Corporate Governance Policies
Rationale
The Board of Directors and executives are responsible for dealing with organizational structure and strategic management to enhance EGAT to generate, acquire, transmit, and sell electricity with the concern on system reliability and reasonable price, as well as aiming to conduct other related businesses with transparency and fairness for all stakeholders to increase EGAT added value.
Benefits of Corporate Governance
1. Enhancing transparency and ethics
2. Building reliability and confidence among key stakeholders
3. Supporting EGAT operation to achieve its goal with effectiveness and efficiency
4. Systematically and effectively disclosing both of financial and non-financial information
5. Providing the organization’s code of conduct to the Board of directors, executives and employees to follow
6. Monitoring the organizational operations
7. Preventing the conflict of interest
Good Corporate Governance Policy
1. Adopting organization-wide six key principles of good corporate governance, namely rules
of law, moral integrity, transparency, participation, responsibility and accountability as well
as effectiveness and efficiency.
2. Setting forth EGAT Code of Ethics and Conduct to provide guidance for the Board of
Directors, management, and all EGAT employees in performing their respective duties in
addition to compliance with EGAT’s rules and regulations.
3. The Board of Directors formulates EGAT’s vision, strategies, policies and key initiatives
taking into account risk factors. The Board also provides guidelines for proper risk and
business management and processes, includingan effective internal control system to
ensure the reliability and accuracy of EGAT’s accounting systems, financial reporting and
accounting audits.
4. Encouraging executives and employees to perform their duties with dedication and
responsibility.
5. Enhancing sound management systems and practices taking into consideration key
stakeholder groups including (1) Government, community and society, and the environment
(2) Customers and stakeholders (3) Organization, and (4) Employees.
6. Promoting the establishment of committees to especially assist the Board of Directors in
reviewing and deliberating on key specific issues.
7. Promoting accurate, adequate and timely disclosure of EGAT’s financial and non-financial
information and ensure fair and equitable access to such information for all stakeholders
and related parties.
8. The Board of Directors and management shall be the role model for ethical conduct.
9. Discharging one’s duties with full responsibility and commitment and with clear division of
roles and responsibilities between the Board Chairman and EGAT Governor.
10. Establishing appropriate, fair and transparent systems and processes for the nomination
and/or selection of all levels of key managerial positions.
11. Conducting self-assessment as a means to review the performance of the Board of Directors.
Good Corporate Governance Policy Compliance
For the implementation of EGAT’s Good Corporate Governance Policy formulated by EGAT Committee, the EGAT Governor, as the highest executive, issued the announcement complying with the policy as follows: Government, Society, and Environment
EGAT aspires to live together in peace and harmony with society. It strives to foster mutual understanding with communities and society at large, treat all people with dignity and respect, and runs its operation and activities in a socially and environmentally responsible way. It also upholds the corporate value of social responsibility and is committed to activity supporting all development efforts on environmental conservation and development of quality of life.
Customers and Stakeholders
EGAT is committed to treating all customers and stakeholders with respect, fairness, and integrity, providing its customers with highest quality of service and products consistent with their requirements, and disclosing relevant information in an accurate, reliable and timely manner.
Organization
EGAT has in place sound policies, strategies, organizational structure, procedures, administration systems, rules and regulations as well as Code of Conduct and Ethics to provide guidance for ethical conduct of all Board Directors, executives and employees. It also promotes fair and transparent procurement practices and procedures as well as corporate and personal integrity and high ethical conducts across the organization. Executives of all managerial levels must lead by example. EGAT is committed to improving and ensuring the efficiency and effectiveness of its internal control and auditing systems, risk management, fair and transparent procurement appraisal and evaluation systems. It also improved and strengthened its corporate governance system and practices to prevent conflict of interest. Continuous learning and self improvement are encouraged among employees to enable them to readily adapt to change.
Employees
EGAT respects the dignity and rights of EGAT employees of all levels. All employees are encouraged to uphold EGAT’s core values of integrity, transparency, honesty, responsibility and accountability, continual self improvement, as well as teamwork spirit. EGAT treats each individual employee equally with fairness and openness.
Six Pillars of Good Corporate Governance
Rules of law
• Legislating and issuing regulations that are fair and acceptable to employees and society
• Legally authorizing the power
• Improving the process of drafting, issuing, and implementing the law with the consideration on quality, fairness and quickness
Moral integrity
• Embracing the morality and cultural values
• Encouraging the employees to conduct their duties and be role model for society
• Encouraging the employees to be honest, sincere, disciplined, and diligent.
