Corporate Governance

Corporate Governance

Good Corporate Governance plays an instrumental role in sustainable business growth, generating long-term value for shareholders and developing society, including practices concerning responsibility and fairness towards all stakeholders. PTT Chemical Plc, as a leading integrated petrochemical producer of Asia, recognizes the importance of Corporate Governance and is determined to manage its business under such principles, which form its business philosophy and part of the corporate culture.

In 2010 the Company won a rating of “Excellent” and “Exemplary” in AGM Assessment of the 2010 Annual General Meeting of Shareholders (AGM) with a perfect score of 100. In addition, it passed an assessment for internationalized corporate governance practices, a survey of Corporate Governance Report of Thai Listed Companies 2010 by Thai Institute of Directors (IOD), rated “Excellent”. Finally, PTT Chemical won SET Award of Honor 2010 – Top Corporate Governance Report Award from the Stock Exchange of Thailand (SET) for maintaining its leadership in conformity with corporate governance principles for three consecutive years (2008-2010).

These successes and acclaim have illustrated PTT Chemical’s commitment to the upgrading of its corporate governance on a par with international standards for the sustainable benefit of all stakeholders.

Conformance to Good Corporate Governance Principles in 2010

The Company remains committed to conforming to the five core good corporate governance principles: shareholders’ rights, equitable treatment of shareholders, stakeholders’ roles, disclosure and transparency, and the responsibilities of the Board. In 2010, the Board ensured such compliance and improvement, in addition to developing areas of supervision as summarized below:

  • Shareholders’ Rights

    Good Corporate Governance requires that the basic legal rights of shareholders be upheld, whether before or after decisions to make the investment. Such rights consist of the right to freely trade or transfer their own shares and receive a proportional share of the profit (a dividend) through the promotion of the exercising of their rights; the right to obtain adequate key information in a timely manner; the right to attend shareholders’ meetings; the right to participate and vote on significant issues affecting PTT Chemical; and the right to express opinions and ask questions about the company at meetings. Through the Board of Directors, PTT chemical takes shareholders’ rights seriously by refraining from infringing such rights and has disclosed a policy and guidelines in its Corporate Governance Handbook. The Board therefore promotes, encourages and facilitates shareholders’ to exercise of their legitimate rights in the following ways:

    • Right to receive essential information:
      Essential necessary information is disclosed via SET’s Community Portal system and through Company’s website in both Thai and English. The Investor Relations Department communicates and addresses queries on changes or issues of current interest in a fair manner, as Department shown under “Disclosure and Transparency”.
    • Right to attend meetings and vote:
      PTT Chemical facilitated all shareholders’ attendance at meetings and their exercising of votes, as well as their major decisions at the Annual General Meeting of Shareholders (AGM) in accordance with the AGM Checklist of the Office of Securities and Exchange Commission (SEC) and the Thai Investors Association. The Board also made continuous improvement on the checklist, as seen under “Equitable Treatment of Shareholders”.
  • Equitable treatment of shareholders

    PTT Chemical values all shareholders and treats them fairly and equally to ensure that the shareholders, including major, minority, and foreign shareholders are treated equitably. To this end, the Board supervises assorted matters to endure the equitable treatment of shareholders as described below:

    • Consideration of fair rights and treatment at AGMs
      The Board has ensured a high quality of AGM and strives to improve this. PTT Chemical participates in an AGM assessment project organized by SEC and Thai Investors Association, and prepares the assessment form for the meeting attendants to do the assessment on quality and satisfaction with information, document, meeting agendas, and the process in organizing the meeting. Attendants are also urged to provide helpful views for further improvement. The assessment results are applied to improvement of the quality of the next AGM.

      In 2010, the Company hosted the AGM on April 7 at 2 p.m., Vibhavadi Ballroom, Sofitel Centara Grand Bangkok Hotel. The venue was selected based on the number of attendants and their traveling convenience.

      The Board also took into account the shareholders’ rights and fair treatment, as summarized below.

      Before the meeting date

      • Valuing shareholders’ meetings, each year the Corporate Governance Committee requires the Company to present a summary of meeting preparations for consideration ahead of time.
      • Notify shareholders of the schedule and agenda of the AGM via the SET system immediately after the Board passed the resolution to hold a meeting. The notification on the meeting was also posted on the Company’s website after the announcement through SET’s system.
      • Allowing each shareholder to propose agenda items for consideration at the AGM meeting ahead of the actual meeting date and also to nominate qualified candidates for election as Directors. The Board instituted criteria to support shareholders’ exercising of their rights. The Board extended the period whereby shareholders were allowed to propose meeting agenda and director nominees up to three months (from October 1 to December 31 of each year). This is to allow the Board ample time in considering whether to include the shareholders’ proposals to the meeting agenda or to secure more information for consideration.
      • Shareholders were allowed to submit written questions about agenda items to the Board ahead of the meeting date through company’s website by fax and by letter.
      • Aside from notification of the meeting on Thai and English-language daily newspapers for three consecutive days as required by law, meeting notices and documents were distributed in both languages through its website a month ahead of the meeting date. The documents were identical to what the Company mailed to allow ample time for shareholders’ consideration before the meeting.
      • The Company has improved the paper document mailing process to 20 days ahead of the AGM so that shareholders may have more time to digest the details before the meeting and prepare their proxies if they are unable to attend the meeting.
      • The annual report was available in a bilingual CD ROM as requested by SET, and the printed edition was available upon request through e-mail, telephone, fax and letter. The printed edition was mailed as soon as requests were acknowledged, and also available at the AGM.
      • Adequate and clear information was disclosed in the meeting notices along with the opinions of the Board.
      • Through the meeting notices, shareholders were informed of meeting participation criteria, providing them with a list of all independent directors who could act as shareholders’ proxy with the proxy forms designed by the Ministry of Commerce and the proxy form on which shareholders can state their voting opinions.
      • For the agenda of directors’ appointment, the names of director nominees along with their educational background and career summary. Including the information on selection criteria for the nomination of directors are disclosed for shareholders consideration.

