Corporate Governance Policy
The Company is committed to maintaining high standards of good corporate governance within the organization to protect and enhance long-term shareholder value. The Company has adopted and is continuously developing a set of good corporate governance practices and policies which are modeled on principles advocated by the SET as per the details set out in the following sections. Additionally, the Company has put in place a Code of Corporate Conduct approved by the Board of Directors and Standard Operating Procedures which have been communicated throughout the organization and publicized the Corporate Governance Policy and Code of Corporate Conduct via the Company’s website in order for all employees at all level to better understand and use as working guidelines and strictly follow in the course of performing their duties. As and when required, new internal rules and regulations are introduced to ensure there are no gaps in the policies.
The Board of Directors has acknowledged and reviewed the implementation of the Corporate Governance Code for Listed Companies published by the Securities and Exchange Commission to update the Company’s corporate governance. In 2019, the Company has established the Corporate Governance Policy which has been considered and recommended by the Audit and Risk Committee (currently known as Audit, Risk and Corporate Governance Committee) and approved by the Board of Directors to benefit its business to have good long-term performance and create value for sustainable business. The Board of Directors has annually reviewed the Corporate Governance Policy for the improvement of good corporate governance. For any principle which has yet been implemented, the Board of Directors has assigned the management to study in details for further consideration.
Rights of Shareholders
The Company recognizes the importance of shareholders’ rights. In the Company’s Annual General Meeting held on 26 April 2019 the Company conducted the meeting in full compliance with all relevant laws and regulations in respect of shareholders’ rights in the following manner.
1.1 All shareholders have the same basis and rights in the casting of votes at the meetings and the receipt of dividends when declared by the Company. These are calculated based on their respective shareholding in the Company.
1.2 At shareholders’ meeting, shareholders are given the right to approve important matters such as election of directors (shareholders can elect directors individually), directors’ remuneration, appointment of auditors and dividend payment, etc.
Furthermore, any shareholders who arrive at the meeting after the meeting has begun are still entitled to vote on the agenda items that are still under consideration and have not been voted upon.
1.3 The Company has a policy to facilitate and encourage all groups of shareholders including institutional shareholders to attend the Company’s Annual General Meeting such as giving an opportunity to every shareholder to propose agenda or send questions related to the Company’s business in advance, distributing a package containing the notice and meeting documents in English to foreign shareholders, selecting meeting venue that is convenient for attendance, etc.
1.4 The Company invites shareholders to propose agenda items in advance of the AGM through the SET and the Company’s website (www.lagunaresorts.com). However, none have been proposed by the shareholders.
The Company provides opportunity for a shareholder or shareholders who hold shares of the Company representing at least 5 percent of the total voting rights of the Company to have the rights to propose an AGM agenda item in advance within 30 days prior to the end of the accounting period. The Audit, Risk and Corporate Governance Committee shall review the proposed agenda item and express its opinion to the Board of Directors for consideration. The proposed agenda item deemed to qualify by the Board of Directors shall be included in the AGM agenda. In the event that the proposed agenda item deemed not to qualify by the Board of Directors, it shall be announced with reasons at the AGM.
The Company provides channels for minority shareholders to make suggestions, express their opinions or make a complaint by sending the original duly signed statement together with supporting evidence to the Company Secretary by registered mail to the Company’s address or by phone +66 2677 4455.
1.5 The Company does not invite the minority shareholders to nominate their own candidates to be appointed as the Company’s directors ahead of the meeting. This is because the Company already gives all shareholders an opportunity to nominate their own candidates (who meet the requirements under the Plc Act) and to vote for candidates at the shareholders’ meeting.
1.6 Through the Thailand Securities Depository Company Limited, the Company’s share registrar, the Company sends out package containing the notice and agenda of the meeting to the shareholders at least 21 days prior to the meeting. The meeting documents include the facts and rationales and opinions of the Board as well as other information relating to the agenda items such as information on the persons nominated for election as directors, auditors’ profiles, the part of the Company’s Articles of Association that relates to the shareholders’ meeting, map showing the venue of the shareholders’ meeting, proxy forms, documents and evidence of entitlement to attend the meeting, etc. This is to enable the shareholders to prepare themselves for the meeting. In addition, the notice of the shareholders’ meeting is advertised in the newspaper and all information contained in the meeting documents will also be posted on the Company’s website (www.lagunaresorts.com) at least 30 days prior to the meeting. Moreover, shareholders are always invited to register at least 1 hour before the meeting begins.
For convenience, transparency and accuracy of the registration and vote counting at the shareholders’ meeting, a barcode system has been utilized.
1.7 At every shareholders’ meeting, all agenda items are clearly identified and particularized, objectives, and rationale and opinions of the Board are also presented in the meeting for consideration of the shareholders. The Chairman will conduct the meeting according to the sequence of the agenda and will not add any additional agenda items which are not indicated in advance in the notice unless there is a proposal to consider other matters other than those specified in the notice, in accordance with the law, from shareholders holding not less than one-third of the total number of shares issued.
No additional agenda item proposed to the 2019 Annual General Meeting other than those specified in the notice.
1.8 Before the start of every shareholders’ meeting, the Company Secretary will explain the voting methodology to shareholders. In the interest of good corporate governance in regard to transparency, minority shareholders are also invited to witness vote counting of each agenda item. A team of legal counsels from a leading international law firm is appointed to verify the registration procedure before the Chairman of the meeting announces to the shareholders, the number of shareholders and proxy holders present at the meeting and the number of shares held by them. The legal counsels also verify the vote counting procedure in respect of each agenda item before the votes are announced as resolution of the shareholders’ meeting. Shareholders may verify the detailed results of the vote of each agenda item at the end of each meeting. The same results and a summary of questions from shareholders will also be included in the minutes of the meeting which are accurately and completely documented in all material aspects and will be sent to all shareholders for their review prior to the following meeting. The minutes of the 2019 Annual General Meeting is posted on the Company’s website (www.lagunaresorts.com) within 14 days after the meeting was held.
1.9 The Company’s policy in conducting shareholders’ meetings is not only to meet all legal requirements but to also provide a platform and opportunity for shareholders to communicate their views and ask the directors and management questions regarding matters affecting the Company. The Chairman allocates sufficient time for the meeting and conducts the meeting in an appropriate and transparent manner. During the meeting, shareholders are allowed to give comments and ask questions before the resolution on each agenda item. In addition, shareholders who have any questions that require the Company’s clarification during the meeting may send their questions in advance at “email@example.com” or fax them to 66 (0) 2285 0733.
1.10 Apart from the external auditor who will attend the Annual General Meeting, the Chairman of the Board, the Chairman of the Audit, Risk and Corporate Governance Committee and the Chairman of the Nomination and Remuneration Committee, and all of the Company’s directors will endeavor to be present at the shareholders’ meeting in order to assist the Board in addressing queries raised by the shareholders. The Company also invites its legal counsels from a leading international law firm to attend the meeting in case there are any legal questions which requires clarification during the meeting. Furthermore, the Company provides a professional translator to be present at the meeting to assist shareholders and the Board to communicate more effectively in English and Thai. At the 2019 Annual General Meeting, the Chairman of the Board, the Chairman of the Audit and Risk Committee, the Chairman of the Nomination and Remuneration Committee, and other directors were present at the Meeting. Details of their names are stated in the minutes of the 2019 Annual General Meeting.
