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CORPORATE GOVERNANCE REPORT (CONTINUED)

BOARD COMMITTEES (Continued)

Remuneration Committee (Continued)

The remuneration of the Directors and senior management is determined by reference to the skills, knowledge and the tasks assigned and also to the individual performance and the overall profitability, corporate goals and objectives of the Company as a whole. In determining the remuneration package, the Committee will also obtain relevant information from external source and consider factors such as salaries paid by comparable companies, time commitment and responsibilities of the directors, etc.

During the year, one remuneration committee meeting was held. During the meeting, the Remuneration Committee members reviewed and determined the remuneration package of the staff including the senior management of the Company and made recommendations on the fees of all the Directors of the Company for the year ended 31 December 2014.

Nomination Committee

The Nomination Committee of the Company has been established with written terms of reference setting out duties, responsibilities and authorities delegated to them by the Board. The Nomination Committee comprises two Executive Directors namely Dr. Lam Ko Yin, Colin (Chairman of the Nomination Committee) and Mr. Li Ning and three Independent Non- executive Directors, namely, Mr. Ho Hau Chong, Norman, Ms. Wong Yu Pok, Marina and Mr. Wu King Cheong.

The terms of reference of the Nomination Committee are

available on the websites of the Company (www.hkf.com) and the Stock Exchange (www.hkexnews.hk) respectively.

The Nomination Committee is responsible for reviewing the structure, size and composition (including the skills, knowledge and experience) of the Board at least annually and make recommendations on any proposed changes to the Board to complement the Company's corporate strategy, with due regards to the Board Diversity Policy. It also identifies individuals suitably qualified to become Board members and select or make recommendations to the Board on the selection of individuals

nominated for directorships and to assess the independence of independent non-executive directors and make

recommendations to the Board on the appointment or re- appointment of directors and succession planning for directors, in particular the chairman and the chief executive. The

Nomination Committee shall consider the candidate from a wide range of backgrounds, on his/her merits and against objective criteria set out by the Board and taking into consideration of his/ her time devoted to the position.

During the year, there is no change in the composition of the Board and one nomination committee meeting was held. During the meeting, the Nomination Committee members reviewed the structure, size and composition (including the skills, knowledge, experience and length of service) of the Board, assessed the independence of independent non-executive Directors and reviewed the independent non-executive Directors' annual confirmations on their independence; and make disclosure of its

review results in the Corporate Governance Report; reviewed the time required for a Director to perform his responsibilities; reviewed and assessed the independency status of an Independent Non-executive Director who has served the Board for more than nine years pursuant to the Listing Rules and

reviewed and make recommendations to the Board for re-

election of the retiring Directors at the annual general meeting of the Company held on 23 May 2014.

DIRECTORS' SECURITIES TRANSACTIONS

The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers (the "Model Code") as set out in Appendix 10 to the Listing Rules as the code for dealing in securities of the Company by the directors. Having made specific enquiry, the Company confirmed that all Directors of the Company have complied with the required standard as set out in the Model Code throughout the year ended 31 December

2014.

The Company has also adopted the written guidelines on no less exacting terms than the Model Code for relevant employees, (including employees of the Company or Directors or employees of its subsidiaries who, because of such office or employment, is likely to be in possession of inside information in relation to the Company or its securities), in respect of their dealings in the securities of the Company.

Hong Kong Ferry (Holdings) Company Limited Annual Report 2014

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