      On the meeting date

      • The meeting venue, meeting sequence, registration and officers were prepared, to facilitate and speed up the registration process. Registration was allowed through the bar-code system two hours ahead of the meeting, and shareholders can register for the meeting after that so that they can maintain their rights.
      • An exhibition was staged to provide corporate information. A Shareholders’ Corner was also set up in front of the meeting room, where directors, senior managers and officers from various units like Investor Relations, Accounting and Finance, Corporate Planning, Marketing, and Corporate Communications were on hand to answer questions of shareholders’ interest.
      • The Company telecast the meeting via a closed-circuit TV system so that shareholders outside the meeting room can stay informed throughout the meeting.
      • The Chairman, the Sub-committee Directors and the President & CEO including executives, external auditor, and legal advisors attended the AGM to explain and clarify questions.
      • The meeting started punctually and the Chairman introduced the directors, executives, and the auditor who joined the question-and-answer session, and the legal counselor who oversaw the voting registration and protected shareholders’ rights, and volunteers from the Thai Investors Association which joined the meeting quality assessment process. The Chairman also clearly notified all shareholders of the meeting criteria as well as the voting method and procedure.
      • Ample time was set aside for shareholders to ask questions on relevant issues and the Company’s business, questions submitted in advance are clarified or answered one by one.
      • The annual performance and views on future business operations were presented through a video for audio and visual presentation to all shareholders.
      • Shareholders were allowed to vote for new directors individually through the ballots. Retired directors left the meeting room so that shareholders could freely discuss and cast votes.
      • A computerized voting calculation system was presented for all agenda, and neutral outsiders counted the ballots. The Chairman then announced the votes, which appeared on the screen and closed-circuit TV for equal disclosure to shareholders.
      • The meeting continued for three hours, from 2 p.m. to 5 p.m., without additional agenda on top of that notified to the shareholders in the meeting notices.

      After the meeting date

      • The Company Secretary recorded all significant information at the AGM, including the resolutions and all votes on each agenda and abstained votes along with recorded all questions and answers as well as the full names of the shareholders who asked questions and those who respond. The minutes of meeting, signed by the Chairman, were disclosed within 14 days after the meeting on the Company’s website and the minutes were properly documented for auditing and reference.
      • The Company recorded the proceeding at the meeting and placed it on the website for the information of those absent. Interested shareholders may file requests for copies in the VCD format.
      • To ensure shareholders of full dividend payment, after the payment had been made as approved by AGM, the Company notified them about the resolution through SET’s channel and coordinated with the registrar at Thailand Securities Depository Co., Ltd., to ensure complete and accurate rights to the dividends. Payment was made sooner than required by law. For 2010, dividends were paid out on 23April 2010.
      • In addition, the Corporate Governance Committee screened the recommendations and views received from shareholders and assessed the AGM to constantly improve shareholders’ meetings.
      • In 2010, the Company launched an open-house activity for shareholders at its plant in Map Ta Phut, Rayong, and took the opportunity to involve them in a social responsibility activity with the communities, students, employees, and executives in the “Tree Planting to Combat Global Warming” project, commemorating World Environment Day, to add green areas to Map Ta Phut communities at Wat Map Chalut School, Rayong.
    • Control and prevention of the use of inside information
      To assure shareholders that the directors, executives, employees and relevant insiders do not use undisclosed inside information for their personal benefit, the Board sets out the following measures;
      • “Written Guidelines on Inside Information” are incorporated in the Corporate Governance and Business Code of Conduct Handbook, which all directors, executives and employees must honor. The guidelines cover transactions on the Company’s shares through inside information, safeguarding and disclosure of the information, and giving opinions to outsiders.
      • “Guidelines on the prohibited Company’s stock transactions of directors, executives and related persons”, which bar directors, executives and related persons (meaning spouses and under-aged children) from buying or selling Company shares - 45 days before the disclosure of the financial statements, from the end of each quarter. They are allowed to conduct such transactions 24 hours after the disclosure to SET.
      • Directors and the executives are required to report to SEC all their changes in shareholding, including those of spouses and under-aged children under Article 59 of the Securities and Exchange Act. They must also make regular reports on any change in shareholding to the Board. The Company Secretary compiles the data for presentation as an agenda item at the Board meeting.
      • Specific timetables for the disclosure of significant information like the quarterly and annual financial statements, which may affect the Company’s share prices, are distributed to the directors and executives, so that they can refrain from conducting any share transaction during the specified period.
  • Roles of Stakeholders

    Stakeholders should be duly taken care of, and cooperation should be promoted among them, which will contribute to sustainable growth. The Board has instituted a policy in treating individual groups of stakeholders in line with their legal rights and agreements with the Company, while developing written guidelines in the Corporate Governance and Business Code of Conduct Handbook, so that directors, executives and all employees can accordingly follow. This policy and guidelines are spelled out for practical conformance as follows:

    Policy Tangible practice
    Shareholders:  The Company is committed to creating the highest satisfaction for shareholders through its consideration of sustainable growth, value creation, continually suitable returns on investment, and business execution with care, prudence, and integrity under good corporate governance. PTT Chemical pays due attention to the rights and equality of shareholders by visibly providing them with proper, complete, and regular information.
    Customers: The Company is committed to creating satisfaction and confidence for customers and the general public on quality goods and services at fair prices. The standards have been elevated and the relationship has been nurtured and sustainable. A task force for customer management has been set up with participation by senior managers to create satisfaction and address the needs of customers while developing the relationship between the Company and all customers through the constant development of product and service quality.  In addition, PTT Chemical introduced an IT system for processing customers’ data and CRM (customer relationship management).  Product and service guarantees have been provided under suitable time conditions.  Finally, the Company values earnest maintenance of customers’ sensitive information.
    Business Partners:  The Company takes into account business equality, integrity, and mutual benefit through strict compliance with the law and mutually-agreed rules as well as business ethics. A process has been put in place for supplier relationship management, as well as a satisfaction survey and communication for business partners’ information concerning Company policy of quality and good corporate governance.
    Business Competitors:  The Company treats competitors under international standards and the framework of the Anti-Competition Act. Fair competition rules are honored. PTT Chemical does not seek competitors’ confidential information through dishonest means, does not discredit them through accusations or slanders or attack competitors groundlessly.
    Creditors:  The Company fairly treats creditors in line with good practices and conditions and honors repayment schedules. PTT Chemical gives equal opportunities to financial institution, defines major conditions in loan agreements under the same standard, and nurtures good relations with them through activities like meetings, social functions, and plant trips.
    Government:  The Company outlines the code of practices for the regulators and regulation sectors in line with rules of respective countries that it invests in to avoid inappropriate actions. PTT Chemical forges cordial relations with public-sector officials within reasonable bounds.  Seminars and meetings are held on sensible occasions.  It cooperates by sharing information beneficial to the public sector and Company business alike as necessary and as seen suitable without hurting Company business.
    Employees:  The Compensation and welfare scheme is concretely identified and fairly considered. PTT Chemical introduced a management process linking employees’ performance to fair awards and pay, values development and sharing of expertise and competency, listens to views and recommendations from all employees equally, and looks after the safety and work environment.
    Communities and Society:  The Company operates responsibly for the benefit of communities, society, and environment for safety, living quality and environmental conservation.  It promotes efficient energy use, recognizes the living quality of communities and society, with due concern for those living in surrounding areas and at the national level.  Partial profits are used to finance community and social development projects. It operates with environmental concerns, through the facility construction process, technology selection, waste management system and research and development for energy-efficient innovations. PTT Chemical supports various projects, whether they are its own or those of other entities and foundations so as to develop capabilities, whether it be in education, occupation science, technology, or public service. The Company also support nearby as well as the national communities with emergency center.
    Occupational safety:  The Company has emphasized occupational safety and health.  An occupational safety and health policy is outlined and reviewed and good practices are implemented for sustainable development. PTT Chemical opts for effective production technologies and waste disposal processes. Apart from developing innovations to promote efficient energy consumption, training, and cultivation of awareness of safety and the environment for employees and regularly engaged workers.

