Good Corporate Governance

The Board of Directors has implemented and complied with the good corporate governance principles which are in line with the established policy and the legal requirements. The Board realizes that corporate governance is concerned with relationships among different groups including the Company’s Board of Directors, management, shareholders, society and all stakeholders. It also realizes that the Company needs to implement corporate social responsibility activities continuously. As a result, the good corporate governance serves as a foundation for the organization’s sustainable growth and stability. Having good governance standards as well as efficient and transparent management help enhance the Company’s competitiveness and build investor and stakeholder confidence.
Based on the Corporate Governance Report of Thai Listed Companies 2011, the appraisal results of the Company are as follows:
1) The Company receives an “excellent” score for the organization of its annual general meeting of shareholders. The appraisal was conducted by the Thai Investors Association (TIA).
2) The Company receives a “good” score for its corporate governance. The appraisal was jointly conducted by the Thai Institute of Directors Association (IOD) to corporate with the Stock Exchange of Thailand (SET), the Office of the Securities and Exchange Commission (SEC).
In order to raise the level of its good corporate governance, the Company has established the following guidelines on good corporate governance:
1) Establishment of Corporate Governance Framework
         To support the implementation of the good corporate governance, the Board of Directors has developed a corporate governance framework with details as follows:
Leadership and Vision
          The Company has put in place a system that clearly separates the roles and responsibilities of the Board of Directors and those of the Executive Committee. In this connection, the Board of Directors has also established clear business goals which are specific and measurable. The goals serve as guidelines plans in the best interests of the Company. The Board of Directors will appraise the results of the implementation carefully and regularly, by measuring the performance of the management against the established goals. In case there are differences between the performance and the established goals, causes contributing to the differences will be identified and corrective actions will be taken to eliminate or minimize the difference. The Board of Directors will meet at least four times annually.
Code of Conduct
         The Board of Directors has developed the Code of Conduct. The purposes are to maintain the standards of the good corporate governance and to make the good corporate governance as a key part of the corporate culture. Both the management and the staff are already informed of the Code of Conduct which they are required to adhere to strictly. Under the Code, they are required to carry out their duties in an honest and transparent manner, taking into account the interests of the Company and all groups of stakeholders. Importantly, they will also be involved in socially responsible activities which support communities. In dealing with competitors, they will not use deceitful or unethical means. Instead, they will develop their potential to the effect that the Company’s market competitiveness in enhanced, As regards confidentiality, they will not disclose trade secrets and confidential information of the Company to outsiders or other staff without getting prior permission from the authorized offices concerned, The Confidential information includes, among others, information about the Company’s customers, suppliers, trading partners, and personnel. Moreover, they need to preserve the rights of customers by being responsible for the quality of the products and the delivery of the products to the customers in a timely manner, taking into account the long-term impact.
Merger and Separation
          The Chairman of the Board of Directors is not the same person as the Managing Director. On the other hand, the Chairman is an independent director in accordance with the Stock Exchange of Thailand’s definition. As well, the Chairman has no relationship whatsoever with the management. Moreover, as a checks and balances mechanism, independent directors make up one-third of the Board of Directors.
Internal Control and Audit Systems
– Organization and Environment
The Company has put in place an organizational structure that clearly separates functions as well as roles and responsibilities of different organizational units. The objective is to enable the management to carry out their duties in an efficient manner. In addition, the Board of Directors has established clear business goals which are specific and measurable. They serve as guidelines for the staff in performing their duties.
– Risk Management
The Company has assessed the risks arising due to factors that are internal and external to the organization. As a result, it has purchased foreign currencies in advance in preparation for future settlement of outstanding debt obligations. As well, it has purchased insurance policies that cover all of its products in the warehouses and those being delivered to customers. It has also purchased insurance policies that cover both its immovable and movable properties. In addition, it has established rules on the user of computers, with which the staff are required to comply. Importantly, it has formulated a business continuity plan which results in the establishment of a backup center. This center can resume work immediately in an event that an emergency takes place at the Company’s office.
– Management Control
Management Control is an important activity for the Company. It helps ensure that the policies and plans established by the management have been supported and implemented by all the Company’s employees. As well, the delegation of authority and authorization limits have been clearly established and put in writing, taking into consideration the various positions of the responsible executives concerned, form the top downwards through the chain of command.
– Information Technology and Communication
In submitting matters to the Board of Directors for consideration, the Executive Committee shall arrange for adequate material information to support the decision making of the Board of Directors. In keeping documents that support accounting entries and accounts, the Company has kept all the documentation in appropriate files based on proper classification and indexing systems. The Company has never been notified by the auditor of any problem on this matter. As regards the accounting policies, the Board of Directors finds that the management has adopted generally accepted accounting policies which are appropriate to the Company’s businesses. Moreover, in relation to the computer file backups, the Company has established a clear rule on the file backup, which the staff concerned are required to comply with.
– Monitoring Systems
To ensure efficiency and effectiveness of business operations, the Company regularly compares the actual performance with the established business goals. In the past year, Ernst & Young Office Ltd. Conducted a study to assess the efficiency of the Company’s internal control systems as it deemed appropriate for the purpose of determining the scope of auditing. It appeared that the auditor did not find any significant weaknesses in the internal control systems.
2) Rights and Equitable Treatment of Shareholders
        The Company recognizes the rights of shareholders in line with the good corporate governance. As a result, it treats every shareholder fairly and equitably. It provides the shareholders with adequate information and convenience in all areas, to enable them to attend the shareholders meetings, exercise their voting rights and give their opinions at the meetings.
3) Rights of Stakeholders
        The Company fully realizes that, to achieve sustainable growth, the organization needs to recognize the importance of the rights of all groups of stakeholders including customer groups, the management, employees, trading partners, shareholders and investors, independent auditors, the public sector, and the community in which the Company is located, competitors and lenders.
        As a result, the company supports collaboration between the Company and the various groups of stakeholders in a systematic manner and in line with the legal requirements, taking into account the Code of Business Ethics. Such collaboration brings about confidence and satisfactions of all the stakeholders concerned.
4) Information Disclosure and Transparency
        The Board of Directors places strong emphasis on the disclosure of its material information including its business performance, both monetary and non-monetary, ensuring that the disclosed information is accurate, complete, timely and transparent. To be fair to all parties concerned and to comply with legal requirements, the Company disseminates information via the Stock Exchange of Thailand’s distribution channels and media as well as via the Company’s website ( The objective is to disseminate information to investors and stakeholders directly.