The Company has the policy to comply with the code of best practice to enhance transparency and for the benefits of the Company’s business operations, as well as to build trust among the shareholders, investors and all parties. The Board of Directors has thus formulated the corporate governance principles which shall be used as a guideline for the conduct of good governance as stipulated by the SET. The Company’s corporate governance principles consist of five chapters as follows:
Chapter 1 The Rights of Shareholders
The Company realizes the importance of fundamental rights of its shareholders as company owners and investors, such as right to buy, sell or transfer their held securities, right to receive sufficient Company’s information, right to profit sharing from the Company, rights at a shareholders’ meeting, right to express opinions, and right to make joint decisions for such critical matters as dividend distribution, director appointment and removal, auditor appointment, approval of transactions critically affecting the direction of the course of its business operation, etc.
In addition to the fundamental rights above, the Company has carried out several matters to facilitate the right exercise by shareholders as follows :
- An annual general meeting will be held every year within four months from the end of each fiscal year, with a notice of meeting and agenda supporting documents sent to the shareholders seven days prior to the date of meeting and put on a newspaper informing the date of meeting for three consecutive days in advance of the date of meeting, and each agenda accompanied with the Board’s opinion.
- The agenda supporting information will be posted in advance on Company website, with clarification about shareholders’ rights to attendance and voting.
- If a shareholder is unable to attend the meeting, he/she may delegate one of the independent directors or any other person to attend on his/her behalf using any one of the forms delivered together with the notice of meeting.
- Prior to the meeting, shareholders are given an opportunity to submit their opinions, suggestions and questions through the Board Secretary to the Company.
- At the meeting, shareholders are given opportunities to pose questions, give suggestions, or express their opinions to the meeting on various issues independently and equally. A shareholder meeting will be attended by relevant directors and executives to provide answers and detailed information.
Chapter 2 The Equitable Treatment of Shareholders
Every shareholder is given equal opportunity. Voting rights at a meeting are determined based on the number of shares. One share is associated with one vote. No action is taken to restrict or violate or deprive of the rights of major, small, institutional and foreign shareholders. The independent directors are assigned to take care of small investors who can pass their suggestions and opinions or complaints to the directors for their appropriate actions taken. For complaint, as an example, the directors will carry out to verify the facts and find out an appropriate corrective action. For suggestion essentially affecting stakeholders as a whole or the Company’s business conduct, it will be proposed to the shareholder meeting for its consideration of inclusion thereof as agenda therein.
The meeting is conducted in conformity with the Company’s Articles of Associations and based on the order of the agenda, each of which is accompanied by complete details. No additional matters are submitted to the meeting without informing the shareholders in advance, in particular the agenda that requires time for consideration and decisions. In the case where a shareholder is unable to attend the meeting, he/she is given an opportunity to authorize one of the independent directors or any other person to attend on his/her behalf using one of the proxy forms delivered together with the notice of meeting. Voting will be conducted transparently based on the specified order of agenda. In the appointment of directors, shareholders are entitled to vote for each director individually.
In addition, an Insider trading protection measure has been established for such concerned individuals as directors, executives, and employees in those departments related to inside information (including their spouses and minors) to be prohibited from trading Company securities for the period of at least one month prior to disclosure of quarterly and annual financial statements and to wait for at least 24 hours after such disclosure to the public and to be prohibited from disclosure to others.
Directors and executives are informed of their obligation to report their securities holding in the Company and of the penal clause pursuant to the Securities and Exchange Act B.E. 2535 (1992) and to the SET’s requirement. In the event of Company securities trading by directors or executives, they are required to report to the SEC for dissemination to the public within three business days in accordance with Section 59 of the Securities and Exchange Act B.E. 2535 (1992) their shareholding in the Company, including those of their spouses and minors.
Chapter 3 The Role of Stakeholders
Importance is given to the rights of all groups of stakeholders, consisting of such internal ones as Company employees and executives and such external ones as competitors, partners, customers, etc. Realizing that supports and comments from all groups of stakeholders benefit the Company’s operation and business development, the Company will comply with the applicable laws and requirements to ensure that the rights of such people are well maintained. Besides, the Company has promoted cooperation with each stakeholder group in order to strengthen its status based on the following directions :
- Shareholder : The Company has focused on development for consistent growth, which will accordingly boost its income and profit, hence higher value and maximum yields to its shareholders.
- Customer : The Company has taken into account product quality and standards, and taken good care of and been responsible for customers with honesty and fairness.
- Trade Partner : Trade partners have been treated fairly in conformity to the Company policy and trade conditions and/or mutual agreements to create good business relationships that will benefit all parties.
- Competitor : The Company has promoted free and fair competition, and been adhered to good competition rule and framework.
- Employee : The Company has a policy to treat every employee equally and fairly, with appropriate remuneration and welfare, and knowledge and competency development.
- Community & Society : The Company has given importance to responsibility toward communities and the society. It has operated its business with code of ethics and supported appropriate activities that will contribute, and be constructive to, the society.
- Environment : The Company has complied strictly with environmental laws and ordinances and put in place a continual environmental impact control guideline.
The Company will comply with the provisions of applicable laws, rules and ordinances to ensure that the stakeholders’ rights are well maintained.
Chapter 4 Disclosure and Transparency
The Company is fully aware of the importance of proper, complete and transparent disclosure of both financial and general information in accordance with the rules of the SEC and the SET, as well as such other information as essentially affecting Company securities price, all of which can influence the decision process of the investors and stakeholders. Accordingly, company information is disseminated to its shareholders, investors and the public through several channels including information channels of the SEC and the SET, and the Company’s website www.chowsteel.com.
With respect to investor relations task, an Investor Relations Department was established for the purpose of communicating with investors, shareholders, analysts and public sector concerned. The Board of Directors is responsible for financial statements and financial information appearing in the Annual Report. The financial statements have been produced pursuant to the generally accepted accounting standards for Thailand, with accounting policy appropriately selected and regularly used throughout the operations, including adequate disclosures in the financial statements. In this regard, the quality of the financial statements and internal control, including adequate disclosures in the notes to financial statements, will be reviewed by the Audit Committee.
Chapter 5 Responsibilities of the Board of Directors
- Structure of Board of Directors
The Board of Directors is composed of knowledgeable and capable persons who play an important role in defining policies and overall directions of the organization, and play an important role in independently supervising, inspecting and evaluating the results of operations of the Company in compliance with the set plan.
