Corporate Governance Policy
The Company and its subsidiaries have recognized the importance of Corporate Governance Code to uphold the operation of the Company and its subsidiaries to have efficient and sustainable growth, which will lead to the best interest for all stakeholders, including employees, investors, shareholders and others. Thus, the Board of Directors has deemed it necessary to develop a policy for better corporate governance, which covers different key principles – the Board of Directors’ structure, roles, duties and responsibility coupled with transparent, clear and auditable management carried out by executives to guide organizational management to create the confidence that any operations of the Company and its subsidiaries will be fair and take into account the best interest for its shareholders and all stakeholders.
The Company and its subsidiaries have a goal to improve the organization holistically in terms of ethics, values and corporate governance which, in due course, increase the Company’s value in the long run for all stakeholders and support the development of employees within the Company concurrently.
The Board of Directors has developed policy and guidelines to oversee and monitor each subcommittee’s performance to be in accordance with the Company’s set foundation. Moreover, there will be an annual review of the policy and guidelines to keep up with domestic and international situations. Corporate Governance will also be the key agenda of the annual meeting.
Corporate Governance Policy and Guidelines Overview
The Company and its subsidiaries have a full intention to adhere to a good corporate governance policy by referring to the 2017 Corporate Governance Code (CG Code), developed by the Securities and Exchange Commission. Nevertheless, the Board of Directors has recognized that the Corporate Governance Report (CGR) by Thai Institute of Directors (IOD) and DJSI Sustainability Assessment are beneficial to increase the credibility of the Company and its subsidiaries. Some of the guidelines that have not been in use or have been acted as hindrance, the management is monitoring and reporting the Board of Directors for considering a review annually.
As per Company’s subsidiaries, the Board of Directors has acknowledged that, although these companies are not registered as public, it is deemed necessary to comply with the corporate governance policy and guidelines in the organizations so as to be aligned with the parent Company. The key is to operate the business while simultaneously building a foundation within the organizational culture to form a best interest in society, community and environment. The Board of Directors will also review the subsidiaries’ policy each year for the greatest suitability and ability to adopt in each business type. The Company has a consensus to hold a meeting regularly to discuss the topic of corporate governance policy and guidelines; Then, the observations and comments from the Board of Directors’ viewpoint will be used to improve repeatedly in order to improve the efficiency of the Company and its subsidiaries.
To be credible to its shareholders and all stakeholders and to create sustainable value to its business in line with the expectations of the business sector, investors, the capital market, and society as a whole, the Company formulated a good corporate governance policy by adhering to the 2017 Corporate Governance Code (CG Code), developed by the Securities and Exchange Commission to serve as the guidelines for corporate governance of the Company. The corporate governance policy consists of eight principles, which are outlined as follows:
Principle 1: Establish Clear Leadership Role and Responsibilities of the Board
1. The Board of Directors shall demonstrate a thorough understanding of its leadership role, assume its responsibilities in overseeing the company, and strengthen good governance, including:
1.1. Defining objectives and goals, formulating strategies and operating policies;
1.2. Allocating key resources to achieve the objectives and goals; and
1.3. Monitoring, evaluating, and reporting on performance.
2. The Board of Directors will oversee the Company to achieve governance outcomes, which will create sustainable corporate value. It must make sure that the Company is competitive and has good performance while taking into account of long-term impacts, ethical business conduct, respect for rights and responsibility for shareholders and stakeholders, social benefits, mitigation of negative impacts on the environment and adaptability to change factors. The Board of Directors will serve as an exemple; provide policies for directors, executives, and employees and will communicate with them to establish their understanding; provide sufficient mechanisms conducive to the compliance with the policies; monitor performance results; and review policies and practices on a regular basis.
3. The Board of Directors will ensure that all directors and executives perform with duty of care and duty of loyalty; ensure that operations comply with laws, regulations resolutions passed by the Shareholders’ Meetings, policies or guidelines set forth; and provide a process for approving key operations, e.g. investments, transactions that have a material impact on the Company, transactions with connected persons, asset acquisition/ disposition and dividend payment.
4. The Board of Directors shall demonstrate a thorough understanding of the division of board and management responsibilities. The board should clearly define the roles and responsibilities of management and monitor management’s proper performance of its duties.
Principle 2: Define Objectives that Promote Sustainable Value Creation
1. The Board of Directors will ensure that the Company’s key objectives and goals allow for sustainability, which are consistent with creation of value for the Company, customers, stakeholders and society as a whole.
2. The Board of Directors will ensure that the Company’s medium-term and/or annual objectives and goals are consistent with the Company’s key objectives and goals via appropriate and safe use of technology.
Principle 3: Strengthen Board Effectiveness
1. The Board of Directors shall be responsible for determining and reviewing the board structure, in terms of size, composition, and the proportion of independent directors as to ensure its leadership role in achieving the Company’s objectives.
