EN TH

To be a leading value-oriented integrated energy company in Asia-Pacific

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The Company believes that good corporate governance practice and operating business by adhering to the good corporate governance principle of listed companies which covers transparency, ethics, integrity, and responsibility towards the society, environment and all stakeholders are the key mechanism that drives the Company to achieve sustainable development and growth. Such practices also create and strengthen trust among shareholders and other stakeholders. The Board of Directors has therefore formulated the “Corporate Governance Policy for the Company’s Group”, the “Code of Conduct”, and “Policies on Specific Stakeholders Group” which serve as the framework and guideline for its directors, executives, employees and other stakeholders. Such policies are prepared in writing and published on the Company’s website under Good Corporate Governance section.

The Board of Directors is aware of its organization leader’s role in assuring good understanding about corporate governance principle and its benefits in creating value and enhancing the Company’s stability, prosperity, and sustainability, matching that of the international level. The Corporate Governance and Social Responsibility Committee was assigned to consider, review, promote, supervise and monitor the execution of corporate governance practice with an assistance from the Corporate Governance Working Team which was appointed by the Chief Executive Officer. The Working Team has the responsibility to monitor, study, consider, review and improve the corporate governance policy to ensure it is updated and corresponds with the current international practice, laws, rules, regulations, recommendation/order of related organizations. The Working Team is also responsible for proposing corporate governance practice for the Company and its subsidiaries, setting the framework for corporate governance practice and risk management that is related to and covers anti-corruption practice; promoting consciousness raising of corporate governance principle and anti-corruption practice to employees of the Company and its subsidiaries; making recommendations to the executives to support risk assessment and collecting results of fraud risks to support the preparation of corporate risk paper which covers fraud risk profile and fraud risk register; and monitoring, assessing and reporting result of the implementation of corporate governance policy and risk management plan related to anti-corruption practice to the Board of Directors, the Corporate Governance and Social Responsibility Committee, the Audit Committee, the executives and related organizations according to the preset procedure to also ensure that the corporate governance practice is implemented properly and includes appropriate development plan, and regular assessment in terms of overview and individual item for operational efficiency improvement as well as ensure that the Company’s Group’s corporate governance practice well reflects the current business situation and rapidly changing environment. In 2017, the Company has strictly followed the corporate governance practice as follows:

1. Rights of Shareholders

 

Realizing the importance of protecting all shareholders’ rights, the Board of Directors formulates and announces the Shareholders’ Policy, reviews and regularly monitors the policy implementation to ensure its compliance with the guideline and that the shareholders equally receive the basic rights, such as the right to attend shareholders’ meeting, the right to propose agenda and/or nominate director at the shareholders’ meeting, the right to express opinion and ask questions at the shareholders’ meeting, the right to appoint a proxy to attend the meeting and vote on their behalf, the right to receive dividend, the right to elect, terminate and determine remuneration for directors, the right to appoint and determine remuneration for the auditor, the right to vote at any significant events, the right to register share ownership, the right to share transfer and the right to accurately, sufficiently, timely and equally receive significant information. The Company has promoted the shareholders’ right as follows:

  1. Right to Attend Meetings

    The Company held the Shareholders’ Annual General Meeting Year 2560 (B.E.) on Wednesday, 5 April 2017. This is to allow shareholders, who are the owner of the business to participate in the shareholders’ meeting every year in order to be involved in significant decision making, get updated of the Company’s performance and review the performance of the Board of Directors and the Management. The Company has complied with related laws, rules, regulations, and related guideline for shareholders’ meeting standard quality and efficiency development; and encouraged shareholders to exercise their basic right to attend shareholders’ meetings. The Company has facilitated the shareholders in the following areas:

    • Pre-meeting preparation:
      • Minor shareholders were given an opportunity to propose items to be added in the meeting agenda and/or nominate persons who have complete qualifications and do not have prohibited qualifications for the director election in the Shareholders’ Annual General Meeting Year 2560 (B.E.). The process was held according to the Board of Directors’ criteria and carried out from 1 September 2016 to 31 December 2016, totalling 4 months. The Company announced clear details about criteria, method, process and channel of agenda item proposing on SET’s disclosure system and the Company’s website (on 31 August 2016). At the end of the period, no shareholder proposed agenda or nominated person for a director position.
      • The Company sufficiently and completely informed the shareholders of the date, time, venue and agenda together with details and the Board of Directors’ opinions on each agenda via the SET’s information disclosure system before the morning trading session on 16 February 2017, which is the day after the Board of Directors resolved on 15 February 2017 to hold the Shareholders’ Annual General Meeting Year 2560 (B.E.) on 5 April 2017 at 14.00 hours at World Ballroom, Level 23, the Centara Grand and Bangkok Convention Center, Central World, No. 999/99 Rama 1 Road, Pathumwan, Bangkok, which is easily accessible with public transport and the size of the venue is sufficient to support a large number of meeting attendants.
      • The complete meeting notice and supporting documents for the Shareholders’ Annual General Meeting Year 2560 (B.E.) was published in Thai and English on the Company’s website on 1 March 2017, which is 35 days prior to the meeting date.
      • The Company sent the meeting notice and supporting documents to shareholders on 14 March 2017, 24 days prior to the meeting date, which complies with the related laws and good corporate governance guideline requiring listed companies to send out meeting notice to the shareholders at least 7 days and 21 days respectively. The meeting notice provided details of the date, time, venue, a map of the meeting venue, agenda which is arranged according to their priority, background, reasons and key issue of each agenda item proposed to the shareholders for consideration or acknowledgement. The Board of Directors’ opinion on each agenda item is sufficiently and clearly provided.
      • The Company sent the meeting notice to the Registrar on 14 March 2017, 24 days prior to the meeting date (no less than 7 days as required by the law) and to the auditor on the same day.
      • The Company allowed the shareholders to submit additional questions and/or opinions on the items already included in the meeting agenda and/or other recommendation that is beneficial to the Company’s operations prior to the meeting date by post or fax to the Company Secretary or email to CS@ratch.co.th in order to enable the Company to clarify or provide more information at the Shareholders’ Annual General Meeting Year 2560 (B.E.). The Company published the details on this matter on SET’s disclosure system, the Company’s website and in the meeting notice that was sent to the shareholders. At the Shareholders’ Annual General Meeting Year 2560 (B.E.), no shareholders submitted questions and/or recommendation in advance to the Company.
      • The Company published the meeting announcement in Thai and English newspapers from 24 - 26 March 2017 for 3 consecutive days and no less than 3 days prior to the meeting date in compliance with the related laws and the Company’s Articles of Association.
      • The Company informed shareholders about identification document, proxy document, proxy appointment procedure and advice, list of Independent Directors, Chief Executive Officer and other persons shareholders would appoint as proxy to attend the meeting and vote on their behalf, registration form, and the Company’s Articles of Association related to shareholders’ meeting for the shareholders to consider and make decision to vote on each agenda item.
    • Procedure on the Meeting Date
      • The meeting was held at World Ballroom, Level 23, the Centara Grand and Bangkok Convention Center, Central World, No. 999/99 Rama 1 Road, Pathumwan, Bangkok. The meeting venue is easily accessed through public transport system, which provides great convenience for shareholders to travel to the venue. The place is big enough to accommodate a large number of participants. The registration was opened at 12.00 hours, (2 hours before the meeting time) and the meeting began at 14.00 hours and adjourned at 16.10 hours, totalling 2.10 hours. The Company allowed shareholders to register after the meeting began until the meeting adjourned to provide them with the opportunity to make decision whether to attend the entire meeting or only specific sessions. The Company did not limit the shareholders’ right to attend the meeting and vote on the agenda under consideration and that resolution was not yet made.
      • The Company fully provided meeting facilities, including audio-visual equipment to support presentation, computer and barcode system recording individual shareholder’s information that enables fast shareholder registration and accurate and transparent ballot.
      • Identification documents that shareholders have to present to attend the meeting are checked by the persons appointed by the Chairman of the Board of Directors. Identification document checking is done in simple process and in the procedure as informed earlier in the meeting notice. - The Chairman of the Board of Directors acted as the chairman of the meeting according to the Company’s Articles of Association. The Chairman announced the quorum, assigned the Company Secretary to record and prepare the meeting minutes, and introduced the directors, executives, auditors and legal advisors attending the meeting to provide additional information and answer questions asked in the meeting.
      • The meeting was informed about the meeting procedures for each agenda item in order to meet with the shareholders meeting regulations of listed companies designed by the SET and to ensure that all shareholders clearly understand all the details as earlier informed in the meeting notice. Voting process, vote counting and resolutions of each agenda item were also announced to the meeting.
      • Separate ballot was prepared for each agenda item. All shareholders received such ballot at registration. Voting process was made simple. Shareholders were asked to raise hands if disagree or do not wish to vote so that the Company’s staff members could collect their ballots. Computerized and barcode systems were used in vote counting.
      • A representative from its legal advisor was invited to act as an unbiased inspector to check on different areas, including the shareholders’ or their proxies’ identification document, the quorum, persons with conflict of interests do not exercise the voting right and vote counting to ensure that the vote counting process comply with the Company’s Articles of Association and the rules earlier announced to the meeting. The inspector also ensured that all ballots were collected from all shareholders attending the meeting, especially for director election session, and that meeting resolutions and vote counting were correct.
      • The meeting process is according to the agenda. The Company has never abruptly informed the meeting of additional significant information, added new agenda for approval, or changed significant information without prior notice. The matters proposed to the Shareholders’ Annual General Meeting Year 2560 (B.E.) all complied with the legal requirements.
      • The meeting process was in the same order as informed in the meeting notice without switching agenda items, as the Board of Directors understood the necessity for the shareholders to study the information before making decision and strictly adhered to a principle of not taking any action that will infringe or derogate the right of the shareholders.
      • The process for each agenda item began with the Chairman providing the background, details, full information for each agenda item and recommendation as stated in the meeting notice, the Chairman allocated appropriate time for discussions that would encourage the meeting attendants to ask questions for the Board of Directors and the Management to clarify for full understanding on related matters. The Chairman then asked the meeting to vote.
      • Director election and remuneration approval ware treated as two different agenda items and ware voted separately. Individual vote was arranged for each new director election. All ballots were kept for reference to ensure accuracy and transparency.
      • In each agenda voting, the Company provided ballots for each shareholder. A computerized system was used to provide convenience for vote counting.
      • After the vote counts, the voting results were announced to the meeting by dividing into “agree”, “disagree” and “abstention” votes.
      • Other agenda items (if any) ware allowed in order to provide opportunities for the shareholders to propose additional issues other than those set in the meeting agenda. According to the Company’s Articles of Association, to propose a new agenda item for the shareholders’ meeting to consider, the shareholders who propose the new agenda item must represent no less than one third of the Company’s saleable shares. In the Shareholders’ Annual General Meeting Year 2560 (B.E.), no other agenda item was proposed for voting. Only some recommendation and questions about the Company’s operations were raised as recorded in the meeting minutes.
      • In the Shareholders’ Annual General Meeting Year 2560 (B.E.), there were 1,259 shareholders and proxies attending the meeting, representing 67.36 percent of the total saleable shares, which made a quorum with the Company’s Chairman of the Board of Directors acted as the meeting chairman according to the Company’s Articles of Association.
      • The entire Board of Directors and all Committees attended the meeting, representing 100 percent of the Board/Committees members.
    • After the meeting process
      • Resolution of the Shareholders’ Annual General Meeting 2560 (B.E.) was announced via SET’s disclosure system immediately after the afternoon trading session was closed on 5 April 2017. The meeting resolutions were clearly presented with details on “agreed”, “disagreed” and “abstention” with percentage of each category.
      • The Company Secretary prepared meeting minutes in writing by clearly and adequately recording essence of each agenda, questions by the shareholders and clarifications by the Board of Directors and Management, the recommendation from the meeting, and the meeting resolutions, including detailed voting results and percentage in all categories.
      • The publicizing of the meeting minutes was announced via the SET’s disclosure system and the Company’s website on 18 April 2016 (prior to deadline required by law: 14 days counting from the meeting date.) This is done to offer opportunities for shareholders to express their opinions without waiting for the next meeting. Shareholders did not ask the Company to amend, add or adjust the minutes.
      • The Company submitted the complete minutes signed by the chairman of the meeting to SET, SEC and the Registrar (the Department of Business Development) for reviewing and reference on 18 April 2017 (prior to deadline required by law: 14 days counting from the meeting date.)
      • Meeting evaluation form was arranged to collect opinions and recommendations from the meeting attendees on the meeting notice and annual report, facilitation to the shareholders, meeting arrangement and meeting minutes. The information collected is used for further improving the arrangement of shareholders meeting in order to ensure transparency, efficiency and benefits to both the Company and shareholders.
      • The Company received scoring of 96 in the Thai Investors Association’s 2017 shareholders’ annual general meeting assessment, which is higher than the average of 91.97. New assessment criteria was launched and applied for the first time in 2017.
  2. Right to Appoint Proxy to Attend Meeting and Vote on Their Behalf