Currently, there are 10 Board members comprising three managerial directors and seven non-management directors. Four of the said seven members are independent directors with the purpose of balancing the voting in matters for consideration. There is an Audit Committee consisting of four independent directors whose duty is representing the shareholders in supervising the course of operation of the Company for appropriateness and transparency.
According to the Articles of Association, at an annual general meeting one-third of the directors shall retire by rotation. If the number of directors is indivisible by three, the one nearest to one-third shall apply. Directors due to retire by rotation in the first and second anniversary of Company registration shall be determined by drawing lots. For subsequent years, those directors being in office the longest shall vacate his office. However, the directors who retire by rotation may be re-elected to resume their directorship.
Besides, the Board of Directors formed four sub-committees comprising the Audit Committee, Executive Committee, Nomination and Remuneration Committee and Risk Management Committee to perform specific duties and propose matters to the Board of Directors for consideration and acknowledgment. Each sub-committee has its own rights and duties as designated.
The duties and responsibilities between the Board of Directors and executives are clearly separated. The Board of Directors has the duty to define policies and supervise the operation of policy level executives, while executives have the duty to manage the Company’ work in compliance with the set policy. Accordingly, the Chairmen of the Board and executives are different persons and both types of positions are subject to selection by the Board of Directors to ensure most suitable persons.
The Company has a Board Secretary to provide the Board with recommendations about rules and regulations that need to be known, to oversee Board activities, and to coordinate compliance with Board resolutions.
- Role, Duty and Obligation of the Board of Directors
The Board of Directors is composed of knowledgeable persons having skills, expertise and leadership from diversified areas. The Board of Directors takes part in defining vision, mission, strategies, policies and guidelines for business conduct and supervising the Company’s operations in compliance with the laws, objectives, Articles of Association, and shareholder meeting resolutions. In order to enable close monitoring and supervision, several committees have been established to carry out the tasks.
- Corporate Governance Policy
A corporate governance policy has been defined in writing and agreed to by the Board meeting, with the policy and its compliance reviewed on a regular basis. In addition, after the Company’s common stocks are listed on the SET, the Company will comply in every respect with the rules and regulations prescribed by the SEC, the SET and Market for Alternative Investment (MAI), with its corporate governance report disclosed in its Annual Report (Form 56-2) and Annual Information Disclosure Report Form (Form 56-1).
- Code of Conduct
The Code of Conduct has been established for adherence by the Board of Directors, executives and employees in performing their duties with honesty, integrity and impartiality toward the Company, all groups of stakeholders, the public and society, with their compliance therewith monitored on a regular basis.
To that end, all employees have been informed of the Code, including their compliance therewith.
- Conflicts of Interest
A conflict of interest policy has been defined on the basis that any decision made in the course of business activity should inure to the best interests of the Company. To avoid any action leading to conflicts of interest, the person relating or linked to the transaction being considered must inform the Company of his/her relationship or linkage to such transaction, and not participate in the consideration and decision thereon, as well as not authorized to approve such transaction.
Connected transactions and transactions with conflicts of interest carefully considered by the Audit Committee in terms of appropriateness and in accordance with the rules of the SET and/or the Office of the SEC will be proposed to the Board of Directors and disclosed in the Annual Report and Annual Information Disclosure Report Form.
- Internal Control
The Company gives importance to internal control at both executive and operational levels. In order to enhance work efficiency, obligations, duties and authority for operatives and executives have been clearly defined in writing. The use of Company assets in meaningful ways is put under control. Duties of staff, supervisors and evaluators are clearly separated, with the Audit Committee appointed to have the duty in reviewing the internal control and internal audit system to ensure appropriateness and effectiveness. The Company has also hired external expert to monitor and examine the internal control system, and report to the Audit Committee to ensure that the core business has been conducted in accordance with the set directions and in an efficient manner.
- Risk Management
The Company has assessed sufficiency of the existing internal control system in order to remedy and improve its operations to ensure more efficiency.
- Report of the Board of Directors
The Audit Committee is responsible for reviewing the financial report with participation by the Accounting Department and the auditor. The Committee will then propose it to the Board of Directors on a quarterly basis. The Board of Directors is responsible for Company consolidated financial statements and financial information (Report on the Responsibility of the Board of Directors for the Financial Report) as appeared in the Annual Report. The financial statements are produced based on the generally-accepted accounting standards and audited by the auditor. Complete and regular disclosure of essential information, including financial and non-financial information, shall be made on the factual basis.
- Corporate Governance Policy
- Board Meeting
According to the Articles of Association, a Board meeting shall be convened at least every 3 months and additional special meetings may be held as necessary, with a notice of meeting sent out seven days prior to the date of meeting, except in urgent, necessary case to protect the Company’s interests. For each meeting, agenda and complete meeting documents must be made available and forwarded to the Board of Directors in advance for their preparation before the date of the meeting.
The Company Chairman and Chief Executive Officer will jointly define meeting agenda and consider which matters should be included as agenda items at each Board meeting. Each director is given an opportunity to suggest matters for such inclusion. All directors can discuss and express their opinions openly and the meeting chairman will then compile them and draw a conclusion from the meeting. In voting at a meeting, the Board of Directors adheres to majority of votes. One director has one vote. The director having conflicts of interest should not join the meeting and/or vote for the matter thereof. In the event of tie, the meeting chairman should have another casting vote. The minutes of meeting will be made in writing after the meeting session and kept after passing Board approval and ready for verification by the Board and people concerned.
In 2015, the Company arranged 6 Board meetings, 8 Audit Committee Meetings, 8 Executive Committee meetings, 4 Risk Management Committee meetings, 2 Nomination and Remuneration Committee meeting, and 1 the Audit Committee has a meeting with the external auditors without the person of the management. Details of each director’s attendance are shown below :
Board of Directors Audit Committee Executive Committee Nomination and Remuneration Committee Risk Management Committee 6 meetings 8 meetings 8 meetings 2 meeting 4 meetings Dr.Pruchya Piumsomboon 4/6 - - - - Associate Professor Dr.Narong Yoothanom 6/6 8/8 - 2/2 - Assistant Professor Kalyaporn Pan-ma-rerng 6/6 8/8 - 2/2 4/4 Mr. Noppadon Jason Chirasanti 6/6 7/8 - - - Mr.Kanawath Aran 6/6 7/8 - - 4/4 Mr. Sanguankiat Lewmanomont 5/6 - - 2/2 - Mr. Mark D Remijan 5/6 - - - - Mr. Anavin Jiratomsiri 6/6 - 8/8 2/2 4/4 Miss Koo Man Wai 4/6 - 8/8 - - Miss Sharuta Jiratomsiri 4/6 - 8/8 - - Mr. Satit Cheybubpha - - 8/8 - - Mr. Suttichai Suraphat 1/ - - 4/8 - -
Notes: 1/ appoint Mr.Suppachai Yimsuwan effective date on 15 May 2015
- Remuneration for Directors and Executives
The Company has appointed Nomination and Remuneration Committee, and clearly and transparently set out Remuneration Policy. Remuneration is set at the level commensurate with directors’ duties and responsibilities and sufficient for retaining knowledgeable and capable directors, subject to the approval of the Annual General Meeting of Shareholders.
