At AAPICO, we commit to conduct our business with responsibility, integrity, honesty, transparency, and fairness. AAPICO's business principles are defined by its ethical framework and continuous improve in response to changes in economy, society and environment, and corporate governance circumstances

Corporate Governance Policy

AAPICO places great importance in having good corporate governance. Over the years, the Company has continually improved its governance practices and standards across the organization to gain and maintain shareholders' trust and confidence in its operations. In its roles, the Board of Directors ensures that the Company adheres to good corporate governance principles and acts in compliance with its corporate governance policy in 5 areas as follows:


The Right of Shareholders

AAPICO highly respects the rights of shareholders. As the owners of the Company, shareholders are entitled to set the Company's direction and decide on matters of significant impacts to the Company's operations and their benefits. Apart from the election of directors to supervise the Company's operations on their behalf, shareholders are encouraged to attend shareholders' meeting to express their opinions, question, and vote on important affairs of the Company.

Scheduling Shareholders' Meeting The Company has made efforts to encourage and facilitate shareholders to exercise their rights and has emphasized on the good practices and quality of shareholders' meeting. The Company schedules the annual general meeting of shareholders within 4 months of the annual closing of its accounting books. The Company selects the venue of the meeting in the areas that can be easily accessible by public transport and fixes date and time with consideration of convenience to shareholders. The Annual General Meeting (AGM) of shareholders for the year 2018 was held at Arnoma Grand Bangkok Hotel on April 23, 2018 at 10:00 A.M.

The hotel is located on Rajdamri Road with easy access to public transport (e.g. taxi, bus, boat, skytrain, etc.) and has sufficient capacity to accommodate the shareholders attending the meeting.

Notice to Shareholders' Meeting The Company disclosed the Board Meeting's decision on the AGM date, the AGM agenda, and the Board's opinions on SET website to notify shareholders before sending the meeting notices. The Company ensured that the notice of shareholders' meeting contained correct and complete information of the time, date, venue, and agenda of the meeting, and provided with facts and opinions of the Board Meeting for each agenda item. The notice of shareholders' meeting and supporting documents, including the minute of the last meeting, the annual report and proxy forms with complete instruction, were made available in both Thai and English on AAPICO's website 30 days prior to the meeting date. The same documents were mailed to shareholders more than 14 days in advance prior to the meeting date to allow enough time for shareholders to prepare for meeting.

Appointing Proxies For shareholders who are unable to attend the meeting in person, the Company gives opportunity for them to appoint proxies or delegate their votes to independent directors. The company has specified independent directors' names in the proxy forms defined by the Ministry of Commerce. Shareholders can exercise their voting rights without conditions by using the Proxy Form B attached to the meeting notice or downloaded other proxy forms, including those proxy forms required for investors who authorize custodians in Thailand, from AAPICO's website. The Company considered and treated proxies as if they were shareholders and has included their votes in the voting system as they wish.

At the Meeting At the registration, the Company had applied technology to facilitate and smoothen shareholders' registration process. The Company had placed adequate number of staffs and had provided the affixing of stamp duty on proxy forms to assist shareholders at the registration table.

Before the meeting, the Company Secretary introduced the Board of Directors, Management, and external auditors to the meeting. At the 2018 AGM meeting, every member of the Board of Directors including the Chairman of every committees were all present in the meeting.

The Company Secretary elaborated on the voting procedure, the voting count, and the announcement of voting results. A vote cast is done openly by hand showing the voting cards which are filled with a vote and shareholders' signature affixed. The Company collects and counts these votes for disapproval and abstention as a deduction to derive the approval votes. After the voting count is completed, the result is announced for each agenda item. In the case that the voting count may take long time, the Chairman may proceed to the next agenda item to avoid disrupting the Meeting and informed the result when the voting count has finished. Shareholders are requested to return their signed voting cards to the Company after the meeting adjourned.

The AGM meeting in 2018 was proceeded by the order of the agenda as appeared in the meeting notice. There were no changes in the order of the agenda and no request to consider any other matters. For each agenda item, the Chairman ensured that shareholders had adequate time to freely express their opinions and raise questions. The Chairman also welcomed additional comments and inquiries of shareholders' interests and provided that the management answered all questions clearly and precisely

As a rule for conflict of interest matters, any directors with vested interests or involvement on any agenda item must inform the meeting to excuse themselves and abstain from voting on that agenda item. At the 2018 AGM, nominated directors are requested to leave the meeting room for shareholders to duly consider the appointment of director and vote on individual basis.

The Company maintains shareholders' right to attend and vote at the shareholders' meeting even after the meeting had commenced. Their attendance had constituted part of the quorum, starting from the agenda item for which they were in attendance and can exercise their rights provided that the resolution had yet to be concluded.

