Good Governance
  

Corporate governance policy

The company recognizes that good corporate governance is the major factor that enables the organization to have efficient operation and supports sustainable growth. The CG Policy was drafted by corporate governance and risk management committee and approved by the Board of Directors. On 7th November 2016, the board of directors agreed to revise such policy in order to improve the standard and the operation of the good corporate governance, to be complied with ASEAN Corporate Governance Scorecard (ASEAN CG Scorecard).

In this regards, the corporate governance policy is available on the company’s website http://www.apthai.com/investor-relations under the sequence of menu headings “Corporate Governance”

Corporate governance report 2017

In 2017, the board of directors was considered and reviewed the implementation of CG code with the context of company’s business. Furthermore, the company’s corporate governance practices in 2017 were in line with the principle of good corporate governance for listed companies by the Stock Exchange of Thailand, which are presented in 5 categories as follows:

1.
Rights of the Shareholders

Concerned as the company owner, shareholders have their rights and votes, according to the laws, in key administration of the company. Therefore; the company aims to create highest benefit among shareholders on a basis of equal treatment such as buying or selling shares, receiving dividends, together with an adequate, timely, and complete information. Relations and Corporate Secretary section were set up as a channel for communication where the shareholders can access via telephone email and post. In addition, shareholders are entitled to take part in material business decisions e.g., payment of dividends, appointment and removal of directors, determination of directors’ remuneration and amendment to provisions of the Articles of Association.

  • Shareholders’ Meeting

    In 2017, the company held its Annual General Meeting of Shareholders (AGM) on 27th April 2017, which did not exceed 4 months after the fiscal year end. The company conducted the proceedings in a manner to ensure that the shareholders were able to exercise their rights in accordance with law, relevant regulations and good governance practices as follows:

    Before the meeting
    1. The company ensures that shareholders receive clear and adequate information with sufficient time to consider agenda items of the AGM, also, shareholders are able to easily access the Notice of the AGM and its accompanying documents. To this end, the company posted the Notice of the AGM and related documents on its website (http://www.apthai.com/ investor-relations/) on 21st March 2017, which was not less than 30 days prior to the meeting date. Then, the Notice of the AGM, in both in Thai and English, together with the 2016 Annual Report (in CD-ROM format) was sent via post by Thailand Security Depository Co., Ltd. (TSD) to shareholders on 10th April 2017, which was more than 14 days in advance of the meeting date. The Shareholders were entitled to receive the printed 2016 Annual Report before the date of the meeting from the company secretary upon request. The aforesaid Notice of the AGM contained information such as date, time and venue of the meeting, and details of each agenda item (including factual background, rationale and opinions or recommendations of the board) as well as accompanying documents. The Meeting Notice was also advertised in newspapers during 7 and 10-11th April 2017, which were three consecutive days prior to the date of the meeting.
    2. In order to encourage all shareholders (individuals, juristic persons and institutional investors) to attend the AGM and exercise their rights in an equitable manner, the company delivered the Notice of the AGM together with the Proxy Form to the shareholders for the appointment of proxies to attend the meeting on their behalf in the event that the shareholders were unable to attend the AGM in person. In addition, the company proposed the name of 2 independent directors, Mr. Nonthachit Tulayanonda and Mr. Kosol Suriyaporn on the notice of the meeting for the shareholders consideration to appoint proxy.
    3. In order to facilitate attendance to all shareholders and proxy holders, the AGM was held on a working day - Thursday 27th April 2017 at 14.30 hrs, at easily accessible location, Meeting room 1-4, zone B, Queen Sirikit National Convention Centre, New Ratchadapisek Road, Bangkok, 10110. The company provided the adequate personnel to facilitate the meeting and verify the documents. The meeting registration service was divided into different counters for each shareholder by type, i.e., individuals, juristic persons and fund managers or custodians.
    4. In encouraging the using of technology, the company has assigned Inventech Systems (Thailand) Co., Ltd to provide a barcode system for registration and voting process including ballots bearing the same barcode as their registration bar code for voting on each agenda item. The IT experts were provided to oversee the meeting for the accuracy and convenience of the registration, and vote counting process.
  • The conduction of the shareholders’ meeting

    1. Directors and executives were to present at the meeting to explain and answer the shareholder’s questions. All directors, executives, auditors, and the representatives of each subcommittee were introduced to shareholders before the start of the meeting.
    2. The company conducted transparent shareholder’s voting and allowed shareholders to vote separately in each agenda item. Therefore, the shareholders can exercise their right freely.
    3. The chairman of the meeting allowed shareholders to have an opportunity to ask questions and/or make recommendations on an equitable treatment basis, and provided comprehensive responses to all questions or issues raised. Minutes of the meeting and votes cast under each agenda item were recorded by the company secretary.
    4. The company counted the votes and announced the voting results of each agenda item with transparency during the meeting by specifying the voting of approval, disapproval and abstention. In 2017, there were no shareholders opposed to the voting results.
  • The preparation of AGM’s minute and disclosure of AGM’s resolution

    1. The resolutions adopted were disclosed via SET portal in both Thai and English on websites of the Stock Exchange of Thailand. In 2017, the company submitted the resolution of AGM’s meeting on 27th April 2017 by classifying the votes into approval, disapproval and abstention.
    2. The company prepared the minutes of the meeting with the significant information such as the name list of directors who attended or missed the meeting, abstracts of the questions, issues raised and the answers or clarifications, and the resolutions with the number of approval, disapproval and abstention votes.
    3. The minutes of the AGM 2017 in Thai and English were submitted to the Stock Exchange of Thailand on the website on 11th May 2017, which is 14 days following the meeting.
2.
Equitable treatment of shareholders

