1. Rights of Shareholders
Right of Shareholders Protection
- The Company places priority on protection of shareholders’ rights and promotes their exercise on fundamental rights such as equal right to profit sharing, right to receive adequate news and information from the Company in timely manner, voting right in the shareholders’ meeting to appoint or to remove director and appointment of auditor including other issues which may affect to the Company namely dividend allocation, amendment of articles and memorandum of association and reduction or increment of capital, etc.
- The Company takes into consideration the rights of shareholders, therefore; the Company prepares the shareholders more assisting than their fundamental rights as stipulated by laws. For example, the Company provides important and update information via its website as well as Management Discussion and Analysis (MD&A) to present its operating results in quarterly basis and news release via BAFS Newsletter.
- The Company’s shareholding structure comprises many minor shareholders, who can cause considerable balance between minor and major shareholders by not contributing to any person or any group to control the Company or the voting rights. As a result, it brings forth good corporate governance in shareholder level. The distribution of share to minor shareholders (Free Float) is higher than 40% with neither cross-shareholding among companies in the Corporate Group nor creating pyramid scheme shareholding structure. The whole Board of Directors is holding shares altogether for 0.68%. In the meantime, proportion of shares held by domestic and foreign institutional investors is approximate 19%.
Annual General Meeting of Shareholders
- The Company sets an Annual General Meeting of Shareholders (AGM) once a year within 4 months from the last day of the Company’s fiscal year. In 2017, the AGM was on April 27th , 2017, Chairmen of Committees, Managing Director, Directors, Senior Executives, Auditor and Legal Advisor had attended to provide answers in the meeting.
- The Company assigned Compass Law Ltd. to perform as its legal advisor and had representatives from shareholders to count the votes and results thereof are disclosed in the Annual General Meeting of Shareholders’ minutes.
Meeting Invitation Notice in Advance
- The Company appoints Thailand Securities Depository Co., Ltd., which is its securities registrar, to send the meeting invitation notice to its shareholders prior to the meeting for 21 days. Moreover, to provide opportunity to shareholders for meeting information review in advance, the Company publicizes similar information being sent by post to the shareholders via www.bafsthai.com for at least 30 days prior to the meeting date. In Addition, the Company’s meeting notice is advertised in newspapers for 3 consecutive days with at least 3 days prior to the meeting date as well.
- The meeting invitation notice includes complete and adequate detail such as date, time, venue, and agendas of shareholders’ meeting by stating explicitly that each agenda is for acknowledgement or consideration. Moreover, meeting documents for each agenda are provided with objectives, reasons, the committees’ opinions, and the Company’s shareholders meeting regulations. In addition, map of meeting venue, detail of documents that the shareholders shall present on meeting date and meeting procedure are attached. The Company arranges all related meeting documents in English as well to serve and facilitate its foreign investors.
- The Company respects the shareholders’ right and avoids right violation and infringement. Meanwhile, the Company promotes the exercise of shareholder’s rights by presenting important issues to shareholders for their approval as well as disclosure complete information as stipulated by laws, regulations of the Stock Exchange of Thailand and the Company’s Articles of Association.
- The important meeting agendas are informed precisely to propose to shareholders for their approval in every year. They include:
- Appointment of Director: the Company provides opportunity to shareholders for selection of director individually.Eachofcandidates’ informationsuchasname,age,educational background, workexperiences, number of companies that each of candidates works for as director, in which separated to be listed company and general company, are clearly informed to the shareholders. In addition, the Company also advises procedure and selecting process for director nomination, types of director proposed for nomination, his/her meeting attendance information, his/her number of years in office in case exiting director is proposed to reassume the position.
- Director Remuneration: the Company provides detail regarding remuneration models and their amounts including policy and remuneration criterion for director, which are reviewed and screened by the Remuneration Committee.
- Appointment of Auditor: the Company provides detail regarding auditors’ names and their audit firms, experiences and capabilities as well as independencies of auditors, audit fees, number of years for audit service providing(incaseofappointingtheexitingauditor)or reasonsofchangingauditor (incaseofappointing new auditor) including criteria to determine appropriateness of auditing fees, which are reviewed and screened by the Audit Committee.
- Dividend Allocation and Payment: the Company provides detail regarding profitallocationand capital reserve, amount of dividend payment, reasons including information in accordance with the Dividend Payment policy and record date specified by the Board of Directors in order to determine shareholder’s title to dividend. The dividend allocation and payment is reviewed and screened by the Remuneration Committee.
Facilitation Provided to Shareholders
- The Company imposes policy to provide facilitation and promote shareholders, institutional investors including major and minor shareholders to attend the meeting.
- The Company provides channel to the shareholders for sending their queries regarding meeting agendas through the Corporate Secretary to the Board of Directors prior to the meeting date. Its detail information is publicized on the Company’s website accordingly.
- The Company arranges its Annual General Meeting of Shareholders at the Queen Sirikit National Convention Center, which is convenient for shareholders to reach and attend the meeting. In the meantime, the Company arranges equitable treatment to all shareholders by having receptionists in place to provide them facilitation.
- The Company provides 2 hours prior to the meeting commencement to the shareholders for their meeting registration. The Company encourages the shareholders to exercise their rights thoroughly in the meeting. Thus, in case of late arrival, the shareholders are not restricted form meeting participation.
- The Company applies barcodes that display detail of each shareholder by having them printed on shareholder meeting registration forms to facilitate shareholders with prompt and accurate meeting registrations, number of votes counting and results informing services.
- The Company grants the shareholders, who delay in meeting, to exercise their rights by balloting for agenda under consideration and has not yet concluded.
- Prior to the meeting commencement, the Chairman of the meeting shall introduce the attending Board members, Chairman of Committees, the management, the Company’s auditor and legal advisor including meeting procedures and voting process to the meeting.
- The Company allocates sufficient time and opens the floor in the meeting for shareholders to opine and question on each agenda. The Company’s directors and management place emphasis on every question; hence, they shall provide explicit and pertinent answers before having the meeting to vote for such agenda.