2. The Board of Directors shall select an appropriate person as the chairman and ensure that the board composition serves the best interest of the Company, enabling the board to make its decisions as a result of exercising independent judgment on corporate affairs.
3. The Board of Directors shall ensure that the policy and procedures for the selection and nomination of directors are clear and transparent resulting in the desired composition of the board. The Board of Directors should set meetings to consider the nomination criteria and process to ensure that the candidate’s profile meets the requirements set out in the skills matrix and nomination criteria. In addition, the Board of Directors shall review the nomination criteria and process prior to the selection of directors whose term has expired.
4. When proposing Board of Directors’ remuneration to the shareholders’ meeting for approval, the Board of Directors shall consider whether the remuneration structure is appropriate for the directors’ respective roles and responsibilities, linked to their individual and company performance and provide incentives for the Board of Directors to lead the company in meeting its objectives, both in the short and long term.
5. The Board of Directors shall ensure that all directors are properly accountable for their duties, responsibilities and (in-) actions and allocate sufficient time to discharge their duties and responsibilities effectively.
6. The Board of Directors will ensure that the company’s governance framework and policies extend to and are accepted by subsidiaries and other businesses in which it has a significant investment as appropriate.
7. The Board of Directors shall conduct a formal annual performance evaluation of the Board of Directors, its committees and each individual director to review performance, challenges and obstacles each year. The evaluation results should be used to strengthen the effectiveness of the board.
8. The Board of Directors will ensure that the Board of Directors and each individual director understand their roles and responsibilities, the nature of the business, the company’s operations, relevant law and standards and other applicable obligations. The Board of Directors should support all directors in updating and refreshing their skills and knowledge necessary to carry out their roles on the Board of Directors.
9. The Board of Directors will ensure that it can perform its duties effectively and have access to accurate, relevant and timely information. The Board of Directors should appoint a company secretary with necessary qualifications, knowledge, skills and experience to support the Board of Directors in performing its duties.
Principle 4: Effective Executive and People Management
1. The Board of Directors will ensure that a proper mechanism is in place for the nomination and development of the chief executive officer and key executives to ensure that they possess the knowledge, skills, experience and characteristics necessary for the company to achieve its objectives.
2. The Board of Directors will ensure that an appropriate compensation structure and performance evaluation are in place by defining the remuneration structure that provides incentive to executives and employees, aligning with the Company’s main objectives and long-term interest.
3. The Board of Directors shall consider its responsibilities in the context of the Company’s shareholder structure and relationships, which may impact the management and operation of the company.
4. The Board of Directors will ensure the Company has effective human resources management and development programs to ensure that the Company has adequate staffing and appropriately knowledgeable, skilled and experienced employees and staff
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Principle 5: Responsible for Business Operations
1. The Board of Directors shall prioritize and support operations that create value for the Company and its shareholders, together with benefits to its customers, other stakeholders, society and the environment in support of sustainable growth of the Company.
2. The Board of Directors will encourage management to adopt responsible operations and incorporate them into the Company’s operational plan to ensure that every department and function in the Company operates in accordance with the Company’s objectives, goals and strategies.
3. The Board of Directors will ensure that management allocates and manages resources efficiently and effectively throughout all aspects of the value chain to enable the Company to meet its objectives. The types of resources that the company should consider include financial capital, intellectual capital, human capital, social and relationship capital, and natural capital.
4. The Board of Directors shall establish a framework for governance of enterprise IT that is aligned with the Company’s business needs and priorities, stimulates business opportunities and performance, strengthens risk management and supports the Company’s objectives.
Principle 6: Strengthen Effective Risk Management and Internal Control
1. The Board of Directors will ensure that the Company has effective and appropriate risk management and internal control systems in accordance with the Company’s objectives, goals and strategies which comply with applicable law and standards.
2. The Board of Directors shall establish an audit committee that can act effectively and independently which comply with applicable legal requirements, including those promulgated by the Securities and Exchange Commission and Stock Exchange of Thailand.
3. The Board of Directors shall manage and monitor conflicts of interest that might occur between the Company, management, directors and shareholders. The Board of Directors should also prevent the inappropriate use of corporate assets, information, and opportunities, including preventing inappropriate transactions with related parties.
4. The Board of Directors shall establish a clear anti-corruption policy and practices including communication and staff training and strive to extend its anti-corruption efforts to stakeholders. The Board of Directors should ensure company-wide awareness and implementation of the Company’s anti- corruption policy and practices, and compliance with applicable law and standards.
5. The Board of Directors shall establish a mechanism for handling complaints and whistleblowing.
Principle 7: Ensure Disclosure and Financial Integrity
1. The Board of Directors is responsible for ensuring the integrity of the Company’s financial reporting system and that timely, sufficient and accurate disclosure of all material information regarding the Company is made consistent with applicable requirements, standards and practice.