    The Board has ensured the practices along with this policy, taking into consideration the mechanism of stakeholders’ participation. The Board also formulates a compensation policy and measures to cover stakeholders who are legally violated. Satisfaction surveys on individual groups of stakeholders are carried out for further improvement. The Company provided communication channel for suggestions to the Board through email at cg@pttchemgroup.com, or through our corporate website under Contact Us, Corporate Governance menu. The Company Secretary will handle the suggestions or documents for submission to the relevant Sub-committee and eventually to the Board.

    In 2010, the Corporate Governance Committee assigned its internal functions responsible for looking after each group of stakeholders and defining stakeholder relationship management program that cover all group of stakeholders. The Committee took into account the adequacy and suitability, and provided useful recommendations and views to those responsible for the matter and develops their approaches for treating stakeholders in concrete ways. The report will be in place and actions are to be monitored next year.

  • Disclosure and Transparency

    To bolster the confidence of all stakeholders, good corporate governance requires that the Company’s key information be disclosed transparently, accurately, equally and credibly. The Board therefore values the quality of information and its equal transparent and fair disclosure through easily accessible channels by taking the following measure to supervise such disclosure and define a policy on using internal information for stakeholders’ greater confidence.

    Quality of Information

    • The financial statements must be accurate, complete and factual in line with accounting standards. They are audited by the independent auditor and the Audit Committee.
    • The Board bears responsibility for the financial statements through a report of responsibility, signed by the Chairman and the President & CEO and included in the annual report along with the auditor’s report.
    • The annual and quarterly balance sheets are reviewed and reported to SEC and SET, and disclosed to shareholders/ investors before the deadline.
    • Key information, financial and non-financial, is properly, completely, and transparently disclosed after due examination. In 2010, the Company duly observed all requirements of SEC and SET.
    • The information about directors, executives, and their connected persons related to the business thus execution of PTT Chemical or its subsidiaries, is required by the regulation of connected transactions, thus the directors and executives shall perform their fiduciary duties without vested interests, both direct and indirect, in their decision-making. Therefore the information contained in connected transaction reports benefits the performance monitoring of directors and executives for conformance to the principles and law, section 89/14 of the Securities and Exchange Act B.E. 2535 (1992), amended by the same act (No. 4) of B.E. 2551 (2008).

    At their meeting No. 4/2009 of 19 June 2009, the Board reviewed the criteria, procedures, and declaration forms for directors, executives, and connected persons, effective from 1 July 2009, which has been carried out ever since. The first report is requested upon their appointment, and to be followed when such information changes. The report will also be reviewed by annual report at year end. The Company Secretary is to compile such reports and provide copies to the Chairman and the Chairman of the Audit Committee each time a report is made.

    Disclosure Channels

    • The Company’s key, current and complete information in line with the corporate governance practices are disclosed through Form 56-1 and the Company’s website (www.pttchemgroup.com, available in Thai and English). Access is open for questions and information downloads.
    • The website is regularly updated with current information and links to all Departments.
    • The Company’s Vision, Mission, Goals and Financial Performance have been disclosed internally and externally by the President & CEO. For external communication, there are press conferences, interviews and presentations of views under the year plan or on particular occasions/situations.
    • Internally, the President & CEO communicates the information through the annual conference to all employees of companies in the PTT Chem Group, providing them an opportunity to meet executives management, learn and understand the Group’s guidelines and business direction. Internal communication is carried out continually.

    Information Disclosure Channels and Responsible Parties

    • An Investor Relations department has been established and appointed with a vice president of the department. The department is closely supervised by the executive vice president of finance and accounting as well as the President & CEO. In 2010, Investor Relations department won Best IR award and Best CFO award in a category of industrial goods at the SAA Awards for Listed Companies 2010, hosted by the Securities Analysts Association, to give recognition to the excellence in management, presentation, update in-depth information, and consistent effort on investor relations activities.
      • Senior executives take part in Investor Relations activities, including meetings with investors and securities analysts under an annual schedule to clarify and answer questions on the Company’s operation. Such information is clearly presented and posted on the website after each meeting. A questionnaire is also prepared to measure the satisfaction of analysts towards the performance of Investor Relations for future efficiency improvement.
      • As an additional channel for shareholders, individual investors and institutional investors, securities analysts, and relevant others such as SET and SEC, the Investor Relations department discloses the Company’s key information at www.pttchemgroup.com, under “Investor Relations” menu. IR department also welcomes e-mails at ir@pttchemgroup.com. The channels are posted in the Company’s media for the acknowledgment of shareholders and investors. Finally, investors and analysts can also access the Company’s information through “IR News Clipping and Press Release”.

      In 2010, the Investor Relations Department conducted the following major activities:

      • International meetings and road shows with investors in Asia, Europe, and the United States, a total of 11 meetings
      • Meetings with local individual and institutional investors.
      • Quarterly Securities Analysts Conferences to present the Company’s financial data and social responsibility after the disclosure of the financial data to the SET.
      • Arranging a total of 68 company visits and conference calls for the Company’s executives, as requested by shareholders, investors and analysts.
      • Regular reports to SET as required by SET’s corporate governance regulations and principles.
      • Addressing telephone calls and e-mails from shareholders, investors, analysts, and concerned agencies.
      • Disclose key Company notification including notifications to SET, shareholders’ meeting notices, and share prices through the Company’s website under “Investor Information”.
      • Participation in the “Money Expo 2010” during 6-9 May 2010 and “SET in the City” during 18-21 November 2010 to provide information to prospective investors and shareholders through documents and exhibitions.
    • A Corporate Communications Department is in place to communicate and announce news about corporate movement, activities, and collaboration to the media to extend the communication channel to the general public. The department is also responsible for internal communications with employees and continuingly communicates news update about the company’s strategies and business direction.