- The Company conducts the shareholders’ meeting in accordance with list of agendas as informed in the meeting invitation notice. The Company will neither be abruptly distributing other important document nor adding unexpected agenda to the shareholders’ meeting.
- To ensure transparency and auditability in case of an objection occurring thereafter, the Company provides ballot tickets for voting. In the meantime, the ballot tickets are also used when voting for any agenda that composes many listings, for example, the appointment of director agenda in which the Company provides opportunity for shareholders to select director individually.
Procedure after the Shareholders Meeting
- The Company shall announce resolutions of the meeting by notifying them to the Stock Exchange of Thailand and have them disseminated on the Company’s website before 09.00 hrs. on the following day after the Annual General Meeting of Shareholders day.
- In accordance with resolution of the shareholders’ meeting regarding dividend payment, the Company shall coordinate with Thailand Securities Depository Co., Ltd. to ensure the shareholders’ receipt of dividend with correct amount. According to the SET’s recommendation, the Company, therefore, specifies the record date for shareholders’ title to dividend to be at least 5 working days after being approved by the shareholder’s meeting.
- The Company shall completely and accurately prepare the meeting minutes for shareholders’ inspection, in which comprises names and positions of attending directors, voting method and vote counting, shareholders’ opinions, clarifications from directors and management including meeting resolutions with numbers of votes for approval and disapproval as well as abstaining and voided ballot vote. The meeting minutes shall be submitted to the SET within 14 days after the Annual General Meeting of Shareholders day. The meeting minutes, video and audio of shareholders’ meeting shall be disseminated on the Company’s website as well.
2. Equitable Treatment of Shareholders
Proposal of Meeting Agendas and Nominations of Directors
The Companyfacilitatesshareholdersin proposingagendaand nominatinginadvance qualified personas a candidatefor the Company’s director prior to the Annual General Meeting of Shareholders. With this regard, the Company disseminates explicit procedure via the SET and its website. The shareholders can propose agenda and detail information of candidate for consideration in advance for 3-months period. A single shareholder or group of shareholders who holds minimum share of 0.05 percent is able to propose agenda or detail of candidate for the Company’s director. The percentage as mentioned is ratio that facilitates the shareholders more than requirement of the law that determines whether one or more shareholders who altogether hold shares for not less than 5 percent can be able to propose agenda. Nonetheless, for the Annual General Meeting of Shareholders 2017, there was none of shareholder purposed agenda and nominated qualified person.
In case any shareholder is unable to attend the meeting, the shareholder shall appoint another person, independent director or managing director to attend the meeting on behalf of the shareholder. The Company shall provide a proxy form in which shareholders can determine the direction of their votes through proxy (Form B). Documents required and instructions process for appointing proxy, which is not complicated, are explicitly informed to shareholders accordingly.
Supervision of Insider Information Usage and Conflict of Interest
The Company protects insider information by stipulating measures to prevent misuse of undisclosed insider information by its directors and the management for their exploitations, for example; stock trading by using insider information and disclosure of insider information to its directors or the management’ related persons which causes damages to the shareholders as a whole, etc. Stipulated measures for protection of the Company’s interests and trade secret are shown in the Company’s policy and rules & regulations manual. Meanwhile, termsof securities trading,usageof insider information,and conflictsof interests including penalties for violation are shown in the Company’s Code of Conduct. These measures and terms are made known to all directors, the management and employees by having them signed for acknowledgment accordingly. Inaddition, the Companyhas specified that its directors, themanagementand employeesare prohibited to buy or sell its securities for at least 30 days prior to disclose of the Company’s operating results of each quarter and 1 day after announcement of such information.
The Company notifies its directors and the management to report the changes of their securities holding to the SEC in pursuant to Section 59 of the Securities and Exchange Act B.E. 2535. Moreover, detail of directors and the management’s securities holding is added as agenda in every session of the Board of Directors Meeting including being disclosed in the annual report.
Moreover, the Company specifies that its employees, who work closely to the Company’s information, must report changes of their securities holding within 3 business days from the date of transaction. This issue is also added as agenda in the management monthly meeting.
- The Company stipulates regulations for its directors and the management to submit reports on their stakes to the Company. The Board of Directors including the management must also disclose information regarding theirstakes and their related persons’ stakes. The regulations stipulated are consistent with nature of business, laws and related regulations. In addition, directors and the management must report every change of their stakes to the Company as well. The Corporate Secretary is in charge for following up such information accordingly.
- The Board of Directors has stipulated guidelines to prevent its directors or the management, who have stakes, to take part in decision-making process of transaction between the Company and those stakeholders. Prior to the Board of Directors Meeting, the Chairman of the Board will advise director, who has stake, to notify the meeting his/her stake, and then, such director shall leave the meeting. In addition, director, who has stake, is not entitled to vote on such matter.
- BAFS’ shareholding structure is not complicated whereby almost all of its connected transactions are normal business transactions.
- BAFS has conducted its business in compliance with laws and regulations of the Stock Exchange of Thailand and the Securities and Exchange Commission such as criterion of connected transactions and acquisition or disposal of assets, etc.
In year 2017, the Company did not receive any complaints regarding shareholders’ basic rights infringement whereby the Company also equally treated all shareholders. Moreover, there was no record of the use of insider information for exploitation.
3. Roles of Stakeholders
Treatment of Stakeholders:
BAFS has stipulated guidelines on treatment of all stakeholder groups comprising shareholders, customers, business partners or trade partners/ distributors or creditors, employees, society, community, environment and regulators. The guidelines on treatment of stakeholders in writing are shown in the Company’s Corporate Governance Policy and Code of Conduct. Their details are disseminated via BAFS’ website. Meanwhile, the Company encourages its employees to comply with such policy. BAFS’ has obligation to respect the rights ofstakeholders and performs accordingly as follows:
- Shareholders: the Company imposes policy and guidelines on the treatment of shareholders, which include performing duties with integrity and fairness, conducting business toward prosperity and stability and generating appropriate returns to shareholders, disclosing information to shareholders equally, regularly and completely. In addition, BAFS provides opportunities for shareholders to express their opinions and suggestions including proposing agendas or candidates to take director positions in Meeting of Shareholders.