After the meeting, the Company disclosed the resolution with the voting results for each agenda item on the SET website at the end of the same day. The meeting minute was completely and accurately recorded with details of the number of shareholders and proxies in attendance, the voting results, shareholders' comments and questions, and explanations from the directors and the management. The minute of the 2018 AGM meeting was prepared and submitted to the SET within 14 days from the date of the meeting as per the SET rule, and was made available to the public on AAPICO's website in both Thai and English.

Equitable Treatment of Shareholders

At AAPICO, we treat every shareholders fairly and equally despite their shareholding proportions and regardless of their gender, age, race, nationality, religion, beliefs, social status, physical abilities, and political views. Shareholders receive equal right for voting. One share equal to one vote. No shares have extra privileges over other shares. Their voting power is equal to the number of shares they hold.

Proposing Agenda Items and Nominating Directors

The Company protects the interests of every shareholders being major or minor, individual or institutional, or Thai or foreign investors. All shareholders have equal rights to express their opinions, propose agenda items, or nominate the Company's directors. The Company had defined the criteria and procedures for shareholders to propose the agenda item or nominate directors, or both, in advance for the Board of Directors to deliberate and include in the AGM meeting agenda. These information are publicly available on AAPICO's website in both Thai and English and was also announced on SET website. For the 2018 AGM, the Company invited all eligible shareholders to propose agenda item and/or nominate directors during the period from October to December 2017. However, there were no proposal from shareholders to be considered for the 2018 AGM.

Facilitating Shareholders at the Meeting The Company ensures to provide adequate convenient for every shareholders to attend the shareholders' meeting. At the 2018 AGM, the Company arranged the registration to be opened at least one hour prior to the scheduled meeting time and extended until last meeting agenda. The Company used an online tool to support the registration and voting.

The 2018 AGM was conducted in Thai as most shareholders are Thai. However, for the benefit of foreign directors and shareholders, the Company had arranged that supplement documents and presentations are also available in English. Staffs with a good command in English were ready to provid the translation of discussion and questions in English and Thai to ease communication needs for shareholders.

The Company provided disclosures of its information in both Thai and English and made available to public on AAPICO's website, SET website, and other relevant channels for shareholders to receive information equally and timely.

The Use of Internal Information

AAPICO is aware of possible abuse of internal information and has a policy to protect the confidentiality of financials and business information and transactions that could have impact on share price and has not been disclosed to public. The Board of Directors, executives, and employees who have access to these internal information must keep information strictly confidential and must be aware not to disclose information to any party not involved in the transactions.

The Company prohibits the use of internal information for personal benefit. In compliance with good corporate governance practices, the Company has established a guideline concerning the transfer of the Company's securities to be applicable for directors, executives, relevant employees, and their related persons, including their spouse and children who are minor, which are as follow:

  • Black out period: Directors, executives, and employees, including their related persons, shall refrain from trading the Company's securities for a period of 30 days prior to and at least within 24 hours depending on materiality after the release of financial statements or public disclosure of significant matters.
  • Report of securities holding (Form 59-1): Directors and executives as defined by SEC definition, including their related persons, are required to report their holding of the Company's securities to the SEC within 30 days after the date on which they are appointed.
  • Report of changes in securities holding (Form 59-2): Directors and executives as defined by SEC definition, including their related persons, are also required to report any changes in their securities' holding as a result of sale, purchase, transfer, or acceptance the transfer of securities within 3 working days, with exception to the case that such changes are resulted from the Employee Joint Investment Program (EJIP) or other program which received exemption from SEC.

Failure to comply or violation to this policy may result in derogation or damage to the Company and are subjected to penalty measures, such as warning, suspension without pay, termination and possible legal action taken by relevant regulatory authorities. The Board of Directors and top executives shall report any changes of their holding of the company's securities to the Company. The movements of securities' holding of directors and top executives are also disclosed in the Annual Report.

Managing the Conflicts of Interests

As a group of companies, AAPICO is well aware of matters relating to conflict of interests among entities and related parties. The Company has defined a guideline in dealing with such matters in a prudent, fair, and transparent manner. These practices include the following:

  • The Company ensures that the shareholding structure in subsidiaries, associates, joint venture companies, and other investments is clear and transparent and disclosed to public. There is no cross-holding among major shareholders.
  • The Company advises that directors and executives, including their related persons shall report their vested interests to the Company upon their appointment and at every year-end.
  • At directors' meeting, directors or executives who have vested interests in the agenda must abstain from voting on such agenda. This is to ensure that decisions are made in a fair and transparent manner for the best benefit of shareholders.
  • Transactions with related parties shall be conducted fairly, at arm's length basis, on normal business terms, or based upon agreements between the Company and related party that will benefit the Company as a group.
  • Connected transactions requiring shareholders' approval must be carried out duly and in compliance with the regulations and requirements of SEC and SET.