2. The Board of Directors shall monitor the Company’s financial liquidity and solvency.
3. The Board of Directors shall ensure that risks to the financial position of the Company or financial difficulties are promptly identified, managed and mitigated and that the Company’s governance framework provides for the consideration of stakeholder rights.
4. The Board of Directors shall ensure sustainability reporting, as appropriate. The Board of Directors shall consider and report data on the company’s compliance and ethical performance (including anti-corruption performance), its treatment of employees and other stakeholders (including fair treatment and respect for human rights), and social and environmental responsibilities, using a report framework that is
proportionate to the company’s size and complexity and meets domestic and international standards.
5. The Board of Directors shall ensure the establishment of a dedicated Investor Relations function responsible for regular, effective and fair communication with shareholders and other stakeholders such as analysts and potential investors.
6. The Board of Directors will ensure the effective use by the Company of information technology in disseminating information.
Principle 8: Ensure Engagement and Communication with Shareholders
1. The Board of Directors will ensure that shareholders have the opportunity to participate effectively in decision-making involving significant corporate matters.
2. The Board of Directors will ensure that the shareholders’ meetings are held as scheduled and conducted properly, with transparency and efficiency, and ensure inclusive and equitable treatment of all shareholders and their ability to exercise their rights.
3. The Board of Directors will ensure accurate, timely and complete disclosure of shareholder resolutions and preparation of the minutes of the shareholders’ meetings.
The Company considers the treatment and protection of shareholders’ right equally and fairly (The Equitable Treatment for Shareholders), acknowledges and emphasizes on the Rights of Shareholders such as the right to buy, sell or transfer shares, having share in the profit of the Company, receiving adequate and complete information of the Company, participating in the meeting to exercise voting right in the shareholders’ meeting freely and equally, determining the criteria that allow minority shareholders to propose agenda prior to the shareholders’ meeting as well as participating in the decision-making process of important matter that has impact to the Company such as dividend allocation, appointment of directors, determining director’s remuneration, appointment or discharge of auditor and determining auditor’s remuneration
Business Ethics
The Company and its subsidiaries have considered and valued Business Ethics. The Company is committed to transparency in operation by making it an important part in driving the culture of the Company and subsidiaries within the group and building the credibility and honesty for all stakeholders. The Board of Directors is responsible to establish the policy and business ethics for employees, the Board of Directors and all executive directors to be upheld as a way of conducting oneself within and outside organization to promote the growth of business and all employees in an efficient and transparent way to achieve predetermined goals, corresponding with the vision, attitude, and objectives of the Company by adhering to the following principles:
1. Fair and transparent business operations.
2. Strict compliance with laws and regulations
3. Non-disclosure of internal information to outsiders
4. Social and environment development of the Company and its subsidiaries must be sustainable
5. Respect for human rights and equal treatment of employees
6. Treatment of business partners
7. Treatment of trade or contract partners
8. Not accepting or giving valuable assets that may benefit both the giver and the receiver
9. Responsibility to consumers or service before and after sales
The Board of Directors have arranged for the preparation and distribution of guidelines to enhance the understanding of the business ethics to employees in the Company and subsidiaries for them to see the importance of such matters. Every year, there will be a review of corporate governance policy and code of conduct to make them most comprehensive and effective.
Key Milestones of the Policy, Practice, and Governance System in 2022
In 2022, the company has made amendments to policy, practice and governance system as follows.
Under the constantly changing economic, social and environment, the Company and subsidiaries have emphasized on honest, transparent and sustainable operations. These together have allowed each committee to perform its duties in overseeing the Company’s business effectively. In addition, the Company has arranged the meeting for all sub-committee, including the committees of subsidiaries, to express their opinion and brainstorm on business practices to welcome various opinions from the different views of each sub-committee with different responsibility, resulting in sub-committees being able to promote and enhance the governance function of the management.
The concept of giving value to human resources of the organization is one of the driving forces for the resilient growth of the Company and help the Company achieve goals and strategies. In 2022, the Nomination and Remuneration Committee had a discussion on improvements to the compensation package in both monetary and non-monetary terms to cover the needs of employees as much as possible within the scope and rules set forth.
Besides, the Company has periodically reviewed and amended the Charter of the Board of Directors both for the Company itself and subsidiaries by adjusting the Company’s vision to be most current and up-to-date with various situations as well as in the environment and social aspects. Moreover, details in the Charter have been improved to be more clarified and to cover topics or issues that have been defined by various agencies.
The Company and subsidiaries have elevated and improved the policy, guidelines, and governance system to achieve more sustainable governance system and comply with 2017 Corporate Governance Code in 4 topics as follows:
1. Review the policy of qualification and nomination of the Company’s director to be in accordance with international standards
2. Review and improve the Company’s risk management policy
3. Establish a policy for managing diversity and acceptance of individual differences and amend the policy regarding human rights .
4. Determine policies for taking care of the environment, society, and nearby communities to grow together with sustainability.