    The Company provided shareholders with the right to appoint other persons who have already come of age to attend the meeting and vote on their behalf. Proxy appointment document must be in the format designed by the Registrar. The proxy has to present the proxy document to the meeting chairman or the person assigned by the chairman before attending the meeting.

  3. Right to Receive Dividend

    The Company has a policy to pay dividend at no less than 40 percent of its profit after legal reserve and other reserves, depending on the Company’s cash flow. The Company has consistently paid dividend to its shareholders every year since the Company’s inception. In 2017, the Company used the “Record Date” of 3 March 2017 and the “Book Closing Date” of 6 March 2017 to gather the list of shareholders who received the right to participate in the shareholders’ meeting on 5 April 2017 and receive dividend on 27 April 2017. This follows legal requirement and the Company’s Articles of Association requiring the Company to pay dividend within 1 month after the shareholders’ meeting resolved to pay dividend. The Company published an announcement on dividend payment in Thai and English language newspapers for 3 consecutive days from 7 – 9 April 2017.

    A continuous monitoring found a certain amount of accrued dividend payment that shareholders have not yet received. The Company has contacted the shareholders based on existing contact details by sending a letter to inform the shareholders of the procedure and how to receive the dividend as well as facilitating shareholders on cheque reissuing in case of loss or expiration. The Company also assisted the heirs of the shareholders on share transfer in case the shareholders passed away.

    Shareholders are also encouraged to use e-Dividend service for convenient, fast and safe dividend receiving in the next payment. The trend shows that more shareholders have switched to e-Dividend.

  4. Right to Appoint, Terminate and Determine Remuneration for Directors

    The Company requires the Board of Directors to nominate directors to the shareholders’ annual general meeting to elect new directors replacing the vacant positions due to rotation of office and to propose directors’ remuneration for the meeting to approve. Details are stated in Management Structure.

  5. Right to Appoint Auditor and Determine Remuneration

    The Company requires the Board of Directors to propose to shareholders at the shareholders’ meeting for the appointment of auditors and the amount of auditors’ remuneration.

  6. Right to Share Ownership Registration or Transfer

    The Company appointed Thailand Securities Depositories Company Limited (TSD) as its registrar responsible for the Company’s share deposit, collecting and updating shareholders’ information and provides services to shareholders, such as issuing, depositing, withdrawing and transferring of share certificates, as well as remitting benefits to the shareholders. Shareholders can contact TSD directly at the TSD Call Center at +66 2009 9999. At present, TSD offers online service through Investor Portal. Shareholders can apply for the service at https://www.set.or.th/tsd/en/investorportal/investorportal.html.

  7. Right to Receive Information and Significant News in Accurate, Sufficient and Timely Manner

    The Company has completely followed the regulations, criteria, conditions and procedure related to timely and accurate disclosure of information and activities of listed companies. In 2017, there was no punishment due to failure or delay to submit report as required by law.

    In 2017, there was no event or activity that infringed or derogated shareholders’ rights.

2. Equitable Treatment of Shareholders

 

The Company treated all its shareholders equitably without discrimination of their status as major shareholders, minority shareholders, institutional shareholders, or Thai and other nationalities. Major activities are as follows:

  1. Access to the Company’s Information

    To ensure shareholders’ equal access to the Company’s information, the Company uses SET’s disclosure system as the main communication channel. The Chairman of the Board of Directors, directors, Chief Executive Officer and chief officers are the authorized persons responsible for the Company’s information disclosure. To ensure equal access to the Company’s information, the Company sets up additional communication channels through the Company’s website and related units namely the Company Secretary Office, Internal Audit Division, Corporate Relations Division and Investor Relations Department.

  2. Preparation of Bilingual Documents

    For equitable treatment of both Thai and foreign investors, the Company prepares all published information in Thai and English, including all the information provided through the SET’s disclosure system, meeting notice, meeting document and report, press conference and the Company’s website.

  3. Encouraging Minority Shareholders to Propose Additional Agenda and Nominate Directors

    The Company invited minor shareholders to propose meeting agenda and/or nominate persons with complete qualifications and do not have prohibited qualifications as directors for the Shareholders’ Annual General Meeting Year 2560 (B.E.). The announcement was published approximately for 4 months from 1 September - 31 December 2016. The Company published an invitation to the shareholders’ meeting on the Company’s website on 31 August 2016, providing clear details about criteria, method, process and channel of agenda proposing. At the end of the period, the shareholders did not make any proposal.

  4. Proxy Appointment

    For convenience, shareholders who cannot participate in the shareholders’ meeting can appoint other persons to attend the meeting and vote on their behalf. The Company prepared and delivered proxy document to the shareholders together with the meeting notice. Proxy is available in three forms as designed by the Department of Business Development.

    Form A is the general proxy appointment form.

    Form B is a proxy appointment that lists specific items for proxy appointment.

    Form C is the proxy appointment that is used only when the shareholder is a foreign investor with a custodian in Thailand.

    Shareholders can also download all three types of proxy document from the Company’s website or they can also use other form of proxy or prepare it themselves as deemed appropriate.

    At the Shareholders’ Annual General Meeting Year 2560 (B.E.), the Company nominated 3 independent directors and the Chief Executive Officer for shareholders to appoint as their proxy to attend the meeting and vote on their behalf. Personal information of each nominated person and each person’s conflict of interest were provided on each concerned agenda. In the meeting, 184 shareholders assigned the Company’s independent directors as their proxy while 12 shareholders assigned the Chief Executive Officer as their proxy.