Roles of Stakeholders

AAPICO adheres to ethical business conduct and carries its businesses to jointly create values with its stakeholders for mutual and sustainable benefits. The Company recognizes the rights of stakeholders, their interests and different needs of each group.

The Company ensures to protect basic rights of its stakeholders in accordance with laws and related regulations, and has carefully defined the policy, guidelines and practices that appropriately address the needs of each stakeholder. AAPICO's key stakeholders are as follows:

Shareholders

Shareholders are owner of AAPICO's business. The Company shall operate its businesses to create long-term corporate sustainability, increase the Company's economic value, and generate good returns to shareholders. The Board of Directors are shareholders' representative. Directors and executives are to perform their duties with honesty and integrity to supervise and manage AAPICO's businesses to operate effectively, efficiently, in a transparent and auditable manner. They shall act in consideration of the best interests of its shareholders and in compliance with good corporate governance principles.

AAPICO arranges activities with shareholders and provides equal access to shareholders to contact the Company. Its key activity is the shareholders' factory visit which is arranged on annual basis. The Company gives equal opportunities to all shareholders to sign up and join this activity. Shareholders can register their names at the AGM in person or call or send email. Subjected to seat availability, the Company selects the participants on first come first serve basis regardless of the number of shares holding. In 2018, the Company arranged a shareholders' visit to its main stamping and tooling factory at Hitech Industrial Estate in Ayutthaya province on Thursday May 25, 2018.

AAPICO discloses financial and non-financial information in a factual, complete, adequate, constant, and timely manner. Shareholders are well informed of financial results and public disclosure on AAPICO's website and SET website. The Company monitors access to internal information to prevent anyone from using such information for personal gains and causing damage to the organization. The Company assigns the Investor Relations (IR) to be its primary contact window to communicate business information and clarify questions and concerns of shareholders and public, hence reducing the fluctuation and impact to the Company's share price.

Customers

AAPICO focuses on the SQCDEM principle as it is the key success factors to high standard of operations and customer satisfaction. AAPICO emphasizes on excellent production and the delivery of high quality products to its customers in a timely manner and at a competitive and reasonable price. Being a responsible partner in the automotive part supply chain, the Company ensures the continuity of its production and on-time delivery to support the overall supply chain of the automobile production.

AAPICO values the good relationships with customers. As a large tier 1 supplier in Thailand, the Company commits to continuously develop and improve the product quality and services according to the SQCDEM principle in order to serve customers on or beyond their expectation. The consistent recognition of its quality management system, as well as awards and achievements from many customers, are good confirmation of AAPICO's commitment to excellence.

AAPICO has a policy to keep information of each customer strictly confidential. The Company ensures that employees are aware not to share any business information with its partners or other parties. The Company works closely with each customer and operates in compliance with guidelines and policies of its customers for good management and good corporate governance practices.

AAPICO gives importance to innovation. The Company does not violate any regulations or contractual rights regarding the use of intellectual property and copyrights. The use of information technology is conformed to the computer related act and other local intellectual property and copyright laws.

Suppliers

AAPICO conducts a fair and transparent business with its suppliers. The Company has a policy to select its suppliers in a fair and open manner, where no parties have unfair advantage of a separate, prior, closed door negotiation for a contract. Purchase of materials and hire of services are considered for its quality, price, service, and punctual delivery according to the agreement and product requirements. The procurement officers shall refrain from demanding and accepting, and shall not be influenced by, the offer of gifts, favors, or benefits of any kind from suppliers. Employees must adhere to the Company's policy regarding the receipt of gifts and anti-corruption policy to avoid any incidents leading to corruption.

Suppliers are the Company's valued business partners. The Company is committed to promoting cooperation between the Company and its suppliers to create good relationships and to improve efficiency, capabilities, skills, and knowledge of suppliers to ensure that they operate in compliance with good corporate governance practices and deliver the same level of quality standards as required by the customers. Activities in 2018 include the annual supplier meeting, the supplier audit, CSR activities, etc.

The Company supports environmental friendly procurement and intends to avoid dealing business with suppliers who do not operate in compliance with laws and regulations related to human rights, intellectual property, etc.

Joint Venture Partners

AAPICO treats its joint venture and business partners equally and fairly with respect and honors the agreements between both parties. The Company acts in compliance with business ethics, restrictions, and applicable regulations and laws of the country it operates. The Company collaborates with its partners to promote and support the joint venture business operations and encourages exchange of ideas, opinions and suggestions to drive the business toward the shared goals.