      Key activities in 2010 of Corporate Communication Department

      • Hold an annual press conference for announcing the investment plans of 2010 to the media stationed at the Ministry of Energy, Ministry of Industry, and SET.
      • Organized executive exclusive interviews to various press groups, averaging 2-3 times each quarter.
      • Together with Science & Innovation Department organized the Open Innovation event to promote the Company’s R&D technology, and invited the media to visit the Science & Innovation Center, in Rayong.
      • Invited the media stationed at the Ministry of Energy, Ministry of Industry, and SET to join the inauguration of the Emergency Control Center, which serves as the center for emergency prevention and response, together with ensuring safety, occupational health, and community environment in Rayong.
    • Appointment of a CSR (Corporate Social Responsibility) Department responsible for the communication of information, expectations, or feedback obtained from stakeholders and for analyzing such information for its impact both internally and externally to the company before handling the findings to the CSR Steering Committee of PTT Chem Group, which in turn provides policies for the outline of strategic plans. The Company’s sustainable development strategy is implemented and monitored closely in order to accomplish the objective set. The CSR steering committee then reports such performance or any issues found to the Board for acknowledgment for further improvement.

      The CSR Department also submits a sustainability report for 2010 on Global Reporting Initiative (GRI), the world’s most prevalent standards for sustainability reporting. The sustainability report is submitted along with the annual report to the shareholders and distributed to other stakeholders; it is also accessible on the Company’s website.
  • Responsibilities of the Board of Directors

    The Board plays a key role in business supervision in the Company’s best interests. Their responsibility to duties and performance is therefore a core principle of good corporate governance. Conducting their duties with integrity, transparency, and prudence, the Board not only understands the roles and responsibility required by laws, regulations, company regulations, shareholders’ resolutions, and the principles of good corporate governance, but also refrains from engaging itself in actions of conflict of interests with the company, so as to bolster the confidence of the shareholders and investors.

    • Structure and Composition

      The Board consists of Directors, Independent Directors, Sub-committees, the President & CEO, and the Company Secretary. The structure is balanced and appropriate, with due checks and balances.

      Directors

      • As of 31 December 2010, the Board consisted of 12 directors - 11 non-executives, with six being independent directors, and one executive (the President & CEO). All directors are experts with diverse managerial experience in the petrochemical and chemical industry which is the Company’s core business, as well as other disciplines of benefit to the Company, and apply such expertise, and experience to benefit the Company’s business.
      • The Chairman and the President & CEO are two distinct persons with clear separation of roles. The Chairman has performed his duty with independence, particularly in expressing his views on the Company’s performance under the Board’s policy and in the best interests of the Company, shareholders, and the country.
      • The Board has disclosed the directors’ names, profiles, credentials, experience, and shareholding through the annual report, Form 56-1, and the Company’s website.

      Independent Directors

      • The Company’s Independent Directors consists of six directors which accounts for more than one-third of the Board. All independent directors performed their duties concerning benefits of all stakeholders with fairness.
      • In 2010, the Corporate Governance Committee proposed that the independent directors should hold an exclusive meeting among themselves which enable them to express views and expectations, review their performance, and provide recommendations freely and concretely to the executives and the Board. At the first such meeting, the directors examined the composition, definitions, qualifications, and performance of independent directors under good corporate governance, concluding that these were adequate, proper, and inclusive of their performance. In addition, they provided helpful recommendations and views for the Board’s performance. They endorsed the year’s meeting plan and favored one quarterly meeting ahead of the Board of Directors meeting, each lasting about 30 minutes to an hour long.
      • The Board reviews the independent directors’ independence through past and current performances as well as their business relationships to the Company under SEC’s regulations.
      • The Board defined the definition of independent directors’ independence in line with regulations of SEC and SET. The Board also imposed stricter rules on their shareholding, which must not exceed 0.5% (SEC’s limit of 1%). All independent directors are qualified as follows:
        1. Not holding more than 0.5% of shares with voting rights of the Company, parent company, subsidiaries, affiliates, major shareholders or the authorized persons of the Company, including shareholders related to independent directors.
        2. Not being a director, involved with executive, a staff, members or consultant who receives regular salary, or an authorized person of the Company, parent company, subsidiaries, affiliates, same ranking subsidiaries, major shareholder, or of the authorized persons of the Company for the last two years prior to being appointed as independent director.
        3. Not having a blood or legally registered relationship in the form of fatherhood, motherhood, spouse sibling, and offspring, including spouse of the offspring of the executive, major shareholders, authorized persons, or nominated persons to be the executives or authorized persons of the Company and its subsidiaries.
        4. Not having business relationship with the Company, parent company, subsidiaries, affiliates, major shareholders or authorized persons of the Company which may interrupt his/her independent discretion, including not being a significant authorized shareholders or persons of any person having business relationship with the Company, parent company, subsidiaries, affiliates, major shareholders or authorized persons of the Company for the last two years prior to being appointed as the independent director. The term “business relationship” includes normal business transaction, rental, or lease of immovable property, transaction relating to assets or services, or grant or receipt of financial assistance through borrowing or lending loans, guarantee, pledge of asset as collateral, including any other similar transactions which may cause the Company or the partners of contract including any other similar transactions which may cause the Company or the partners of contract to pay debt of 3% or more of tangible net asset of the Company, or Baht 20 Million or more, of which is lower with value calculation of the related transaction. According to the announcement of the Capital Market Supervisory Board, it also includes any debt occurred during one year prior to the date that business relationship with the same person begins.
        5. Not being the auditor of the Company, parent company, subsidiaries, affiliates, major shareholders, or authorized persons of the Company and significant shareholders (holding more than 10 % of the total outstanding voting shares of the Company including those of the related person) authorized persons or partner of the audit firm which employs the auditor of the Company, parent company, subsidiaries, affiliates, major shareholders, or authorized persons of the Company for the last two years before the appointment of the independent director.
        6. Not being any professional service providers including legal or financial advisors who receive annual service fee in the amount of more than Baht 2 million from the Company, parent company, subsidiaries, affiliates, major shareholders, or authorized persons of the Company, and not being covert shareholders, controlling persons, or partners of such professional service providers for the last two years before the appointment of independent director.
        7. Not representing the Company’s directors, major shareholders, or shareholders related to major shareholders.
        8. Not operating any business with conflicts of interest with the Company, subsidiaries, or not being significant shareholders of the partnership, or not being director involved in management, an employee, a staff, a consultant who receive regular salary or holding more than 1% of the shares of the total outstanding voting shares of other companies having conflicts of interest with the Company or subsidiaries.
        9. Not having any other characteristics which may prevent the director from independently providing his/her opinions regarding the Company’s operations.

      Sub-committees

      In line with the corporate governance principles, since the Company’s formation in 2005, the Board has appointed four Sub-committees (committees). To conform to good practices concerning the composition of the Nomination Committee and Remuneration Committee, the Board ensured that most of the committees are independent directors and that the chairpersons are independent directors. The sub-committees screen critical relevant matters with prudence and efficiency as assigned by the Board. They are to regularly report their findings and their performance for the year to the shareholders through the annual report.