As stipulated in the company’s Corporate Governance Policy, all shareholders, i.e., major, minor, institutional and foreign shareholders, are entitled to have common shareholder rights and to be treated on an equitable and fair basis. The details are as follows:

  • Providing of information before AGM meeting
    1. On 21st March 2017, 36 days prior to the meeting date, the company posted the notice with related information in both Thai and English on the company website, which was identical with the hard copies.
    2. Before the meeting begins, the company informs the meeting on the proportion of shareholders and the proxy holders, the vote counting procedure, and the voting process.
  • Protection of minor shareholders
    1. The company allows shareholders to propose the meeting agenda items and names for consideration elections as directors in advance of the shareholders’ meeting. For the AGM 2018, the company disclosed the information of complete criteria proposal on 20th November 2017 through the Stock Exchange of Thailand’s website under the sequence of menu headings ‘investor relations’ (http://www.apthai. com/investor-relations/). Shareholders were welcomed to submit the agenda proposal and director nomination during 1st to 31st December 2017, but no agenda items and name of directors were proposed.
    2. The company conducts the meeting in accordance with the regulations without switching, adding, revising any agenda items, or modifying previously issued information during the meeting.
    3. In the agenda item of the election of directors, the company allows shareholders to cast their votes for individual directors with separated ballots and collected all ballots from all shareholders in every case (approval, disapproval, and abstention).
  • Supervision of the use of insider information

    The company has supervision of the use of insider information measure in written notice. ‘The supervision of the use of insider information and report of the company’s shareholding’ was approved by The Board of Directors on 13th August 2013 with the following objectives:

    1. Informing the executives of every division regarding duties and responsibilities to report their holdings of the company’s shares, also announcing the punishments according to regulations of the Stock Exchange of Thailand and the Securities and Exchange Act B.E. 2535.
    2. The company obliges the executives to report any changes in their shareholding to the Office of Securities Exchange Commission and the Stock Exchange of Thailand according to Section 59 of the Securities and Exchange Act B.E. 2535. The executives shall provide the co py of the report to the company on the same day that they provide the report to the Office of Securities Exchange Commission and the Stock Exchange of Thailand.
    3. Connected transactions made by directors and executives must be reviewed by independent directors to ensure the best benefit or to prevent loss of the company.
    4. The Board of Directors issues the principle and penalty measures concisely on the usage of internal information, especially before being reviewed by certified public accountants and approved by the audit committee and the Board of Directors, or before being publicly disclosed.

    Moreover, the silent periods are set to refrain directors, executives and staff who are significantly involved in financial reporting from the company’s stock trading during the period of financial report disclosure (both before and after). Shareholders and public are allowed to have enough time to study the report and gain equal investment opportunities. This also applies to staff in the investor relations and public relations section to refrain from giving the significant insider information to outsiders, shareholders, investors, analysts, and mass media 7 days before the public announcement, also, to refrain from meeting or responding to any question so related.

    If any employee violates the aforementioned measures, the company will take the following disciplinary actions:

    1. First violation Written warning
    2. Second violation Salary cut/Suspension
    3. Third violation Termination of employment without compensation

    For the report of ownership of shares, directors and executives are responsible for making reports of company’s stock trading within 3 working days after changes to propose to office of Securities and Exchange Commission (SEC) and Stock Exchange of Thailand. The company secretary is responsible for collecting those changes to put into the agenda of information for every board meeting. Directors and executives are to inform the Board of Directors about stock trading at least 1 day before making transaction.

    For the report of ownership of shares, directors and executives are responsible for making reports of company’s stock trading within 3 working days after changes to propose to office of Securities and Exchange Commission (SEC) and Stock Exchange of Thailand. The company secretary is responsible for collecting those changes to put into the agenda of information for every board meeting. Directors and executives are to inform the Board of Directors about stock trading at least 1 day before making transaction.

    In 2017, the changes on the directors and executives’ ownership of shares are as follows:

    Directors’ ownership of AP shares

    No.
    Name
    Number of shares
    Remark
    30th December 2016
    29th December 2017
    Change during the year
    1.  Prof. Dr. Naris Chaiyasoot
    -
    -
    -
    No ownership of AP shares
    2. Mr. Anuphong Assavabhokhin
    670,047,561
    670,047,561
    No trading transaction of AP shares
    3. Mr. Pichet Vipavasuphakorn*
    113,982,879
    113,982,879
    -
    No trading transaction of AP shares
    4. Mr. Siripong Sombutsiri
    -
    -
    -
    No ownership of AP shares
    5. Mr. Wason Naruenatpaisan
    132,000
    132,000
    -
    No trading transaction of AP shares
    6. Ms. Kittiya Pongpujaneegul
    817,520
    817,520
    -
    No trading transaction of AP shares
    7. Mr. Visanu Suchatlumpong
    100,000
    100,000
    -
    No trading transaction of AP shares
    8. Mr. Pornwut Sarasin
    673,000
    673,000
    -
    No trading transaction of AP shares
    9. Mr. Yokporn Tantisawetrat
    -
    -
    -
    No ownership of AP shares
    10. Mr. Phanporn Dabbaransi
    -
    -
    -
    No ownership of AP shares
    11. Mr. Kosol Suriyaporn
    -
    -
    -
    No ownership of AP shares
    12. Mr. Nontachit Tulayanonda
    -
    -
    -
    No ownership of AP shares
    13. Mr. Somyod Suteerapornchai
    2,200
    2,200
    -
    No trading transactions of AP shares