Disclosure of remuneration paid to directors and executives will be made available using the form designated by the Office of the SEC.
- Director and Executive Development
The Board of Directors has a policy to provide training and knowledge to the directors involved in the Company’s corporate governance system, consisting of Board members, Audit Committee members and Executive Committee members in order for continued development in their performance of duties. In the event of new director, business operation guideline and information beneficial to his/her performance will be introduced to ensure consistently effective performance under the good corporate governance framework.
In 2015, the directors attend training and seminars as follows :
No. Name Training / Seminar topics 1. Dr. Pruchya Piumsomboon The “many issues of the Audit Committee” Annual Seminar with Ernst & Young on November 24, 2015. 2. Mr. Mark D. Remijan Director Certification Program (DCP207/2015), Thai Institute of Directors
In addition, the Company has realized the importance of human resources development to enhance optimum efficiency and effectiveness. The Company has thus set out the training and human resources development policy targeting all personnel levels on a regular basis. The Company also has work performance assessment system and key performance indicators in place to assess effectiveness at both the organization and work unit levels. Moreover, the nature of business has been reviewed and adjusted in accordance with the business work plan that should lead to staff development system. To this end, training and staff development work plan has been formulated in line with the organizational development plan. This training and staff development plan is drawn from survey of needs of all work units to ensure appropriateness and enhance work efficiency of respective units.
The company emphasizes the importance in human resources and development. From this reason, 87.08 percent of the employees was sent to the training and seminars which were 72.92 percent arranged internally by the company and 14.16 percent by outside institutions and organizations.
- Achieving the Vision
The Board of Directors of Chow Steel Industries Public Company Limited (“the Board”) strongly believes that good corporate governance will enhance the performance of the Company, and is instrumental to achieving the Company's principal objective of maximizing shareholder value.
The Board is, by law, responsible for governing the Company’s business operation, and accountable to all the Company’s stakeholders, i.e. customers, shareholders, employees, service providers and the society.
- Board Composition and Qualifications
- The Board shall be composed of at least five members, of whom no less than half shall have domicile in the kingdom, comprising:
- Executive directors,
- Non-executive directors,
- Non-executive directors, who are independent, for at least one-third of all directors and no less than three. Independent directors and related persons thereof shall hold no more than one percent of the issued and paid-up registered shares of the Company and related companies.
- All directors shall have qualifications pursuant to Section 68 of Public Limited Companies Act, B.E. 2535 (1992), notifications of the Securities and Exchange Commission, and/or notifications of the Capital Market Supervisory Board.
- Directors who are independent shall comprise persons of requisite qualifications according to notifications of the Securities and Exchange Commission, and/or notifications of the Capital Market Supervisory Board, and with proper experience being able to bring quality and fair judgments, free of bias, to all issues. They may be people from any professions considered appropriate to be directors by the Nomination and Remuneration Committee appointed by the Board to propose qualified persons for new appointments of directors.
- Term of Office and Holding of Meeting
- One-third of the directors of the Board shall be due to retire by rotation at every annual general meeting of the shareholders, whereby the directors who have been in office the longest shall vacate office first. If the number of directors to vacate office is not a multiple of three, the closest number to one-third will be applied. If an agreement for vacating office cannot be reached, a lots drawing shall be adopted. Any retiring director may be re-elected.
- The resolution of the shareholders’ meeting to appoint a director shall be passed by the majority votes under the following criteria and procedure:
- Each shareholder shall have one vote per share;
- In election of directors, each shareholder may vote to elect each candidate as a director one by one or several candidates altogether as directors as deemed fit by the shareholders’ meeting. However, in each voting, he/she shall allot all the votes he/she owns, and shall not divide his/her votes to any particular candidate or candidates.
- Election of directors shall be decided by majority votes. In case where the votes cast are tied, the chairman of the meeting shall cast the final vote.
The Nomination and Remuneration Committee shall nominate candidates for appointment as directors in replacement of directors due to retire by rotation, and shareholders will be invited to make nominations of directors before the shareholders’ meeting is held in each year.
- Any vacancy of director due to reason other than retiring by rotation, the Nomination and Remuneration Committee may nominate any person having qualifications and not prohibited under the public limited company law as director to fill the vacancy in the next meeting, unless the remaining duration of the director’s term of office is less than two months. Any person so appointed shall retain office only for the remaining term of the vacating director. The resolution of the committee shall be supported by the votes of at least three-fourths of the number of remaining directors.
- At least half of the total number of directors of the Board shall constitute a quorum of the meeting.
- Authorities, Duties and Responsibilities
The Board has duties and responsibilities in administering the Company as stipulated by laws, the objectives and the articles of association of the Company, as well as the lawful resolutions of its shareholders’ meeting, with integrity and prudence in the best interest of the Company, as follows:
- Arrange an annual general meeting of shareholders within 4 months from the end of each fiscal year of the Company.
- Hold a Board meeting, which each director is duty-bound to attend, at least once every 3 months, and also a special meeting as necessary.
- Prepare the Board’s annual report, and be accountable for the preparation and disclosure of audited financial statements to exhibit the financial position and the operating results of the Company in the previous year, which shall be submitted for the consideration and approval of the shareholders’ meeting.
- Have the authority and responsibility to perform duty in accordance with the laws, the objectives and the articles of association of the Company, as well as the resolutions of its shareholders’ meeting, with integrity and prudence in the best interest of the Company and with accountability to the shareholders on a consistent basis.
- Set the business targets, strategies, policies, plans and budgets of the Company; and control and monitor the implementation and administration of the Executive Committee to be in line with the policies assigned, aiming at maximizing the Company’s economic value and shareholders’ wealth.
- Have the power to examine, consider and approve policies, operational directions and plans in relation to the Company’s large projects as proposed by subcommittees and/or the management.