- Customers: BAFS imposes policy and guidelines on the treatment of customers as follows:
- BAFS has provided full attention and accountability to customers by being compliant with agreements made with customers, treating all customers equitably and justly, focusing on creatingcustomers’ satisfaction and confidence and providing service with quality.
- BAFS has conducted the aviation fuelling service by adhering to international quality standards, punctuality and maximum safety. BAFS’s operational service is certified by the Quality Management Systems: ISO 9001 and Occupational Health and Safety Assessment Series: OHSAS 18001.
- BAFS has applied customer satisfaction measurement as part of its Key Performance Indicators (KPIs of the Company).
- BAFS has organized activities to promote good relations with customers, for example; arranging BAFS visits for customers to observe its operations and participating in seminars, meetings with customersinorder tostrengthenrelationsand tolistentotheir feedbacks,arranging quizgames with questions related to BAFS including meetings with customers on special occasions, etc.
- Business Partners or Trade Partners/ Distributors or Creditors
BAFS sets explicit and tangible criteria on trade partner selection. BAFS’s trade partners must be qualified as required and be able to comply with procedure or process as specified by BAFS.In case selection of new trade partner, the Board of Directors’ approval is required. BAFS shallcomply with agreements made with all business partners or trade partners/ distributors or creditors equitably and justly based on mutual fair compensations. BAFS shall not request, receive or give advantages of dishonesty to trade partners/ distributors or creditors. In addition, BAFS prepares Business PartnerCode of Conduct to be guidelines in which BAFS’s business partners shall comply.
Additionally, BAFS shall not request, receive or give advantages of dishonesty to trade partners/distributors or creditors. BAFS stipulates JV Core Principle as a tool to prevent disclosure of sensitive information.
- Employees: as all employees are significant for its business operation, BAFS imposes policy and guidelines to treat its employees by emphasizing on their development as well as providing them appropriate compensation and welfare. Additionally, BAFS promotes employee’s engagement with detail as follows:
- Imposing regulations regarding employee’s compensation and welfare.
- Imposing explicit policy regarding employees’ compensation whereby their performances are assessed in accordance with Balanced Scorecard concept, which is in line with BAFS’s performance includes finance, customers, internal management process as well as learning and development in both short-term and long-term.
- Providing appropriate compensation and welfare such as monthly salary, annual bonus, and provident fund including life, accident and health insurances.
- Providing employee orientation and training programs regarding Code of conduct, Anti-Corruption policy, safety and quality system including necessary basic knowledge equipped to new employees to ensure their capabilities before taking on-the-job training program.
- Imposing policyregardingapproachesforemployeesystematic development.Withthis regards,competency model is used as standard for human resource development planning, for example; Competency and Potential Assessment, Training Roadmap, Individual Development Plan Career Development Plan, Job Rotation and Job Transfer, Succession Plan and Successor Development Plan. In 2017, there were 494 employees who had been trained and developed accordingly with training hours by average at 46 hours/ employee.
- Promoting educational support projects such as giving scholarships to employees and arranging domestic and overseas work observation and training programs for employees, etc.
- Promoting ethical behavior by arranging training program regarding “anti-corruption measure” and ensuring employees’ work ethics by having them to take Code of Conduct tests. BAFS has also supported its employees in participating dharma practices activities organized by the Young Buddhists Association of Thailand. In addition, BAFS has arranged various training programs regarding morality as appropriate.
- Promoting Core Value campaign and cultivation by arranging internal activities such as employee relations activities and security support activities, etc. Moreover, BAFS has also organized Core Value test to ensure employee engagement, understanding and awareness including encouraging all employees to carry out ethical behaviors with one accord in order to enhance treatment of stakeholders.
- Society and Community: Since BAFS indicates the community and society as an important stakeholder, BAFS emphasizesthe processtoencouragethecommunityto become a sustainableself-sufficiency.Thesustainability strategy’s plan of 2016-2020 refer to community participation’s work plan. Moreover, according to the community satisfaction survey in Don Mueang and Suvarnabhumi areas the results lead to create model schemes for community framework, which focus on the areas around Don Mueang and Suvarnabhumi aviation fuel depot. Also these schemes were distributed to respond departments as follows: 1.Community work plan by corporate social responsibility department2.Community relations plan at Suvarnabhumi aviation fuel depot 3.Community relations planat Don Mueang aviation fuel depot 4.Cooperation framework plan by 10 organizations (MOU Sisa Chorakhe Noi sub-district) and 5.Corporate communication activities and voluntary activities plan. Therefore, these plans are exercised throughout 2017 and summarized into 6 main categories as follows:
- (1) Health
Community Health Promotion Project, Moo 2 - 9 -10, Srisajorakaenoi Subdistrict, is located in Suvarnabhumi depot operation area. According to the community’s master plan of BAFS, The project is a collaborative network between the community, theorganization and local authorities to implement the plan for the community database. To Create a healthy community promotion and care process, also encourage community awareness including create better health of the community by themselves.
- (2) Family and Elderly
This project is a practical research and requires for participation aiming to support and develop Community Health Volunteer potential in order to take care of family and elderly in their community. Besides, it’s an associated cooperativenetwork betweencommunity,organization,and localauthorities to workforelderly in the community.
- (3) Education, Religion, and Culture
BAFS has many projects related to this category as mentioned below: Arranging field trips to educate students outside classroom, giving scholarships, and inheriting Thai traditional culture through activities. For example, activities about religion; the robe offering ceremony, listen to the sermon, go to a meditation retreat. Furthermore, BAFS also supports to arrange religious and cultural activities held by the community occasionally.