      1. The Audit Committee
        The committee consists of three independent directors, all of whom are knowledgeable and experienced in reviewing the reliability of the financial statements. The scope of their power and responsibility is specified in the committee’s charter. In reviewing the financial statements, the committee is always joined by the external auditor whose opinions as well as remarks and suggestions are noted in the meeting minutes. The committee’s performance was regularly reported to the Board, the annual performance appraisals were conducted, and the number of meetings was disclosed, along with the number of meetings attended by individual directors. The committees also complete the previous year’s report for submission to the shareholders in the annual report and publicize the charter on the Company’s website. In 2010, the Audit Committee scheduled one meeting with the external auditor in the absence of the management, in line with its plan for the year.
      2. Nomination Committee
        The committee consists of three directors, two of whom are independent directors, each with a three-year term. The Chairman, who is not the Chairman of the Board, is an independent director. The committee performs its assigned duties of examining the criteria and recruitment process for directors and the President & CEO, and selects persons under the recruitment process prescribed with independence and transparency in the Nomination Committee’s charter.
      3. Remuneration Committee
        The committee consists of three directors, two of whom are independent directors, each with a three-year term. The Chairman, who is not the Chairman of the Board, is an independent director. The committee examines the criteria and patterns of compensation paid to directors and the executives with independence, fairness, transparency, and sensibility as specified in the Remuneration Committee’s charter.
      4. Corporate Governance Committee
        The committee consists of three directors, two of whom are independent directors, each with a three-year term. The Chairman is not the Chairman of the Board. Though not an independent director, the Chairman has performed his duties as assigned by the Board in considering practical guidelines for corporate governance and providing recommendation to the Board for improvements in accordance with the guidelines of SEC, SET, leading organizations and international standards.

      The Board has instituted written charters for all sub-committees, which contain the roles, duties, and responsibilities, as well as the qualifications, terms, and meeting outcomes. These information have been disclosed in the corporate governance manual and the Company’s website.

      The Company Secretary

      • At its meeting No. 4/2008 on 20 June 2008, the Board appointed Mrs. Walaiporn Puspavesa, Vice President, Corporate Governance and Secretariat, under the Corporate Affairs Department, as the Company Secretary under the Securities and Exchange Act, based on her knowledge and experience to perform the duty for the benefit of the Company, the Board and shareholders.
      • In performing the duty, aside from regulatory requirements like the preparation and documentation of directors’ certificates, the Board’s meeting dates, the Board’s meeting minutes, shareholders’ meeting notices, the Company’s annual reports, and accumulation and maintenance of connected transactions having been reported by directors and the executives, the Secretary also ensures that the Company and the Board observe the Company’s regulations, relevant laws and regulations and corporate governance practices. The Secretary organizes the meetings for the Board, Sub-committees, shareholders, Top Team, subsidiaries’ Board and shareholders; notifies the directors and executives of rule amendments; supports/co-ordinates training for the directors and executives in relevant areas; and supports activities related to the Board.
      • The Company Secretary attends training, seminars and clarification, and gives opinions on issues raised by the regulatory body that oversees listed companies, which will boost the efficiency of the functions and the Company’s corporate governance. Shareholders can contact the Company Secretary via e-mail: cg@pttchemgroup.com.
    • Director Nomination and Appointment

      The Board has defined a formal and transparent recruitment procedure for directors, whereby the Nomination Committee performed its duties for the confidence of shareholders and all stakeholders in recruitment and nomination process for Director and the President & CEO, a process undertaken with transparency and conformance to the defined criteria and procedures for the Board’s consideration and shareholders’ approval, whichever is the case. This is to ensure that the Board consists of knowledgeable, capable and experienced persons in diverse fields to benefit the Company’s operations. The Board has made it possible for shareholders to nominate suitable persons ahead of the AGM.

    • Terms of Directors
      • As stated in Company regulations, each director’s term is three years in line with the Public Company Limited Act. The Board allows the Audit Committee to serve no more than two consecutive terms unless the Board sees otherwise. As for other directors and members of the sub-committees, the Board will ensure that Company practices align with the good corporate governance principles.
      • Recognizing the limit to the efficiency of directors, the Board takes seriously the number of companies where Company directors also serve. The policy is outlined, allowing directors to serve no more than five listed companies. If the number exceeds this limit, taken into consideration are the suitability to the nature and condition of the Company’s business and the fact that they should emphasize companies in which the Company invests in. The Company discloses the positions of each director in other companies in the annual report, Form 56-1 and the Company’s website.
      • The Board has defined the policy and procedures for serving as directors in PTT Chem Group for executives (Top Team) from the rank of vice president upward. The President & CEO has the delegated authority to consider the suitability of such terms and the number of companies each can serve, so as to align the business direction and strategy with the policy of PTT Chem Group.
    • Segregation of Roles

      The Board has devised a written code of the Board and the executives’ authority and responsibilities for the benefit of supervision, examination and assessment as follows:

      • The Board has clearly separated the authority of the Board and the executive through the Board’s resolutions which are translated into guidelines on the financial authority and the authority to decide on matters of the President & CEO. The President is empowered of such matters on a written endorsement, valid for three years at a time.
      • To achieve the Company’s goals, the Board has decided on its proactive roles, duties, and responsibilities. It reviews and endorses critical operational matters, namely its vision, mission, strategies, financial goals, risk management, operating plans, and budgets. Such matters are first screened by the Top Team, consisting of the President & CEO, Senior and Executive Vice Presidents from different departments and value centers before submission to the Board. The Board has ensured that the executives regularly follows the policy and operating plans.
    • Duties and Responsibilities of the Board
      • The Board’s leadership is illustrated through the outlining and reviewing of the vision and business mission at the meetings, based on the analysis of internal and external factors which will have an influence on the operations, strengths, weaknesses, potential, and the circumstances of the organization as well as expectations of stakeholders.
      • The Board is determined to accomplish its mission, taking the benefits of the Company and stakeholders into consideration. In 2010, the Board monitored the operations through the key performance indicators devised under the Balanced Scorecard system to evaluate the efficiency and effectiveness. The executives were assigned to report the operating results and index, the comparative indicators with the goals on a quarterly and annual basis. If the results do not meet the goals, the Board devises emergency measures to ensure goal achievement.
      • Independent directors are acting independently in giving their opinions at the meetings and ensuring no conflict of interest. They are assigned to sit on the sub-committees to make sure that the matters pending the Board’s consideration are properly and efficiently screened in line with corporate governance practices.
      • The Board has instituted meetings among non-executive directors as needed to discuss managerial problems of interest, and has also instituted exclusive meetings among independent directors which enable such directors to express views, review their performance, and provided free recommendations to the management.
    • Corporate Governance Policy and Code of Conduct
      • The Board is convinced that corporate governance provides the management framework and business guidelines toward sustainable growth and confidence of stakeholders. The corporate governance policy is set, and the Board ensures communication, publicizing and monitoring of the policy.
      • The Board compiles assorted guidelines and defined acceptable behavior that serves as standard under a framework of ethics, virtue, and integrity. All employees value these and responsibly observe them.
      • The Board prepares the Corporate Governance Handbook & Business Code of Conduct and enforces them throughout PTT Chem Group. A copy of the publication has been handed to all directors, executives, and employees to master, sign their names in acknowledgment, and observe, thus illustrating the participation of everyone across the organization.
      • PTT Chemical delivers the Business Code of Conduct of PTT Chemical Group to stakeholders, including business partners, customers, lenders, joint-venture partners, and relevant agencies, and publicizes them for the interested public through the Company’s website aiming to encourage an adoption of the same principles among these business partners.
      • The Corporate Governance Committee revises the above-mentioned handbook and code of conduct every year. For this year, considering them still valid, complete, realistic under current business circumstances and international standards, and conforming to laws, criteria, and requirements, the committee approved its continued enforcement.