- Have the duty to monitor the Company’s performance to ensure compliance with the law on securities and securities exchange and the stipulations of the stock exchange, such as making of connected transactions and acquisition and disposal of core assets pursuant to the regulations of the Capital Market Supervisory Committee or the Stock Exchange of Thailand or other laws relevant to the Company’s business, etc.
- Consider the Company’s management structure, and have power to appoint, assign or give suggestions to subcommittees or working committees for their consideration and implementation of any issues as deemed appropriate by the Board.
- Follow up consistently the Company’s operating results in accordance with the plans and budgets, and the operation and performance of subcommittees and/or the management to ensure effectiveness in the Company’s business operation.
- Not carry on any business of the same nature as or in competition with that of the Company, nor be a partner in any ordinary partnership, or an unlimited partner in any limited partnership, or a director of a private company or another company carrying on business of the same nature and competitive to the business of the Company, whether for his/her own benefit or others, unless he/she has informed the shareholders’ meeting prior to being elected.
- Inform the Company, without delay, of any direct or indirect interests in the agreement to be entered into by the Company, or of any increase or decrease in his/her holding of shares or debentures of the Company or affiliated companies.
- Be accountable to the shareholders constantly, operate the business in the best interest of the shareholders, and ensure disclosure of information is accurate, complete, transparent, and up to the standard.
- Arrange for the Company to have in place internal audit measures to ensure there are efficient internal controls and risk management as well as reliable financial reports, with an internal audit work unit designated to follow up and implement in collaboration and coordination with the Audit Committee.
- Have power to consider and approve any issues as necessary and in relation to the Company, or as appropriate in the best interest of the Company.
The following issues shall be subject to prior approval of the shareholders’ meeting:
a)Any issue prescribed by law to require a resolution of the shareholders’ meeting; and
b)Any issue in which a director has interest and falling in the purview of the laws or the notifications of the Office of the Securities and Exchange Commission, or as stipulated by the Stock Exchange of Thailand to seek approval from the shareholders’ meeting.
Decision of the Board to carry out the following issues shall be subject to prior approval of the shareholders’ meeting with affirmative votes of at least three-fourths of the total votes of the shareholders attending the meeting and having the right to vote:
- Sale or transfer of the entire or the major part of the Company’s business to another party;
- Purchase or acceptance of transfer of the business of another company to the Company;
- Entering into, amendment or termination of an agreement relating to lease of the entire or the major part of the Company’s business, assignment of another party to manage the Company’s business, or business merger with another party, with the objective of profit/loss sharing;
- Amendment of the Company’s memorandum or articles of association;
- Capital increase, capital decrease or issuance of debenture of the Company;
- Merger or liquidation of the Company’s business;
- Any other matters prescribed under the law on securities and securities exchange, and/or notifications of the Stock Exchange of Thailand to require prior approval of the shareholders’ meeting with the above-mentioned affirmative votes.
Director who has interest in or conflict of interest with the Company and/or its subsidiary (if any) in any issue shall have no right to vote on such issue.
- Board Committees
- The Board may appoint Board Committees to assist the Board in carrying out any business under its responsibilities, including Audit Committee, Risk Management Committee, Nomination and Remuneration Committee, and Executive Committee.
- The Board will, as it may deem appropriate, consider and approve the appointment of members of the Board Committees and the charters thereof, in which the essence with regard to the composition, duties and responsibilities, administration, and other matters relating to the Board Committees, are included.
- Assessment of Board Performance
The Board is duty-bound to assess the performance of the Board every year in comparison with that prescribed in this charter. The Board will use the assessment results for the development of the charter.
The Board may seek opinion from an external professional advisor at the cost of the Company.
1. Composition and Qualifications
- The Audit Committee shall be appointed by the Board of Directors meeting or the shareholders’ meeting, and all members of which shall be Board members.
- The Audit Committee shall be composed of at least 3 independent directors, one of whom shall be appointed as the Chairman of the Audit Committee.
- The Committee members shall have the qualifications stipulated under Notification no. TorChor. 28/2551 of the Capital Market Supervisory Board regarding Application for and Approval of Offer for Sales of Newly Issued Shares, as follows:
- Hold shares not exceeding one per cent of the total number of shares with voting rights of the Company, its parent company, subsidiary company, associated company, or juristic person that may have conflict, including shares held by related persons of such Audit Committee member;
- Neither be nor used to be an executive director, employee, staff, advisor who receives salary, or controlling person of the Company, its parent company, subsidiary company, associated company, same-level subsidiary company, or juristic person that may have conflict, unless the foregoing status has ended not less than two years prior to the date of filing an application with the Office of the Securities and Exchange Commission (SEC) or prior to the date of appointment as Audit Committee member;
- Not be a person related by blood or legal registration as father, mother, spouse, sibling and child, including spouse of child, executive, major shareholder, controlling person, or person to be nominated as executive or controlling person of the Company or its subsidiary company;
- Neither have nor used to have a business relationship with the Company its parent company, subsidiary company, associated company, or juristic person that may have conflict, in the manner which may interfere with his/her independent judgment, and neither be nor used to be a major shareholder, director that is not independent director, or executive of any person having a business relationship with the Company, its parent company, subsidiary company, associated company, or juristic person that may have conflict, unless the foregoing relationship has ended not less than two years prior to the date of filing an application with the Office of the SEC or prior to the date of appointment as Audit Committee member. The term ‘business relationship’ above-mentioned shall include any normal business transaction, rent or lease of immovable property, transaction relating to assets or services, or granting or receipt of financial assistance through receiving or extending loans, guarantee, providing assets as collateral, and any other similar actions, which result in the Company or its counterparty being subject to indebtedness payable to the other party in the amount of three per cent or more of the net tangible assets of the Company or Baht 20 million or more, whichever is lower. The amount of such indebtedness shall be calculated according to the method for calculation of value of connected transactions under the Notification of the Capital Market Supervisory Board governing rules on connected transactions mutatis mutandis. The consideration of such indebtedness shall include indebtedness occurred during the period of one year prior to the date on which the business relationship with the person commences;
- Neither be nor used to be an auditor of the Company, its parent company, subsidiary company, associated company, or juristic person that may have conflict, and not be a major shareholder, director that is not independent director, executive or partner of an audit firm which employs auditors of the Company, its parent company, subsidiary company, associated company, or juristic person that may have conflict, unless the foregoing relationship has ended not less than two years prior to the date of filing an application with the Office of the SEC or prior to the date of appointment as Audit Committee member;
- Neither be nor used to be a provider of any professional services including those as legal advisor or financial advisor who receives service fees exceeding Baht 2 million per year from the Company, its parent company, subsidiary company, associated company, or juristic person that may have conflict, and, in case where the provider of professional services is a juristic person, not be a major shareholder, director that is not independent director, executive or managing partner of the provider of professional services, unless the foregoing relationship has ended not less than two years prior to the date of filing an application with the Office of the SEC or prior to the date of appointment as Audit Committee member;
- Not be a director appointed as representative of directors of the Company, major shareholder or shareholder who is related to major shareholder of the Company;
- Not have any other characteristics which would disable the expression of independent opinions with regard to the Company’s business operation;
- Not be a director assigned by the Board to take part in the business decision of the Company, its parent company, subsidiary company, associated company, same-level subsidiary company, or juristic person that may have conflict;
- Not be a director of the parent company, subsidiary company or same-level subsidiary company which is a listed company;
- Have sufficient knowledge and experience to perform duties as Audit Committee member, provided that at least one member of the Audit Committee shall have sufficient accounting and/or financial knowledge and experience to review the reliability of financial statements.