1.11 The Company gives an opportunity for shareholders to freely communicate with each other without creating any barriers and also provides convenient access to relevant news and information via the Company’s website (www.lagunaresorts.com) for shareholders to receive adequate important information such as the resolutions of the Company’s Board of Directors on important matters, resolutions of the shareholders’ meetings, financial information, information which may affect the Company’s share price, Annual Report, etc.
1.12 The Company received a score of 97 points out of 100 points for the 2019 AGM Checklist assessment conducted by the Thai Investors Association. The Company will continue to strive to improve its good corporate governance practices.
Equal Treatment of Shareholders
The Company treats all shareholders fairly despite different shareholding proportions and voting power due to their shares. In recognition of its duty to ensure equal treatment of shareholders, the Company complied with all relevant laws and regulations as follows:
2.1 The Company has only one class of shares, the ordinary shares. Shareholders shall have votes equal to the number of shares held by each of them, which means one share is entitled to one vote.
2.2 For shareholders who are unable to attend a meeting in person, the Company provides opportunity for such shareholders to appoint another person as proxy to attend the meeting on their behalf by using a proxy form B sent by the Company. The Proxy form B is one of the forms prescribed by the Ministry of Commerce which allow shareholders to make voting directions. Moreover, the Company provides opportunity for shareholders to appoint the Company’s independent director as proxy to undertake proxy voting on behalf of shareholders who are unable to attend the meeting. The name of the independent director is provided in the proxy forms, together with the profile of that independent director who has been given proxy to vote on behalf of shareholders who are unable to attend the meeting, all of which are attached as part of the meeting documents.
2.3 The Company ensures that directors and management are aware of their duty to report a change in their holding of the Company’s securities to the SEC within 3 business days in accordance with the Securities and Exchange Act. The securities holding report is also included in the agenda of the Board meeting for the Board’s acknowledgment once every 3 months.
2.4 Any director or management who has an interest in, or is related to, any transaction between the Company and an interested or related person will not participate in the decision making process involving such transaction. The Company has disclosed the details and reasonableness of transaction to shareholders prior to dealing with any transaction in case such transaction requires the approval from shareholders and strictly follows the procedures on such transaction in accordance with the notification of the Capital Market Supervisory Board. The details of all connected transactions are disclosed under the heading “Related Party Transactions” in Form 56-1 and under the heading “Persons with Mutual Interest and Connected Transactions” in the Company’s Annual Report.
During 2019, there is no report of non-compliance with the notification of the Capital Market Supervisory Board on connected transactions.
2.5 The Company has formulated a Corporate Governance Policy and Code of Corporate Conduct to provide guidelines for the Board, senior management and employees of all levels to comply with. The Statement includes the prohibition on the improper use of insider information for personal benefit or to benefit others. Additionally, the Board approved a policy on dealing in securities of the Company which prohibits the dealing in the Company’s shares while in possession of unpublished confidential and price-sensitive information during the “Embargo Period.” Details are further described under the heading “Supervision on the Use of Inside Information” in the Form 56-1 and in the Company’s Annual Report. There is no violation of the policy found during the past year.
2.6 Apart from the credit term payment given under the normal course of business, the Company has no policy on providing financial assistance to any non-subsidiary companies except those whose loans or guarantees are in accordance with the proportion of shareholding in a joint venture agreement. In the prior year, the Company did not provide the financial assistance to any non-subsidiary companies.
Role of Stakeholders
In its pursuit for sustainable growth and financial returns for its shareholders, the Company strives to become a role model corporate citizen. It respects the rights of all its stakeholders and conducts its operations fairly and strictly in compliance with all laws, rules and regulations.
|Shareholders:||The Board of Directors is committed to perform its duties honestly, transparently and diligently in the best interest of all its shareholders, to preserve and enhance long-term shareholder value. All important information which may have an impact on the Company’s share price and/or shareholders’ decisions are fully disclosed in a timely manner.|
|Employees:||Being in the hospitality industry, the Company believes that its people are its greatest asset. The Company has taken steps to ensure that all labour laws are complied with and all employees are treated fairly without discrimination or favoritism. The Company offers competitive pay packages and welfare benefits such as meal allowance, laundry allowance, complimentary vouchers and health & personal accident insurance to all its employees with continually upgraded programs. Additionally, the Company provides its employees a safe, hygienic and conducive working environment, air-conditioned buses and provident fund.
People Development Policy
The Company believes that the growth of the Company depends on the quality and efficiency of employees. As such, the employee development policy mainly focuses on the knowledge and skills development of employees at all levels to strengthen the enterprise’s and overall success of the Company. The Company intends to have all management and employees set their working plan in accordance with the Company’s direction and goals, based on Company’s Vision, which can efficiently lead the operations towards the same direction. Each department sets up its own business strategy and business plan so employees can have clear objectives and individual KPIs (Key Performance Indicators) that support the Company’s Operations and their responsibilities. The KPIS will be used as a standard to evaluate employee’s performance.
The trainings are divided into 2 categories;
1) Compulsory training which is the Company tailored for each position/employee such as new employee orientation and anti-corruption policy
2) Career training which is a special course. Employees can apply for, including outsourced institutions, for specific development.
Training is one of the Key Performance Indicators (KPIs) and will be used for employee evaluation standards. Each employee is evaluated during the fourth quarter of every year.
New Employee Orientation
All new employees shall attend orientation training which is aimed to introduce new employees the rules and regulations in the workplaces, the organization’s policies and products, and the location of each hotel/BU, to prepare them to work with other employees.
The Company assigns the development process by having training courses to increase employee’s knowledge and ability such as;
People Development to Support the Growth and Expansion of the Company
For the staff development to support the growth and expansion of the Company, there is the Succession Plan for the managerial level up. This is to prepare them to be ready for the next position and for long-term expansion. Furthermore, high potential middle Management and Assistant Manager employee are selected to participate in Management Development program (MDP) and Talent Management Program respectively, in order to give an opportunity to promote a potential employee as such to join Pre-opening team to support the new hotels.
For the talent development, the Company also has the Management Trainee Program to develop new graduates to grow in the management level in the future. In the first year, they are assigned to experience every department to gain the operational knowledge and skills. They are also expected to submit their report with their findings and alternative solutions to the executive team. In the second year, they are promoted to be permanent staff at their sponsored hotel and further developed to be middle and top management accordingly.
|Customers:||The Company aims to conduct business, both in property development, sales of products, and services, in a safe and environmental-friendly manner and continuously develop products and services, create new innovations to add more values to the products and respond to the customers’ needs. Safeguarding customer confidentiality and/or customer privacy is one of the Company’s top priorities and in this regard the Company conducts business with integrity, honesty, and fairness, and does not take any action that would violate customer rights and refrain from abusing it for personal interest or for the interest of other parties.
