of the Company Secretary(ies) is a matter for the Board as a whole. The Company Secretary(ies) shall be suitably qualified and capable of carrying out the duties required of the post.
      2. The Company Secretary(ies) is expected to provide unimpeded advice and services to the Board of Directors, as and when the need arises, to enhance the effective functioning of the Board and to ensure regulatory compliance.
      3. The primary responsibilities of the Company Secretary shall include the following:
         • ensuring that Board procedures and applicable rules are observed;
         • maintaining records of the Board and its meetings and ensuring effective management of the Company's records;
         • preparing comprehensive minutes to document Board proceedings and ensure conclusions are accurately recorded;
         • timely dissemination of information relevant to Directors' roles and functions and keeping them updated on new or evolving regulatory requirements; and
         • carrying out other functions that may be deemed appropriate by the Board from time to time.
   6. Board Committees
      1. The Board shall establish Committees from time to time to assist the Board in the discharge of its duties and responsibilities. Each Committee has its own terms of reference in writing, specified by the Board, detailing its roles and responsibilities, structure and composition.
      2. A number of standing Committees, with written terms of reference have been established, namely the following:-
         • Audit Committee
           The Audit Committee assists and supports the Board primarily in the areas of financial reporting in liaison with the external auditors and the Group's system of risk management and internal controls in liaison with the Internal Auditors. The Terms of Reference of the Audit committee are made available on our website www.evergreengroup.com.my .
         • Nominating Committee
           The Nominating Committee assists the Board in matters relating to the selection and assessment of Directors. The terms of reference of the Nominating Committee are made available on our website www.evergreengroup.com.my.
         • Remuneration Committee
           The Remuneration Committee assists the Board on the Director's Remuneration with the objective of attracting and retaining competent Directors. Its terms of reference are made available on our website www.evergreengroup.com.my .
   7. The Board's relationship with shareholders and stakeholders
      1. The Board shall maintain a communications policy that enables both the Board and Management to communicate effectively with the Company's shareholders, stakeholders and the general public. An online shareholder / investor enquiries or feedback link is made available on our website to our email address at efb@tm.net.my or they can directly contact our Senior Independent Non-Executive Director Mr Kuan Kai Seng at his email address kuankaiseng@gmail.com .
      2. The Board shall ensure that the General Meetings of the Company are conducted in an efficient manner to enhance shareholder communications. The Board shall also provide timely and relevant information to shareholders and encourage their active participation at the meetings, taking into account the following measures:-
         • ensure that each item of business included in the notice of meeting is accompanied by a full explanation of the effects of the proposed resolution;
         • for re-election and re-appointment of Directors, ensure that the notice of meeting states which Directors are standing for election or re-election, with a brief description including information such as age, relevant experience, list of directorships, date of appointments to the Board, details of participation in Board Committees and whether a particular Director is independent;
         • the Chairman shall provide reasonable time for discussion at the meeting. Where appropriate, the Chairman will undertake to provide the shareholder with a written answer to any significant question which cannot be answered immediately;
         • ensure to announce the detailed results of the votes cast for and against each resolution. The Chairman shall also inform shareholders of their right to demand a poll vote at the commencement of the General Meeting; and
         • ensure that the Company publishes these measures listed above, on its corporate website on a dedicated Corporate Governance section.

5. Board Procedures

   1. Board meetings
      1. Meetings shall be conducted at least on a quarterly basis. The Company Secretary(ies) shall prepare and distribute to all Directors in advance a timetable for the meetings for the year. The Company Secretary(ies) shall work together with the Chairman in developing the meeting agenda.
      2. Except in the case of emergencies, five (5) days' notice of every Board meeting will be provided in writing. In addition to notices sent through the post, notices may also be sent via facsimile, electronic mail or by any means of telecommunication in permanent written form.
      3. The chairman of the Board or in his absence, a Director from amongst the Board members appointed, shall chair the meeting.
      4. Board members are required to attend Board meetings. However, other Senior Management may be invited to attend meetings for particular items within their responsibility. The Board may also invite external parties such as the auditors, solicitors and consultants as and when the need arises. Decision to questions arising at any meeting of the Directors shall be decided by a majority of votes. Resolutions of the Directors at a meeting or adjourned meeting of the Directors shall be adopted by all Directors present. In the event issues requiring Board's decision arise between meetings, such issues shall be resolved through circular resolution subsequent to discussions being held amongst the Board members, either via teleconference, videoconference, email, etc., in order for the Board as a whole to be apprised on such matters and obtain their view points before arriving at a decision.
      5. The Directors may participate in a meeting of the Directors by means of telephone and video conference or by other means of communication. The physical presence of Director(s) is not compulsory and participation in the meeting in the aforesaid manner shall be deemed to constitute presence in person at such meeting. The Directors participating in any such meeting shall be counted in the quorum for such meeting. All resolutions agreed upon by the Directors in such a meeting shall be deemed to be as effective as a resolution passed at a meeting in person of the Directors duly convened. All information and documents must be made equally available to all participants prior to, at, or during the meeting.
      6. Pursuant to regulatory requirements, a Director shall abstain from voting on contracts or proposed contracts or arrangements in which the Director has direct/ indirect interests. A Director shall not vote on contracts or proposed contracts or arrangements with any other company in which the Director is interested either in the capacity as an officer of the company or as shareholder of the Company. In such cases, the interested Directors shall also abstain from deliberation on the matter and not be present for the deliberation and voting session of such matters.
   2. Agenda
      1. The Chairman, in conjunction with the company Secretary, shall assess the type of information needed to be supplied to the Board and the contents of the agenda. The agenda shall include, amongst others, matters specifically reserved for the Board's decision. The Board shall record its deliberation, in terms of the issues discussed, and the conclusions thereof, in discharging its duties and responsibilities.
   3. Meeting Papers
      1. To allow sufficient time for Directors to consider the relevant information, Board papers and agenda items are to be circulated at least seven (7) days, or a shorter period where unavoidable, prior to the meeting. Where there is a need to table a report, a brief statement of findings and/ or recommendations is prepared.
      2. Minutes are prepared following a Board meeting and are circulated in draft form. The draft minutes will be re-circulated with the Board papers in readiness for signing at the following meeting. The practice is for minutes to record processes and decisions rather than a historical narrative of the discussion or concluding remarks of final decisions made. If one or more Directors request their opinion to be noted, the Company Secretary shall comply with the request.
   4. Access to information
      1. All Directors shall have unrestricted access to Management and to information pertaining to the Company, including access to the Company auditors and consultants, relevant to the furtherance of their duties and responsibilities as Directors of the Company.
   5. Independent professional advice
      1. In discharging the Directors' duties, each member of the Board is entitled to obtain independent professional advice at expense of the Company.
      2. Where such advice is considered necessary for the discharge of his / her duties and responsibilities as a Director and, for the benefit of the company, such Director shall first discuss it with the Chairman and, having done so, shall be free to proceed, where appropriate.