2. Term of Office and Holding of Meeting
- The Audit Committee shall have a term of office of 3 years. Any retiring member of the Committee may be re-appointed by the Board or the shareholders’ meeting.
- At least half of the total number of the Committee members shall constitute a quorum of the meeting.
- The Audit Committee shall hold 4 meetings or more each year, as may be deemed fit by Chairman of the Committee.
3. Authorities, Duties and Responsibilities
The Audit Committee shall have the same authorities, roles, and responsibilities to conduct any matters as provided in the Notifications of the Stock Exchange of Thailand (SET) governing the Qualifications and Scope of Work of the Audit Committees, as follows:
- Have power to invite the management or the officers of the Company to attend the meeting in order to clarify, give opinions, or provide documents as requested and as necessary.
- Consider, select, and nominate an independent person to serve as the Company’s auditor together with the auditor remuneration to the Board for endorsement before proposing to the Company’s shareholders’ meeting for approval, as well as evaluate the performance of the auditor.
- Acknowledge other non-audit operations and the remuneration in relation thereto to ensure independence of the auditor.
- Consider and make decision in case the management and the auditor have contrasting opinions on the financial reports.
- Consider the disclosure of connected transactions or transactions with possible conflict of interest to ensure that they comply with the relevant laws and regulations, and the transactions are reasonable with maximum benefit to the Company.
- Consider and approve the appointment, removal, transfer or termination of employment, and consider performance of Internal Audit Department.
- Consider the reports of Risk Management Committee, and discuss with the management on risk management and assessment policy.
- Attend joint meeting with the auditor, without the management’s presence, at least once a year.
- Consider the financial reports as follows:
- Review the financial reports and ensure the adequacy of the data acknowledged by the Audit Committee, and assess the appropriateness of the accounting principles applied in the annual and quarterly financial reports;
- Review the accounting issues and important financial reports, including the complex or unusual transactions which require judgment in decision making;
- Enquire the management and the auditor about the audit result, the major risks relating to financial reports and the relevant risk mitigation plan;
- Review the internal control system in relation to the preparation of the financial statements with the auditor and the internal auditor.
- Consider the internal control process as follows:
- Review and ensure that the management has put in place proper internal control system, including internal control of information technology system, and guidelines for communicating the importance of internal control system and risk management system organization-wide;
- Review and ensure that the management has made remedy and improvement as recommended by the auditor and the internal auditor regarding the internal control.
- Consider the internal audit process as follows:
- Review and approve the Charter of Internal Audit Department, the annual audit plan, and also the personnel and resources necessary for the operation of Internal Audit Department;
- Review the activity and the operation of the Audit and Compliance function line to ensure the independence of Internal Audit Department;
- Review and ensure the effectiveness of the internal audit performance in conformity with the internal audit standard.
- Have power to inspect and make investigation, as necessary, of any of the following transactions or acts which might have material effects on the Company’s financial position and operational performance:
- Transactions with conflict of interest;
- Fraud or unusual practice or material deficiency in the internal control system;
- Violation of the law on securities and exchange, regulations of the SET and the laws relevant to the Company’s business.
- Monitor compliance with rules and regulations:
- Consider, on a consistent basis, laws and regulations that have changed and have impacts on the Company’s business operation;
- Review the results or findings of regulatory bodies and results of remedial actions, and report the same to the Board;
- Review the effectiveness of the monitoring system in relation to compliance with relevant laws and regulations and the results of remedial actions in case of non-compliance.
- Monitor compliance with the business ethics and code of conduct of the management and the employees:
- Review and ensure that the business ethics and code of conducts of the management and the employees and the policy to prevent conflict of interest have been made available in writing and acknowledged by the management and the employees;
- Promote performance in compliance with the business ethics and code of conducts as well as the policy to prevent conflicts of interest.
- Other responsibilities:
- Perform any other act as assigned by the Board and with consent of the Audit Committee;
- Review and evaluate the Audit Committee Charter regularly, as well as propose it for approval by the Board when there are any changes thereto;
- Prepare report of Audit Committee, duly signed by the Chairman of Audit Committee, for disclosure in the Company’s annual report, containing at least the following details:
- Opinion on the accuracy, completeness and reliability of the Company’s financial report;
- Opinion on the adequacy of the Company’s internal control system;
- Opinion on the Company’s compliance with the law on securities and exchange, the SET regulations and the laws relevant to its business;
- Opinion on the suitability of the auditor;
- Opinion on the transaction with a possible conflict of interest;
- Number of the Audit Committee meeting held and attendance by the individual Audit Committee members;
- Opinion or observation in overall received by Audit Committee from its performance of duties in accordance with the Charter;
- Other transactions that should be notified to the shareholders and the general investors within the scope of duties and responsibilities designated by the Board.
4. Reporting of Audit Committee
The Audit Committee shall report its activities to the Board and the shareholders in the annual report and to regulatory authorities as prescribed by law.
The Audit Committee may seek opinion from an independent advisor at the cost of the Company, and may seek additional information as required, or request to have the Company’s officers or an external party to jointly attend the meeting as considered appropriate, provided that such person is in relation to or in charge of the agenda item under consideration at the meeting.
1. Composition and Qualifications
- The Risk Management Committee shall be appointed by the Board of Directors.