The Company will strictly comply with the trading agreements, in the event that any particular condition cannot be met, the Company would notify the customers in advance, and jointly seek a resolution to prevent any possible damage.
|Competitors:||The Company believes that competition is the essence of a free and open market and therefore avoids any actions which may prevent, obstruct or discourage potential competitors from entering the markets in which the Company operates in. The Company takes the view that healthy competition encourages product and service innovations in the market place which would increase market standards and ultimately benefit consumers and society at large. The Company will neither engage in any fraudulent act to violate or obtain competitors’ trade secrets nor in any infringement of intellectual property or copyright including corruption and bribery, which has been stipulated in the Code of Corporate Conduct approved by the Company’s Board of Directors, for the benefit of the Company’s business.|
|Society & Environment:||The Company emphasized and aims to be a socially responsible company and has established a dedicated team of CSR and Community Relations practitioners who strive to make a positive difference to the local communities where the Company operates and to develop sustainable communities by initiating various CSR programs which focus on social and educational development, environmental conservation, religious and cultural preservation, associate benefits and relations, details as shown under the heading “CSR” in Form 56-1 and in the Company’s Annual Report as well as in the Company’s website
Green Leaf Awards received by the individual hotels reflect recognition of Laguna Phuket’s commitment to conserve the environment. In property development, the Environmental Impact Assessment (EIA) has been carried out to evaluate the likely environmental impacts of the Company’s development projects, taking into account inter-related socio-economic, cultural and human-health impacts, both beneficial and adverse including proposed measures for shaping projects to suit the local environment and reducing any potential impact. The Company encourages and supports the staff to use resources efficiently. Day-to-day operations at the resort apply the “Three Rs” of green management: Reduce, Re-use and Recycle. Each hotel has a staff education program to teach the importance of caring for the environment, and consumption of energy and water is closely monitored through the extensive checklists to be completed by the staff. No raw sewerage is discharged into the sea from the resort complex. After being treated, sewerage and wastewater are directed into a sophisticated recycling system. The resulting water is used to irrigate the gardens, details as shown under the heading of “CSR/Environmental Policy” in the Company’s website (www.lagunaresorts.com).
The Company strives to forge long-term business relationships with its suppliers and therefore has the policy to always give a fair profit to its suppliers and to respect payment terms and conditions. In addition, the Company has a policy in selecting its suppliers fairly and transparently, competitive quotations from at least 3 suppliers are required according to the criteria specified in the Company’s Standard Operating Procedures which have been distributed and communicated throughout the organization in order to understand and to strictly adhere to the procedures accordingly.
|Creditors:||The Company considers creditors as important business partners and therefore aims to treat all creditors in an equal and fair manner and strictly comply with all the terms and conditions agreed upon, particularly on credit guarantee, and capital management. The Company’s financial position will be duly and accurately disclosed. In the event that any particular condition cannot be met or in case of debt default, the Company will inform creditors concerned beforehand and seek a mutually acceptable solution to prevent any possible damage. In the previous year, no creditors challenged that the Company had failed to comply with any obligations.|
There is no violation of laws and regulations regarding to labour, employment, consumer protection, commercial competition and environmental found in the previous year.
Policy and Practice Relating to the Control and Prevention of Corruption Involvement
The Company is committed to conducting its business with integrity, transparency, morality and accountability. The Company adheres to the principles of the Corporate Governance Code and conducts its business responsibly towards the society and its stakeholders. Apart from the Corporate Governance Policy and Code of Corporate Conduct, the Company has established the Anti-Corruption Policy which was proposed to the Audit, Risk and Corporate Governance Committee for recommendation prior to being submitted to the Board of Directors for approval in order to promote anti-bribery and anti-corruption practices and to be a clear guideline for business operations.
The Company has adopted a zero-tolerance policy towards corruption for directors, management and employees of the Company to strictly follow. The policy forbids them to carry out or participate in corrupt practices in any form both directly and indirectly and they must seriously follow the guidelines in the Anti-Corruption Policy which covers various processes, including charitable contribution, sponsorship and the provision and acceptance of gifts.
The Company communicated its Anti-Corruption Policy to business partners and the public through its website and notice board for them to acknowledge and conform to the Company’s guidelines. In order to understand as well as to promote anti-bribery and anti-corruption practices and serve as clear guidelines for all employees, training will be scheduled annually. During an orientation, new employees are required to sign the Associate Declaration Form to confirm their intention and to fully comply with the Company’s Code of Corporate Conduct and Anti-Corruption Policy and all employees are required to sign for annual declaration.
The Company has put in place a risk management system suitable to the Company’s business nature and implemented risk assessment procedure, which included internal compliance and control program to monitor and prevent possible risks including corrupt practices. As part of the on-going risk management process, the Company’s Group Risk Committee in collaboration with Group Internal Audit regularly conduct a risk monitoring, assessment, evaluation and propose a control program to prevent and mitigate possible risk and report findings to the Audit, Risk and Corporate Governance Committee. The Audit, Risk and Corporate Governance Committee is responsible for overseeing and reviewing strategic and operational risk management including risk assessment and control procedures as well as seeking to ensure that the Company has a continuous process for managing risk, appropriate and effective internal control and internal audit systems.
Seeing the long-term benefits to operate business ethically with integrity, and to implement business principles to encounter corruption, the Company has declared an intent to fight corruption by declaration of intent with Thailand Private Sector Collective Action Coalition Against Corruption (CAC). The Company is proud to announce it is a certified member of CAC since February 2019 after putting in place all necessary anti-corruption policies and measures under the stringent guidelines of the CAC.
The Company announced the “No Gift Policy” during New Year Festival and other occasions in compliance with the good Corporate Governance Policy and Anti-Corruption Policy regarding to the provision and acceptance of gifts for employees at all levels to acknowledge and implement in order to create a good standard in operation. A letter on “No Gift Policy” was distributed to the Company’s business partners to ask for their cooperation not to offer any kinds of gifts to the management and employees of the Company. In case there is any inconvenience for the return of the gifts, the Company will consider donation of gifts to charitable entities or social projects as deemed appropriate.
Failure to comply with the Anti-Corruption Policy or any employee who is caught committing corruption shall be disciplined in accordance with the Company’s policies including termination of employment. A criminal/civil case may also be brought upon such employee if the act is in violation of the law.
There is no report of wrongful conduct involving fraud and corruption during the past year.
Policy on Whistle Blowing and Complaints
The Company recognizes the importance of compliance with good corporate governance and adheres to the high standards of conduct and responsibility for all stakeholders. The Whistle Blowing Policy has been established and approved by the Board of Directors and communicated throughout the organization. The policy emphasizes to encourage and enable associates and third parties to raise any serious concerns on wrongdoing, irregularity or impropriety within the Group. The Head of Group Internal Audit was appointed as the Receiving Officer or a channel for stakeholders to communicate critical corporate issues with the Company, any concerns can be raised either in writing via “firstname.lastname@example.org” or directly by hotline number 66 (0) 2285 0112. The Receiving Officer will ensure that the report from the whistle blowers will be professionally and independently addressed, assessed and investigated. Additionally, the Whistle Blowing Evaluation Team, comprising of members of Audit, Risk and Corporate Governance Committee and Head of Group Internal Audit, was set up to evaluate the reports from whistle blowers, assess and review the nature of the complaints, and set the direction of the investigation, where necessary. An appropriate timeframe to consider the complaints is set and the protection of the genuine whistle blowers from any unfair treatment will be observed. If, at the conclusion of an investigation, the Company determines that a violation has occurred or the allegations are substantiated, effective remedial action commensurate with the severity of the offence will be taken. Results and conclusions of the investigation shall be reported to the Board of Directors. There is no report of complaints or allegations during the past year.
