HOSPITALITY AND ENTERTAINMENT POLICY AND PROCEDURES
1. Objectives
1.1. The objective of this Policy and Procedures is to serve as a guidance and point of reference with regards to the giving and/ or receiving of hospitality and entertainment, to prevent any corrupt In doing so, this Policy and Procedures will:
a) assist in avoiding conflict of interest or the appearance of conflict of interest in any on- going or potential business dealings with the Business Associates1.
b) promote transparency in the disclosure of hospitality and entertainment received and/ or given.
c) support the building of good business relationships between PPB Group and its Business Associates.
1.2. This Policy and Procedures applies to expenditure on Hospitality and Entertainment given or received by PPB Group’s2 Personnel3 to existing or potential Business Associates, existing or potential customers, or any third parties that have business dealings with PPB Group.
1.3. It does not include expenditure for meetings within the Group, i.e., between PPB Group and its Affiliates 4 . This expenditure will continue to be governed under PPB Group’s Financial Authority Limits (“FAL”) or the internal claim process.
2. Definitions
Hospitality and entertainment expenditure includes:
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- the provision of food and drink.
- the provision of recreation including amusement, sport, theatrical, sightseeing, and similar leisure time pursuits.
- travel, transportation, or accommodation associated with any of the abovementioned activities during the course of business.
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It does not include the provision of light refreshments such as tea, coffee and sandwiches, or reasonable meals consumed on PPB Group’s premises.
3. Authority Limits
The following PPB Group Personnel are authorized to incur reasonable hospitality and entertainment expenses in accordance with this Policy to further PPB Group’s business interests:
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- Chairman and the Board of Directors
- Group Managing Director (“Group MD”)/ Chief Executive Officer (“CEO“)
- Head of Company (“HOC”) / Head of Department (“HOD”)
- Employees authorized by Group MD/ CEO/ HOC/ HOD
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4. Expenditure And Record-keeping
4.1. All expenditure on Hospitality and Entertainment incurred by the authorized Personnel must satisfy the following:
a) have a direct link to advancing the business interests of PPB Group (includes any invited guests that are considered of benefit to advancing the business interests of PPB Group).
b) aimed at creating and promoting genuine relationship building, g. knowledge sharing session.
4.2. The designated approving officer must be able to identify that the expenditure is business related.
4.3. The expenditure must be properly and accurately reported and authorized in accordance with the requirements of PPB Group’s FAL or other relevant policies pertaining to authority limits.
4.4. Only “reasonable” and “appropriate” expenditure may be The authorized Personnel shall be guided by the following:
a) the respective Business Units’ financial claims procedure with reference to the Hospitality and Entertainment threshold.
b) the frequency of the provision of such expenditure.
Please refer to the Summary of GHE Thresholds for more information.
4.5. Examples of expenditure that is not “reasonable and appropriate” include:
a) where there is an unacceptable element of For example, any expenditure that may expose PPB Group to legal or reputational risk.
b) the provision of lavish meals, travel (including accommodation), or entertainment5 which is neither necessary nor justifiable.
c) where there is an obvious mismatch between the quantum of the expenditure and the outcome.
d) providing overly frequent and excessive Hospitality or Entertainment.
e) the incurrence of Hospitality and Entertainment expenditure that may involve family and friends of the Personnel and Business Associate, or expenditure which is not business related.
4.6. In addition to the above, Personnel are STRICTLY PROHIBITED from either paying for, or participating in any activities which are exorbitant, illegal, and immoral. Examples of expenditure that are unacceptable are as follows:
a) entertainment at night clubs.
b) provision of sexual favours.
c) extravagant or disproportionate circumstances.
4.7. When requesting reimbursement of expenses incurred on Hospitality and Entertainment, the authorized Personnel shall include the following:
a) the names of all PPB Group recipients of the benefit.
b) the names of all other recipients of the benefit, and the organization and department, of which they are a representative.
c) original receipts or tax invoices with clear details on the expenditure incurred.
d) provide the purpose of the claim, e. justifying how the business interests of PPB Group have been advanced by the incurrence of the expenditure.
e) any other information that may be required by the Finance Department for the reimbursement of expenses.
4.8. In incurring of expenses, the most senior Personnel hosting the hospitality or entertainment must pay and submit the claims for approval in accordance with the FAL or existing claims procedures.
5. Limitations
5.1. Any giving and receiving6 of hospitality or entertainment during sensitive period, should be avoided or Examples of sensitive period (non-exhaustive) include:
a) During an external audit, inspection, or quality assessment.
b) Where it involves an approval, such as during an application for license or renewal of permit.
c) During tender process or contract negotiation.
However, in some limited circumstances, reasonable7 hospitality may be permitted on an occasional basis, for example, a courtesy meal for the team conducting the audit, inspection, or assessment (if permitted by local law) at a moderately-priced restaurant, to mark the end of a review or an assessment exercise. Employees must obtain prior approval from the HOC/ CEO/ Group MD, based on the recommendation/ endorsement of the HOD, before any giving or receiving of hospitality or entertainment.
5.2. For any hospitality or entertainment given to authorities or public officials, prior approval must be obtained from the HOC/ CEO/ Group MD on the recommendation/ endorsement of the HOD and declared in the GHE Register.
Please refer to Appendix A and Appendix B for the hospitality and entertainment declaration process (giving and receiving) for employees.
5.3. For clarity, both scenarios (a) & (b) above do not include the provision of light refreshments such as tea, coffee, and sandwiches, or reasonable meals consumed on PPB Group’s premises.
5.4. Personnel must be present (as the host) when providing any Hospitality or Entertainment. Otherwise, the expenditure is considered as a gift.
5.5. Any offers of hospitality, e., travel, transportation, or accommodation by Business Associates is only allowed if it is specified in the contract. Otherwise, any offer to pay for Personnel’s travel, transportation, and accommodation expenses require prior approval from HOC/ CEO/ Group MD, on the recommendation/endorsement of the HOD.
For clarity, modest offer of transportation, for example, offer from Business Associates to pay for Personnel’s taxi fare to the airport after a meeting, is permitted and does not need to be declared.
Appendix A: Hospitality and Entertainment Declaration Process (Giving) Flowchart for Employees
Appendix B: Hospitality and Entertainment Declaration Process (Receiving) Flowchart for Employees
FOOTNOTE:
1 For purposes of this Policy, the term “Business Associates” includes, but not limited to, suppliers, vendors, contractors, agents, service providers, consultants, advisers, distributors, joint venture, or partners consortia parties and any other third party acting for or on behalf of PPB Group.
2 PPB Group refers to PPB Group Berhad and its subsidiaries.
3 Refers to PPB Group directors (executive and non-executive) and employees.
4 Affiliates include: (a) The Group’s associates; and (b) PPB’s holding company, Kuok Brothers Sdn. Bhd., its subsidiaries, and associates.
5 Examples of lavish entertainments include golf games, VIP tickets for Formula 1 race, or VIP tickets at a renowned international concert or performance.
6 Receiving of H&E may occur when Personnel performs audit or inspection on the Group’s Business Associate(s), as part of performance evaluation or quality control.
7 Please refer to the Summary of GHE Thresholds for the definition on what is considered as reasonable expenses.