- The Risk Management Committee shall be composed of at least 3 members.
- Chairman of the Risk Management Committee shall appoint Secretary to the Risk Management Committee.
2. Term of Office and Holding of Meeting
- The Risk Management Committee shall have a term of office of 3 years. Any retiring member of the Committee may be re-appointed by the Board.
- At least half of the total number of the Committee members shall constitute a quorum of the meeting.
- A Risk Management Committee meeting shall be held at least once a quarter, and a special meeting may be held as necessary.
3. Authorities, Duties and Responsibilities
- Determine the risk management policy for submission to the Board for consideration of overall risk management issues, e.g. strategic risk, liquidity risk, credit risk, market risk, operational risk, and other risks that are of importance to the Company.
- Determine structure and resource strategies in consistency with risk management policy of steel industry sector, being able to effectively analyze, assess, measure and monitor risk management procedure.
- Set risk limits in various significant dimensions for submission to the Board for approval.
- Monitor, review and give recommendation to the Board regarding risk management policy, standard procedure, overall risk measurement and strategy, to ensure risk management strategy has been implemented properly.
- All Risk Management Committee members are duty-bound to attend the meeting either in person or by conference call.
- The Risk Management Committee may invite any other person to attend the meeting as necessary, and such person must be related to or responsible for the agenda item under consideration by the meeting.
1. To Audit Committee
The Risk Management Committee shall regularly report to the Audit Committee risk status and changes that would impact risk appetite to ensure that risk management policy and system could be translated into efficient and effective implementation for the Company.
2. To Board of Directors
The Risk Management Committee shall report to the Board on the following matters:
2.1 Portfolio exposure and change in risk framework, as well as change in new product development and policy;
2.2 Risk status and changes that would impact risk appetite at appropriate timing;
2.3 Ensure that the Board is aware of and realized importance of factors that may pose significant impact on the Company’s risk status.
3. To Shareholders
The Risk Management Committee shall prepare an annual report for submission to the shareholders’ meeting on behalf of the Board, as an integral part or appendix to the annual report and financial report.
The Risk Management Committee may seek opinion from an external professional advisor at the cost of the Company.
1. Composition and Qualifications
Nomination and Remuneration Committee shall be appointed by the Board of Directors, being composed of at least 3 members from the Board, and Chairman of which shall also be appointed by the Board.
2. Term of Office and Holding of Meeting
- The Nomination and Remuneration Committee shall have a term of office of 3 years. Any retiring member of the Committee may be re-appointed by the Board.
- At least half of the total number of the Committee members shall constitute a quorum of the meeting.
- A Nomination and Remuneration Committee meeting shall be held at least once a year.
3. Authorities, Duties and Responsibilities
- Give recommendation to the Board in relation to remuneration rates of Chairman of the Board, Board members, Chairman of Audit Committee, Audit Committee members, and various subcommittees (if any) (with approval of the shareholders’ meeting to be sought afterward).
- Work out remuneration policy and set conditions in engagement of executives from department head upward.
- Consider qualifications and appropriateness of personnel to assume executive positions from department head upward.
- Consider and give recommendations to the Board and follow up implementation concerning human resource vision and strategy as well as executive development plan.
- Nominate name of person with appropriate qualifications for first appointment as Committee member, and consider achievements, qualifications and appropriateness of retiring member for re-appointment prospect before submission to the Board for endorsement, and to the shareholders’ meeting for approval.
Chairman of the Nomination and Remuneration Committee shall report directly to the Board, with minutes taken at each meeting to be submitted to the Board after the meeting.
The Nomination and Remuneration Committee may seek opinion from an external professional advisor at the cost of the Company.
1. Composition and Qualifications
- The Executive Committee shall be appointed by the Board of Directors, being composed of at least 3 members who are Board members and management members.
- Members of the Executive Committee shall have appropriate expertise and experience, being able to make good judgments in performing duty to benefit the Company’s business operation.
2. Term of Office and Holding of Meeting
- There is no requirement of retirement by rotation for members of the Executive Committee. However, when any Committee member who is Board member and/or management member of the Company has retired as Board member and/or as management member for whatever reason, such Committee member shall forthwith retire as Committee member, and a new Committee member shall, without delay, be appointed by the Company to replace the vacating member.
- Chairman of the Executive Committee shall appoint Secretary to the Executive Committee.
- An Executive Committee meeting shall be held as deemed appropriate, at least once a month, and a special meeting may be held as necessary.
- A quorum of the meeting shall be composed of at least half of the total number of Committee members, and always with attendance by Chairman of the Committee or person assigned by the Chairman.
- All Executive Committee members are duty-bound to attend the meeting either in person or by conference call.
3. Authorities, Duties and Responsibilities
- Have the authority and duty to manage and conduct the business of the Company as prescribed by the Board or approved by the Board to undertake case by case.
- Have the authority and duty to administer the business of the Company in accordance with the policy and plan set forth.
- Have the authority as delegated by the Board.
- The following issues shall be subject to prior approval of the Board meeting:
- Matters relating to Company policies;
- Matters which, if undertaken, would pose significant changes to the Company business;
- Matters required by law to be undertaken by the Board;
- Matters to be undertaken to comply with the regulations set forth by the Company;
- Matters deemed appropriate by the Executive Committee to approve case by case, or in accordance with the criteria set forth by the Board.
- Have the authority and duty to conduct the business as specified to administer the Company to its success and achievement of its business target, including:
- Preparation and review of the Company’s strategic objectives, financial plans and significant policies before submission to the Board for consideration and approval;
- Scrutinize annual business plan, capital expenditure budget, operational targets, and significant initiatives to achieve the targets for submission to the Board for consideration and approval;
- Scrutinize projects with capital expenditure exceeding the limits set out by the Board before submission to the Board for consideration and approval;
- Consideration and approval of the issues designated under its scope of authority or as authorized by the Board;
- Consideration and review of the power to act in various issues according to the delegation of authority table before submission to the Board for consideration and approval;
- Managing and creating balance between short-term and long-term objectives;
- Developing and ensuring personnel implement according to the human resource strategy as endorsed by the Nomination and Remuneration Committee;
- Follow up and report to the Board the Company’s operating results and progress in implementation to achieve the objectives.
- Consider allocation of annual budget before submission to the Board for consideration and approval, including consideration and approval of any change and addition in annual expenditure budget in urgent case during the absence of Board meeting, and thereafter submit to the Board for acknowledgment at the next Board meeting.