- (4) Profession and Income
The making projects assist members in community to get them a career especially for housewife and elder. Also, this is part of the “Health promotion in community at Moo2-9-10 Sisa Chorakhe Noi sub-district” project which can build up an economy of local community. In order to strengthen the economy of local community and help locals to have jobs, BAFS has worked by extending the results from this health promotion project.
- (5) Life safety, Environment, and Community infrastructure
Basic fire safety training project for the community and schools around Suvarnabhumi aviation fuel depot’s area project has a purpose to increase knowledge and awareness about fire drill and first aid assistance. In addition, this project is focus on student, community, and local security department by training through real situation in order to increase their skills and make them solve the problems correctly
- (6) Quality of life and Society in general
BAFS has cooperated with Royal Thai Army medical department, Foundation of Phramongkutklao hospital, and Rehabilitation medicine arrange the project to help and encourage soldiers whom injured from military service at the 3 violence-prone southern provinces. BAFS has proceeded this project for 10 years and the main objective is to treat the injured soldiers both physical and mental health at Phramongkutklao hospital so that they can be able to proudly continue serving the country or demobilize and earn a living in the society.
- (1) Health
- Environmental: BAFS emphasis on operation process to consider the environment and stipulated preventive measure to prevent and relieve impact systematically. Moreover, BAFS still control the energy management which described in more detail in section 3 “environment protection and utilize resources efficiency”
- Regulators: the Company has complied with related laws, regulations and rules, and has conducted its business in accordance with principles of good corporate governance, anti-bribery and corruption while promoting human rights protection.
BAFS has never violated laws related to labour, employment, consumer and trade competition and also has never been reported or complained about bribery and corruption.
In 2017, BAFS received Outstanding Awards for Being Organizational Prototype on Safety, Occupational Health and Working Environment for its three operating Sites. They included Platinum Awards for Don Mueang Aviation Fuel Storage and Into-plane Refuelling Station and Diamond Awards for Suvarnabhumi Into-plane Refuelling Station and Suvarnabhumi Aviation Fuel Storage Station.
4. Information Disclosure and Transparency
BAFS’s Information Disclosure
BAFS has disclosed important information in its annual reports and its website at www.bafsthai.com in both Thai and English. The information includes vision, mission, major policies, corporate group structure, nature of business and competitive situation, financial status and operating results, business risks, shareholding structure, organizational structure, Board of Directors, the Management, categories of directors, biographies, direct and indirect shareholding of directors and the management, training experiences of directors, remuneration policy for directors and the management, compensation models, amount of compensation for directors of the Company and its subsidiaries, duties and responsibilities of the Board of Directors and Sub-committees during the past year such as number of meetings, number of times for meeting attendance, investor relations information, meeting invitation notices, minutes of Annual General meetings and press release, etc. In addition, the Company has updated information in its website regularly.
Preparation of financial report
The Board of Directors appoints the Audit Committee to review and ensure adequate accuracy completion and transparency of BAFS’s financial report, which effectively protects and maintains BAFS’s assets and prevent fraudulent and unusual actions including compliances with the Generally Accepted Accounting Principles and appropriate accounting policy and to study on reasonability and prudence in financial report preparation to strengthen the Company’s stakeholders’ confidence. The Board of Directors also provides report on the Board of Director’s responsibilities towards the financial statements, which inclusively includes important matters in accordance with Code of Best Practice of Directors of Listed companies recommended by the Stock Exchange of Thailand. The Report in which signed by the Chairman of the Board of Director and the Managing Director will be presented together with the Auditor Report in the Company’s Annual report.
In 2017, the Company assigned the auditor from EY Office Company Limited, who is approved by the SET as knowledgeable, proficient and independent auditor to be the Company’s auditor. The Company’s financial report was certified unconditionally in all material respect in accordance with the General Accepted Accounting Principles and approved by the Audit Committee/the Board of Director before disclose to the shareholders.
The Company also prepares Management Discussion and Analysis (MD&A) in a quarterly basis to provide analytical explanation regarding its financial status, operating results, factors that affect to financial status including significant changes. Moreover, important news and information are disseminated to the shareholders via BAFS Newsletter as well.
In accordance with the Balanced Scorecard concept that suggests to view organization from four perspectives including financial, customer, internal management process, and learning & development, the Company, then, applies Key Performance Indicators (KPIs) by stipulating its strategic objectives to be in line with goals of strategic plans and risk appetite, for instance; return on assets, market share, customers’ satisfaction and success derived from human development plan, etc.
Channels for Information Disclosure
- The Company recognizes importance of disclosure of information, which is relevant to the Company including financial and non-financial information. The information disclosed must be done in timely manner with accuracy, completion, and transparency. Hence, the Company provides channels for information disclosure as follows:
- Information dissemination system of the Stock Exchange of Thailand (SET) and website of the Securities and Exchange Commission (SEC).
- The Company’s website at www.bafsthai.com, which provides information in both Thai and English.
- Reporting on the Company’s quarterly operating results by providing information to analysts and investors on Opportunity Day at the SET.
- Press Release
- Newsletter to present the Company’s financial status.
- Providing Information to analysts or investors who visit the Company and have consult meeting with its Management.
- Analyst Meeting
- Documents delivered to shareholders by post.
- The Company provides information disclosure in compliance with regulations of the Stock Exchange of Thailand (SET) and the Securities and Exchange Commission (SEC). The Company sets up Compliance Division to undertake on this matter accordingly.
- The Investor Relations Division is also provided as communication channel for investors, shareholders, analysts and other relevant organizations. Its e-mail is firstname.lastname@example.org, Tel: 02 834 8914. In addition, the Investor Relations Division has organized annual activities in accordance with its action plans. In 2017, there were significant activities as follows:
- Joining the Opportunity Day for 4 times
- Inviting the executives to participate in television and radio programs for 3 times
- Arranging the Company Visit for 24 occasions to accommodate institutional investors, general investors and analysts
- Arranging the Site Visit for 3 occasions to accommodate shareholders and investors
- Providing the Company’s information for Credit Rating Review for 1 time
- Arranging 2 issues of the shareholders’ newsletters.