  5. Ballots

    In voting at the shareholders’ meeting, the Company prepared and provided ballots for every participant. Computerized system was deployed for tallying. Legal advisor, as an unbiased party, is assigned as an inspector to review the vote counting accuracy, especially in voting for directors, which individual vote and ballot was kept as reference for accuracy and transparency.

  6. Additional Agenda Item

    At the Shareholders’ Annual General Meeting Year 2560 (B.E.), there was no additional agenda item proposed. The Board of Directors has the policy not to propose new agenda other than those informed in the meeting notice as it realizes the importance and necessity for the shareholders to study information before making decision. Shareholders can propose additional agenda for consideration if necessary, by following the rules set in Company’s Articles of Association.

  7. Prevention of the Abuse of Inside Information

    The Board of Directors has formulated policy and written guidelines on internal information keeping and prevention of internal information usage for abusive self-dealing in the Code of Conduct, regulation, order and related announcements. Such policy and guidelines are communicated through appropriate channels and distributed to the directors, executives and employees for signature and acknowledgement on the first day of employment (during orientation) and published through internal communication channel and on the Company’s website. The prevention of internal information usage measures are:

    • The Management and employees have duty and responsibility to protect confidential information and are not allowed to use such information for personal benefit or suggest others to do, especially on the Company’s securities trading.
    • No disclosure or self-dealing or transferring of significant or confidential information to outsider or those who are not related to the Company, including family members, cousins, friends, which may decrease the Company’s benefit.
    • Sharing or giving confidential information to other person within the Company can be done as necessary and only for the benefit of the other person’s ability to perform their duties.
    • The Company requires directors and executives who have duty to report the changes in security holding of their own, spouse and minor children to the SEC according to the Article 59 of the Securities and Stock Exchange Act 2535 (B.E.) to report such changes within 3 days to notify the Company Secretary after the changes are made. The Secretary will record such changes and report the security holding summary of individual director and executive and report to the Board of Directors at the monthly Board of Directors meeting. The Company also requires its Directors and all employees to report security holdings changes of their own, spouse and minor children, to the Chief Executive Officer within 3 days after the changes are made.
    • The Company has announced and published the “Network and Computer Usage Policy” through its internal communication channels and website. The policy draws guidelines to ensure smooth, efficient and most effective use of the computer network, as well as strict compliance with the Computer Crime Act. The Company also improved the efficiency, security and prevention to network harm. This guideline is as follows:
      • Authorizing employees to use the Company’s computer and network by using password and keeping the password confidential.
      • Encouraging employees to use the internet for work and not to distribute information that is against moral norm, tradition and laws.
      • Using email, internet and computer device allowed by the Company and fully following the instruction on safe use of such devices for the best benefits of the Company.
      • Using only copyrighted programs.
      • The Company will check, search, monitor, investigate and control the use of information technology system as appropriate to ensure safety.

      Throughout the year 2017, there was no accusation of directors and executives for not reporting their security holding as required by the Company or using inside information for own or other benefits.

3. Role of Stakeholders

 
  1. Stakeholders Policy

    The Company adheres to the principle of “promoting and ensuring that the right of all stakeholder groups, such as shareholders, customers, employees, business partners, competitors, the government and communities in which the Company locates is well protected and treated”. The Board of Directors has also formulated and announced the Corporate Governance Policy and policy on specific group of stakeholders on the Company’s website and other channels as follows:

    Shareholders Treatment

    • Operating the business to generate growth, profitability and good returns for shareholders.
    • Operating the business with carefulness, integrity, sincerity, fairness and equitability for all shareholders.
    • Respecting the right to receive information and disclosing quality, complete, sufficient, and equitable information.
    • Monitoring the implementation of policy and Code of Conduct related to the shareholders, ensuring that they receive the basic rights and are treated fairly and equitably, receive quality information, are encouraged to attend the shareholders’ meeting so as to have participation in making significant decision and acknowledge the progress, express opinion and monitor the Board of Directors and the Management performance, and to allow for efficient measures to prevent directors and executives from using insider information to their own benefits and refrain from taking any action that infringe or lessen shareholders’ rights.

    Employees Treatment

    • Promoting quality of life by providing good work environment, occupational health and safety.
    • Focusing on continuous and thorough management and enhancement of its personnel’s knowledge and capability.
    • Managing and ensuring fair and attractive remuneration and benefits which is comparable to that offered by other leading companies.
    • Transferring, appointing, awarding and punishing on the equitable and fair treatment.
    • Employees can lodge complaint when treated unfairly or without the appropriate process.
    • Monitoring and ensuring full compliance with laws and regulations related to employees

    Community, Society and Environment Treatment

    • Encouraging community participation and promoting communication.
    • Supporting the development and strength of communities.
    • Promoting and conserving local tradition and enhancing social quality.
    • Supporting environment conservation and restoration.
    • Operating with responsibilities to community, society and environment.

    Customer Treatment

    • Producing and delivering high quality products and services with responsibility to the customers.
    • Providing warranty for products and services under an appropriate time condition.
    • Disclosing correct and complete information about product and service.
    • Providing for a customer complaint system or process and handling complaints well.
    • All executives and employees must keep customers’ confidential information
    • Not asking for, accepting or paying any illegal benefits to customers while strictly complying with trade conditions.

    Creditors Treatment

    • Strictly respect the conditions with the creditor.
    • Not asking for, accepting or paying any illegal benefits to and from the creditors.
    • Cooperating well with creditors to solve problems related to illegal benefits request and acceptance or payment.
    • Providing accurate, complete, timely and regular financial reports.
    • Informing creditors in advance in case the Company cannot meet the conditions in order to solve the issue.

    Partners/Suppliers Treatment

    • Considering the Company’s best benefits and not personal benefits.
    • Offering equitable and equal opportunities to partners and suppliers.
    • Adopting international standards for assessment process, partner selection and contract.
    • Having in place a good system to monitor that contract and conditions are well and completely respected.
    • Not asking for, accepting or paying illegal benefits to the partners.
    • Inform partners/suppliers in advance in case the Company cannot meet the conditions so as to find a solution to the issue.

    Trade Competitors Treatment

    • Respecting and adopting the internationally accepted competition guidelines and principle.
    • Not seeking competitor’s confidential information by using dishonest or inappropriate method.
    • Not groundlessly accusing competitors.
    • Not asking for, accepting or paying any illegal benefit to trade competitors.
    • Strictly respecting trade condition.

    Business Partners Treatment

    • Strictly adhere to the contract and commitment.
    • Providing business assistance that will bring mutual benefits by considering the Company’s benefit as priority and being based on fair return for both parties.
    • Providing accurate information and report while any negotiations seeking solution to a problem shall be based on business relations.

    Government Treatment

    • Supporting the government and complying with policy and criteria set by related regulators.
    • Promoting and collaborating in government sector’s activities.
  2. Respect for Human Rights

    Since 2013, the Company has integrated human rights issues related to the treatment of 3 groups of stakeholders namely, employees, communities and trade partners into its business process based on the labor law principles that are in line with the International Labour Organization’s regulations. Such guidelines are also applied to employees’ care and protection and employment, including employment of local people. In terms of communities, the Company fully respects their rights to receive information and safety. Various types of communications have been established between the Company and communities. In terms of business partners, the Company focuses on fair treatment of its business partners. Respect for human right is represented in the Company’s Core Value, “Happiness”. The Company also sets the basic guideline for human rights practice in the Code of Conduct, and promotes awareness raising and understanding regarding human rights to the employees so that they can acknowledge, practice and be aware of the Company’s sustainability as risk regarding human rights may affect stakeholders’ trust as well as the corporate image.

  3. Use and Protection of Intellectual Property

    Every employee has the duty to protect the Company’s intellectual property and use it only for the benefit of the Company. Computer Crime Act must be abided, which corresponds with the Network and Computer Usage Policy and the basic guideline for the Company’s Group’s information technology system. The Company has set user account and password for its employees. The access to the Company’s information and intellectual property ends when the employment is terminated. Employees shall respect the right and the intellectual property, and avoid or do not infringe on the Company’s or others’ intellectual property.

  4. Risk Management

    Recognizing the importance of risk management, the Board of Directors appointed the “Risk Management Committee” to be responsible for risk management. The Company ensures that risk management is planned and implemented with carefulness, and provides the measures to prevent or handle possible impact on different stakeholder groups. The Board of Directors has formulated and announced the “Risk Management Policy” through internal communication channel and the Company’s website with key essence as follows:

    Risk Management Policy

    • Promoting risk management culture
    • Providing quality, appropriate and sufficient risk management process, guideline and measures
    • Having in place both qualitative and quantitative risk assessment
    • Setting risk appetite and identifying event or risk level that is a warning sign
    • Having operation guideline in writing

    Risk Management Guideline

    The Company identifies risk factors and sets measures to manage risks at the acceptable level to prevent impacts on the business operations and stakeholders by reviewing the risk management practice in order to prevent impact on business operations and all stakeholders. The Company gives high importance to the warning signs and irregular items, enabling it to quickly adjust Quarterly report on risk management is submitted to the Audit Committee and the Board of Directors respectively. (Details are as in the Risk Management Committee’s Report, Management Structure and Risk Factors.)