    * including indirect shareholding (spouse)

    Executives’ ownership of AP shares

    No.
    Name
    Number of shares
    Remark
    30th December 2016
    29th December 2017
    Change during the year
    1.  Mr. Opas Ruangrajitpakorn
    -
    -
    -
    No ownership of AP shares
    2. Mr. Piyawat Suephaisal
    -
    -
    -
    No ownership of AP shares
    3. Ms. Tippawan Sirikoon
    -
    -
    -
    No ownership of AP shares
    4. Mr. Somchai Wattanasaowapak
    -
    -
    -
    No ownership of AP shares
    5. Mr. Vittakarn Chandavimol
    -
    -
    -
    No ownership of AP shares
    6. Mr. Pamorn Prasertsan
    172,238
    38
    (172,200)
    Sell out 172,200 shares
    7. Ms. Chidapa Amralikit
    -
    -
    -
    No ownership of AP shares
    8. Mr. Worrapong Virojtananugoon
    231,000
    11,000
    (220,000)
    Sell out 220,000 shares
    9. Mr. Ratchayud Nunthachotsophol
    -
    -
    -
    No ownership of AP shares
    10. Mr. Thanit Paiboon
    -
    -
    -
    No ownership of AP shares
    11. Mr. Boonchai Jankrajanglerd
    -
    -
    -
    No ownership of AP shares
    12. Mr. Pattaraphurit Rungjaturapat
    -
    -
    -
    No ownership of AP shares
    13. Mr. Set Srisayant
    -
    -
    -
    No ownership of AP shares
  • Conflicts of interest by directors
    1. In accordance with the Securities and Exchange Act, B.E. 2535, the company requires directors and executives to report any conflict of interest of themselves and their related parties to chairman of the board within 7 days following the end of the year and the day of existing reported items changes. The company secretary is responsible for collecting such reports. However, no conflicts of interest by directors are reported.
    2. The company considers any transactions with transparency and fairness for the best interest of the company and shareholders. The transactions need to be approved by the audit committee, the board and/or the shareholders in accordance with the notification of SEC and SET related to the acquisition or disposal of assets. Executives or shareholders who have any conflicts of interest reports are not involved in such transactions.

      In 2017, the company had reported the acquisition or disposal of assets transaction of 6 items to the Stock Exchange of Thailand, which were not exceed the transaction size to get approval from shareholders. Also, the company informed Stock Exchange of Thailand thoroughly.
3.
Role of stakeholders

The company emphasizes on the right of a broad range of stakeholders, both internal and external, including employees, creditors, trade partners, governmental agencies, customers and shareholders. The company’s corporate governance policy includes the role of stakeholder and the treatment of stakeholders is summarized as below:

  • Employee policy

    The company recognizes that human resource is an essential key for driving the company to success. Therefore, the company aims to recruit and develop all employees equally.

    The company also treats employees fairly and adopts a nondiscriminatory basis regarding gender, age, nationality or religion. The employees interests are addressed through the market based as well as compensation practices (short and long term) and the welfare and benefit are considers as important issues according to their performances. That is, in short term, employees’ performances, capability to make profit each year and KPI would be tools in compensation management, and in long term, Employee Stock Ownership Plan (ESOP) would be offered.

    In addition, the company provides various benefits to the employee who has passed the probationary period as follows:

    • Annual check up
    • Group insurance, including life insurance, health insurance, and disability insurance.
    • Remuneration and welfare shall be transparent and unprejudiced with regard of suitability, working performance and the Company financial ability.
    • Provident fund
    • Booking of the AP’s condominiums.
    • Home loan

    Besides, the company works hard on building culture, good relationship and good working atmosphere by arranging various activities. Employees are encouraged to suggest ideas for organization development. Therefore, the company conducts an annual survey and analyzes the results for further improvement. Moreover, health promotion activities are provided regularly for employees to take part in running program, weight loss running program, and annual check up.

  • Training and human resource development

    The company sets up AP Property School to provide knowledge and develop abilities and working skills for employees, 5 curricula are provided at AP Property School. The details of 2017 training are shown in the topic of Corporate Social Responsibility (CSR), sub-topic of AP Property School.

  • Anti-corruption

    Throughout 25 years, the company holds the principles of honesty and transparency in business conduct by realizing that corruption would affect company reputations, competitiveness, and trust of all stakeholders.

    The company issues very strict guidelines of Anti-corruption policy for all Board of Directors, committees, executives, and every level of employees as stated below:

    1. Anti-corruption policy
    2. Anti-corruption measures
    3. Code of conduct
    4. Good Corporate Governance
    5. Accepting/Offering Gifts, Rewards and Benefit policy
    6. Whistleblowing policy

    Following Anti-corruption policy and measures, the company provides knowledge to employees via various inside communication channels such as employees’ e-mail, pop-up animation on screen of every computer, and activities. These are to support learning and understanding, and to inform code of conducts of company’s Anticorruption policy. Besides, Anti-corruption policies and measures are put in new employees’ training curricula.