- The Company recognizes importance of disclosure of information, which is relevant to the Company including financial and non-financial information. The information disclosed must be done in timely manner with accuracy, completion, and transparency. Hence, the Company provides channels for information disclosure as follows:
The Company has never been ordered to have its financial statements amended by the SEC. The Company discloses its annual and quarterly financial statements to shareholders and investors in a timely manner.
5. Responsibilities of Board of Directors
The Board of Directors plays a key role in Corporate Governance to ensure benefits of the Company as well as takes responsibilities on their performances for shareholders including being independent without intervention from the Management.
The Board of Directors Structure
- The Board of Directors has considered appropriateness of its structure and determined its composition to consist of at least 11 members, but not over than 15 members. Currently, the Company’s Board of Directors comprises 14 directors as follows:
- Executive director 2 directors (14.29%)
- Non-executive director 12 directors (85.71%)
- The Board of Directors has also defined its structure to be comprised of directors with diversified qualifications. They are experts who possess knowledge, capabilities, experiences, leadership skills, integrity, and morality including being accepted generally. Their knowledge and skills include industrial knowledge, finance, management, international trade, strategy, crisis management, Corporate Governance and others that are in line with and beneficial to the Company’s operation. Meanwhile, the independent director’s qualification regarding shareholding proportion is defined to be more stringent than requirement of the Securities and Exchange Commissionas showninclause3. Nominationand appointmentof directorand high-level executive.
- To enhance the balance of power, the Chairman of the Board shall be independent director, who is not the same person serving as the Managing Director and shall not have any relation with the Management.
- Duties and responsibilities of the Board of Directors and the Management of the Company are segregated from each other, which are defined in written explicitly.
- The directors hold the term of office as stipulated in the Company’s Articles of Association, which reads “At each annual general meeting of shareholders, 1/3 of the directors must retire from office. The directors who have been the longest in office shall retire first.” Nonetheless, number of years of independent directors’ term of office and number of consecutive terms for directors are not defined due to an inadequacy of person who has knowledge and experience relevant to the Company’s business.
- The Board of Directors is well aware of its role, therefore; in compliance with policy, each member of the Board is able to perform as director for not more than 5 of listed companies. In the meantime, besides of the Company’s subsidiaries and associates companies, the Company’s Managing Director is able to take position of director or managing director for another companies if and only of being approved by the Company’s Board of Directors.
- The Company has the Assistant Director of the Corporate Secretary Office with a wide knowledge of laws and passed corporate secretary training course and other relevant courses.
The Company imposes policy regarding its directors or employees appointment to be directors or executives of its subsidiaries. BAFS also arranges monitoring system and operating direction for its subsidiaries to ensure that the Company is able to oversee its subsidiaries’ performances efficiently.
Furthermore, the Company has established committees to assist on studying projects in details and screening tasks to enhance the Board of Directors’ work efficiency and ensure its transparency. Detail of the said committees is shown in clause 2: Subcommittees.
- The Board of Directors has considered appropriateness of its structure and determined its composition to consist of at least 11 members, but not over than 15 members. Currently, the Company’s Board of Directors comprises 14 directors as follows:
Role, Duties and Responsibilities of the Board of Directors
- To perform duties and responsibilities with integrity and accountability in compliance with laws, objectives and the resolutions of the General Meeting of Shareholders and the Board of Director Meeting by concerning to the Company’s highest benefits. The Board of Directors shall not have stake or commit any act that cause conflict of interest.
- To consider and review the Company’s vision, objectives, main goal, strategies, policies and core value including resource allocation.
- To undertake the management of the Company and ensure sustainable value creation resulting in good performance in the long term. To conduct business with ethical standards and be accountable to the stakeholders while developing or mitigating negative impacts toward environment and be able to adapt to changes.
- To ensure that the executives and employees perform their duties with accountabilities, carefulness, and integrity and to undertake the operations in compliances with related laws, objectives, regulations, resolutions of the General Meeting of Shareholders and the Board of Director Meeting and the Company’s policies.
- To assign duties and responsibilities to the managing director and the management explicitly in writing and to ensure that the directors and executives perform their duties efficiently and effectively in accordance with policies, duties and responsibilities as assigned.
- To oversee and ensure that the management sets up operational plans in accordance with vision, objectives, goals, strategic plans and the Board’s resolutions as well as allocates resources efficiently and effectively while cultivating corporate culture that results in innovation creation in order increase the Company’s value in the long term. In addition, the Board of Directors has monitored the operation of strategic plans every 6 months.
- To stipulate and review structure and composition of the Board of Directors as well as appropriate proportions of directors and independent directors to ensure their consistencies with the Company’s business objectives and strategic plans.
- To set recruitment and selection processes in order to appoint transparent directors and managing director, to provide director, managing director and executive development processes in order to ensure that they have knowledge, skills, experiences and attributes that are necessary for driving the corporate toward goals. To follow up and oversee human resource management and development in order to ensure number of workforce, knowledge, skills, and experiences including appropriate motivation.
- To set appropriate remunerations for the directors and executives by considering on their roles and responsibilities. Such remunerations shall be in line with strategy, short-term and long-term goals and the Company’s performance.
- To oversee and deal with conflict of interest which may occur among the management, the committees or the shareholders as well as wrongful use of the Company’s assets, information and opportunities including transactions of related persons in compliance with laws, official regulations and conditions.
- To stipulate policy, to oversee and ensure compliances with anti-corruption policy and measures including receipt of complaints and actions taken in case of whistle-blowing in every internal level and for third party.
- To ensure that the Company has effective risk management system, internal control and internal audit in order that the Company’s operations would comply with related laws and standards.