- Approve procurement of steel scraps in the normal course of business operation in the volume up to 10,000 metric tons per transaction, or up to Baht 200 million per transaction; and up to 60,000 metric tons per month or up to Baht 1,200 million per month.
- Approve sales of goods in the normal course of business operation in the volume up to 20,000 metric tons per transaction and up to 60,000 metric tons per month.
- Approve expenses in purchase of assets which is in the nature of investment (including repair of machinery and equipment) beyond that specified in the annual budget in an amount of not exceeding Baht 30 million per transaction.
- Approve expenses in significant investments specified in the annual expenditure budget as assigned by the Board or as earlier approved in principle by the Board.
- Allocate bonus payment duly approved by the Board to permanent and contract employees of the Company or any persons conducting business for the Company.
- Appoint or authorize any one or several persons to conduct any act on behalf of the Executive Committee as deemed appropriate, which shall be subject to cancellation, revocation, change or rectification by the Executive Committee.
The Executive Committee’s approval of transactions shall not include transactions in which Committee members or persons that may have conflicts, vested interest or conflict of interest in any other nature with the Company and/or subsidiary (if any), and transactions specified to seek shareholders’ approval, e.g. connected transactions and acquisition and disposal of core assets of the Company and/or subsidiary (if any) to comply with the stipulations of the Stock Exchange of Thailand and Office of the Securities and Exchange Commission, or any laws relevant to the Company’s business.
The Executive Committee may seek opinion from an external professional advisor at the cost of the Company.
ทบทวน ครั้งที่ 1 วันที่ 9 ส.ค. 2555
The Nomination and Remuneration Committee shall nominate and propose for the Board’s appointment of Chief Executive Officer (CEO).
- Authorities, Duties and Responsibilities
- Control, oversee operation, and/or administer day to day operation of the Company, and follow up and assess operating results on a daily basis to be well prepared for and prevent any risk that may take place both internally and externally.
- Conduct business and perform duty in accordance with the policies, plans and budgets approved by the Board and/or the Executive Committee.
- Endorse legal acts relating to normal business operation of the Company, e.g. trading, procurement of goods, expenses in normal business operation, investment, acquisition and disposal of tools, assets and services, etc., for the benefits of the Company and within the limits set forth.
- Approve procurement of steel scraps in the normal course of business operation in the volume up to 5,000 metric tons per transaction, or up to Baht 100 million per transaction; and up to 30,000 metric tons per month or up to Baht 600 million per month.
- Approve sales of goods in the normal course of business operation in the volume up to 10,000 metric tons per transaction and up to 30,000 metric tons per month.
- Approve expenses in purchase of assets which is in the nature of investment (including repair of machinery and equipment) beyond that specified in the annual budget in an amount of not exceeding Baht 15 million per transaction.
- Be attorney of the Company in its business management in line with the objectives, articles of association, policies, regulations, covenants, orders, resolutions of shareholders’ meeting and/or resolutions of Board and Executive Committee meetings in all respects.
- Issue orders, regulations, notifications and memorandum to ensure performance of duty is in line with the policies and for the benefits of the Company, as well as to maintain work rules and discipline within the organization.
- Act and present oneself as representative of the Company to external parties in relevant business as necessary, and in the normal course of business operation for the benefits of the Company.
- Perform other duties as assigned by the Board and/or the Executive Committee
- Sub-authorize another person to conduct the above acts on his behalf to allow for flexibility in the Company’s operation.
However, the CEO’s power shall not include approval of any transaction that may have conflict of interest or any transaction in which the CEO or related person has vested interest or benefit in any other nature that has conflict with the Company or subsidiary as provided in the laws and notifications of Securities and Exchange Commission or the Stock Exchange of Thailand. Transaction in such nature shall be subject to endorsement by the Audit Committee and further submission to the Board meeting and/or the shareholders’ meeting (as the case may be) for consideration and approval in accordance with the Company’s articles of association or relevant laws, unless it is the transaction in the nature of normal course of business operation on which the Board has already set a clear consideration framework.
ทบทวน ครั้งที่ 1 วันที่ 9 ส.ค. 2555
|NO.||Directors and Management||Shareholding As of 31 December 2015||Percentage|
|1||Pruchya Piumsomboon, Ph.D., P.E.||1,298,000||0.16%|
|2||Associate Professor Dr.Narong Yoothanom||-||-|
|3||Assistant Professor Kalyaporn Pan-ma-rerng||-||-|
|4||Mr Noppadon Jason Chirasanti||-||-|
|5||Mr Kanawath Aran||-||-|
|6||Mr Sanguankiat Lewmanomont||-||-|
|7||Mr Mark D. Remijan||414,000||0.05%|
|8||Mr Anavin Jiratomsiri||408,000,000||51.00%|
|9||Ms Koo Man Wai||40,500,000||5.06%|
|10||Ms Sharuta Jiratomsiri||40,500,000||5.06%|
|11||Mr. Suppachai Yimsuwan||-||-|
|12||Ms Nuttanun Yuying||-||-|
1. Raw material risks
Risk from fluctuation in raw material price
Normally, key material to be used in melting process to product long steel is metal scrap which accounts for 70-80% of production cost so fluctuation of metal scrap directly affects cost of production and sales. Typically, domestic price of metal scrap will be changed based on selling price of long steel and metal scrap in global market and radical change of price is common. Therefore, profitability of company may be affected according that price of metal scrap is fluctuated and company cannot adjust selling price of product in correspond to the cost of metal price used in production, as well as sunk cost from metal scrap inventory.
To minimize effects of such risks, company planned policies to stock sufficient metal scrap for production; in normal situation, supply of metal scrap will be kept to support 1-2 times of monthly demand, and company set policy to order metal scrap only when customers order (Matching Order). This strategy helps company set selling price that corresponds to cost of goods sold and the price is flexible to respond to market situations. Company also closely monitored price fluctuation of long steel and raw materials by using experiences and relationship with metal scrap providers. This method helps company properly forecast price trend and demand of long steel in both domestic and global market and effectively plan production schedules.
Risk from raw material procurement and dependence on suppliers
As business of company relies much on metal scrap as raw material and top 5 suppliers account for 80-90% of purchasing value, it is very risky for company in case that demand is higher than inventory and suppliers cannot deliver as planned. Company may face scarcity for production and need to bear high cost of metal scrap compared with imported one, thus losing competitive advantage and affecting operating and financial performance.