    All employees are able to act as a whistleblower by sending e-mail to kosol.boardap@gmail.com or hotline@apthai.com. The company conducts procedures of investigation by setting committees to determine complains and petitions, in order to create fairness for every whistleblower, also, all data and information of whistleblowers are kept confidentially.

  • Resource and environments

    The company recognizes the importance of Safety, Hygiene, and Environment in working operations (SHE), therefore, the policy of Safety, Hygiene, and Environment in working operations is set to provide knowledge and to encourage practicing. Animation information is made to disseminate via inside communication channels such as e-mail and company’s website which are easily accessible. Moreover, training courses for employees, focusing on environment are put in the management curriculum of Construction Curriculum as one of AP Property School curricula. In 2017, 42 times of training courses were held with 599 participants.

    From the previous year of 2017, accidental rate, leave of absence rate, and sickness rate were recorded as shown below:

    1. Accidental rate during work: total 6 cases, details as follow;
      Month
      No.
      Accident/Symptom
      January
      1.
      A knife cut
      2.
      A leg hurt after falling into a swimming pool
      3.
      Painting color splashes to the eyes
      February
      4.
      Broken bones caused by fall accidents
      October
      5.
      A heavy object dropped on top of the foot
      November
      6.
      Step on a nail
    2. Leave of absence rate:
      Type
      Total employees (person)
      Total leaves (day)
      Average (day/person)
      1. Sick leave
      1,339
      8,330
      6
      2. Personal leave
      236
      536
      2
      3. Annual leave
      1,722
      14,614
      8
    3. Work related sick leaves
      Type
      Total employees (person)
      Total leaves (day)
      Average (day/person)
      1. Work related sick leaves
      5
      21
      3.5
    4. For environmental conservation, the company enhances employees to operate works without causing any impact to environment. Employees shall not cause any emission by discharging garbage or wastewater from construction sites to community, also, garbage and dangerous goods from construction are not allowed to be eliminated and create air pollution by burning. Fences are built around construction areas in order to cover dust and debris not to spread out to areas nearby. The company expects employees to consume resources efficiently for instance, using reuse papers, and saving energy and water by displaying campaign on boards inside the office building. The company follows the law of environment by applying EIA before starting any project. The details are shown under the topic of Corporate Social Responsibility (CSR), sub-topic of Environmental conservation.

  • Human rights

    The company issues human right policy to encourage the Board of Directors, committees, executives, and employees including employees of subsidiary company to follow strictly. According to the Universal Declaration of Human Rights and Human Right in Organization, the company holds the recruitment with employment ethics - no discrimination on race, religion, color skin, and gender, also, no children labor or illegal labor. Moreover, the disabled are welcome for the suitable position and responsibilities.

  • Consumer

    The company adheres to and strictly complies with the policy of liabilities for consumers. House and condominium care, together with another services are provided with high standard and high quality development. The company organizes the assessment of construction impact on consumer regularly as well as After Sale Service team, which details are illustrated in the topic of Corporate Social Responsibility (CSR) under the sub-topic of Accountability to customers. Also, many accessible channels are provided for consumers to easily communicate with the company - through the website http://www.apthai.com/contact-ap, call center 1623, and special call service for AP’s customers 0-2018-9999.

    Furthermore, in 2017, various activities were continually held by AP Society as shown in details available on company’s website http:// www.apthai.com/ap-society/, in the topic of CSR under sub-topic of AP Society.

  • Community (including creditors, business partners, and competitors)

    The company behaves in an ethical and transparent way with creditors, business partners, and competitors based on good faith and business ethics. The company also operates strictly to comply with stakeholder policy as shown on company’s website http:// www.apthai.com/investor-relations/, under the topic of Corporate Governance.

  • Creditors

    The company sets creditors policy to encourage the Board of Directors, committees, executives and employees including employees of subsidiary company to follow strictly. It is taken into action by following the commitment and agreement equitably between all creditors based on fairness of mutual benefits, in order to create trust and sustainable relationship with creditors. The code of practices are conducted by setting guidelines for guarantee conditions, fund management, and default payment to bring fairness to creditors, both trade payable and financial institutions. The settlement shall be conducted in the period punctually according to the agreement to avoid default payments, and any contracts or agreements shall be followed seriously. In case of the situation which causes impact significantly to financial stability and payment capability, fund shall be managed by informing the creditors to consider for the solution to prevent damages or loss.

  • Business Partners

    The company sets business partners policy to encourage the Board of Directors, committees, executives and employees including employees of subsidiary company to follow strictly by focusing on maximizing company’s benefits, conducting business with transparency, and improving collaboration with business partners to generate customers highest benefit. Besides, the company issues procurement policy, which identifies the criterion of procurements for company’s project both low rise and high rise, as well as Buyer Code of Conduct for purchasing officers to be the framework and code of practices to operate their duties with honesty, integrity, and transparency by seriously concerning about company’s benefit and equitable treatment for business partners.

    However, in selecting business partners, the company sets the regulations in written notice as illustrated clearly and concretely in the section of procurement and code of practices. The approaches are as follows:

    1. Comparing and Bargaining approach - at least 3 partners or contractors are taken into consideration and the one with best offering would be selected.
    2. Bid Auction approach - at least 2 partners or contractors are allowed in bid auction by proposing the offering and bargaining on date and time quoted by the company.
    3. Specific approach - special procurement which requires specific criteria such as, urgent cases related to company’s benefit, materials or works restricted on identifying the producers or expert contractors, etc.