Policy on Environmental and Social Sustainability
The Company is committed to strive towards achieving environmental and social sustainability. With the participation in EarthCheck program, which is widely regarded as the world’s leading sustainable environmental benchmarking and certification program used by the travel and tourism industry, the Company is committed to continually improve its environmental and social sustainability performance by implementing an environmental management system, identifying environmental risks, recording and monitoring any impact to meet the standard of EarthCheck and will comply with all relevant legislation and regulations, and strive to achieve international best practice. The Company was certified to environmental standards and has been awarded EarthCheck Silver Certification since 2015. The annual audit to retain the Silver Status was conducted in December last year.
The Company has constantly provided an environmental training session for employees to raise awareness about environmental sustainability. A risk assessment on potential environmental impacts resulting from the Company’s business operation have been conducted and an environmental approach have been established and communicated throughout the organization by posting on intranet and bulletin board so that all employees understand the policy and contribute to environmental sustainability.
Since 2017, the Company together with hotels in Laguna Phuket jointly announced the Environmental & Social Sustainability Policy with the commitment to continually improve their environmental and social sustainability performance and annual Benchmarking as measured by the EarthCheck tool. As a part of Laguna Phuket Community, they continue to work on environmental and social development projects by safeguarding the nature environment, the cultural heritage, and promoting communal prosperity through participation in Laguna Phuket Community’s Corporate Social Responsibility programs such as carbon reduction through tree planting, providing mentoring and scholarships to the youth in the community, cleaning activity, considering special employment and empowering local employees and using local products and services that are environmentally friendly and etc.
Policy on Health, Safety and Environment
The Company has concrete policy in regards to health, safety and environment by given top priority to the safety and health of the surrounding community and overall society. By realizing that it is a contributing factor in driving sustainable development of society and the environment, the Company therefore continuously carries out community and social development activities together with its business operations with responsibility toward the overall community and society as per the following details:
- Continuously perform business operations in compliance with safety law and other related regulations.
- Safety at workplace shall be treated as top priority and responsibility of every employee.
- Every level of commanders must be a good role model and be able to lead, train, instruct and motivate other employees to perform duties safely.
- All employees must take into account their personal safety as well as the safety of their colleagues and properties of the Company as their topmost priority while on duty.
- All employees must always maintain cleanness and order of their workplace.
- Supporting safety-related activities in order to raise safety awareness among employees and promote safe work environment.
- Continuously review, improve and develop safety management system.
- Seeking solutions to minimize environmental impact by constantly checking, monitoring and controlling the amount of pollutions released including the disposal of hazardous and non-hazardous waste in order to protect existing natural resources.
- Using the available resources and energy in the most efficient manner, including proving water and air pollutions as well as wastes and other pollutions that arise from the Company’s business activities to ensure minimal impact on the environment and surrounding community as much as possible.
First Aid Supporting Team (FAST)
The company has selected potential employees from various departments as well as from hotel to be FAST and training to medical help in an emergency. Training curriculum standards by the staff of the Bangkok Phuket Hospital, which must train constantly, every six months to provide basic strength to help its guests and employees were immediately found to illness or accident in the hotel and workplace.
Exercise Evacuation Tsunami in Phuket.
The company has many employees working in offices and hotels in Phuket. Tsunami Evacuation Policy had been practicing evacuation drills every year. The main objective was to focus on enhancing the knowledge, skills and expertise to evacuate staff in the area and help the victims, as well as the order of the commander of the personnel in a medical emergency, including testing tools and equipment. And vehicles with practicality, so to be prepared for natural disasters, which may happen at any time. It is not to be ignored any longer. The company believes that the knowledge Participants practice and experience, everyone will be extremely useful to prepare. It also ensures the employees and guests of the hotel as well.
Policy on Respecting Human Rights
The Company gives importance to respecting human rights by conducting business in compliance with laws and human rights which are the basic rights ensuring that all human beings are born free and equal in dignity and rights without discrimination against race, nationality, color, gender, religion, age, language, personal status, social value, education or political opinion.
The Company provides equal opportunity to all employees in working under the rules, regulations, notifications and orders of the Company. The Company treats the employees’ personal information confidential and shall neither send or distribute such information to irrelevant person nor disclose personal information without the consent of the owner. The Company also supports and respects the protection of human rights e.g. by not conducting or concerning in any violation of human rights such as forced labor, unfair dismissal and the use of child labor. No complaints on the unfair treatment to employees in the past year.
Policy on Preventing Violation of Intellectual Property or Copyright
The Company has established a policy and practice not to support any violation of intellectual property or copyright, which has been stipulated in the Code of Corporate Conduct such as using a licensed computer program or program authorized by the copyright owner and restricting computer program installation by authorized person only. The use of computers and information technology will be monitored periodically by the Group Internal Auditor. There is no violation of intellectual property or copyright found in the past year.
IT Risk Management
The Company is committed to operating its business without disruptions and safeguarding the Company and customer’s information. Therefore, information technology is important in managing the following:
- Using the most up to date firewalls to secure company network
- Locating the server room in a secure place and equipping it with FM200 fire extinguisher
- Adopting the latest version of IT systems in all computers and server.
The Company manages IT related disaster risks by setting up a data backup and recovery system which can reinstall the IT system in a timely manner to ensure continuity of business operations in the event of viruses, trojans, malware, fraudulent email or hacker attacks.
Each year, the Company reviews and practices its Business Continuity Plan (BCM) and Disaster Recovery Plan (DRP) to prepare the IT system for risks and crises that may occur. In addition, the internal auditor monitors compliance with the risk mitigation measures to ensure that the Company’s risk is acceptable and manageable.
IT Governance Policy
IT Governance Policies and Procedures have been developed and communicated to all employees of the Company to comply with the Company’s corporate governance regulations. Some of these policies include,
- Use of non-infringement software only.
- The use of computers and the internet must not cause any risk, data corruption and the computer system of the Company.
- Safeguarding the Company and its customers’ data to prevent data leakage.
- Computer and internet usage must comply with the Computer Related Crime Act.
- Data access level control – password and data retention can be verified backwards.
Application development and environmental responsibility.
Environmental responsibility is an issue that the Company places great importance on. The Company has developed online application software systems, such as Purchasing Online, Member Online, and Leave online to reduce the amount of paper used in the Company and to also increase efficiency and productivity of our employees.
Information Disclosure and Transparency
The Company’s emphasis on the disclosure of accurate and complete information in a transparent and timely manner as shown by the following.
4.1 Each of the directors and executives of the Company has filed with the Company a report covering his interest or his related person’s interest in relation to management of the Company or its subsidiaries in accordance with the criteria and procedures as specified in the notification of the Capital Market Supervisory Board, and has updated and filed with the Company within 30 days should there be any change in the report. The report is also included in the agenda of the Board meeting for the Board’s acknowledgment once every 3 months.
4.2 In the previous year, the Company disclosed all general and financial information as well as information which may affect the price of the Company’s securities correctly, completely, transparently and on a timely manner, in accordance with the rules and regulations of the SEC and the SET. All information is communicated to investors, shareholders and relevant sectors through the channels of the SET and the Company’s website (www.lagunaresorts.com).
4.3 Individual investors, shareholders, stock analysts and state agencies may contact the Company through the Company Secretary at telephone number 66 (0) 2677 4455 or at “email@example.com”.
