Topic 4

3 aspects of the Code

1. principles 2. recommendations 3. explanations

Principle 15

A mechanism for employee participation should be developed to create a symbiotic environment, realize the company's goals and participate in its corporate governance processes.

Principle 3

Board committees should be set up to the extent possible to support the effective performance of the Board's functions, particularly with respect to audit, risk management, related party transactions, and other key corporate governance concerns, such as nomination and remuneration. The composition, functions and responsibilities of all committees established should be contained in a publicly available Committee Charter.

Principle 5

The Board should endeavor to exercise objective and independent judgment on all corporate affairs.

Principle 6

The best measure of the Board's effectiveness is through an assessment process. The Board should regularly carry out evaluations to appraise its performance as a body, and assess whether it possesses the right mix of backgrounds and competencies.

Principle 1

The company should be headed by a competent, working board to foster the long-term success of the corporation, and to sustain its competitiveness and profitability in a manner consistent with its corporate objectives and the longterm best interests of its shareholders and other stakeholders.

Principle 16

The company should be socially responsible in all its dealings with the communities where it operates. It should ensure that its interactions serve its environment and stakeholders in a positive and progressive manner that is fully supportive of its comprehensive and balanced development.

Principle 10

The company should ensure that material and reportable non-financial and sustainability issues are disclosed.

Principle 8

The company should establish corporate disclosure policies and procedures that are practical and in accordance with best practices and regulatory expectations.

Principle 9

The company should establish standards for the appropriate selection of an external auditor, and exercise effective oversight of the same to strengthen the external auditor's independence and enhance audit quality.

Principle 11

The company should maintain a comprehensive and cost-efficient communication channel for disseminating relevant information. This channel is crucial for informed decision-making by investors, stakeholders and other interested users.

Principle 13

The company should treat all shareholders fairly and equitably, and also recognize, protect and facilitate the exercise of their rights.

Principle 2

The fiduciary roles, responsibilities and accountabilities of the Board as provided under the law, the company's articles and by-laws, and other legal pronouncements and guidelines should be clearly made known to all directors as well as to stockholders and other stakeholders.

Principle 14

The rights of stakeholders established by law, by contractual relations and through voluntary commitments must be respected. Where stakeholders' rights and/or interests are at stake, stakeholders should have the opportunity to obtain prompt effective redress for the violation of their rights.

Principle 12

To ensure the integrity, transparency and proper governance in the conduct of its affairs, the company should have a strong and effective internal control system and enterprise risk management framework.

Principle 4

To show full commitment to the company, the directors should devote the time and attention necessary to properly and effectively perform their duties and responsibilities, including sufficient time to be familiar with the corporation's business.

Non-executive Director

-a member of a company's board of directors who is not part of the executive team. A non-executive director typically does not engage in the day-to-day management of the organization but is involved in policy making and planning exercises

Conglomerate

-a very large business organization consisting of several companies that often sell different types of product or service

Competent board

-competency: diversity - majority of non-exec directors -policy on training of its directors -policy on board diversity -Corporate Secretary -Compliance Officer

The Principles

-considered as high-level statements of corporate governance good practice, and are applicable to all companies.

Related party transactions

-deal or arrangement between two parties who are joined by a preexisting business relationship or common interest.

Encouraging employee participation and sustainability and social responsibility

-health, safety , and welfare -training and development -reward or compensations

Basis for the creation of the Code of Corporate Governance for publicly-listed companies

-latest G20/OECD Principles of Corporate Governance -ASEAN Corporate Governance

Internal control

-mechanisms, rules, and procedures implemented by a company to ensure the integrity of financial and accounting information, promote accountability, and prevent fraud.

Promoting a Comprehensive and Cost-efficient Access to Information

-media and analyst's briefings as channels of communication

The Recommendations

-objective criteria that are intended to identify the specific features of corporate governance good practice that are recommended for companies operating according to the Code.

Stakeholders

-party that has an interest in a company and can either affect or be affected by the business.

Related party

-person or a close member of that person's family is related to a reporting entity -entity is related to a reporting entity if, among other circumstances, it is a parent, subsidiary, fellow subsidiary, associate, or joint venture of the reporting entity, or it is controlled, jointly controlled, or significantly influenced or managed by a person who is a related party.

Enterprise risk management

-plan-based business strategy that aims to identify, assess, and prepare for any dangers, hazards, and other potentials for disaster—both physical and figurative—that may interfere with an organization's operations and objectives.

Increasing Focus on Non-Financial and Sustainability Reporting

-policy on the disclosure of non-financial info with emphasis on the mgmt of economic, environmental, social and governance

Independent Director

-refers to a person other than an officer or employee of the corporation, its parent or subsidiaries, or any other individual having any relationship with the corporation, which would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. -independent fees shareholdings and management

Corporate governance

-refers to a system whereby shareholders, creditors and other stakeholders of a corporation ensure that management enhances the value of the corporation as it competes in an increasingly global marketplace.

Management

-refers to the body given the authority to implement the policies determined by the Board in directing the course/business activity/ies of the corporation.

Board of Directors

-refers to the collegial body that exercises the corporate powers of all corporations formed under the Corporation Code. It conducts all business and controls or holds all property of such corporations.

The Explanations

-strive to provide companies with additional information on the recommended best practice.

Executive Director

-the highest-ranking executive in an organization, company, or department, with ultimate responsibility for making managerial decisions

"comply or explain"

-voluntary compliance with mandatory disclosure

Cultivating A Synergic Relationship With Shareholders

Principle 13

Duties To Stakeholders

Principle 14-16

Related party transaction committee

• tasked with reviewing all material related transactions of the company -independent

Strengthening the Internal Control System and Enterprise Risk Management Framework

- size, profile, and complexity of operations -independent internal audit function -Chief Audit Executive appointed by BOD -separate risk mgmt function -Chief Risk Officer

Board's governance responsibilities

1. Establishing a Competent Board 2. Establishing Clear Roles and Responsibilities of The Board 3. Establishing Board Committees 4. Fostering Commitment 5. Reinforcing Board Independence 6. Assessing Board Performance 7. Strengthening Board Ethics

Principle 7

Members of the Board are duty-bound to apply high ethical standards, taking into account the interests of all stakeholders.

The Board's Governance Responsibilities

Principle 1-11

Internal Control System And Risk Management Framework

Principle 12

Risk oversight committee

• generally for conglomerates and companies with high risk profile

Audit committee

• Composed of at least three appropriately qualified non-executive directors, the majority of whom, including the Chairman, should be independent. • All of the members of the committee must have relevant background, knowledge, skills, and/or experience in the areas of accounting, auditing and finance. • The Chairman of the Audit Committee should not be the chairman of the Board or of any other committees.

Corporate governance committee

• Tasked to assist the Board in the performance of its corporate governance responsibilities, including the functions that were formerly assigned to a Nomination and Remuneration Committee. • It should be composed of at least three members, all of whom should be independent directors, including the Chairman.