    The company offers the opportunity of business equality without bringing disadvantages to small enterprises of business partners. Also, the company launches campaign of creating core value and anti-bribery by providing knowledge to all levels of employees via inside communication channels.

  • Competitors

    The company sets competitors policy to encourage the Board of Directors, committees, executives and employees including employees of subsidiary company to follow strictly by conducting the business according to regulations of business competition with honesty and fairness, based on alliance principle to support each other under the framework, not to bring loss and disconnection. Up until now, including in 2017, the company had no dispute among competitors.

    Furthermore, the company recognizes the importance of being a part of society that is responsible for helping and supporting the society in providing beneficial public activities for communities. Therefore, the company sets social policy to encourage the Board of Directors, committees, executives, and employees including employees of subsidiary company to follow strictly. The purpose is to participate in developing quality of Thai society by continuously supporting and providing activities that are beneficial for communities and public society. The details of social activities are shown in the topic of Corporate Social Responsibility (CSR).

    Apart from the implementation of policies related to stakeholders above, the company emphasizes on Anti-corruption by enhancing and supporting every level of employees to build good sense against all types of dishonesty and corruption. To ensure such intention, the company declared to be the part of Private Sector Collective Action Coalition Against Corruption (CAC) on February 26th, 2015. Later, AP was officially certified as a member of Private Sector Collective Action Coalition against Corruption (CAC) by CAC council on 9th March 2017. The details are shown in Anti-corruption guidelines.

  • Communication channels for stakeholders

    The board realizes the importance of stakeholders and participation of all stakeholders, so the communication channels are provided for stakeholders to directly give suggestion, advice, or complain about any issues that may cause damages to the company. Sending e-mail is available through Mr. Kosol Suriyapon, audit committee member of the company; kosol.boardap@gmail.com. or hotline@ apthai.com. The procedures of accepting complains, petitions, and investigation shall be reported to the board.

4.
Disclosure and transparency
  • Disclosure of information
    1. In 2017, the company disclosed the significant information in accordance with the regulations of listed companies such as the Annual Registration Statement (form 56-1) and the Annual Report (form 56-2) in both Thai and English through the Stock Exchange of Thailand’s website and the company’s website.
    2. In Annual Report 2017, the company disclosed the following significant information for shareholders: director’s responsibilities concerning the company’s financial report alongside the auditor’s report, a management discussion and analysis (MD&A), audit fee and non-audit fee, names and responsibilities of sub-committee, the number of meeting held, the attendance record of each director, and the remuneration policies for directors and executives.
    3. The company designated the Investor Relations to be responsible for communication and disclosure of information on the operating performance of the company to the investors, shareholders, analysts, and related agencies. The contact is available via contact person, Ms. Kittiya Pongpujaneegul, corporate secretary, or
      Investor Relations
      AP (Thailand) Public Company Limited
      170/57 Ocean Tower 1 Building, 18th Floor, New Ratchadapisek Road, Klongtoey Sub-district, Klongtoey District, Bangkok 10110
      Tel: 0 2261 2518-22
      E-mail: investor@apthai.com
      Website: http://www.apthai.com/contact-ap/

    In 2017, the activities undertaken by Investor Relations are summarized as below:

    Activities
    Times
    Analyst meeting 4
    Investor conferences 23
    Road show
    - Domestic 4
    - International 3
  • Minimum information disclosed on the company’s website

    The company disclosed its information on website such as the Annual Registration Statement (form 56-1), the Annual Report (form 56-2), the notice to the shareholders’ meeting, the article of association, company’s regulations, Memorandum and Article of Association, the CG policy, business ethics for employees and board of directors, and other information. All disclosed information is up to date.

  • Disclosure of key performance indicators

    The company discloses company Key Performance Indicators (KPI), both financial KPI (e.g. revenue and profit) and non-financial KPI (e.g. customer satisfaction), with an intention to continuously build and increase customer satisfaction of the residence by emphasizing on research and product development. The company organizes marketing research sector and product development sector in order to profoundly analyze customers’ need, especially in the aspect of space utilization that meets customers’ lifestyle. This highlights AP’s qualification of Responsive creator as the company always uses the feedback from the research to help develop new projects. Besides, the company also organizes the sector of marketing strategy which operates the survey, research, and analysis about customers’ need in each area together with the potential of providing public utility of every project location. Therefore, the company is holding sufficient database for the analysis to study market demand on residence in each area along with roles, residence types, locations, and price levels in order to develop company’s project to be the most outstanding project among the competitors nearby, also, to affirm customers’ pride on selecting company’s product.

5.
Responsibilities of the board
  • Board structure

    The board of directors’ qualification is in line with clause 68 of Public Limited Company Act B.E. 2535 and the related notification of the Securities and Exchange Commission (SEC). The board appointed Mr. Pramart Kwanchuen as a secretary of the Board of Directors, in order to handle the meeting in accordance with the relevant rules and regulations.

    The company considered an appropriate Board Structure and balanced their responsibilities. As of 31st December 2017, the board comprised of 13 directors, as shown in the section of management structure.