4.4 The Company’s financial statements contain accurate and complete information and are prepared in accordance with generally accepted accounting standards. In addition, they are audited / reviewed by auditors from a well-known auditing firm approved by the Securities and Exchange Commission (currently EY Office Limited) and are approved by the Company’s Audit, Risk and Corporate Governance Committee and Board before being disclosed through the SET. The information relating to the “Board of Directors’ Responsibility for the Company’s Financial Statements” is available in the Company’s Annual Report. In 2019, the Company’s quarterly and annual financial statements were unconditionally certified by the auditor.
4.5 The Company wishes to refer the following matters to the disclosure made in other places:
- The name of directors and the scope of the powers, duties and responsibilities of the Board and other committees are detailed under the heading “Management Structure” in the Form 56-1 and in the Company’s Annual Report.
- The professional experience of the directors, members of other committees, Head of Group Internal Audit and Company Secretary is detailed in Attachment 1 to Form 56-1 and under the heading “Board of Directors Management, Head of Group Internal Audit and Company Secretary of the Company” in the Company’s Annual Report.
- The number of Board meetings held and the number of Board meetings attended by each director in 2019 are detailed in clause 5 under “Board Responsibility” hereof.
- The performance of the Audit, Risk and Corporate Governance Committee in the past year is detailed in Attachment 4 to Form 56-1, and under the heading “Report of the Audit, Risk and Corporate Governance Committee” in the Company’s Annual Report.
- The performance of the Nomination and Remuneration Committee in the past year is detailed in Attachment 5 to Form 56-1, or under the heading “Report of the Nomination and Remuneration Committee” in the Company’s Annual Report.
- The remuneration for directors and management is detailed under the heading “Directors’ and Management’s Remuneration” in Form 56-1 and in the Company’s Annual Report.
4.6 In 2019, the Company made full disclosure of information within the time frame specified in the regulations of the SET and the SEC. In addition, neither the SET nor the SEC challenged that the Company had failed to comply with any disclosure requirement.
5.1 Board Structure
5.1.1 Members of the Board and Terms of Directorship
The Company’s Board of Directors currently comprises 12 members, 5 of whom are Independent Directors namely Mr. Vudhiphol Suriyabhivadh, Dr. Jingjai Hanchanlash, Mr. Thongchai Ananthothai, Ms. Srinthorn Ounayakovit and Mr. Surapon Supratya, representing more than one-third of the total Board members.
The Board member are selected on the basis of, among other things, knowledge, experience, skill, diversity of expertise, integrity, abilities to make independent analytical inquiries, and their understanding of the Company’s business. Currently the Board comprises business leaders and professionals with financial, accounting, legal, business management and sales & marketing backgrounds.
Directors and senior management of the Company have never been an employee or partner of the current external auditor in the past 2 years.
All independent directors of the Company are independent of management and major/substantial shareholders and meet the Company’s definition of Independent Director which also in line with the qualification of Audit Committee in accordance with the notification of the Capital Market Supervisory Board.
The Company’s directors are the persons with knowledge, competence, honesty, have ethical business practices and sufficient time to devote themselves to serve the Company. There are no independent directors of the Company who serve on more than five boards of listed companies and no executive directors who serve on more than three boards of listed companies outside of the Group.
The Company’s policy to fix the term of office of directors is under Article 14 of the Company’s Articles of Association which stipulates that at each annual general meeting, one-third of directors shall retire from office and that the director who has been longest in the office shall retire. Therefore, the term of office of a director of the Board shall be 3 years. Retiring directors would be eligible for re-election.
The independent directors have no affiliations or business relationships with the Company and are not directly associated with a shareholder of the Company, nor do any relationships or circumstances exist which are likely to, or could appear to, interfere with the exercise of their independent business judgment with a view to the best interest of the Company.
5.1.2 Definition of “Independent Director”
“Independent Directors” means the persons who have all the necessary qualifications and independence which is in line and more stringent than the criteria set by the Capital Market Supervisory Board. At present, the said criteria prescribe that the qualifications of an Independent Director are as follows:
(a) holding not exceeding 0.75 percent of the total voting shares of the Company, its parent company, subsidiary, associate company, major shareholder or controlling person, including shares held by the connected persons of such independent director;
(b) neither being nor having been an executive director, employee, staff, advisor who receives salary or the controlling person of the Company, its parent company, subsidiary, associate company, same-level subsidiary, major shareholder or controlling person, unless the foregoing status has ended not less than two years prior to the date of appointment. Such prohibited characteristics shall exclude the case where an independent director used to be a government official or advisor of a governmental agency, which is a major shareholder or the controlling person of the Company;
(c) not being a person who is related by blood or registration under laws, such as father, mother, spouse, sibling and child, including spouse of child, other directors, executives, major shareholders, controlling person or person to be nominated as director, executive or controlling person of the Company or its subsidiary;
(d) not having or having had a business relationship with the Company, its parent company, subsidiary, associate company, major shareholder or controlling person in a manner that may interfere with his/her independent judgment, and neither being nor having been a significant shareholder or the controlling person of any person having a business relationship with the Company, its parent company, subsidiary, associate company, major shareholder or controlling person, unless the foregoing relationships has ended not less than two years prior to the date of appointment.
The term of ‘business relationship’ aforementioned under paragraph one includes any normal business transaction, rental or lease of immovable property, transactions relating to assets or services or grant or receipt of financial assistance through receiving or extending loan, guarantee, providing assets as collateral, and any other similar actions, which result in the Company or his/her counterparty being subject to indebtedness payable to the other party in the amount of three percent or more of the net tangible assets of the Company or twenty million baht or more, whichever amount is lower. The amount of such indebtedness shall be in accordance with the method for calculating the value of connected party transactions under the Notification of the Capital Market Supervisory Board governing rules on connected transactions mutatis mutandis. The combination of such indebtedness shall include the indebtedness taking place during the course of one year prior to the date on which the business relationship with the person commences;
(e) neither being nor having been an auditor of the Company, its parent company, subsidiary, associate company, major shareholder, or controlling person, and not being a significant shareholder, controlling person, or partner of the audit firm which employs the auditor of the Company, its parent company, subsidiary, associate company, major shareholder, or controlling person, unless the foregoing relationship has ended not less than two years prior to the date of appointment;
(f) neither being nor having been any professional advisor including legal advisor or financial advisor being paid with a service fee of more than two million baht per year by the Company, its parent company, subsidiary, associated company, majority shareholder, or controlling person, and not being a significant shareholder, controlling person, or partner of the professional advisor, unless the foregoing relationship has ended for not less than two years prior to the date of the appointment;
(g) not being a director who is appointed as the representative of the Company’s directors, major shareholder, or shareholder who is a connected person of the Company’s major shareholder;
(h) not operate any business which has the same nature as and is in significant competition with the business of the Company or its subsidiary, or not being a principal partner in any partnership, or not being an executive director, employee, staff, advisor earning regular monthly salary, or not holding shares exceeding one percent of the total number of voting rights of any other company operating business which has the same nature as and is in significant competition with the business of the Company or its subsidiary;
(i) not having any other characteristics which make him/her incapable of expressing independent opinions with regard to the Company’s business affairs.
After having been appointed as independent director with qualifications complying with the criteria under (a) to (i) of the first paragraph, the independent director may be assigned by the board of directors to take part in the business decision of the Company, its parent company, subsidiary, associate company, same-level subsidiary, major shareholder or controlling person, providing that such decision shall be in the form of collective decision.
