Corporate Governance

Introduction


ARA LOGOS Logistics Trust (“ALOG”) is a Real Estate Investment Trust (“REIT”) listed on the Main Board of Singapore Exchange Securities Trading Limited (“SGX-ST”) on 12 April 2010. ALOG is managed by ARA LOGOS Logistics Trust Management Limited (as manager of ALOG, the “Manager”). The Manager is a wholly-owned subsidiary of LOGOS.

ALOG was constituted by a deed of trust dated 11 February 2010 (as amended by a first supplemental deed dated 18 March 2010, a second supplemental deed dated 29 September 2014, a first amending and restating deed dated 13 April 2016 and a fourth supplemental deed dated 31 May 2018) (the “Trust Deed”) entered into between the Manager, and HSBC Institutional Trust Services (Singapore) Limited, in its capacity as trustee of ALOG (the “Trustee”).

The Trustee and the Manager are independent of each other. The Trustee is responsible under the Trust Deed for the safe custody of the assets of ALOG on behalf of the unitholders of ALOG (the "Unitholders"). The Manager's main responsibility is to manage the assets and liabilities of ALOG in accordance with the Trust Deed and act honestly in the best interest of Unitholders. As required under the licensing regime for REIT managers, the Manager holds the Capital Markets Services ("CMS") Licence issued by the Monetary Authority of Singapore (the "MAS") to carry out REIT management activities.

The Manager is fully committed to sound corporate governance policies and practices and adheres to high standards of conduct in line with the recommendations of the Code of Corporate Governance 2018 (the “2018 CG Code”) and the Listing Manual of the SGX-ST (the “Listing Manual”) as well as other applicable rules and regulations.

The Manager believes that an effective corporate governance culture is critical to its performance and the success of ALOG. In particular, the Manager has an obligation to act honestly, with due care and diligence, and in the best interest of its Unitholders.

The primary role of the Manager is to set the strategic direction on, amongst others, acquisitions, divestments, asset enhancement and capital management, and subject to any feedback from recommendations made to the Trustee, execute the adopted strategy accordingly.

Other functions and responsibilities of the Manager include:

  1. using its best endeavours to carry on and conduct its business and operations in a proper and efficient manner and to conduct all transactions with or for ALOG at arm's length;
  2. preparing an annual budget proposal including the net income forecast, property expenditure, capital expenditure, and providing explanations for major variances from the previous year's forecasts, written commentaries on key issues and any relevant assumptions;
  3. establishing a framework of prudent and effective controls which enables financial, operational, compliance and information technology risks to be managed;
  4. ensuring compliance with the principles and provisions of the 2018 CG Code and other applicable laws, rules and regulations including the Securities and Futures Act, Chapter 289 of Singapore (the “SFA”), the Securities and Futures (Licensing and Conduct of Business) Regulations (the “SF(LCB)R”), the Listing Manual, the Code on Collective Investment Schemes issued by the MAS (the “CIS Code”), Appendix 6 of the CIS Code (the “Property Funds Appendix”), the Singapore Code on Takeovers and Mergers, the Trust Deed, the relevant MAS Notices and Guidelines and any tax rulings and all relevant contracts;
  5. managing communications with Unitholders; and
  6. oversight of the property management services provided by the property managers.

This Corporate Governance Report (this “Report”) describes the Manager’s corporate governance framework and practices. The Manager is committed to complying with the principles and provisions of the 2018 CG Code. There are deviations from the provisions of the 2018 CG Code, such as in respect of the formation of a nominating committee and a remuneration committee, the disclosure of remuneration, and the implementation of absentia voting at general meetings of Unitholders. Explanations for such deviations as well as how the practices adopted by the Manager are consistent with the intent of the relevant principles have been provided within this Report.

For the full report, please click here.

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