However, company estimated that effect of material shortage is minimal because there are a few manufacturers of long steel and metal sheet who have their own melting molds so the number of metal scrap are sufficient for the demands (including irregular situation in 2008). Moreover, company has strong relationship with suppliers of metal scrap due to long-term business and company also order imported steel regularly to maintain relationship with global suppliers and maintain inventory in case that domestic supplies are not enough. Company can minimize risk of shortage by monitoring demand trends, planning supply stock, and scheduling production plan.
2. Marketing and distribution risks
Risk of long steel price fluctuation
Long steel is the key product of company to be processed by forming steel to produce long steel products such as round bar and deformed bar. Normally, demand and supply of long steel depends upon construction business that utilizes long steel as main materials. However, long steel is commodity product so its price will be changing based on demand and production capacity in both domestic and international markets.
Company has realized such risks and set policy to produce based on customers’ order, thus helping company to set selling price in correspond to cost of goods sold and market situations. To minimize risks, company also set plan to monitor price of long steel by considering overall economic climates, construction business, and customer interviews in order to forecast demand of long steel and schedule production plan, distribution, and inventory of long steel based on situations and demands.
Government policy change risks
Steel industry in Thailand mainly serves as import substitution. It has been developed to serve demand of domestic downstream steel industry, the products from which are basic raw materials of several related industries. Thus, steel industry greatly relates with the country’s economy as a whole. Therefore, the government has placed great importance and has set out measures on domestic steel industry as follows:
ASEAN Free Trade Area (AFTA)
Association of Southeast Asian Nations or ASEAN had agreed on the reduction of tariffs under Common Effective Preferential Tariff (CEPT) scheme, thereby the six existing member countries (Brunei Darussalam, Indonesia, Malaysia, Philippines, Singapore and Thailand) and the four new member countries (Vietnam, Laos, Myanmar and Cambodia) are required to reduce tariffs under CEPT scheme to 0% by 2010 and by 2015, respectively.
List of goods entitled under CEPT scheme covers a total of 105,123 items, including iron and steel which meet the production process criteria whereby the products have adequately been processed in home country. Steel billet, steel bar and deform bar are subject to cuts of tariffs under CEPT to 0% by 2010. At present, Thailand has set tariff rates of 2% - 5% on products from ASEAN counterparts depending on product type and size. Thus, prices of imported steel bar tend to go down in the future, while billet, which can be produced by the Company, could be imported freely without any import tariff as domestic production cannot adequately fulfill domestic demand. However, importing billets has constraints in delivery time, operating expense, and minimum volume per purchase order, end-use producers thus still prefer domestic billets to imported ones. Therefore, the Company has expected no negative impact from such measure. On the contrary, domestic producers will have advantage and better opportunity to penetrate the ASEAN market as Malaysia, Philippines and Vietnam who have in the past charged imported steel billets from Thailand will have to lift tariff barrier against Thai billets by the set deadline.
Even if the no-tariff measure and policy be terminated in future for whatever reasons, impacts on the Company are minimal, as domestic producers of billets have for the past years been unable to fully meet domestic demand, necessitating imports of billets all along. Imported billets carry very high transport costs and take longer time of delivery as compared with domestic products.
Investment promotion policy for intermediate steel industry
The Board of Investment (BOI) has announced guidelines to support investment in steel industry in a bid to develop high quality steel, boost competitive advantage of related industries, and promote Thailand as the hub of steel production and export of the region. BOI privileges and benefits have been granted to the intermediate steel production business according to the criteria in the BOI Notification No.1/2000 dated 1 August 2000. In this regard, as the Company’s factory is located in Prachinburi Province, which is in Investment Promotion Zone 3, the Company has been granted privileges and benefits such as corporate income tax holiday for eight years, 50% reduction of corporate income tax for the next five years after the end of tax holiday, allowance of deductibles two times the actual transportation, electricity and tap water expenses for 10 years, etc. If the government terminates or changes the said privileges and/or if the privileges expire or are terminated in the future, the Company’s operating performance and income generation capabilities may be affected.
Company is strongly confident that government has no plan to change and/or exempt any privilege as it may affect confidence of investment that receive subsidy and support. However, company may be affected by expiration of government promotion period/amount; 1st phase and 2nd phase earned privileges from of investment promotion such December 2005 and July 2008 respectively, in which exemption of corporate income tax will be expired 8 years since the first date. Committee of investment promotion has approved further investment for companies that register in MAI stock market within specified period that earn privileges from BOI by changing type of corporate income tax exemption from limited investment to unlimited investment, requiring applicants to submit request to BOI within December 31st, 2012. Company has applied these benefits on September 14th, 2011 to register in MAI stock market and follow BOI regulations, thus gaining tax exemption and unlimited investment. In case that company earns net profit t in privileged period more than such investment, full amount of corporate income tax is still be exempted and this is favorable for performance of company.
- ASEAN Free Trade Area (AFTA)
3. Financial risks
Foreign exchange risk
The Company procured raw materials such as scrap, chemicals, and spare parts from abroad for its own operations accounting for 5% of total procurement value. It also exported billets around 6% of total revenue. Thus, the Company is exposed to foreign exchange risk.
The Company has a policy to prevent such risk by entering into forward contracts with a number of financial institutions, including hedging funds provided by domestic financial institutions. The Company will closely monitor and follow up foreign exchange movements and seek proper timing for the transactions to ensure maximum benefits to the Company.
4. Risks for investors
Risks from having major shareholders who controlling the operation
Jirathammasiri family holds total 506.00 million of shares, or 63.28% of total paid-up capital which is equivalent to THB 800 million. In the event that the Jirathammasiri family vote in the same side, they will control the resolution in the shareholders’ meeting in regard to appointment of directors or any resolution that require majority vote unless the matter as stipulated by law to have three fourth (3/4) vote in the shareholders’ meeting. Accordingly, other shareholders will not be able to control and balance the agenda that the major shareholders may propose.
The Company is aware of such risk. To lower the risk, the Company has appointed 4 audit committee, or 40% of total directors, as an independent director. The Audit Committee must be qualified with education and skills, as well as with capability to protect minor shareholders. Furthermore, it has been formulated by the board of directors that any decision to execute or refrain from any actions must be mainly concerned to benefits of the shareholders. If it is necessary to execute transaction with the person who may have any conflict, the Company will follow all required procedures to seek for approval of connected transaction as well as fallows the criteria as notified by the Securities and Exchange Commission and the Stock Exchange of Thailand strictly.