      Communications and dissemination of corporate governance policy

      • The Board made it compulsory for the external and internal dissemination of the corporate governance policy and Business Code of Conduct for regular communication with stakeholders through various media and channels. These are handed to all new directors, employees, and during orientation sessions.
      • PTT Chemical organizes activities to promote the corporate governance as a corporate culture to nurture knowledge and understanding of the principles and encourage real implementation at work. In 2010, the Company and PTT Group staged PTT Group CG Day 2010: The Code to Growth event to promote sustainable growth under corporate governance. These particular activities have been consistently held by PTT Group, with employee cooperation and attention; the Corporate Governance Committee also took part.

      Compliance Monitoring

      • The Board has monitored conformance to the corporate governance policy, having the Corporate Governance Committee devise the guidelines, give recommendations and oversee the corporate governance practices. The Audit Committee is also tasked to review and evaluate internal controls to ensure conformance to relevant rules.
      • The Corporate Governance Committee regularly reviews and assesses compliance through its quarterly meetings where the Company’s compliance is compared to the international-standard guidelines for listed companies. Compliance reports are submitted to the Board and presented to shareholders in the annual report.
      • A Company culture of “Integrity”, one of the company’s corporate cultures, is an act of righteousness, ethics, honesty, transparency, openness to scrutiny, delivery of promises, and fairness to all. Such value becomes a part of Company personnel’s behavior assessment in the annual performance appraisal.
    • Evaluation and Control Apparatus

      The Board has devised the following evaluation and control apparatus to ensure transparent operations for the confidence of the shareholders, investors and related stakeholders.

      Conflicts of Interest

      • The Board has devised a policy on conflict of interest as part of the Corporate Governance and Business Code of Conduct Handbook. It has also followed the recommendations of SEC on Board approvals for commercial transactions under agreements between PTT Chemical or its subsidiaries and directors, the executives, or related parties, to comply with the amended Securities and Exchange Act.
      • In approving any transaction, the Board has ensured the compliance with the criteria and guidelines with prudence, sensibility, and independence. The transparent process completely and accurately emphasizes the Company’s overall benefit.
      • In approving connected transactions, the Board demands the disclosure of the interests of directors, the executives and related parties, the transaction value, independent directors’ opinions, and others as necessary for the Board and shareholders to properly make a decision for the Company’s overall benefit.
      • The Board devises a guideline which bars “related” directors or executives or employees from considering the transactions of such persons. Any involved individual must refrain from attending the meeting, or do so only to clarify some facts. They have no right to consider or vote on the issue.
      • The Board, as advised by the Corporate Governance Committee, requires directors, executives and employees to complete the disclosure process (at the end of each year) of transactions with possible conflicts of interest, or even when no such transactions take place, starting from year-end 2009.
      • A Conflict of Interest Committee has been formed to examine reports on conflicts of interest, charged with defining the process, procedures, and examination of such reports, as well as provision of recommendations, views, and approaches for resolution or acknowledgment of findings. The task force reports to relevant agencies or the President & CEO, and reports to the Corporate Governance Committee every year.
      • In 2010, PTT Chemical developed the format of reports of conflicts of interest for all employees into online reporting through the intranet of the Group for convenience and speed, in addition to cutting down on the use of paper.
      • Internal Audit is in charge of handling complaints in regard to the Business Code of Conduct from whistle-blowers. Such complaints can be filed when an improper action violates the Code of Conduct, and there are measures to protect the whistle-blowers throughout and after each investigation.

      Internal Controls and Internal Audit

      • The Board values internal controls. The Audit Committee is assigned to review the internal control system for sufficiency and appropriateness to business conditions, as well as operating effectiveness, and report to the Board and shareholders.
      • The Board also set up Internal Audit as a separate department, responsible for the assessment of the adequacy and effectiveness of internal controls on the operations and activities in line with the annual audit. By regularly report to the Audit Committee to promote the effectiveness of the control environment, risk assessment and control activities under ethical and standard internal audit standards for the independence and quality of internal controls.
      • The Audit Committee submitted the findings of its assessment of the 2010 internal control to the Board at its meeting No. 2/2011 on 24 February 2011. The committee made recommendations to the executives in continuing on the improvement of internal controls. Acknowledging the recommendations, the Board considered the Company’s internal control as shown by each element of internal controls and detailed below.
        1. Control Environment:
          Overall, this is suitable and contributes to the system’s adequacy and effectiveness. For instance, the Company issued a written policy and procedure on integrity and ethics by defining a policy on good corporate governance with international standard. The Board, executives, and all employees must observe the principles shown in the Corporate Governance and Business Code of Conduct to maximize the shareholders’ interests while being responsible to all stakeholders—whether shareholders, customers, business partners, lenders, the public sector, employees, communities, society, or the environment. In conducting their business, they must have transparency and be open to scrutiny. The Company’s goal is to be an internationally recognized leading operator in chemicals, petrochemicals, public utilities, and auxiliary services, marked by reputation and efficient management that can bolster confidence among the stakeholders, thus leading the Company to sustainable progress.
          • By analyzing employees’ educational background and required skills, the Company assesses their competencies to ensure that they are knowledgeable, skillful, and competent to perform their assignments.
          • By defining the structure of the Board and the Audit Committee that gives them independence of the management, PTT Chemical ensures that the Board supervises and monitors the management’s execution against the defined policy and goals, that financial reports are credible, that internal audit and internal control systems are adequate and effective, and that disclosure of connected transactions are properly done.
          • Executives possess a work philosophy and style characterized by good attitudes supporting performance in accounting, information management and human resource management systems, monitoring and assessment, internal and external audits, as well as the implementation of the Risk Management for key business operation.
          • In place is a clear and suitable organization structure with lines of command, complete with written delegation of responsibility and consistent modifications for prevailing business circumstances.
          • Defined in writing are its policy and management procedures for human resource management, including recruitment selection, training, promotion, and awarding of benefits, to boost morale and preserve a good work ambience.
        2. Risk Assessment:
          with the Risk Management Committee at the executive level who are responsible in supervising risk management. Risks on business and achievement of strategic objectives are assessed under the criteria stated in the risk management manual. Mitigation plans are defined toward off or reduce risks in manageable levels. A mechanism is also in place to track actions under risk management plans or action plans every month and report the findings to the Audit Committee every quarter.