6. Directors' training

   1. Directors are required to undergo the mandatory accreditation program under the auspices of Bursa Malaysia. In addition, Directors are required to attend relevant training courses/ seminars at periodic intervals to keep them updated on developments pertaining to the oversight function of Directors as well as technical matters, for example, financial reporting standards, tax budgets, etc. The Nominating Committee shall decide on the continuous education training program for Directors.
   2. All trainings attended by Directors shall be disclosed in the Annual Report. In special circumstances, valid justifications for non-attendance at any training by Directors for the financial year shall also be disclosed.

7. Directors' external commitments and conflict of interest

   1. A Director who is in any way, whether directly or indirectly, interested in a contract or proposed contract with the Company shall declare the Director's interest in accordance with the Companies Act, 1965. The Director concerned shall not participate in deliberations and shall abstain from casting votes in any matter arising thereof unless otherwise as provided for in the Articles of the Company.
   2. Should there be an actual, potential or perceived conflict of interest between the Company or a related corporation and a Director, or an associate of a Director such as a spouse or other family members, the Director involved shall make full disclosure and act honestly in the best interest of the Company.
   3. Directors shall devote sufficient time to carry out their responsibilities. The Board shall obtain this commitment from its members at the time of appointment. Each Director is expected to commit at least four (4) days per year for attending meetings of the Board or Board Committees.
   4. The Company Secretary(ies) shall facilitate the Directors' annual independence and conflict of interests declarations, which will allow the Directors to perform an annual self-declaration on independence (i.e. for Independent Non-Executive Directors) and conflict of interest (i.e. for all Directors).

8. Directors' Remuneration

   1. NEDs will be paid a basic fee for acting as Directors of the Company, subject to approval by shareholders. They will also be paid a nominal meeting fee for their attendance in Board Committees meetings.
   2. The remuneration of EDs shall be decided by the Board with the individual Directors concerned abstaining from discussing his / her individual remuneration. The amount of remuneration payable shall be determined with reference with the Group's performance, including the attainment of the Company's goals and objectives.

9. Board and member assessment

   1. The Nominating Committee is entrusted by the Board to review the performance and effectiveness of the Board and Board Committees, including individual Directors, annually, with the assessment report, together with a report on the Board balance covering the required mix of skills, experience and other qualities of Board members.

10. Corporate disclosures

    1. The Board shall have relevant corporate disclosure policies and procedures to ensure comprehensiveness, accuracy and timeliness of information disclosed. These policies and procedures shall ensure compliance with the relevant disclosure requirements as enumerated in Bursa Malaysia's Listing Requirements.
    2. The company shall consider the use of information technology in communicating with stakeholders, including a dedicated section for Investor Relations on the Company's website. This section shall provide information such as, amongst others, the Board Charter and the Annual Report of the Company.

This Board Charter was first adopted by the Board on 01st June 2013 and has been last reviewed on 01 October 2014 and approved by the Board.

This Board Charter is made available for reference on the Company's website at www.evergreengroup.com.my.

Appendix A

DIRECTORS' CODE OF ETHICS

The Board shall observe the Directors' Code of Ethics as follows:-

Governance

1. Compliance at all times with this Code of Ethics, the Board Charter and regulatory requirements expected to be adhered to by Directors of a listed issuer;
2. Observe high standards of corporate governance, in particular the practices set out in the Malaysian Code on Corporate Governance 2O12, the Listing Requirements of Bursa Malaysia Securities Berhad and the Companies Act, 1965;
3. Adhere to the principles of selflessness, integrity. objectivity, accountability, openness, honesty and leadership;
4. Act in good faith and in the best interest of the Company;
5. Not misuse information gained in the course of duties for personal gain or for any other purpose, nor seek to the opportunity of the service as Directors to promote private interests or those of connected persons, firms, businesses or other organizations;
6. Ensuring the Company's resources are safeguarded and that the Company conducts its operations economically, efficiently and effectively at all times:
7. Directors shall not accept positions in Board Committees or working groups where a conflict of interest is likely to arise, without first declaring that interest at Board meeting;
8. Directors shall declare any personal, professional or business interests that may conflict with their responsibilities as Directors of the Company;
9. Adhere to the Company's guidelines on acceptance of gifts and hospitality from third parties; and
10. Directors shall adhere to the regulatory requirements pertaining to trading in the Company's shares, including insider trading.