Transparency
• Building the trust within the organization or nation by encouraging transparent working process in every division; disclosing information to employees, general public, and stakeholders to access the information.
• Providing the opportunities for employees, general public or stakeholders to check the correctness
Participation
• Providing the opportunities for employees, general public or stakeholders to understand the situation
• Providing the opportunities for employees, general public or stakeholders to participate in solving the organization problems by giving opinions or voting.
Responsibility and accountability
• Realizing that one has duties and responsibility for the society and environment
• Concerning oneself with public problems
• Enthusiastically solving the problems
• Respecting the different opinions
• Being responsible to one’s conduct
Effectiveness and efficiency
• Managing the limited resources for the optimal benefits for public and encouraging the employees and public to be economical
• Using the resources efficiently
• Producing high quality goods and providing good service
• Conserving the natural resources
• Adding values
Composition, Qualifications, and Criteria for the Board of Directors Appointment
- The Board of Directors shall comprise of a Chairman and other Directors not exceeding 10 members including EGAT Governor who serves as an ex-officio Director.
- The Chairman and Directors excluding the ex-officio Director are appointed by the Cabinet.
- The Chairman and Directors shall be of Thai Nationality and must be well qualified and experienced in the field of business administration, science, engineering, economics, finance, or law.
- The Chairman or Directors must not have any direct or indirect interest in the contract made with EGAT or in the activities acted fo EGAT, except that they are merely shareholders who invest in good faith in a limited company or a public limited company. They must not hold any political post or possess prohibited attributes in accordance with the Act on Qualification Standards for Directors and Officials of State Enterprises B.E. 2518 (1975) and its amendment.
Independence and Balance
Independence is a key factor to enhance accountability of each Board member for the Board’s performance. Independent members shall be able to use their independent judgments and drive for change or inhibition of any execution of EGAT Board of Directors included members from various agencies and institutions. Standard practices require that one-third of the total Board members must be external, independent members and at least one of the independent directors must be selected from the list of state enterprise directors’ pool prepared by the Ministry of finance.
Board of Directors’ Authority and Responsibilities
- Lay down rules and regulations
- Establish EGAT’s vision and policies and responsible for overall operations
- Review and approve significant policies and strategies including objectives, financial objectives, corporate social responsibility (CSR) and the organization’s initiatives as well as monitor performance of the management regularly
- Ensure the reliability of accounting system, financial statements, and auditing, as well as the effectiveness and efficiency of internal control, internal audit, risk management and financial information disclosure, and follow up observance
- Oversee and address conflicts of interest issues that may occur with an employee, management, or Director as well as monitor the misuse of EGAT’s property and investigate misconduct of illegal or unethical behavior
- Ensure that the structure and practices of EGAT Board of Directors comply with the principles of good corporate governance and high ethical standards
- Monitor the appropriateness of human resource management including position classification and manpower
- Evaluate the performance of the Governor and review EGAT’s planning regularly
Information Disclosure and Transparency
EGAT gives priority to disclosing financial and non-financial information in its annual report and communicating news and information with all stakeholders with equity, in accordance with the Official Information Act B.E. 2540 (1997) and related laws. It also places importance on financial and management reports which serve as its oversight tool and ensures the report’s accuracy, credibility, actuality, and accountability to reduce the risks that might affect the operation. EGAT emphasizes on the integrity of EGAT’s operation founded on the principle that employees at all levels perform their duties to maximize EGAT’s benefits without personal interest involvement.
Equal Treatment to Stakeholders
In effort to enhance corporate governance practices for the best interest of all stakeholders, EGAT has provided various communication channels for information service and complaints. The Information Management Committee has been appointed to be responsible for EGAT’s information service covering information of all operational lines and units. It has also promptly addressed all complaints received via EGAT Call Center 1416 and the government’s 1111 hotline. Public surveys have been made to gather attitudes and expectations of all groups of EGAT’s stakeholders and general public with respect to EGAT’s corporate governance practices. The results from the surveys will be used in the analysis of EGAT’s governance strength and weakness for the preparation of its Good Corporate Governance Master Plan. The survey results will also serve as baseline information used in performance evaluations in the next following years.