5.1.3 Consecutive Terms of Office of an Independent Directors
The Company encourages the consecutive terms of an independent director may serve no more than 3 consecutive terms, and the end of each term on the date of the Annual General Meeting of Shareholders in which they are due to retire by rotation. The Board of Directors may nominate their names to be re-elected at the Annual General Meeting of Shareholders as deemed fit.
The Company has yet stipulated limitation on the consecutive directorship terms of office for independent directors, as the Company’s independent directors are qualified according to the definition specified by the SEC and the Company. They also have knowledge and good understanding of the Company’s business and are able to provide opinions independently in Board of Directors’ meeting and Sub-committees’ meetings.
5.1.4 Roles of the Chairman of the Board
- Summoning meeting for Board and presiding over the meeting. In making a decision, the Chairman has a deciding or casting vote in the event of tied votes.
- Setting Board meeting agenda in consultation with the Chief Executive Officer / Managing Director, Chairman of the Audit, Risk and Corporate Governance Committee and Chairman of the Nomination and Remuneration Committee and ensuring that Board members receive accurate, complete, timely and clear information prior to the meeting in order to assist their decision making process.
- Conducting the Board meeting according to the agenda, relevant laws and good corporate governance, allocating sufficient time and encouraging all directors to participate in the discussion, exercise their discretion prudently and express their opinions freely.
- Overseeing and ensuring that the Board of Directors and the Sub-Committees effectively carry out their duties to achieve the Company’s objectives.
- Promoting constructive relations between executive and non-executive directors, and between the Board and the management.
- Ensure that all directors contribute to the Company’s ethical culture and good corporate governance.
5.1.5 Duties and Responsibilities of the Chief Executive Officer / Managing Director
- To be in charge of the daily business operations of the Company, supervise and manage the works and operations of the Company for complying with the policy, vision, mission, values, strategy and goals, both in terms of financial and non-financial, as well as to drive the business plan to achieve the financial budget as approved by the Board of Directors;
- To employ, appoint, transfer, dismiss, and terminate employees in all levels, except the appointment, transfer and dismissal of the Head of Group Internal Audit, which shall also be approved by the Audit, Risk and Corporate Governance Committee;
- To determine the salary and remuneration, adjust the salary, bonus, reward, and welfare of all employees of the Company, including the senior management in correspondence with the remuneration mechanism and welfare as approved by the Nomination and Remuneration Committee;
- To issue internal order, policies, announcement and memo of the Company to ensure that the operations of the Company are in compliance with the policy and the interest of the Company, including to maintain the organizational discipline;
- To perform other tasks as assigned by the Board of Directors and to perform any other acts as stipulated by laws and regulations of the authorities.
5.1.6 Aggregation or Separation of Positions – Chairman of the Board and Chief Executive Officer
Currently, Mr. Ho KwonPing is the Chairman of the Board and the Chief Executive Officer of the Company. He is closely associated with the Group’s success. The current board structure maintains an appropriate check and balance system because half of the Board members are non-executive directors. The Board is of the view that the current structure is appropriate and adequate given that Mr. Ho KwonPing has been able to effectively and competently execute the responsibilities of both the Chairman of the Board and Chief Executive Officer positions.
To support the balance of power between the Board of Directors and the Management, prior to the Board of Directors’ meeting the Audit, Risk and Corporate Governance Committee Chairman and the Nomination and Remuneration Committee Chairman, who are the independent directors, has participated in determining the agenda of the Board of Directors’ meeting.
5.1.7 Separation of Power, Duties and Responsibilities of the Board of Directors and the Management
The Company has a management structure that clearly defines the separation of power, duties and responsibilities of the Board of Directors and the Management. The Board of Directors, as the policy supervisor, has the duties to define the Company’s vision, mission, values, strategy and long-term goals, including overseeing monitoring and evaluating the performance of the Management. Management, as the executives, has the duties to perform day-to-day operations to be efficient, effective and in compliance with the defined policies, vision, mission, values, strategy and long-term goals and report its performance to the Board of Directors on a regular basis.
The delegation of authority by the Board to the management is clear. All major investments, acquisition of assets and loans made by the Company and/or its subsidiaries require approvals from the Board as follows:
- New investments and acquisition of assets with the value from 1.5 percent of the Company’s total assets and
- New loans with the value from 5 percent of the Company’s shareholders’ equity.
The approval to enter into a significant transaction by the Company’s Board of Directors and/or shareholders’ meeting as well as all information disclosure must comply with rules and regulations of the Stock Exchange of Thailand and/or the Capital Market Supervisory Board.
Duties and responsibilities of the Board have been disclosed under the heading “Management Structure” in Form 56-1 and the Company’s annual report.
The Board approved the establishment of two sub-committees comprising all Independent Directors to assist the Board to screen details in order to achieve operational efficiency. Additionally, in order to perform their duties transparently and independently, the Chairman of the Board is neither a Chairman nor a member of both committees as follows:
5.2.1 Audit and Risk Committee
The Audit, Risk and Corporate Governance Committee comprises three independent directors, one of whom has adequate expertise and experience to review the creditability of the financial reports by reviewing the financial reports of some listed companies in the Stock Exchange of Thailand. The members and the scope of duties and responsibilities of the Audit, Risk and Corporate Governance Committee have been disclosed under the heading “Management Structure” in Form 56-1 and in the Company’s Annual Report.
5.2.2 Nomination and Remuneration Committee
The Nomination and Remuneration Committee comprises three independent directors, thus forming a strong and independent element which will enable decisions on nomination and remuneration to be made independently. Members and the scope of duties and responsibilities of the Nomination and Remuneration Committee have been disclosed under the heading “Management Structure” in Form 56-1 and in the Company’s Annual Report.
5.3 Role, Duty and Responsibility of the Board
5.3.1 Corporate Governance Policy
The Company is committed to maintaining high standards of good corporate governance within the Company. The Company has adopted and is continuously developing a set of good corporate governance practices and policies which are modeled on the Corporate Governance Code for listed companies 2017 advocated by the SEC. The Company has established and continues to apply the Corporate Governance Policy and Code of Corporate Conduct approved by the Board of Directors and communicated throughout the organization. The Standard Operating Procedures have also been documented and applied by the Company. In addition, new internal rules and regulations with an aim to continuously improve the good corporate governance of the Company are approved and announced from time to time.
In the past year, no director resigned due to the issue of corporate governance of the Company and no conduct causing a negative reputation of the Company due to the failure of the Board of Director’s supervisory performance
5.3.2 Code of Corporate Conduct
The Board of Directors has approved the Code of Corporate Conduct to set the framework for its officers, executive directors, associates and agents to act in business matters solely for the benefit of the Company and not enter into any business or other transactions which cause or appear to cause a conflict of interest between him / her and a hotel within the group, the Company / subsidiary, owning company or any other related parties. The Code of Corporate Conduct was distributed and communicated to all relevant persons in order to understand and to strictly adhere to the Code accordingly. The Code was drafted based on the highest level of business ethics and law compliance. In order to promote the compliance with the Code of Corporate Conduct, all employees are required to sign for the acknowledgement and compliance with the Company’s Code of Corporate Conduct on an annual basis.
During 2019, the Company’s Board of Directors was not aware of any claim or allegation that the Company’s Code of Corporate Conduct was disobeyed.