    1. The board comprises of directors with diversity of age, gender, skill, experience and specific ability, that are beneficial to perform their duties. There are 6 executive directors from total of 13 directors as follows: Mr. Anuphong Assavabhokhin, Mr. Pichet Vipavasuphakorn, Mr. Siripong Sombutsiri, Mr. Wason Naruenatpaisan, Ms. Kittiya Pongpujaneegul, and Mr. Visanu Suchatlumpong. The chairman of the board is Prof. Dr. Naris Chaiyasoot, a non-executive director, who has no experiences in property business. The profiles of each director are shown in the attachment.
    2. There are 7 independent directors as follows: Prof. Dr. Naris Chaiyasoot, Mr. Pornwut Sarasin, Mr. Yokporn Tantisawetrat, Mr. Phanporn Dabbaransi, Mr. Nontachit Tulayanonda, Mr. Kosol Suriyaporn, and Mr. Somyod Suteerapornchai, that are more than one-third of the total directors. All of them have qualifications as specified by SET and SEC. There are 4 members of audit committee as follows: Mr. Phanporn Dabbaransi, Mr. Nontachit Tulayanonda, Mr. Kosol Suriyaporn and Mr. Somyod Suteerapornchai. The independent directors are to review company’s operation and act as balance of power in the board of directors as well as to independently object any issue in the meeting and enable efficient decision making process.
    3. Each director has a term of position for 3 years, when any directors complete their terms, the board will proposed to the shareholder’s meeting for approval, details are shown in the corporate governance policy.
    4. The chief executive officer and the managing director hold 21.30% and 3.62% shares (combining shares holding by spouse) in the company respectively (as of 29th December 2017). Therefore, the CEO and managing director are both major shareholders and act on behalf of all shareholders in managing the company with the objective of maximizing shareholders’ benefit.
      However, to separate duties and responsibilities between board of directors and executives, the company sets up corporate governance policy and daily management policy separately that chairman of the board, CEO, and managing director are not the same person. The chairman of the board performs duty of the leader and the operator of board meetings efficiently, supports the participation in meetings, and gives advice without interference with daily duty or daily business performed by executives.
    5. The Board of Directors establishes policy and practices about the directorship in other companies that the Chief Executive Officer, Managing Director, and Executive Directors shall hold a directorship in no more than 5 group companies, in conformity with the corporate governance policy.
    6. The board appoints the Corporate Secretary to serve the board by providing legal advice, taking care of the board’s activities and monitoring compliance with the board resolutions. Ms. Kittiya Pongpujaneegul was appointed as Corporate Secretary.
  • Sub-committees
    1. The following 4 sub-committees were set up by the board.
      • Audit committee
      • Executive committee
      • Nomination and remuneration committee
      • Corporate governance and risk management committee

      The scope of responsibilities of each committee is shown in the section of management structure.

    2. The chairman of the board is an independent director and does not hold any chairman position in any sub-committee in order to create independence.
    3. The sub-committee meetings are held regularly. The record of attendance, the list of attended person, and the positions in each committee are shown in the section of management structure.
  • Roles and responsibilities of the board
    1. The board’s duties and responsibilities shall be in accordance with those specified by law, Memorandum and Article of Association, and resolution of the shareholders, as well as the corporate governance policy.
    2. The board established a written corporate governance policy, which was latest revised on 7th June 2016.
    3. The board established a written code of conduct for all directors, executives and employees in order to provide understanding of ethical standards for business operation. The details are available on the company’s website http:// www.apthai.com/investor-relations/ under the sequence of menu headings “Corporate Governance” sub-heading “Code of conduct”. The latest revision of Code of conduct was announced on 3rd January 2018
    4. The board considers any conflict of interests thoroughly with no stakeholder involving in decision making process and provides the clear guidelines for benefits of company and shareholders. The board also monitors compliance with regulations regarding criteria, procedure, and disclosure of transactions with conflict of interests.
    5. The board establishes an internal control including financial, compliance, and policy control. The board assigns the internal audit to be responsible for auditing such internal control.
      The audit committee conducted the assessment of adequacy of internal control systems of 2017 in the audit committee meeting no.1/2018 held on 27th February 2018.
    6. The board also sets clear procedures on whistleblowing for related parties or stakeholder, ensures that the company provide protective measures on keeping the whistleblowers’ names confidential, and operates the investigation according to company’s regulations.
    7. The board organizes risk management procedures properly and efficiently. Risk management policy and risk committee are set.
  • Board meetings
    1. In 2017, the company set the meeting schedule and agenda in advance and notifies each director in order to manage time for meeting attendance.
    2. The number of board meetings are appropriated with duties and responsibilities of the board as well as the nature of business operation. In addition, the company held 13 board meetings in 2017.
    3. The company sends all meeting documents to each director at least 7 business days in advance of the meeting.
    4. The minutes of the Board of Directors’ meeting have all necessary and relevant information, such as date, time, names of directors with presence and absence, significant information, comments and resolutions. The company has good storage systems to retrieve the data. The Company Secretary also informs SEC of the storage place.
    5. In 2017, the meeting among the non-executive directors were held once a year to discuss business matters without executive directors.
  • Assessment
    1. Board Self-Assessment
      The Board of Directors conducts Evaluation on the Performance of the Board of Directors, Director Self-Assessment, and Sub- Committee Self-Assessment annually. The assessment of these 3 forms would be organized by the same process and criterion.

      Process
      The company secretary makes and reviews assessment forms to ensure the accuracy, then proposes to the Board of Directors to make an evaluation. The secretary is to summarize all performance assessments and proposes to the Board of Directors to consider and make improvement of the operations for more efficiency.