          In 2010, such risk management mechanism was in place to reduce controllable risks to manageable levels through corporate risk management, which could affect the outcomes of corporate KPIs. Under the scheme, three aspects of risks were monitored and reported:
          • Risks to Company performance for 2010
          • Risks to achievement of Company objectives under the Balanced Scorecard of 2010
          • Risks to Company growth under its long-term investment plan (Project Risks).
        3. Control Activities:
          Overall, the Company commands suitable, adequate, and effective control activities. A policy and procedures have been defined in writing along with work instructions to ensure implementation success. Control activities indicate work-related risks to make employees more careful and thus achieve success, for instance:
          • Management controls: The objectives are defined in writing to inform all employees about business achievement objectives, complete with mechanisms for action planning as well as allocation of resources, budget, and manpower. Defined work processes and monitoring effectiveness, together with conformance to laws, regulations, and standards.
          • Internal controls for accounting and finance: Instituted is a process for examining the accuracy and completeness of account entries and preparation of financial reports, stewardship of properties, and examination of cash advancement items and connected transactions. There is proper segregation of duties for accounting and finance.
          • Internal controls for procurement and hiring: Instituted are rules and requirements which spell out duties and responsibilities under the procurement and hiring process.
          • Internal controls for human resource management: A recruitment process is in place for personnel with desirable competencies, as is a compensation system characterized by suitability and fairness. Duties and responsibilities are defined along with a system for providing information and an adequately efficient communication system.
          • Internal controls for information technology: Controls are in place for conformance to applicable laws and control activities.

          Enterprise resource planning (ERP) - a system designed to control all work processes under all Company functions and to link all information from relevant functions to a central database - has been introduced to its business execution. In addition, the Company has developed a procurement system that relies on the ARIBA software, a customer relationship management (CRM) system, and a supply chain management (SCM) system for more efficient and effective control.

        4. Information and Communication:
          Instituted is an information system for operation, financial reporting and execution, policies and rules for controlling and executing Company activities, apart from information from external sources. The company also communicates to executives and company user with user-friendly formats for efficiency and effectiveness. Also put in place are internal and external communications that enable PTT Chemical to achieve its goals. Finally, modern IT support is establish for the management of the Company’s key data.
        5. Monitoring:
          Instituted is a monitoring process in support of business goal achievement, as well as adequately effective internal controls—for ongoing monitoring activities and separate evaluations. Ongoing monitoring activities include monthly monitoring of execution under strategic plans at BSC Monitoring meetings, weekly top management meetings, internal tracking, review meetings of the quality/safety/occupational health/environment standards, and monthly monitoring of subsidiaries’ execution to report to the executives. Separate evaluations include internal audits, assessment of quality/safety/occupational health/environment standards, and meetings with the external auditor.
    • Risk Management
      • The Board has defined a comprehensive risk management policy, processes, and guidelines throughout the entire organization in the Corporate Governance and Business Code of Conduct Handbook. The Audit Committee is assigned to review the system to ensure effective risk management and acknowledge risk management reports before presenting to the Board at its quarterly meetings or when irregularities emerge.
      • The Board has devised a risk management monitoring and reporting system, requiring reports on risks to PTT Chem Group’s financial performance, goal achievement as stated on the Balanced Scorecard, and the Company’s long-term investment plan, or when any incident that may cause significant risks arise.
      • The Risk Management Committee, chaired by the President & CEO and having the executives as members, is responsible for formulating a corporate risk management policy and framework so that the risk management aligns with business goals with maximum efficiency. The corporate risks are charted during the top-down approach in formulating business plans to complement the strategic planning on corporate risk monitoring and management. The committee is also tasked to endorse the Company’s regular risk management reports for submission to the Audit Committee and eventually the Board. Details appear under “Risk Management and Risk Factors”.
    • Board Meetings
      • In 2010, the Board held nine meetings. The number of Board meetings is compatible with the directors’ performance and the nature of Company business. Directors’ individual attendance records are disclosed as required by SEC. Each meeting took 2-3 hours on average, depending on the agenda.
      • The Board fixes meeting dates and times for the year and informs all directors in advance so that each may schedule his/her attendance at the meetings. Other extraordinary meetings are scheduled as needed. If a director cannot attend a meeting, he or she must send a notification of absence to the Chairman. The agenda items are jointly decided by the Chairman and the President & CEO. The Company sends meeting notices with an agenda along with complete and sufficient documents in advance. Each director maintains independence and may also propose matters they consider important and also request further information from the President & CEO, who serves as Secretary to the Board. The Chairman should allow adequate time for management presentations and discussions by the Board. Directors with potential conflicts of interest must neither attend meetings on their conflicts of interest nor vote on those issues.
      • The prepared minutes of each meeting, with complete significant details, are to be prepared by the Company Secretary and approved at subsequent Board meetings and signed by the Chairman of the meeting. Storage of the minutes must be in both hard copies and the electronic form for convenient search. A mechanism is in place to prevent alteration without the knowledge of the Board.
      • The executives delivers significant documents/information to the Board regularly and encourages non-executive directors to hold their own meetings in the absence of the management to discuss concerns and problems of interest. To this end, the Corporate Governance Committee has provided a practical approach, including meeting before the full Board meeting, to come up with recommendations or deliberate other matters jointly.
      • The Board encourages non-executive directors to discuss among themselves as necessary without the management involved. The Audit Committee hosts the meeting with the external auditor without the management involved at least once a year. The other sub-committees (the Nomination Committee, the Remuneration Committee and the Corporate Governance Committee) may have separate meetings with relevant individuals without the participation of the President & CEO, to promote independent consideration.
    • Assessment of Board Performance
      • The Board institutes annual assessment to allow it to review its own performance, problems, and obstacles during the past year.
      • In 2010, at the recommendation of the Corporate Governance Committee, it reviewed the annual Board of Directors assessment form to align with the assessment approach of conformance to good corporate governance principles and the CG rating criteria adopted by assorted agencies so as to show assessment scores in more detail. Views on directors’ performance are of five levels: over 85% (excellent), over 75% (very good), over 65% (good), over 50% (satisfactory), and under 50% (need improvement).