- The independent directors shall exercise their discretions to determine strategies, work management, the use of resources, committee appointments and business operational standards. The independent directors shall be ready to oppose the actions of another directors or the management in the event of conflict that affects to equality of all shareholders.
- Whether for their benefits or benefits of others, the Company’s directors shall not conduct businesses or be directors or executives or shareholders of companies conducting the same business and competing with the Company unless such directors having noticed in the shareholders meeting or the Board meeting prior to the nomination. With this regard, Company’s director shall take director positions for not over than 5 listed companies.
- To keep the Company’s internal information confidential and shall not use such information for their benefits or benefits of others as well as refrain from trading in securities for at least 30 days before and 1 day after the financial results announcement.
- The Company’s directors shall report the Company in a timely manner in the events as follows:
- (1) The director or related person having stake directly or indirectly while such stake is related to the Company or its subsidiaries’ business operations.
- (2) Holding shares or debentures of the Company or affiliated companies. The director shall report such Information with total number of shares or debentures that increase or decrease.
- To appoint the Corporate Secretary to provide suggestions related to laws and regulations, to undertake documentation and to maintain documents related to the Board meeting and shareholder meetings as well as to perform other duties as required by laws.
- To have the financial reports and other reports prepared in accordance with related rules, standards and practices. The accurate, adequate and equitable information shall be disclosed to stakeholders in a timely manner.
In the meantime, the shareholders are entitled to participate in making decision on the Company’s important issues.
- The committees may consider on hiring external consultants to provide suggestions or assists the Board. The consultants’ information including their independences without conflict of interest shall be reported to the Board of Directors and disclosed in the Annual Report.
- Roles and responsibilities of the Board of Directors and the management are clearly separated from each other in terms of structures and duties. With this regard, authorization letters identifying scope and delegation of authority of the management are arranged. Meanwhile, the Company has communicated such roles, duties and responsibilities to relevant persons regularly.
- The Company has stipulated Code of Conduct with detail as follows:
- Business ethics.
- Businessethics for stakeholdersnamelyshareholders,employees,customers,creditors, society,community, environment and regulators including code of conduct for business partners namely trade partners, distributors/vendors.
- Ethics for the Company’s directors
- Ethics for employees such as conflict of interest, confidential maintenance, procurement process, use of insider information, anti-bribery and anti-corruption, intellectual property and usage of information technology, etc.
- Compliance monitoring and disciplines The Company has promoted Code of Conduct compliance and defined monitoring system to ensure tangible compliance such as on line safe-assessment on a yearly basis for all executives and employees.
- The Board of Directors clearly defined Conflict of Interest Policy in the Company’s Code of Conduct and set procedure to monitor transactions that may cause conflict of interest and regulations on related transaction in accordance with regulations of the SEC. In case any transaction must be approved by the Board of Directors and /or shareholders meeting, such transaction will be firstly reviewed, screened and given comments by the Audit Committee accordingly. Nonetheless, in case the Board of Directors’ opinion is different from the Audit Committee’s opinion, the Company shall disclose their different opinions as well. With this regard, The Company’s directors who has stake on transaction in any agenda, shall has no right to vote on it.
- The Company has disclosed information regarding its connected transactions with persons who may have conflicts in year 2017. The Board of Directors opined that all connected transactions were reasonable and beneficial to the Company’s business and complied with the regulations of the SEC as shown in topic “the Connected Transaction”.
- The Company has adequate and appropriate internal control system and workforce to conduct its internal control effectively. Meanwhile, the Company has monitored and overseen its subsidiaries performances to ensure that they are able to protect assets from wrongful actions of their directors and executives. In year 2017, there was no report of wrongful action and the internal control system deficiency in substantial. Its detail is shown in the topic “Summary of Opinions Concerning Internal Control System, Year 2017”.
- The Board of Directors defined the Risk Management Policy emphasized that the Company should apply risk management process throughout the whole organization to support the Company to accomplish its strategic objectives. The Risk Management and Strategic Plan Office undertake risk management monitoring to ensure that every department apply risk management process and assess on strategic objectives accomplishment in a yearly basis. In addition, the Company has set trigger points as early warning and has relevant persons to define corrective measures to improve performance as a precaution against severe crisis. With this regard, the Risk Management shall consider and summarize risk management operating results while the Audit Committee shall review such summarization and have it reported to the Board of Directors in a quarterly basis.
- To assess the internal control system and the risk management effectiveness, the Company set up the Internal Audit Unit to undertake the internal control system and the risk management assessments as well as to provide reliability advices independently to increase value and improve the Company’s operations. The Internal Audit Unit shall also prepare auditing report for the Audit Committee and management report for the Managing Director. In addition, the Board of Directors and the Audit Committee shall review adequacy of internal control assessment form, which includes the risk management and provide comments on such matters in every year.
- To assess the internal control system and the risk management effectiveness, the Internal Audit Unit shall verify risk indicators or risk factors, which may affect objectives and risk management approaches of operators to ensure accurate and appropriate risk identification and assessment including systematic risk management. Meanwhile, the Internal Audit Unit shall report risks to relevant persons in a timely manner while continually verifying on risks in a quarterly basis.
Authority of the Board of Director
The Board of Director is authorized to stipulate policies as well as to give approval on the Company’s business issues in accordance with its scope of duties that specified by laws, the Company’s regulations and the Shareholders Meeting’s resolutions. The Board of Director’s duties include stipulation and review of vision, operating strategies, annual budget plans and business operating plans. Moreover, the Board of Director shall monitor and assess the Company’s operating performance to ensure its consistency with predetermined plans including supervising on capital expenditure, merger, demerger and joint venture, etc.