      Criterion
      The percentages correspond to the levels of performance achieved in each of area:

      • Over 85% = Excellent
      • Over 75% = Very good
      • Over 65% = Good
      • Over 50% = Fair
      • Below 50% = Need improvement

      Assessment topics

      Topic
      All Board of Directors
      Sub-Committee
      Individual
      Structure and characteristics of the board
      Roles/duties/responsibilities of the board
      Board meeting
      Board’s performance of duties
      -
      -
      Relationship with management
      -
      -
      Self-development of directors and executive development
      -
      -
    2. CEO Assessment
      The board makes an assessment of CEO by dividing into 9 topics: Leadership, Strategy Formulation, Strategy Implementation, Planning and Financial Performance, Relationship with the board, External relationship, Products and services knowledge, and CEO Characteristics. In 2017, CEO assessment result indicated excellent performances.

  • Remuneration

    The Compensation Committee considers the remuneration of directors by taking into account prevailing profit of the company, reflect experience, obligations, scope of work, accountability, and responsibilities that are comparable to the industry level in which the company operates. The committee would recommend the compensation of the directors to the Board of Director for approval and propose to the shareholders’ for final approval. The details of directors and executives’ remuneration in 2017 are shown in the section of management structure.

  • Development of directors and executives
    1. The board encourages and facilitates training for all internal parties related to corporate governance (such as audit committee member, executives, corporate secretary, etc.) in order to keep developing the operations. In 2017, the two directors namely;
      • Mr. Nontachit Tulayanonda had attended the training program, Director Accreditation Program (DAP) no. 139/2017, provided by Thai Institute of Directors (IOD).
      • Mr. Yokporn Tantisawetrat had attended the training program, Advance Audit Committee Program (AACP) no. 25/2017, provided by Thai Institute of Directors (IOD).

      Also, all boards had attended various training program of IOD as illustrated in the table below:

      Directors
      Training course
      DAP
      DCP
      FND
      CDC
      ELP
      AACP
      ACP
      1. Prof. Dr. Naris Chaiyasoot
      -
      -
      -
      2. Mr. Anuphong Assavabhokhin
      -
      -
      -
      -
      -
      -
      3. Mr. Pichet Vipavasuphakorn
      -
      -
      -
      -
      -
      -
      4. Mr. Siripong Sombutsiri
      -
      -
      -
      -
      -
      5. Mr. Phanporn Dabbaransi
      -
      -
      -
      -
      -
      -
      6. Mr. Nontachit Tulayanonda
      -
      -
      -
      -
      -
      7. Mr. Kosol Suriyaporn
      -
      -
      -
      -
      -
      -
      8. Mr. Pornwut Sarasin
      -
      -
      -
      -
      -
      -
      9. Mr. Yokporn Tantisawetrat
      -
      -
      -
      -
      10. Mr. Somyod Suteerapornchai
      -
      -
      -
      -
      -
      -
      11. Ms. Kittiya Pongpujaneegul
      -
      -
      -
      -
      -
      -
      12. Mr. Visanu Suchatlumpong
      -
      -
      -
      -
      -
      -
      13. Mr. Wason Naruenatpaisan
      -
      -
      -
      -
      -
      -
      • DAP = Director Accreditation Program
      • DCP = Director Certification Program
      • FND = Finance for Non-Finance Director
      • CDC = Chartered Director Class
      • ELP = Ethical Leadership Program
      • ACP = Audit Committee Program
      • AACP= Advanced Audit Committee Program
    2. In the orientation of new directors, since the company realized the importance of new directors’ duty performances, the company sets the regulation to help new directors prepare their duty performance to let new directors understand their roles, responsibilities, and company business operation. The “Director handbook”, document of company information and essential regulations and laws, would be distributed in order to be beneficial for new directors’ performances.
  • Succession plan

    The company has a succession plan that the chief executive officer and managing director are authorized to nominate a qualified and experienced person to be the executive of the company.

The selection and nomination of the company’s directors and key executives

  • Independent directors
    Independent directors’ qualification requirement

    Qualification requirements of company’s independent directors are stricter than the SEC notification Tor. Jor.4/2552 dated on 20th February 2009 (no.16 of the SEC notification Tor.Jor. 28/2551 was repealed.) as follows:

    1. Independent directors shall hold not more than 0.5 of all voting rights of the company, parent company, subsidiary company, affiliate company, major shareholder, or controlling person unless such condition is terminated for at least 2 years. This is not applied to the independent director who was a civil servant or consultant to the government sector that held company shares in majority or was a controlling person.
    2. Independent directors shall never be appointed as a director having a role in the company operation, employee, staff, consultant receiving fixed salary, or controlling person of the company, parent company, subsidiary company, affiliate company, subsidiary company in the same share held level, major shareholder, or the controlling person of the company unless such condition is terminated for at least 2 years. This is not applied to the independent director who was a civil servant or consultant of the government sector that held company shares in majority or was a controlling person.
    3. Independent directors shall not related by blood or legal marriage to any parents, spouses, siblings, children, or spouses of children of members on the management team, major shareholders, candidates to the management team, or authorized persons to the company or subsidiaries.
    4. Independent directors shall not related by blood or legal marriage to any parents, spouses, siblings, children, or spouses of children of members on the management team, major shareholders, candidates to the management team, or authorized persons to the company or subsidiaries.
    5. Independent directors shall never be an auditor to the company, parent company, subsidiary company, affiliate company, major shareholder, or the controlling person of the company and never be a significant shareholder, controlling person, or partner of the audit company to the company, parent company, subsidiary company or where the major shareholder or the controlling person takes part in, unless such condition is terminated for at least 2 years.
    6. Independent directors shall never render a professional service, including a legal and financial consultant which is paid for service more than 2 millions baht per year by the company, parent company, subsidiary company, affiliate company, a major shareholder, or a controlling person of the company and never be a significant shareholder, controlling person, or partner of such service render company, unless such condition is terminated for at least 2 years.
    7. Independent directors shall not appointed as a director to represent company directors, major shareholder, or any shareholders related to a major shareholders.
    8. Independent directors shall not belong to any business or partnership that is similar to or competing with the company or subsidiaries; or being an executive director, an employee, or a consultant that receives monthly salary; or holding more than 1% of shares that entitle to voting right in other companies that are in the same business or competing with the company and subsidiaries.
    9. No other conditions that affect the independency of discretion on company management.
  • Selection of directors and key executives
    Director selection

