Question 3

StarGate Limited is a limited liability company registered in Malaysia. The company manufactures and sells high-end fashion clothing. In January 2020, Stairgate's board of directors decided to list 80% of its company shares in Bursa Malaysia. The external auditors, Alpine Chartered Accountants, have advised the board of directors that there is a need for complying with listing requirements, which includes theMalaysian Code on Corporate Governance.

The proposal put forth by the management of StarGate is as follows:

The new board structure will comprise seven (7) executive directors and two non-executive directors who are willing to join the board, namely

Mr. Abdullah is a marketing director of a multinational company and the brother of Stargate's Chief Executive Officer;

Ms. Samantha is the Chief Operating Officer of a listed company and former general manager of operations of StarGate. She left StarGate on 30 November 2019.

Mr. Wee is the Finance Director of StarGate and a fellow member of the Malaysian Institute of Accountants (MIA). The management intends to appoint him as the chairman of the audit committee.

Required

Evaluate whether the proposed governance structure of StarGate complies with theMalaysian Code on Corporate Governancefor listed companies.