      These levels applied to all three assessment types: entire Board, individual self-assessment, and cross-assessment. In addition, topics and questions contained in the form have been improved to align with OECD standard criteria and those of SET for the benefit of upgrading the development of the Board’s future performance.

      The Board has the following opinion on the overall assessment;

      Assessment of the entire Board: encompassing the Corporate Governance Committee’s policy formulation and guidelines to take care of stakeholders, the Board’s opinions on the structure and composition of the Board, performance in the past year, the meetings and the Board’s meeting attendance. In summary, the Board considered its performance appropriate and excellent, with an average score at 89.19%, versus 85.85% in the previous year.

      Self-Assessment: on each director’s performance in line with the regulations, the role in commenting on the vision, mission and the operations, teamwork spirits, and meeting attendance. In summary, the Board’s self-assessment showed that the directors performed excellent duties with an average score of 89.33%, versus 87.61% in the previous year.

      Cross-assessment: was first implemented this year to assess other directors’ knowledge, business experience, participation in giving opinions on risk management and the management, independence and integrity, as well as dedication to the job.

      The Board’s view was that the directors commanded expertise, competency, and suitability for their performance, with an excellent average score of 90.34%, versus 89.75% in the previous year. Based on the assessment of the Board in 2010, the Company has applied assessment outcomes, helpful recommendations and views to the improvement and support of Board performance for greater effectiveness.

    • Assessment of Audit Committee Performance

      The Audit Committee assessed its performance in 2010 to review how it had performed against the assigned scope of responsibility, and reported the following findings to the Board:

      • Assessment of the Audit Committee covered the eight areas under the jurisdiction, namely its charter; composition; meetings; training and resources; responsibility; relationship with the head of internal audit/external auditor, and the executives; reporting to the Board and shareholders; and quality assurance. Three grades were involved - not practiced, partly practiced, and fully practiced. In summary, most of the Audit Committee members fully practiced their performance.
      • Individual self-assessment covered five areas, namely business knowledge; specialty; independence and fairness; appreciation of duties and responsibility; and dedication to office and meetings. Three grades were involved - little, moderate, and considerable. In summary, most areas were rated as considerable and none rated as little.
    • Directors’ Compensation
      • The Remuneration Committee formulates clear policies and criteria for fair and reasonable directors’ compensation, and tables them before the Board, which then seeks approval from the shareholders. The decision process for such compensation is transparent and the compensation amounts are approved by the shareholders.
      • The compensation structures/components are fair, suit individual directors’ responsibilities, reflect the Company’s performance, and are comparable to industry peers. Each director that also serves as members of the sub-committees members duly receives additional compensation.
      • The Board discloses the types and sums of compensation given to each director, as well as compensation for directors serving as directors of PTT Chemical’s subsidiaries, as required by position and responsibility in line with stated policies.
      • In 2011, the committee initiated the idea of including the Board’s annual performance assessment outcomes, which reflect its responsibilities for meeting attendance and participation in the defining of company vision, strategies, as well as business plans – as a component of the Board’s bonus consideration for the following year.
    • Compensation to the President & CEO
      • The Board requires the annual assessment on the President & CEO’s performance, based on the Company’s financial performance, which reflects the President & CEO’s management potential and ability in achieving management goals in the past year and managing the organization’s potential. Including President & CEO’s performance against the Board assigned tasks, social responsibility, and networking ability.
      • The Remuneration Committee decides the assessment criteria for the President & CEO for the Board’s approval.
      • The Remuneration Committee appraises the performance of the President & CEO and decide on his compensation in line with the preliminary assessment findings, which is to be tabled for the Board’s consideration. The Chairman is to communicate the Board’s decision to the President & CEO.
      • In 2011, the committee will require meetings with the President & CEO for periodic performance assessment.
    • Development of Directors and the Executives

      The Board’s policy and means of training for directors are in place for both new and current ones, as well as senior executives appointed to serve as directors of PTT Chem Group. It also regularly disseminates the regulations and practical guidelines of SEC and SET to all of them by the following methods.

      New directors: PTT Chemical has instituted an orientation for all new directors, where information/knowledge is provided on the roles of directors along with other helpful documents for the mastering of PTT Chem Group business. Visits to the Company’s and related companies’ plants and meetings with the executive teams are also arranged. New directors are also encouraged to undergo IOD directors’ training.
      Current directors: Continuing education is provided to these directors through sponsorship of relevant training courses. Directors are encouraged to take courses on the director’s roles. In 2010, the Company’s directors underwent IOD training in their organized courses, with others to do the same in 2011.
      Management executives: These executives are continually trained in relevant laws and regulations that are helpful to their performance in the management role. The directors of PTT Chem Group are also encouraged to attend directors’ courses at IOD.
      Relevant parties in corporate governance: The Company Secretary, the secretary to the Audit Committee, officers engaged in investor relations, and those doing relevant jobs, regularly attend assorted training courses and sit in on seminars on relevant and current topics, and topics that are helpful to their performance organized by SEC, SET, Listed Companies Association, IOD, and other external, related agencies.

      In 2010, the Board, executives, and relevant employees continually underwent training and seminars (both internally and externally organized) to enhance their expertise for work, as summarized below.

      Name Course Institution
      Gen. Winai Pongpirodom Director Accreditation Program Class 86/2010 Thai Institute of Directors Association (IOD)
      Pol. Gen Nopadol Somboonsub PDI Class 5 King Prajadhipok's Institute
      Mr. Somchai Kuvijitsuwan Capital Market Academy Leader Program Class 9 Capital Market Academy
      Mr. Veerasak Kositpaisal Capital Market Academy Leader Program Class 11 Capital Market Academy
      Board of Directors Seminar on Governance Risk and Compliance Integration Pricewaterhouse Coopers
      Relevant parties in Corporate Governance Seminar on Connected Transaction and the acquisition or disposition of assets The Stock Exchange of Thailand
    • Succession Plan

      The Board values succession plans and development plans for executives to succeed top management. For the continuity of management and selection of personnel with the capability and readiness to assume critical positions, the Company has instituted requirements for human resource management and criteria for position successors, based on career management principles and talent management & succession planning. To this end, high-capability people are chosen in writing so that they may acknowledge and understand the extent of development, together with the actions they need to take so as to grow with the organization, which will enable the Company and PTT Chem Group to efficiently achieve their future strategic goals.

In following the good corporate governance principles, aside from the commitment of the Board, executives and employees in further promoting corporate governance, the Company received support and valuable recommendations from listed companies regulatory and assessment organizations like the Office of SEC, SET, the Thai Listed Companies Association, IOD, and Thai Investors Association, all of which share the objectives and mission of raising corporate governance to international standards, which will enhance Thailand’s competitiveness in the global arena and for stable and sustainable development.

 

 



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