The Board of Directors Meeting
The Board of Directors announces the Board Meeting’s schedule in advance for the entire year, to the directors. The meeting is at least 5 sessions a year, which is proper to the responsibilities of the Company’s directors and its business. Nonetheless, special session meeting allowed to be convened as deemed necessary. The Executive Chairman together with the Managing Director shall determine agenda whereas all board members are entitled to propose agenda items independently. In year 2017, the Company arranged the Board of Directors’ meeting for 5 sessions and each director attended meeting regularly for 86.29% of the whole number of meeting sessions.
Detail of meeting attendances of the Board of Directors and Committees is shown in the topic “the Board of Directors”.
- The Company submits meeting invitation notice with complete and adequate attached documents for each agenda to directors for at least 5 working days in advance to ensure their sufficiency of time for studying all details prior to the meeting.
- Decision of the Board of Directors meeting is reached by a majority of the votes. Each director has 1 vote, with the exception that any director, who has stake on any matter, is not entitled to vote for such matter. In the event of a tie of vote, the Chairman shall give a casting vote. Moreover, the Company has stipulated a quorum for a Board meeting whereby not less than two third of the total numbers of director must attend the meeting.
- In each meeting, the Chairman allots sufficient time for the management to propose issues and directors to discuss circumspectly and thoroughly on the issues. The Chairman also encourages the meeting to exercise discretion carefully. Moreover, the Board of Directors allows the Managing Director to invite the management, who are relevant to proposed issues, to attend the meeting for clarifying and providing additional information. In addition, directors can require for more information from the Corporate Secretary. In case of necessary, the Board of Directors may allow the Company to propose opinions from external advisors or experts.
- The Corporate secretary shall prepare meeting minutes with complete and accurate details such as names of directors who attend and who are absent from the meeting as well as substantial summarization of issues discussion and opinions of each director including resolutions of the Board of Directors. All details are to be clear for shareholders’ inspection as required by laws. The Company also provides good system for meeting minutes filing and maintenance as well.
The Chairman of the Board of Directors and the Managing Director
The Chairman of the Board of Directors is the director, who is neither the Executive Director nor the Managing Director, and does not have relation with the Management as their roles, authorities and duties are clearly segregated. The Chairman of the Board is independent director whose duties are as follows:
- Calls for the Board of Directors Meeting and ensures Board members receive accurate, complete, timely, and clear information prior to the meeting to assist in their decision making process.
- Provides leadership and direction to the Board of Directors and chairs meetings of the Board.
- Conducts a Board meeting according to the agendas, the Company’s Articles of Association, and applicable laws.
- Encourages and allocates sufficient time to each Board member to discuss and express their free and frank opinions with due circumspection and concern for all stakeholders.
- Sums up the Board meeting resolutions and the actions to take clearly.
- Sets up a Board meeting without the presence of the Executive Directors.
- Chairs meetings of shareholders according to the agendas, the Company’s Articles of Association, and relevant laws by allocating time appropriately along with providing opportunities for shareholders to express their opinions equitably and ensuring that shareholders’ inquiries are responded to appropriately and transparently.
- Supports and be a role model in compliance with the principles of good corporate governance, anti-corruption measures and Code of Conduct.
- Fosters a positive working relationship between the executive directors and non-executive directors and the Committees and the management.
- Oversees to ensure the transparent disclosure of information and management in the event of conflicts of interest.
- Oversees to ensure the Board of Directors has appropriate structure and composition.
- Oversees that the Board of Directors as a whole, Sub-committee members, and each individual director perform their duties effectively and efficiently including achieving objectives as planned.
- Performs duties of the Chairman of the Board of Directors specifically stipulated by laws.
- Oversees to ensure that all directors take part in promoting corporate culture that reflects ethics and good corporate governance.
The Managing Director is the Head of the Company’s management, whose duties are to undertake the Company’s Board of Directors in order to achieve outcomes in accordance with policies and strategic plans.
Non-Executive Directors Meeting
The Board of Directors encourages non-executive directors to meet each other as deemed necessary in order to discuss various issues being attentive without participation of the management. In 2017, there was 1 meeting of non-executive directors without participation of the management, in which the meeting results were notified to the Managing director
Self-Assessment of the Board of Directors
Although the Company’s Board of Directors and Board Committees have performed their duties completely, the Company provides performance assessment to enhance their efficiency continually. The performance assessment of the Board of Directors and Sub-committees are divided into 2 categories including assessments for the Boards’ performances and individual self-assessment. For the Remuneration Committee, the Nominating and Corporate Governance Committee and the Risk Management Committee, each committee’s performance is assessed as the whole committee. Assessment criterion for the Board of Directors and Sub-committees are aligned in the same direction and regularly reviewed to ensure appropriateness and consistency with self- assessment sample that introduced by the Board of Directors of the Stock Exchange of Thailand.
The Corporate Secretary and Committees’ Secretaries will submit assessment forms to directors and then return them to the Company whereby the Company will not disclose names of assessors to ensure independency of directors. Furthermore, the Company will present assessment results to the Board of Directors and Sub-committees Meetings for their mutual consideration and stipulation on performance improving measure. In 2017, assessment results of the Board of Directors and Sub-committees were ranked as “very good to excellent”.
Criteria in self-assessment of the Company’s director include 6 main points as 1. Qualifications of director; 2. Term of office of director; 3. Remuneration of director; 4. Meeting attendance; 5. Role, duties and responsibilities of director; and 6. Training program and other information. For assessment of the whole Boards, its criterion include 6 main points as: 1. Composition of the Board of Directors; 2. Role, duties and responsibilities of the Board of Directors; 3. Nomination of director and special director; 4. the Board of Directors meeting; 5. Shareholders meeting; and 6. Information report.
Furthermore, the Company regularly arranges assessment on the Board of Directors Meeting Effectiveness after each meeting. Its results will be informed in the next meeting. Its result in overall of year 2017 was ranked as “very good to excellent”.