5.3.3 Company Strategic Planning and Implementation
The Board of Directors sets aside sufficient time each year to review and debate the budget of the coming year and the five-year strategic plan. During the course of each year, the Board is periodically updated on the implementation of the plan and if there is any deviation from the plan, a new course of action would be discussed after taking into account the prevailing economic, financial and market situation.
5.3.4 Leadership and Vision
The Board’s primary functions are to set and annually review vision, mission, corporate policy and overall strategy for the Company and to provide effective oversight of the management of the Company’s business and affairs.
Duties and responsibilities of the Board have been disclosed under the heading “Management Structure” in Form 56-1 and the Company’s annual report.
5.3.5 Conflict of Interest
Transactions between the Company and its related parties which may give rise to a conflict of interest are scrutinized by the Audit, Risk and Corporate Governance Committee and if necessary, the approval to enter into such transactions is sought from the Board of Directors and/or shareholders. Any director or management who has an interest in, or is related to, such transaction will not participate in the decision-making process.
Such transactions are made on terms and pricing that has been negotiated on an arm’s length basis. In the event that the price is unavailable, the Company will then rely on the report of an independent appraiser appointed by the Company to value important related party transactions to arrive at a pricing which is fair to both the Company and the related party.
All related party transactions are disclosed clearly and accurately. Details are further described under the heading “Related Party Transactions” in Form 56-1 and under the heading “Persons with Mutual Interest and Connected Transactions” in the Company’s Annual Report.
5.3.6 Internal Audit and Control
The Company realizes the significance of effective system of control, such as Standard Operating Procedures, particularly in management and operations. Hence, the duties and responsibilities of the employees and the management are clearly defined. The Company has put in place policies to safeguard the Company’s assets and duties between the operators and the appraisal which are clearly separated for effective checks and balances. Furthermore, the Company has also implemented internal audit of the financial and information technology systems.
Internal audit is an independent function within the Company which reports directly to the Audit, Risk and Corporate Governance Committee on audit matters and to the Managing Director on administrative matters. Internal audits are performed to assist the Board and Management in the discharge of their corporate governance responsibilities and to improve and promote effective and efficient business processes within the Group. The internal auditor plans its internal audit schedules annually in consultation with, but independent of, Management and its plans are submitted to and approved by the Audit, Risk and Corporate Governance Committee. The Audit, Risk and Corporate Governance Committee reviews the activities of the internal auditors on a quarterly basis to ensure it is adequately resourced; and has appropriate standing within the Company to perform its role effectively.
Enterprise Risk Management
The Company appointed an external consultant to assist management in implementing a Risk Management framework for the business of the Company. The Risk Management framework covers all aspects of the Company’s operations to enable significant business risks within the Group’s current business environment to be identified, assessed, monitored, managed and evaluated. As part of the on-going risk management process, the Company’s Group Risk Committee annually conducts a risk assessment, evaluation and treatment; considers the adoption of adequate and cost-effective system of internal controls to mitigate significant business risks; and provides for significant risks to be managed through regular reviews by the Company’s Group Risk Committee and the Audit, Risk and Corporate Governance Committee. The Audit, Risk and Corporate Governance Committee has reviewed the Group’s risk management processes and procedures and is satisfied that there are adequate internal controls in place to manage the significant risks identified.
5.3.7 Meetings of the Board and Committees
The Company conducts Board meetings at least 4 times a year on a quarterly basis which are planned and formally agreed upon in advance in the fourth quarter before the start of the new financial year. The meeting documents shall be sent out to the directors in advance at least 5 days prior to the meeting date. Additional meetings are convened as and when circumstances warrant. In 2019, the Company conducted 5 Board meetings and the attendance of all directors is shown below.
|Name||Number of Attendances|
|Mr. Ariel||P. Vera||
|Mr. Eddy||See Hock Lye||
|Mr. Ho||Ren Hua||
|Mr. Stuart||David Reading||
The Board is of the view that the contribution of each director should not be focused only on his or her attendance at Board and/or Committee meetings. A director’s contribution may also extend beyond the confines of the formal environment of Board meetings, through the sharing of views, advice, experience and strategic networking relationships which would further the interests of the Company.
2. Audit, Risk and Corporate Governance Committee
The Company conducts regular scheduled Audit, Risk and Corporate Governance Committee meetings on a quarterly basis at least 4 times a year, prior to the Board meeting, which are planned and formally agreed upon in advance in the fourth quarter before the start of the new financial year. Additional meetings are convened as and when circumstances warrant. In 2019, the Company conducted 4 Audit, Risk and Corporate Governance Committee meetings. Each of the Audit, Risk and Corporate Governance Committee members attended the meetings as follows:
|Name||Number of Attendances|
In addition, in 2019, the Audit, Risk and Corporate Governance Committee attended 1 non-management meeting with the external auditor to deliberate accounting approaches and audit plans.
3. Nomination and Remuneration Committee
The Company conducts Nomination and Remuneration Committee at least 2 times a year. The meetings are planned and formally agreed upon in advance in the fourth quarter before the start of the new financial year. Additional meetings are convened as and when circumstances warrant. In 2019, the Company conducted 2 Nomination and Remuneration Committee meetings. Each of the Nomination and Remuneration Committee members attended the meetings as follows:
|Name||Number of Attendances|
The Company encourages that at the time of Board and/or Sub-Committees’ decision, the quorum should not be lesser than two-thirds of total number of directors.
5.3.8 The Non-Management Meeting
The Company encourages non-executive directors to hold meetings with the external auditor as necessary without the presence of executive directors and management attendance to review and discuss freely on any business issues that are of interest. In 2019, there was one non-management meeting held in November.
5.3.9 Board of Directors’ Report
1. Financial Report
The Board of Directors is accountable to its shareholders for the Company’s financial statements as well as the financial information as shown in the Annual Report. The Board of Directors is satisfied that the Company’s financial statements are prudently prepared in accordance with generally accepted accounting principles and are independently reviewed by the external auditors every quarter with a full audit performed at each year-end. Additionally, the Audit, Risk and Corporate Governance Committee has been tasked to independently review the Company’s financial report and internal control practices directly with the auditors. All pertinent information relating to the financial statements is clearly and completely disclosed in the accompanying notes.
Detail are described under the heading “Internal Control and Risk Management” in Form 56-1 and under the heading “Opinion of the Board of Directors on the Company’s Internal Control” and the “Board of Directors’ Responsibility for the Company’s Financial Statements” in the Company’s Annual Report
2. Minutes of Meetings
The minutes of the meetings of the Board and other committees are accurately and completely recorded in all material aspects addressed at each meeting, including the questions, opinions and clarifications. The Company has a safe and secure filing system in place to keep the minutes of meetings and other supporting documents.
5.3.10 Development of Directors and Management
The Company’s directors, management and employees are constantly encouraged to develop their skills by attending various seminars and training courses organized by various organizations, e.g. the Thai Institute of Directors Association, the SET and the SEC, etc. Seminars and training courses are periodically forwarded to them. Furthermore, relevant information is regularly provided to the directors so that they are kept abreast of latest developments thus enabling them to make informed decisions. In 2019, Ms. Nanchalee Kecharananta, Company Secretary and Assistant Vice President – Corporate Affairs , attended the CGR Workshop “Enhancing Good Corporate Governance based on CGR Scorecard” held by Thai Institute of Directors and the SET .