  5. Anti-Corruption

    The Company is strongly committed to operating its business with fairness and transparency as well as responsibilities towards the society and all stakeholders according to the good corporate governance principle, corresponding to the Company’s policy to fight against all forms of corruption. One of its actions underlining this commitment is the participation in Thailand’s Private Sector Collective Action Coalition against Corruption (CAC) since 2016.

    To emphasize the commitment to operate business that is transparent and auditable under corporate governance principle, to fight against direct and indirect corruption of all forms in dealing with the government and private sectors, and to prohibit its personnel of all levels from directors to executives and employees from asking for and accepting bribes or any corrupted act, the Board of Directors formulated policy and operational framework on anti-corruption and fraud-related risk management and internal control. It also set scope of responsibility, practice guideline and rules for related persons in writing to use as clear guideline to prevent corruption in all business activities to lead the organization towards sustainable development and operations. The Company has communicated with all stakeholders through appropriate communication channels to encourage them to adhere to such policies. This is implemented under the supervision of the Board of Directors, the Corporate Governance and Social Responsibility Committee, the Audit Committee and the Management as the organization’s leader with role and responsibility to show organization’s position in fighting against corruption, which will strengthen confidence among employees, business partners and the public towards the Company’s operations.

    Anti-Corruption Policy

    1. Promoting the anti-corruption culture.
    2. Ensuring clear principle, process and guideline for business operations.
    3. Providing internal control system related to fraud and corruption risks.
    4. Formulating appropriate criteria for reviewing and supervising of anti-fraud and corruption policy implementation.
    5. Having in place anti-corruption regulations and risk management in writing.

    Corruption Risk Management

    5 main corruption prevention measures:

    1. Corruption risk assessment: The Company requires for risk identification; impact, opportunity and severity assessment; and considers appropriate internal control and measures to reduce corruption related risks.
    2. Preparation and improvement of policy, regulations, order and Code of Conduct to communicate with and ensure that employees understand and strictly abide by of the policy and anti-corruption measures.
    3. Communication and training: The Company prepares the annual communication and training plan, including channels, frequency, content and implementation to ensure effective communication both internally and externally. The objective is to raise awareness on the importance and encourage participation in the management of risk related to corruption, transparency and commitment to fight against corruption at all levels within the Company and to communicate it to business partners and stakeholders.


      In 2017, the Company organized anti-corruption trainings, covering general knowledge about corruption and fraud, fighting against corruption and fraud, gift and souvenir giving and receiving, political assistance, charitable donation, and providing financial support, entertainment, corruption risk management and whistleblowing. Assessment of the employees’ understanding, awareness and practice regarding anti-corruption was introduced through e-learning system from 1 - 30 November 2017 with 89 percent of the attendants passed the assessment. The Company also announced, published and officially informed in writing about the anti-corruption policy to business partners and stakeholders for acknowledgement and implementation.

    4. Review of profile of personnel and business stakeholders before hiring or entering into a contract or a connected transaction: The action shall be taken with consent from the other party and in compliance with related laws.
    5. Internal Control: All the Company’s units shall have in place clear procedure and appropriate internal control with clear separation of responsibilities in all process and regular review for improvement at least once a year.

    Monitoring and assessment of anti-corruption policy implementation

    1. Setting mechanism for corruption clue and report channel, providing a channel for corruption reporting without unveiling identity of the person who reports the case to protect them from being harmed or threatened afterward, and specifying the reporting process as disclosed in section 3.6 Complaint and Report on Irregularities Clue.
    2. Specifying in writing a responsible person to monitor the implementation of each respect of the anti-corruption policy.
    3. Assigning the Corporate Governance Working Team to regularly monitor, collecting corruption risk assessment results, monitor the implementation of risk management plan and report to the Management, the Corporate Governance and Social Responsibility Committee, the Audit Committee, the Board of Directors and related committees or units.


      The Audit Committee supervises and ensures sufficiency and completeness of the anti-corruption process through Internal Audit Division and reports the results to the Board of Directors. Activities are as follows:

      1. Reviewing anti-corruption policy and process and assessing the sufficiency of internal control to prevent possible corruption and fraudulent act.
      2. Setting criteria for internal audit and supervision to cover anti-corruption and ensuring that the Company’s policy is appropriately implemented and complies with international standards.
      3. Reviewing anti-corruption practice regarding communication and training policy for all employees, including outsiders and business partners to ensure their acknowledgement and compliance with all policies and principles.
      4. Reviewing regulations, order and the Company’s Code of Conduct related to anti-corruption and fraud, giving and receiving gifts and souvenirs, charitable donation, financial support, per diem, and fraudulent risk management, etc.
      5. Setting annual plan to review corruption risk management to ensure compliance with preset criteria and measures.

      In 2017, no fraudulent or unethical action was found and there was no director or executive who resigned due to corporate governance issue.

  6. Complaint and Report on Irregularities Clue

    The Company has provided for a channel for stakeholders including employees and outsiders affected by or having risk of being affected by the Company’s operations or the Company’s executives or employees’ performance to lodge complaint and report irregularities clue on an action that breaches the laws or Code of Conduct and behaviors that may link to corruption. Stakeholders can report clues or lodge complaint to the following person or channel as follows:

    Complaint Receiver
    Reporting Channels
    By Email
    By Post
    Chairman or Directors (including Independent Directors) directors@ratch.co.th Addressing one of the complaint receivers: Ratchaburi Electricity Generating Holding PCL. 8/8 Moo 2, Ngamwongwan Road, Bangkhen, Muang Nonthaburi, Nonthaburi 11000
    Chief Executive Officer ceo@ratch.co.th
    Head of Unit Individual email of the person
    Vice Persident - Head of Internal Audit Division internalaudit@ratch.co.th

    Process after a complaint is received

    1. Complaint receiver collecting fact related to the breach of Code of Conduct either by himself or by assigning other appropriate person to take action.
    2. Presenting the fact to the Chief Executive Officer who will form an investigation committee.
    3. The investigation committee collecting related fact and information through interviews and/or document study.
    4. The investigation committee analyzes the fact and judge before considering the appropriate process for handling this matter.
    5. The investigation committee sets a measure to solve or alleviate damages felt by the affected person and report to the Chief Executive Officer who will report to the Board of Directors.
    6. The investigation committee reports the result of the investigation to the complainant if the person is known.

    For internal complaint, process and measures are provided for employees to report and complain on unfair treatment. The Company has also provided protection of the complainants against employment termination or punishment when they provide information, truth, fact or any evidence related to the complaints or are responsible for the sincere consideration of the complaints that eventually create adverse impact on the Company. The process and measures are clearly stated in the Company’s regulation on Personnel Management under Complaint section.

    In addition, the Company has provided other communication channels to receive complaints, opinion and recommendation from all stakeholders for the Company’s development and improvement. The channels include the Company’s website, the Company Secretary, Corporate Relations Division, Internal Control Division and Investor Relations Department, and the complainants may use other channels as deemed appropriate.

    Complaint Receiver
    Complaint Channels
    By Email
    By Post
    Company Secretary CS@ratch.co.th Addressing one of the complaint receivers: Ratchaburi Electricity Generating Holding PCL. 8/8 Moo 2, Ngamwongwan Road, Bangkhen, Muang Nonthaburi, Nonthaburi 11000
    Corporate Relations Division PR@ratch.co.th
    Internal Audit Division internalaudit@ratch.co.th
    Investor Relations Department IR@ratch.co.th
  7. Report on Interests of Directors and Executives

    The Board of Directors required all directors and executives to report interests of their own and their related persons as specified in the “Directors’ and Executives’ Interests Report Form”. The original report shall be submitted to the Company Secretary for record keeping and the copy shall be submitted to the Chairman of the Board of Directors and the Chairman of the Audit Committee on annual basis. Further changes shall be immediately reported in order to keep the information updated. The report is used for the Board of Directors’ consideration and decision on stakeholders who have or may have conflict of interest and do not have voting rights on the Company’s transactions, which enables the Company to make the right decision for benefit of the Company.

  8. Community Participation Encouragement

    The Board of Directors has set and announced the policy on social and environment as a guideline for the Company’s Group practice. This focuses on encouraging community participation, communication, support for community development and strength enhancement, promotion of local tradition and culture conservation as well as conservation and rehabilitation of the quality of the environment. This is evident in all process and all project development and operation period. During project development period, the Company studied technical information in parallel to a study on economy, social, culture and way of life of the communities in order to prepare community participation plan and key communication message as well as activities to promote understanding between the project and community. Public hearing was also held to provide opportunity for the communities to share their view on the areas required by government agencies and related authorities. During the construction period, the Company regularly communicated with the communities to ensure understanding of the project development and the Company’s policy. When the project is operating, effective communications with the communities continue. The Company always listens to the communities’ recommendation for on-going development and improvement of activities that better address community needs.

    In addition, Ratchaburi Electricity Generating Company Limited initiated the “Ratchaburi Power Plant Environment Inspector Committee”, comprising representatives from communities, community leaders, local and provincial administration. The committee is responsible for monitoring and ensuring that the power plant operations are in accordance with Ratchaburi Power Plant’s prevention and reduction of environmental impact measures stated in the environmental impact assessment and environmental quality monitoring operation plan. The committee also acts as the center for cooperating with power plants, providing information and news update or problems and possible issues that may cause problems, and recommendation shared by communities which is an important channel for promoting community participation in systematic and continuous monitoring of the Company’s operations.