    The Board of Directors considers persons to be nominated as the company’s directors by their educational background, specialization, and experiences which support the company’s business. The selection principles are as follows:

    1. Requirements by laws, SET’s/SEC’s notifications, and the company’s articles of association in regard of a director qualification
    2. Qualifications as stated in the directors’ ethic
    3. Educational background and experiences which support the company’s business
    4. Trainings related to the directors’ responsibilities, the company business, good corporate governance, and advance policy planning
    5. Intention to guard the shareholders’ benefit with fairness
    6. Devotion and ability to develop the company business
    Selection procedure

    Nomination and Remuneration Committee nominates any appropriate person(s) qualified to the company’s director position, then proposes to the Board of Directors. The Board of Directors, then, proposes to the Shareholders’ meeting.

    An election/appointing of directors

    A meeting of shareholders shall elect the directors in accordance with the following procedures and rules:

    1. Each shareholder has one vote for each share held;
    2. Each shareholder may exercise the votes in electing one or more persons to be the directors but the votes for more than one person are indivisible; and
    3. The person who obtains the highest votes shall be elected as a director in respective order according to the required number of directors, but if two or more persons obtain equal votes, the chairman must exercise a casting vote.

    In the event of vacancy in the Board of Directors due to other factors aside from the end of directorship term, the Board of Directors shall select any persons qualified with Public Company Limited Act and Security and Stock Exchange Act to fill in. Unless such vacant directorship remains less than 2 months, a person who replaces the vacant directorship shall apply for the remaining term.

    Key executives selection

    The company’s human resource section is responsible for the hunt of qualified persons under the executive’s discretion, with the most relevant working experience and educational background.

    The control of subsidiary companies

    The company group authorization empowers the executive committee to appoint the directors and the authorized signatory directors of the subsidiary companies in order to align the management of the subsidiaries with the company. Also, the financial status and business operation disclosure, the transaction among the company group, the asset acquisition, and disposal or any other important transaction of subsidiary companies are conducted by the same guideline of the company.

    Auditor’s fee

    At the 2016 AGM, EY Office Limited (formerly Ernst & Young Co., Ltd.) by Mrs. Siriwan Suratepin (C.P.A. Registration No. 4604) and/ or Mr. Wichart Lokatekrawee (C.P.A. Registration No. 4451), and/ or Ms. Sathida Ratananurak (C.P.A. Registration No. 4753) were appointed as the company’s auditor for 2016 with the auditor’s fees of Baht 2,100,000 per year without non-audit fee.

    At the 2017 AGM, EY Office Limited by Mrs. Siriwan Suratepin (C.P.A. Registration No. 4604) and/or Mr. Wichart Lokatekrawee (C.P.A. Registration No. 4451), and/or Ms. Sathida Ratananurak (C.P.A. Registration No. 4753) were appointed as the company’s auditor for 2017 with the auditor’s fees of Baht 2,100,000 per year without non-audit fee.

    These appointed auditors have no relationship and conflict of interest with the company/ subsidiaries/ management and major shareholders of the company.

    Good corporate governance guidelines in other aspects

    According to the CGR survey 2017 by Thai Institute of Directors (IOD), the CG score of the company was excellent. Nevertheless, there were some issues that may not cover the criteria of the Corporate Governance Report of Thai Listed Companies and ASEAN CG Scorecard, as stated below:

    Issues
    Explanations
    The board of directors consist of 5-12 members The board of directors consists of 13 members, who are appropriate for the nature and size of business during expansion. Experts from a variety of professions are needed.
    In corporate governance policy, the Board of Directors shall specified about limitations of the directorship in other companies - to be not more than 5. Refer to the corporate governance policy, executive directors, managing director and chief executive officer are able to hold a directorship in other companies but not more than 5 group companies. However, there are no limitations for directors, therefore, some directors are holding directorship in other companies more than 5 companies due to the diversity of qualifications and abilities.
    The Board of Directors shall set limitations that individual may serve as an independent director for a maximum of 9 consecutive years. The company has no limitations on terms of the position of directors since the company believes that company’s directors with knowledge and capability would be beneficial. Long term experience of the director provides deep understanding of the company’s business.
    Director election through cumulative voting The company regulations call for director election to be decided by a majority of votes. Each shareholder carries votes equal to his or her number of shares. The company has consistently devised other ways to preserve the rights of minor shareholders including its encouragement for them to exercise their right to nominate additional agenda items or nominate directors in advance.
6.
Corporate Governance & Code of Conduct