Managing Director’s Performance Assessment
The Company arranges the Managing Director Performance Assessment in yearly basis whereby the Remuneration Committee will conduct such assessment and present its results to the Board of Directors for giving consent. The summary of Managing Director’s Performance Assessment is deemed confidential. Criteria of Managing Director’s 102 ANNUAL REPORT 2017 BANGKOK AVIATION FUEL SERVICES PUBLIC COMPANY LIMITED Performance Assessment are divided into 3 parts as 1. Turnover of the Company; 2. Strategic plans of the Company; and 3. Behavior and Management. The assessment results shall be considered as information used for the Managing Director’s compensation adjustment, whereby its detail will be proposed to the Remuneration Committee and the Board of Directors for approval.
- Remuneration for the Director: the Company’s Remuneration Committee is responsible for considering remuneration provided to its director. The remuneration considering process is explicitly and transparently defined and approved by the Shareholders’ Meeting. The remuneration for director is adjusted to be appropriate with duties and responsibilities assigned including being in the same range of the same business industry or organization with similar size. Meanwhile, it is attractive enough to maintain qualified director as required. In addition, the Company’s director who is assigned to undertake more duties will receive higher remuneration as well.
- Remuneration for the Managing Director: the Board of Directors shall approve for remuneration of the Managing Director consist of short-term remuneration such as bonus and long-term remuneration whereby it is firstly screened by the Remuneration Committee in accordance with contract of employment. As agreed, Key Performance Indicators (KPIs) is applied for the Managing Director Annual Assessment, which includes assessment on the Managing Director’s actual performance during January to December in 3 aspects as: 1. Assessment on turnover of the Company; 2. strategic plans assessment in terms of finance, customer, business process, and learning & growth; and 3. other criterion as per approved by the Board of Directors. The Managing Director as executive director, who has stake, is not involve in assessment results consideration, but shall be informed its results by the Chairman of the Board.
- Remuneration for the Management and Employees: the Company has defined remuneration for the Management and employees in accordance to principles and policy stipulated by the Board of Directors, which is in line with turnover of the Company in each year and operating performance of each executive and employee. Accordingly, their performances are assessed by Key Performance Indicators (KPIs) system. The Company discloses remuneration of directors and high-level management in the topic “Management Structure – Remuneration for Director and management”. Meanwhile, remuneration for employees in 2017 was Baht 487,395,187 in total.
Director and Executive Development
- The Company promotes and facilitates its directors, executives and all employees by providing them training programs to ensure their improvements of performances consistently.
- The Board of Directors has prepared guidelines for the “Good Corporate Governance and Anti-Corruption Policy” and Code of Conduct, which are distributed to all directors. To ensure their up-to-date, the contents are regularly improved. The Company’s directors shall realize crucial measures relevant to the Board of Directors and Sub-committees including major policies and important information of the Company. Therefore, the Company’s directors are capable to perform more effectively their duties and responsibilities.
- The Company also organizes orientation program for new directors whereby the Managing Director and relevant Executives together with the Corporate Secretary and Investor Relations Manager will present information regarding shareholding structure, business natures, the Company’s business operation, important financial information, the Corporate Group, the Board of Directors Meeting including other information.
- The Company places importance on improving its directors’ knowledge and capabilities, therefore, the Company encourages all directors to take training courses such as director course organized by Thai Institute of Directors (IOD). In 2017, There were 4 directors Mr. Nitinai Sirismatthakarn, Mr. Phiphawat Sitthichaikasem, Mr. Rungroj Sivachan participated in Director Accreditation Program (DAP), class 138/2017, 139/2017 and 140/2017 respectively. Squadron Leader Pongtorn Thepkanjana attended Director Certification Program (DCP),class233/2017.There wasthe director,Mr.AswinKongsiri, participated seminars whichhad beenorganized by IOD : Director Briefing 2/2017: Directing in the Year of Rooster: Hot Issues and Outlook for 2017, IOD Nomination Director Event 2017: Nomination Committee Best Practice Guideline, IOD Chartered Director & Fellow Member Event 1/2017: Story Telling and IOD Audit Committee Forum 2017: The Audit Committee’s Role in Compliance and Ethical Culture Oversight. BAFS also arranged the internal seminar regarding CG Code for directors.
The Board of Directors recognizes that human resource is key factor that enable its organizational development to achieve sustainability, especially, human resource for managing director and management levels. Therefore, the Company promotes Successor Policy in order to undertake organizational business management systematically. To ensure capabilities of human resource in management level and corporate goal achievement, the Company defines selective process with explicit, tangible and transparent criterion, which is in consistent with the Principles of Corporate Governance and Code of Conduct.
To ensure that the Company will obtain management who possess integrity, capabilities and readiness in every aspect to support on development of organization’s competitiveness and sustainability, the Company arranges appropriate and transparent guidelines for selective process of candidates to fill in management and high management positions that has been set in advance. The Company defines its selective process with detail as follows:
- Managing Director
The Company shall select candidates with capabilities from both internal and external. The Board of Directors and the Executive Chairman shall consider the list of potential candidates whereby candidates shall take tests such as leadership, vision, knowledge, and management capability, which are consistent to the Core Value, including other necessary skills that are in line with the Company’s business nature.
- Deputy Director and Director
When deputy director and director positions are going to be vacant, the Company shall select competent employees from manager level in its organization with criteria as follows:
- Evaluate competence of the candidates.
- Arrange professional tests such as English language, capability and skill, managerial thinking, work presentation, and vision. Then, committee, which comprises high-level executives, will interview candidates.
- Set up human development plan for chosen executives to ensure their preparedness for the vacant positions.
- Upon taking position, probation period shall be specified. Upon completion of probation period, chosen executives shall be assessed by KPIs systematically.
Succession Plan is one element of Good Corporate Governance that can reduce problem regarding insufficiency of human resource for important positions. The Company shall evaluate and forecast its human resource situation periodically including seeking, preparing and developing its workforce consistently.
In addition, as the Company has committed in continuing its good corporate governance, the company has been evaluated to be excellent organization in terms of corporate governance by the Thailand Institute of Director (IDO) for 9 consecutive years.
- Managing Director