  9. Transaction that Has or May Have Conflict of Interest

    The Board of Directors provides a guideline for the transparent and auditable management of conflict of interest and strictly complies with the Company’s regulation on the Board of Directors which specified that directors who have personal interests in any particular area shall not have the right to vote at the Board of Directors’ meeting during a consideration in such area. The Board of Directors and the Audit Committee have an important role in formulating measures to prevent conflict of interest and ensuring that the operations are smooth and reasonable. Complete information disclosure is required in accordance with related regulations for the benefit of the Company.

    The Board of Directors, through the approval by the Audit Committee, has ensured that connected transaction between the Company and its subsidiaries are in the best benefits to the Company and its subsidiaries. Transactions between the Company and its subsidiaries are considered based on the same pricing and conditions as in transaction with other business partners. Accurate and complete disclosure of such transactions are required according to related regulations. For flexibility and convenience, the Board of Directors authorized the Chief Executive Officer to approval normal connected transaction or regular business transaction, with general conditions and trade agreement, within Baht 30 million limit. The transaction shall be reported at the Board of Directors’ meeting on a quarterly basis, according to Article 89/12 of the Securities and Exchange Act.

  10. International Environmental and Occupational Health Standard

    The Company has seriously and continuously encouraged and monitored its subsidiaries and their power plants to adopt and maintain internationally accepted operational standards, such as ISO 14001 environmental management standard, OHSAS 18001 occupational health and safety management standard, and other standards issued by the Department of Industrial Works. For example, since 2016, Ratchaburi Electricity Generating Company Limited has been one of the private sector organizations who signed Memorandum of Participation in the “Industrial Sector’s Corporate Carbon Footprint Preparation Promotion Extension Project, Phase 5” initiated by Thailand Greenhouse Gas Management Organization (Public Organization) and the Industrial Environment Institute, the Federation of Thai Industries, in order to receive information on carbon footprint assessment criteria and method, prepare for the assessment verification and acknowledge the amount of greenhouse gas emitted by the operations of its main power plant namely Ratchaburi Power Plant and Tri Energy Power Plant. The results will be used for database for emission reduction planning in the future and for designing greenhouse gas management according to the country’s plan under the United Nations Framework Convention on Climate Change (UNFCC) in 2020.

  11. Safety, Occupational Health and Working Environment

    The Company realizes the importance of safety, occupational health and working environment of its employee, partners and other stakeholders who work with the Company, especially in the Company’s premises. It has arranged trainings to create understanding and awareness of their role and responsibility to operate the business and perform their tasks with the highest safety level. The Safety, Occupational Health and Working Environment Working Team was appointed to monitor, assess and set prevention and correction measures to ensure safety operations in all situations. All actions shall be effectively and efficiently made based on resource optimization. They should also best address the policy and Code of Conduct that the Board of Directors formulated, announced and communicated through the internal communication channels and on the Company’s website as follows:

    Safety, Occupational Health and Working Environment Policy

    • Promote and develop safety, occupational health and working environment management system to meet with international standard and comply with laws and regulations.
    • Control and prevent loss in various forms as well as maintain the safe working environment. It is the responsibility of all executives and employees to report accident and issues according to the preset procedures.
    • Arranging publicity and communication to ensure good understanding and to notify the concerned stakeholders for acknowledgement and implementation.
    • In case an unsafe practice or an action that does not comply with regulations, standards or may have impact on safety, occupational health and working environment practice is found, the work shall be temporarily halted. Related persons should be informed according to the procedures for immediate solution.
    • Monitor and assess the performance result for strict and effective implementation.


      In 2017, The Company monitored the implementation of safety, health and working environment in the operations and ensured it complies with the plan and legal standards. The action was conducted under close supervision of the Safety, Health, and Working Environment Working Team which held 12 meetings. Major activities on safety, health and working environment are as follows:

    • Arranging annual basic fire fighting and fire drill training for the year 2017 in cooperation with disaster prevention and mitigation units and related organizations at the Company’s office on 4 August 2017.
    • Arranging safety trainings for employees and concerned persons such as Safety, Health and Working Environment Working Team Training held on 1 - 2 June 2017 with 31 attendants; training on first aid and how to use automated external defibrillator (AED) held on 17 July 2017 with 33 participants; and training on how to use personal smoke prevention mask during fire evacuation held on 15 - 16 June 2017 where equipment were distributed to 252 employees and concerned persons.
    • RATCH Go Green@Work 2017 Exhibition with 129 participants. Activities included basic health check, In Body examination, exhibition boards and games educating employees on non communicable diseases (NCDs), chiropractic treatment for office syndrome relief, organic vegetable growing and clean food cooking, for example
    • Considering and drawing 2018 operational plans covering key issues including compliance with related laws, implementation of the Company’s safety, health and working environment policy, operations to maintain Zero Accident status, proactive employees’ healthcare, and preparation for outstanding safety, health and working environment organization competition.

    With strong commitment to safety, health and working environment practice, the Company has achieved zero work-related accident for 2,022,770 hours. The Company therefore received the Bronze plaque for its participation in the Zero Accident Campaign 2017 held by the Department of Labor Protection and Welfare, Ministry of Labor.

    Accident, Absentee, and Work-related Illness Statistics in 2017

    Items Amount
    Accident 0 time
    Injury rate (IR) 0 time
    Occupational disease rate 0 person
    Absentee rate 1.40 %

4. Disclosure of Information and Transparency

 
  1. Type of Disclosed Information

    The information being disclosed comprises financial and non-financial information and periodic and non-periodic report. The objective of the report is to provide sufficient and complete information that support the readers’ investment decision. In 2017, the Company’s information disclosure activities are:

    Information Disclosure in 2017 Time(s)
    Periodic reports 35
    Non-periodic reports 34
    Analyst meeting 4
    Company visit 50
    Domestic roadshow 1
    International roadshow 1
    Press conference on operating performance and significant activities 5
    Media participation in the Company’s CSR activities 6
    Press and photo releases 24
    Shareholders’ and investors’ site visit in Thailand and overseas 1
    Exhibition 4
    Executive interviews 4
    Website hits/page views (average per month)(From 1 January 2017 to 31 December 2017, totalling 209,392 times) 17,449
  2. Quality of Information

    Quality of information includes accuracy, completeness, clarity, sufficiency, timeliness, transparency and auditability. Significant information disclosed by the Company includes both financial and non-financial information, is not one-sided but is presented in both positive and negative aspects. The disclosure of information complies with the related criteria and regulations, such as immediate disclosure of significant information, comprehensive distribution to the general public, clarification in case of rumors and information about abnormal stock trading. The Company has never disclosed propaganda information without solid reasons or used insider information for security trading. Disclosure of information shall not cause excessive cost to the Company and not affect the Company’s competitiveness. Details are presented under the Rights of Shareholders section and Board of Directors’ Report on Its Responsibility to Financial Statements which is published together with the Independent Auditor’s Report in the annual report and the Audit Committee provided its opinion on the quality of the financial statements as published in the Audit Committee’s Report.

    Quality information disclosure to outsiders not only reflects the Company’s transparency but also enhances investors and related persons’ confidence and trust. As a result, the Board of Directors closely supervised and monitored to ensure that responsible persons sufficiently provide at least the information as required by law and that investors have equal opportunity to receive such information.

  3. Information Disclosure Channels

    The Company uses SET’s electronic communications channel as the main channel for information disclosure. The Company also prepares website, press conference on operating performance, analyst meeting, press release, domestic and international roadshows and other activities as reported under Type of Disclosed Information.

    The Company considers disclosure of significant information a very important responsibility. The Board of Directors and the Management have closely monitored and ensured that the information disclosure process complies with the criteria and regulations and strictly supervised the implementation of such activity. Authorized and responsible persons are designated while information distribution channels are developed to ensure information disclosure quality as follows:

    • Authorized persons to disclose information
      as assigned by the Company are the Chairman of the Board of Directors, directors, Chief Executive Officer and chief officers. Other units responsible for information preparation are:
      Unit Information/document preparation
      Company Secretary Office Preparing document related to information and signification disclosure through SET’s electronic channel preparing annual report (Form 56-2) and coordinating with SET and SEC
      General Accounting Division Accounting Control and Analysis Division Preparing financial information document, and the management discussion and analysis
      Corporate Relations Division Preparing information disclosure document and press release and arranging press conference.
      Investor Relations Department Preparing the Form 56-1 and arranging analyst meeting.
    • Communication channels: Based on the commitment to providing complete and equitable access to the Company’s significant information to all shareholders, the Company communicates via various channels and covers both one-way and two-way communication. The distributed information is prepared in Thai and English and distributed at the same time via SET’s electronic channel as the main information disclosure channel; the Company’s website (www.ratch.co.th) to increase opportunity and convenience to distribute information and create understanding among shareholders, investors, interested persons and the general public; analyst meeting; domestic and international roadshows; press conference to announce quarterly and annual performance; distribution of news releases and photo releases of the Company’s activities; executive interviews; exhibitions; site visits for shareholders, institutional investors and analysts; and media relations activities.
  4. Investor Relations

    The Company assigned the “Investor Relations Department” to be the center for fair and equitable communication, and information and news providing, as well as arranging activities to create and strengthen relationship between the Company and its shareholders, institutional investors, individual investors, analysts and concerned government agencies. The Department is also responsible for preparing annual investors’ relations plan. The Company’s Chief Executive Officer and high level executives always act as the Company’s spokespersons who report, provide additional information, clarify and answer questions at the analyst meeting, local and international road shows. Interested persons may contact the Investor Relations Department by sending letter by post to the Company, or call +66 2794 9841 or fax +66 2794 9888 Ext. 9841 or through the Company’s website www.ratch.co.th or sending emails to IR@ratch.co.th

  5. Disclosure of Directors and Executives Remuneration Policy and Payment

    The Board of Directors has disclosed the director and executive remuneration payment and remuneration of individual director and executive remuneration by categories. This annual report also included overall employees’ remuneration. (Details are explained in Management Structure.)