Details of the training previously undertaken by each director are set out in Attachment 1 to Form 56-1 and under the heading “Board of Directors, Management, Head of Group Internal Audit and Company Secretary of the Company” in the Company’s Annual Report.
5.3.11 Orientation for New Director
The Company recognizes the importance of supporting new directors in performing their duties. The Company has provided the information on its business and other information related to the operations of the Company to new directors such as an annual report and relevant laws and regulations so that they are adequately informed of the rules and regulations and business of the Company prior to performing their duties.
5.3.12 External Directorship Policy
The Board of Directors has set a policy to limit the number of listed companies in which each director may hold a directorship. This policy aims to protect the Company’s best interests because it helps to ensure that directors have sufficient time to handle their duties efficiently. The Board of Directors has agreed to set the policy prescribing that each director should hold directorship of a maximum of 5 other listed companies.
In addition, the Company has a guideline that the Chief Executive Officer shall obtain prior approval for any external directorship from the Nomination and Remuneration Committee. While all other executive officers shall obtain prior approval for any external directorship from his/her superior holding the rank of Senior Vice President or higher relevant to the Executive officer’s business unit. Where the approval as described was obtained but a material change in circumstances renders it inappropriate for the executive officer to continue his/her external directorship, it is a conflict of interest unless a fresh approval is obtained by the executive officer in accordance with the requirements set out.
5.3.13 Nomination of Board members
The Nomination and Remuneration Committee will be responsible for the nomination of new directors. The Nomination and Remuneration Committee will search for potential candidates and propose the same to the Board of Directors’ or the shareholders’ meeting (as the case may be) for consideration and appointment. The following matters will be taken into consideration as part of the selection criteria: the structure of the Board of Directors, which shall consist of members in the number that is suitable for the size and business strategy of the Company, the diversity in the structure of the Board of Directors (Board Diversity), including but not limited to, race, religion, national origin and gender, the appropriateness of the qualifications and skills of the director(s) that are necessary but lacking among the existing Board of Directors. The Board Skill Matrix will be used to identify the required qualifications.
5.3.14 Nomination Procedures
The Nomination and Remuneration Committee will select candidates for the position of director(s) of the Company from the recommendation of other directors, the nomination by the shareholders of the Company, the service of external professional search firms, or the directors’ pools of various agencies, or other nomination procedures as the Nomination and Remuneration Committee considers appropriate.
5.3.15 Succession Plan
The Board of Directors places importance on having an effective and efficient management as well as the continuance of its business operations, which are essential factors to the sustainable growth of the organization. Thus, the Company is required to prepare a succession plan for the positions of the Chief Executive Officer, Managing Director and other senior executive positions, and to review every 3 years in order to ensure that there will be competent senior executives for the succession of these key positions in the organization.
5.3.16 Performance Evaluation of the Board
Based on the principles of good corporate governance, the Board of Directors and Sub-committees conducts a self-evaluation at least once a year so that they could review and improve their own performance. The evaluation is based on the self-assessment form developed by the Stock Exchange of Thailand, which is adapted to suit the Company’s business nature and to cover performance of the Board which consists of the following:
1. Self-assessment form of the Board of Directors to evaluate the performance of the entire Board.
2. Self-assessment form of the Sub-committees
2.1 The Audit, Risk and Corporate Governance Committee
2.2 The Nomination and Remuneration Committee
At the end of every year, the Company Secretary will send a self-assessment form to each member of the Board of Directors and Sub-committees to appraise the annual performance, collect the completed forms, conclude and report the performance evaluation results to the Board of Directors and/or each Sub-committee for acknowledgement.
Self-assessment form of the Board of Directors and Sub-committees consists of the following main topics for performance rating including
- Board structure and qualifications
- Roles, duties and responsibilities of the Board
- Board meeting
- Board performance
- Relationship with management
- Director’s self-improvement and management development
The assessment forms follow the levels of performance in accordance with the scores achieved as shown below:
From 85% = Excellent
From 75% = Very good
From 65% = Good
From 50% = Fair
Below 50% = Need improvement
The assessment result in 2019 of the Board of Directors and each Sub-Committee (as a whole) are as follows:
1. The Board of Directors achieved an average score of 90 percent which is in the Excellent category
2. The Audit, Risk and Corporate Governance Committee achieved an average score of 98 percent which is in the Excellent category
3. The Nomination and Remuneration Committee achieved an average score of 95 percent which is in the Excellent category
Governing Over Operations of Subsidiary / Associated Companies
In monitoring the business operations of subsidiary and associated companies, the Company will assign its directors or managements to act as directors in subsidiary and associated companies according to the proportion of shareholding. They act as the representatives on behalf of the Company to set policies and conduct business of subsidiary and associated companies consistently with the Company’s main policy. The assignment of the Company’s representatives to be directors or managements in subsidiary and associated companies is in the scope of authority of the management. The directors or managements who represent the Company will perform their duties within the scope of their roles and responsibilities in order to maintain the maximum benefit of the Company and report directly to the management. All transactions in any subsidiary and associated companies, which may significantly affect the business operation or financial position of the Company, must be considered and approved by the Board of Directors of the Company.
The Company encourages and monitors the subsidiary and associated companies to operate their business in compliance with the good corporate governance policy and the rules and regulations of relevant authorities including business transactions such as the acquisition and disposition of assets and connected transaction of the Company and its subsidiary and associated companies, to maintain accurate accounting records and financial reports according to accounting standards and to be audited by the Company’s Internal Audit to ensure that there is a sufficient and effective internal control system.
Supervision on the Use of Inside Information
In order to prevent the misuse of confidential and price-sensitive corporate information, the Board of Directors of the Company approved the policy on dealing in securities of the Company which prohibits any directors, management and employees, regardless of rank, from disclosing or using such confidential and price-sensitive corporate information. Employees are prohibited to trade in the Company’s shares for personal gain or for any other reason not in the Company’s interest or dealing in the Company’s securities while in possession of unpublished confidential and price-sensitive information during the “embargo period” which is defined as 2 weeks before and up to the date of announcement of results for each of the first three quarters of the Company’s financial year, and 1 month before and up to the date of announcement of the full-year financial results. The policy and reminder of the embargo period is communicated to directors, management and employees on an annual and quarterly basis to strictly comply with this policy. Confidential and price-sensitive information is also restricted to only directors, management and those officers who have a direct responsibility over such matters. Any violation of this policy shall be subject to disciplinary actions under the working regulation. Additionally, the Company monitors the trading of the Company’s securities by its directors, and senior management who are required to report to the Board of Directors on a quarterly basis on the holding of the Company’s securities and in accordance with the rules of the Securities and Exchange Commission.
(for the fiscal year ended 31 December 2019)
6.1 Audit Fees
The Company and subsidiaries paid audit fees for the fiscal year to an audit firm which amounted to Baht 8,715,000 and subsidiaries paid audit fees to other audit firms which amounted to Baht 846,882. This amount does not include the audit fees paid by associated companies.
6.2 Non-Audit Fees
There is no non-audit fees for agreed upon procedures of net sales and other consultant fees for the fiscal year paid to other audit firms by the Company and subsidiaries. There is no outstanding commitment to pay any fees in the future for uncompleted engagements relating to the year 2019.