5. Board of Directors’ Responsibility

 
  1. Board of Directors Structure
    • Composition and qualification (Details appeared in Management Structure)
    • Independence of Chairman of the Board of Directors
      The Chairman is not an executive director. Despite the fact that the Chairman is the representative of EGAT, the major shareholder holding 45 percent of the Company’s total stake, the Board of Directors also comprises 6 independent directors, representing 50 percent or half of the total of 12 directors. As a result, the directors can independently perform their duties as the shareholders’ representative and there is a proper balance. The Chairman independently performs his duty and does not influence or convince other directors during discussions. He also encourages all directors to discuss and express opinion openly by giving sufficient time to find mutual resolution on all matters considered at the Board of Directors’ meeting.
    • Segregation of the Chairman of the Board of Directors and Chief Executive Officer
      The Chairman is not the same person as the CEO and has no relations with the Management. The segregation of the Chairman and the CEO positions has ensured proper balance and prevented either one of them to have excessive power. The Chairman is the leader and has significant role in deciding the Company’s policy resulted from the joint meeting between the Board of Directors and the Management on business goals. The Chairman leads and conducts the meetings in efficient and effective manner, and encourages all directors to participate in the meeting and openly express their opinion.
      The Chairman also supports and provides recommendation for the Management operation through the CEO and does not intervene in routine work by the Management. Meanwhile, the CEO is the only executive director and the highest rank executive whose roles and responsibilities are explained in Management Structure.
    • Directorship in Other Companies
      None of the Company’s directors holds positions in more than three other listed companies, which complies with the Company’s regulation on the Board of Directors and the SET’s recommendation on director’s efficiency and time contribution. More information about individual director is revealed in the directors’ profiles under the Management Structure section.
      Mr. Kijja Sripatthangkura, Chief Executive Officer, does not hold directorship in other company aside from the Company’s subsidiaries and joint ventures. For other directors and executives, the Board of Directors has approved their directorship and executive position in subsidiaries and joint ventures depending on their knowledge, skills and responsibility.
      The Board of Directors has formulated the Company’s Regulation on Subsidiaries, Affiliates and Joint Ventures Supervision, covering clear criteria for the appointment and responsibilities of the Company’s representatives assigned to hold directorship or hold stakes in the companies in which the Company invests. This allows the representatives to convey the Board’s policies and report performances of those businesses back to the Board. (Details on the Company’s representatives assigned to be director and shareholders in subsidiaries, affiliates and joint ventures appear in the Information about Directorship of Directors and Executives section in Management Structure.)
    • Recruitment and nomination of directors (Details appeared in Management Structure)
    • Secretary to the Board of Directors and Company Secretary (Details appeared in Management Structure)
  2. Committees

    The Board of Directors has appointed 5 Committees as appropriate and necessary to assist it in studying information, screening work and making recommendation, which enables the Board to perform its duty more efficiently. The five Committees are the Audit Committee, Human Resources and Remuneration Committee, Risk Management Committee, Investment Committee and Corporate Governance and Social Responsibility Committee. (Details are disclosed in Management Structure.)

  3. Roles, Duties and Responsibilities of the Board of Directors

    The Board of Directors is committed to independent decision making for the best benefits of the Company and its shareholders. Each of the Company’s directors realizes the responsibility towards the shareholders who are the business owners and have the right to appoint the directors who has Fiduciary Duty to govern the business in the way that would best benefit the shareholders. Fiduciary Duty covers four major responsibilities namely Duty of Care, Duty of Loyalty, Duty of Obedience and Duty of Disclosure.

    The Board of Directors’ roles, duties and responsibility are as follows:

    • Formulating and reviewing the Company’s strategy, business plan, policy, budget, and business direction with participation of the Management on yearly basis.
    • Consider and approve human resource management strategy, executive development plan, corporate structure, remuneration structure, and remuneration plan.
    • Consider criteria, method and process for the recruitment, removal and termination of directors and high level executives.
    • Supervise the appraisal process of high level executives to ensure effectiveness by comparing the performance with the mutually agreed goals.
    • Communicate the Company’s vision, goals and operating results to directors, executives and employees to ensure acknowledgement and understanding throughout the entire organization.
    • Monitor the progress, efficiency and success of the strategic plan and compare the result with the short and long term goals; compare efficiency and effectiveness of the performance of competitors; disclose the implementation result and the governance under good corporate governance principle in the annual report; and require the Management to present regular report to the Board of Directors as follows:
      • Monthly report such as monthly operational performance analysis, short and long term investment report, cash flow report, and the highest electricity capacity report, electricity capacity within EGAT and national systems, the security holding and/or changes in security holding of directors, executives and spouses and minor children, and energy stock prices report.
      • Quarterly reports such as quarterly financial report.
      • Annual reports: annual financial reports, evaluation of the annual operational performance against the target and the reports by the Committees appointed by the Board of Directors.

      In 2017, the Board of Directors reviewed the strategic plan and business strategies and approved vision, mission, goals and business strategies for use as guidelines in 2018. The vision, mission, goals and business strategies are designed to support the long-term goals in 2023 and address the changing situation at present while supporting the Company’s plan to diversity its business to strengthen its foundation and support long-term growth. In case that the operational performance did not meet the target due to controllable factors, the cause of the problem will be analyzed and then corrected. In case that such problem arises from uncontrollable factors, the plan has to be reviewed and new and/or alternative target shall be set as deemed appropriate.

      To promote good understanding between directors and among directors, Management and employees, in 2017, the Company arranged informal meetings among directors, Management and employees, including the Company’s activities such as corporate social and environmental responsibility activity that was held on 3 November 2017, annual recreational activity of directors held on 22-26 November 2017 and internal knowledge development activity held on 1 - 2 December 2017.

    • Ensuring completeness of significant events namely ensuring the right mix of independent directors to create the power of balance with the Management and/or major shareholders; reviewing and approving vision, strategy, mission and Code of Conduct, and communicate with employees at all levels for acknowledgement and implementation; auditing and approving annual financial report to strengthen shareholders’ confidence; supervising internal audit procedure, internal control and risk management system, prevention of conflict of interest, connected transaction, protection of corporate reputation, resource optimization and ensuring full compliance with related laws, rules, regulations, Articles of Association, Code of Conduct as well as good corporate governance principle.
    • Establishing and approving role and responsibility of Committees as appropriate and necessary.
    • Setting criteria and appraising the performance of the Board of Directors and Committees for both the entire Board/Committee and individual member, on yearly basis and disclose the result in the annual report.
    • Setting up Board of Directors’ meeting schedule and voting.
      • Holding the Board of Directors’ meeting at least once a month and holding at least one meeting for non-executive directors per year to offer the directors a chance to review the performance of the Board of Directors, the Management and the Company, and to discuss significant management issues without presence of the Management. The CEO will be informed of the meeting resolution which will be used for improving efficiency of the Management.
      • Requiring one director to have one vote. Director with personal interests in specific agenda item shall not have the right to vote. In case the number of votes is equal, the chairman of the meeting shall have the casting vote.
  4. Management and Prevention of Conflict of Interest (details are disclosed in Role of Stakeholders, item 3.9)
  5. Risk Management (details are disclosed in Role of Stakeholders, item 3.4)
  6. The Board of Directors’ Meeting
    • The Board of Directors’ meeting principle and practice For maximum benefits of the Company and its shareholders, the Company maintains the Board of Directors’ independence in decision making. All directors perform their duty with integrity and for the best benefit of the Company. As representatives of shareholders, the Board of Directors closely leads, monitors the operations, guides, assists and supports the Management’s operation.
    • Meeting schedule, meeting agenda and document preparation The Board of Directors approved the Board’s and Committees’ meeting schedules for the entire year and informed every director of the schedule. In 2017, the Board of Directors’ meetings were scheduled at 15.00 hours of every third Monday of the month.

      The Chairman and the CEO jointly considered the matters to be included in each agenda to ensure that all significant matters are submitted to the meeting. They informed the directors in advance and distributed the meeting notice at the appropriate time according to the Company’s regulation. However, directors are free to propose other matters to be included in the agenda by making such proposal 10 days prior to the meeting date. In case of urgent matters which may directly or indirectly affect the Company, directors are free to propose such matters for consideration or acknowledgement as other agenda item at the Board of Directors’ meeting. (Method for deciding matters to be included in the agenda and the method for directors to propose other matters are stated in the Company’s regulation on the Board of Directors and published on the Company’s website.)

      Meeting agenda is grouped for easy consideration and the meeting is run in the preset sequence namely matters to be informed by the chairman, follow-up matters from the previous meeting, matters proposed for consideration, matters proposed for acknowledgement, and others (if any). Regular matters to be proposed to the Board of Directors at the specific period, such as monthly, quarterly and annual agenda are set in advance. Schedule of monthly performance analysis report and progress of projects that the Company invests in are also reported to the Board of Directors meeting every month.

      The Company sends meeting notice, agenda and related document to each director approximately one week prior to the meeting date, providing them with sufficient time to study the information. Directors may ask for more information from the CEO and the Company Secretary Office. Members of Committees can ask for more information related to their tasks from the CEO and through the secretary of each Committee.

    • Roles of the Chairman, directors, Management and meeting atmosphere
      • The Chairman leads the meeting, sufficiently and adequately allocates time for directors to equally discuss and express opinions, encourages directors to participate in the discussion and freely express opinions, and summarizes the meeting’s resolutions.
      • Directors share opinions based on the study of the information provided by the Management and other necessary and relevant information by making constructive discussion with the consideration of the benefits and impact as well as risks for the Company and all stakeholders in order to obtain the meeting resolution. Directors shall contribute time, knowledge and experience to their role as a director of a listed company.
      • The Management is responsible for providing accurate, sufficient, complete and timely information that is relevant and necessary to support the Board of Directors’ meeting decision, as well as present the information in advance in order to allow the directors’ sufficient time to study the information. The Management shall propose options to the Board of Directors, and provide information and clarify additional information when asked in the meeting. The Board of Directors requires high level executives from all functions to attend the meeting and invite other concerned executives for clarification on specific matters.
      • Meeting atmosphere and expression of opinions The Company provides appropriate and sufficient meeting equipment and facilities. The meeting atmosphere is open and encourages all directors to participate in the discussion and openly and positively express opinions based on mutual benefit and impact on all stakeholders. Each meeting lasted 1.5 hours to 2 hours on average.
      • The meeting’s process The meeting generally considers and discusses each agenda item. The Management presents the background, rationale, necessity, clarifications and related information to support decision making process and to support the Management’s proposal. The Chairman allows sufficient time for all directors to discuss all issues and encourages directors to express opinions and ask questions on important matters for the Management to clarify. Afterward, all will make decision together, leading to the meeting resolution.
      • Directors who have personal interests in any subject do not have the right to vote on such subject (personal interests are based on each director’s and executive’s report on their related persons’ interests which was submitted to the Company Secretary.) This has been strictly implemented in all meetings.
      • Consideration of connected transaction and items that may involve conflict of interest is done by taking benefits of the Company and shareholders into consideration. The meeting will consider the necessity and reasons for each matter the same way it does for other transactions. Correct and complete process and disclosure of information are highly weighted.
      • The Company Secretary provides initial recommendation to the Management and the Board of Directors to ensure that all their practice complies with the related regulations, such as information disclosure regarding asset acquisition or disposition, connected transaction and implementation of good corporate governance principle.
    • Meeting minutes preparation and keeping
      • Company Secretary Office is assigned by the Board of Directors to record, prepare and keep the minutes of the Board of Directors’ meeting and shareholders’ meetings.
      • Meeting minutes are prepared in writing and cover all important details, including date and time the meeting begins and ends, meeting venue, list of attending directors and executives, list of absent directors, summary of the matters presented in the meeting, summary of the discussed matters, opinions and observation of the directors, the meeting resolution, and the signatures of the minutes taker and the meeting chairman. Meeting minutes are completed within approximately three days after the meeting and delivered to all directors for consideration. If no revision is made within seven days, the minute is considered approved and submitted to the meeting’s Chairman to sign. A copy of the signed meeting minutes is then delivered to each director for reference. In addition, the certified meeting minutes will be added as an acknowledgement agenda in the next meeting.
      • Dissemination of the meeting’s resolutions The Company Secretary distributes the written resolution to related units for acknowledgement and/or implementation. The implementation will be monitored and reported to the Board of Directors.
    • The Board of Directors and Committee’s meetings (Details are disclosure in Management Structure).
  7. Performance Appraisal
    • Self-assessment of the Board of Directors and Committees

      The Board of Directors has to conduct sel-assessment with the objective to use the appraisal result, observation and recommendations for the Board of Director’s further improvement. The factors considered include the performance of Board of Directors and the Committees as a whole as well as each director’s individual assessment.

      The assessment covers many important areas according to the good corporate governance principle for listed companies, including directors’ readiness, strategy formulation and business planning, risk management and internal control, conflict of interest prevention, financial and operating performance report monitoring, the Board of Directors’ meeting, nomination and remuneration of the directors and the high level executives. The self-assessment of the Committee covers the overall performance of each Committee in terms of the Committee’s readiness, completeness of duty as assigned by the Board of Directors, and the Committee’s meetings both before (provision of meeting document prior to the meeting date to provide sufficient time for the Committee members to study the information), during (information and significant agenda presentation, discussion, answering questions and meeting resolution) and after the meeting (preparation, submission and storing the meeting minutes).

      The assessment levels for the Board of Directors and Committees for both individual and the entire Board/Committee assessment comprise 5 levels according to average scoring of the individual assessment as follows:

      Excellent > 90 %

      Very good > 80-90 %

      Good > 70-80 %

      Fair > 50-70 %

      Should improve < 50 %

      Assessment Results of the Board of Directors and Committees

      Board/Committee Assessment Results
      Entire Board/Committee Individual
      100 Full Score Level 100 Full Score Level
      2017 2016 2017 2016 2017 2016 2017 2016
      1. Board of Directors 97.14 95.02 Excellent Excellent 96.19 95.46 Excellent Excellent
      2. The 5 Committees Score/Full Score Level Score/Full Score Level
      2.1 Audit Committee 29.00/
      30.00
      28.00/
      30.00
      Excellent Excellent 29.00/
      30.00
      28.00/
      30.00
      Excellent Excellent
      2.2 Human Resources and Remuneration Committee 97.39/
      100.00
      93.83/
      100.00
      Excellent Excellent 97.39/
      100.00
      93.83/
      100.00
      Excellent Excellent
      2.3 Risk Management Committee 27.25/
      30.00
      28.50/
      30.00
      Excellent Excellent 27.25/
      30.00
      28.50/
      30.00
      Excellent Excellent
      2.4 Investment Committee 28.75/
      30.00
      28.75/
      30.00
      Excellent Excellent 28.75/
      30.00 
      28.50/
      30.00
      Excellent Excellent
      2.5 Corporate Governance and Social Responsibility Committee 28.00/
      30.00
      28.00/
      30.00
      Excellent Excellent 28.00/
      30.00
      28.00/
      30.00
      Excellent Excellent

      The Company will use the performance appraisal result of the Board of Directors and Committees for further improvement of operational efficiency for both Board of Directors and Committees and to improve performance of individual director in accordance with the management policy under the good corporate governance principle.

    • High Level Executives’ Performance Appraisal

      With assistance from the Human Resources and Remuneration Committee in assessing annual performance of high level executives, the Board of Directors adopts the performance appraisal criteria that were agreed at early of the year. In 2017, the criteria comprised four areas namely business planning and development, supervision of companies within the Company’s Group, financial management, and organizational management. Each area has different weight. The Company also appraised high level executives in terms of capability and management skills, including leadership, strategy formulation and implementation, financial planning and performance, networking, business knowledge and understanding and personal qualifications for the CEO and high level executives. The Company uses the assessment result to determine the remuneration for high level executives and to arrange knowledge and skill development plan.

    • Directors and High Level Executives’ Remuneration (Details are disclosed in Management Structure).
  8. New Director Orientation and the Development of Directors and Executives

    Newly appointed director will be given orientation and briefing by the CEO regarding the nature of the business, the Board of Directors’ and the Committees roles and responsibilities, investment structure, organization structure, financial operating results, progress of investment projects and the Company’s good corporate governance principle. Supporting documents on the aforementioned subjects are provided together with Memorandum of Association, objectives, Affidavit, Article of Association, rules and regulations, policy, Code of Conduct, remuneration and benefits for directors, annual report and sustainability report, as well as the guideline for directors of a listed company and compliance database. The orientation is held according to the Board of Director’s policy to prepare directors to be ready to perform their duties.

    Directors will have the chance for continuous development to enhance understanding of roles, duties and responsibilities as well as necessary skills for the directors to do their best job as directors of a listed company. The Company has a policy to encourage the directors to participate in seminars arranged by related organizations, such as Thai Institute of Directors Association (IOD), Stock Exchange of Thailand and Thailand Energy Academy.The Company is responsible for the expenses related to such course attendance in accordance with the Board of Directors’ policy to enhance directors’ skills and capability.

    Directors’ Attendance in Trainings and Development Courses in 2017

    Director Course Organizer
    1. Mr. Sutat Patmasiriwat Boards that Make a Difference (BMD 4/2017) Thai Institute of Directors Association
    2. Mr. Witoon Kulcharoenwirat Director Certification Program (DCP 243/2017) Thai Institute of Directors Association
    3. Mr. Chuan Sirinunporn Ethical Leadership Program (ELP 8/2017) Thai Institute of Directors Association
    4. Mr. Thaworn Ngamganokwan - -
    5. Mr. Viboon Rerksirathai Corporate Innovation Bootcamp through Design Thinking Ratchaburi Electricity Generating Holding PCL
    6. Mr. Kijja Sripatthangkura Director Certification Program (DCP 245/2017) Thai Institute of Directors Association
    7. Mr. Chartchai Rojanaratanangkule Corporate Innovation Bootcamp through Design Thinking Ratchaburi Electricity Generating Holding PCL
    8. Mr. Samack Chouvaparnante Corporate Innovation Bootcamp through Design Thinking Ratchaburi Electricity Generating Holding PCL
    9. Miss Prapa Puranachote - -
    10. Mrs. Siriporn Luangnual How to Develop a Risk Management Plan (HRP 12/2017)
    Risk Management Program for Corporate Leaders (RCL 6/2017)
    Corporate Innovation Bootcamp through Design Thinking
    Thai Institute of Directors Association
    Thai Institute of Directors Association
    Ratchaburi Electricity Generating Holding PCL
    11. Mr. Veerasak Pungrassamee Risk Management Program for Corporate Leaders (RCL 8/2017) Thai Institute of Directors Association
    12. Mr. Prapon Kitichantaropas - -

    Remark : Other training and seminar attendance are reported in individual director’s profile

    The Management regularly prepared a summary report of the rules, regulations and memorandums both newly issued and amended by SEC and SET then presented to the Board of Directors’ meeting to use as guideline so that their practice strictly complies with the law and regulations of the regulators.

    The Company sent executives and related employees to attend company secretary, corporate governance, internal audit, anti-corruption and risk management courses including other related courses organized by various institutes and organizations. This enables them to better understand their responsibilities, which supports the works of the Board of Directors and Committees.

  9. Succession Plan for High Level Executives

    The succession plan for the Chief Executive Officer follows the policy of EGAT, the Company’s major shareholder. EGAT will consider its executive who has appropriate qualifications, knowledge and capability to perform the task and brings greater benefits to the Company and nominate the person to the Board of Directors for consideration and appointment through the Human Resources and Remuneration Committee. The Board of Directors assigned the Human Resources and Remuneration Committee to prepare succession plan for high level executives.

    For succession plan for other executive positions, the Company hired a consulting firm with expertise to help developing career path of individual position. This covers the competency model which has been developed in systematic manner, covering analysis of competency and expected qualifications of different positions. The guideline will support human resource development and nomination of qualified persons to be promoted, demoted, retired, and transferred and to prepare the Company’s personnel for current and future business expansion.

    In 2017, the Company completed the successor and talent selection plan. Those people will be trained to enhance competency and ability in various areas to get them ready for the new position and to correspond to the retirement plan of several executives in 2017 and 2018.

  10. Directors and Officers Liability Insurance

    In response to the Company’s expansion to more diverse businesses, the Company has engaged more with new business transactions that require directors and executives’ approval, opinion provision, authorization and signing on important documents. Some of such activities may have high risks of claims from outsiders, shareholders and stakeholders on directors and executives responsibility arising from performing their duty. The Board of Directors required the Management to propose the Directors and Officers Liability Insurance (D&O) together with its conditions, limitation and premium for the Board’s consideration every year. The insurance will provide protection over liabilities or claims against directors and officers who perform their duty in accordance with their position in good faith. In case of fraud, the Company is not liable for the loss and can requests the corrupted person to pay for the fees arising from the lawsuit against the corrupted directors or officials.

6. Code of Conduct

 

To drive success of the organization, support corporate vision, mission, policy and growth target as well as to maintain business sustainability amidst the rapidly changing environment, the Company has been operating its business by adhering to the good corporate governance. The Company is strongly committed to fighting against corruption in all forms and has participated and become certified member in Thailand’s Private Sector Collective Action Coalition against Corruption (CAC) since 22 April 2016. This is a concrete factor to promote and support anti-fraud and corruption practice in order to shield or reduce any negative impact on the organization, the country and all its stakeholders.

In 2017, the Company considered, reviewed and improved regulations, rules and Code of Conduct to keep them updated and cover the entire work process according to the CAC’s anti-corruption framework and in line with the new Code of Conduct which has been used as a policy and the desired behaviors as well as good corporate governance principle implementation guideline for the directors, executives, employee and all groups of stakeholders of the Company’s Group. This will raise the corporate governance practice to that of the international standard and build confidence of the investors and stakeholders in the Company’s operations. The Company has awareness raising and conscious building process and also regularly follows up and evaluates the employees’ performance result. The new Code of Conduct was implemented and published on various channels to allow concerned persons and parties to understand. All employees have read and signed their acknowledgement and adopted it in their operations. Interested persons can find the details of the Code of Conduct on the Company’s website.

7. Communications and Monitoring of Performance to Ensure Full Compliance with the Corporate Governance Policy and Code of Conduct

 

New Director’s orientation is disclosed in section 5.8. For new employee’s orientation, human resources officer will give every new employee a briefing on the Company’s overall business operations, investment structure, organization structure, operating result, good corporate governance and corporate social and environmental responsibility principles, rules, regulations, policy, business ethics, remuneration, benefits and welfare. Supporting documents such as the Code of Conduct and other documents that can be used as guideline and reference when performing duties are given at the orientation and the new employee have to sign their acknowledgement. Corporate governance policy is communicated throughout the Company from the Board of Directors and high level executives to all level of employees. The Company also provides communication channel to listen to and collect employees’ problems, concerns and recommendations for consideration, further action planning and execution as well as ensures the practice and the performance are in line with the good corporate governance principle. The Intranet, email system that employees have easy access and internal meetings, are channels provided to effectively communicate, raise awareness and commitment to implementation of Code of Conduct. The implementation result is reported to the Committees and the Board of Directors for acknowledgement respectively.

Aside from regularly discussing with other divisions, the Internal Audit Division has also been assigned to be responsible for monitoring and following up with the implementation of annual audit plan and a quarterly report the audit results as well as making recommendation on solution and prevention of possible damages to the Audit Committee and the Board of Directors respectively.

The “Compliance Database” was prepared, and distributed to the Board of Directors and published on the Company’s internal database, which is easily accessible for use by all employees. The database comprises guidelines for important areas of practice and operations of the Company as a listed company, such as the disclosure of information, connected transaction, the acquisition or disposition of assets. The information is regularly updated.

The Board of Directors prepared the “Directors’ and Executives’ Interests Report Form” and instructed the Directors and executives to report their and related persons’ interests to the Company Secretary for reference and record. The Company Secretary shall make a copy and submit the report to the Chairman of the Board of Directors and the Chairman of the Audit Committee, according to the Securities and Exchange Act. The report will be used when considering those who shall not have voting rights in the Board of Directors’ and shareholders’ meetings.

In addition, the Corporate Governance Working Team was assigned to communicate and follow up the implementation of corporate governance practice in accordance with the Corporate Governance Policy and Code of Conduct. The Working Team also reports the implementation results of corporate governance and anti-corruption related risk management plans to the Board of Directors, Corporate Governance and Social Responsibility Committee, the Audit Committee, the Management and other committees or related units in accordance with the preset procedure.

In 2017, corporate governance items that have yet to be implemented and the reasons and the company’s current practice are as follows:

Pending practice
Current practice and reasons
1 The Board of Directors uses a professional search firm or director pool to select directors The Human Resources and Remuneration Committee selects and nominates persons with appropriate qualifications to be appointed as directors. Specialists in different fields are invited to participate in the selection and nomination process as deemed appropriate. The list of candidates will be submitted to the Board of Directors for consideration and approval.
2 The Company has set meeting quorum policy requiring at least two thirds of the total directors to be presented in the Board meeting before voting and making resolutions. Although there is no written policy, in practice, the Chairman of the Board will ensure that two thirds of the directors were presented at the Board meeting while the voting and the resolutions are made.
3 Chairman is an Independent Director The Chairman is not the same person as the CEO who is the highest ranking executive of the Company and does not have relationship with the Management although the Chairman is the representative of the major shareholders. This provides full confidence that the Chairman can perform his duty independently as the Board of Directors comprises 6 Independent Directors of the total 12 members (50 percent) or half of the entire Board members, resulting in balance and check of power. In addition, during the meeting, the Chairman also promotes and encourages directors to express their opinions and discuss fully on the topic before making decision without the Chairman’s influence.

In 2017, no event or activity that contradicts to the Corporate Governance Policy or Code of Conduct was found.

Good Corporate Governance Awards

  • Sustainability Report Award 2017 from CSR Club, Thai Listed Companies Association with the support from the Securities and Exchange Commission and Thaipat Institute for the 5th consecutive year.
  • Thailand Sustainability Investment 2017 from the Stock Exchange of Thailand for the 3rd consecutive year.
  • Corporate Governance Report of Thai Listed Companies Assessment 2017 at “Excellence” level with 93 percent scoring, which is higher than listed companies’ average score of 80 percent.
  • 2017 Shareholders’ Annual General Meeting Quality Assessment by Thai Investor Association with 96 percent scoring which is higher than the average score of 91.97.
  • Green Office Management Certification at “Excellence” Level (2016 - 2018) from Department of Environmental Quality Promotion, Ministry of Natural Resources and Environment