Joint venture partner is for long-term business relationship. The Company looks for integrity and competency as the key qualifications of its business partners. The Company ensures that its partners are competent and reputable and do not risk the Company being associated with any unethical, illegal, and corrupted activities.

AAPICO has a simple philosophy where the Company clearly define its management control to avoid any conflicts. In all business partnerships of AAPICO, the Company has established long-term relationships where both companies enjoy synergies and mutual benefits to grow their business for long-term sustainable growth.

Creditors

AAPICO commits to carry out its businesses in compliance with good corporate governance practices that creates confidence for its creditors. The Company follows terms and conditions as agreed upon with creditors, being trade creditors, financial institutions, and debenture holders. AAPICO maintains consistent communication with creditors. The Company fulfills its obligation and report to its creditors with full transparency and sufficient disclosure in a timely manner. In case of events that may have material impact to its financial position, the Company ensures to communicate and align with its creditors for waiver or solutions to resolve such matters.

Competitors

AAPICO operates with openness and integrity by adhering to honest and fair competition. The Company carries out its business operations in compliance with laws and relevant regulations, with concern for trade ethics and transparency. The Company shall operate under no circumstances that may cause or be part of any violation of general or special competition regulations. It refuses to gain unfair advantage over its competitors through inappropriate, unethical, and unlawful activities, such as illegal market sharing and illegal pricing cooperation, or engage in any actions that violate relevant competition laws, the competitors' intellectual property rights, or destroy competitors' reputation with untruthful statements. The Company affirms to support and promote free trade and avoiding any acts that monopolize the market or limit fair competition.

Employees

AAPICO places importance on its employees' well-being and good quality of lives. The Company ensures that employees receives their basic rights and are provided with appropriate compensation and benefits according to their knowledge and capabilities, with reference to standard cost of living, and in line with other companies in the same industry.

Remunerations

Employees are remunerated according to their responsibility and accountability, as well as individual performance in their roles. Employee's performance is fairly evaluated based upon the achievement of agreed key performance target. The Company determines employees' remunerations and benefits according to their positions, as required by laws and regulations, and with consideration to its financial position, profitability performance, and economic circumstances, i.e. consumer price inflation, minimum wage requirement, etc

The Company ensures to provide appropriate compensation and benefits associated with job functions. These benefits include work-related benefits and fixed allowances, travel expenses, accommodation, uniform, transportation, annual check-up and medical benefits, sport day and New Year activities, and financial assistance such as mortgage and loan for employees. The Company has also established provident fund, where the Company and employees who are member of the fund made contribution to the fund on monthly basis.

Training and Development

The Company has focused on human resource development as one of its management agenda in 2018. The Company has structured the AAPICO training and development program for every employees in different levels and functions of AAPICO Group. Each employee can choose to attend training programs that serve their development needs and enabling them to advance in their career to next level of responsibility and leadership

Health and Safety

Employee's health and safety is top priority at AAPICO. The Company has established the 5S principles and practices to promote a clean and proper workplace environment. The Company arranges regular safety trainings and organizes the safety week to create and promote safety awareness among employees to reduce risks of accidents and maintain high standards of safety and discipline within the organization.

Child Labor and Human Rights

AAPICO upholds human rights in all its activities and will not act in violation of human right laws or child labor protection regulations locally and internationally. The Company ensures that its employees are treated fairly and equally, promoting mutual respect and openness in its corporate culture, aiming to create the happy workplace for every employee. The Company commits to maintaining the well-being of its employees and has shared its effort and commitment toward sustainability with suppliers and customers throughout the automotive part supply chain.

Community

AAPICO carries out its businesses with consideration to its responsibilities for communities surrounding its facilities. As part of the management agenda, the Company supports and contributes to many activities and community projects. It also encourages employees to be involved in improving lives of people in the community.

The Company operates in compliance with social and environmental protection laws and related regulations, and the requirements of the Labor and Social Welfare Ministry, the Industrial Ministry, the Industrial Estate Authority of Thailand and other relevant agencies.

The Company has a policy for all companies of AAPICO Group to manage and use its resources in the most efficient ways and aims for environmental protection in every part of its operations. With its "Green" vision, the Company promote awareness for energy conservation and continuously implements the concept of using minimum input of natural resources to achieve maximum output.

Additional information on the Company's corporate social responsibility activities can be found in the sustainability report section

Anti-Corruption Policy

AAPICO conducts its business with honesty, integrity, and transparency towards its stakeholders. The Company firmly opposes to all forms of corruption and take a zero tolerance approach toward bribery and corruption. The Company supports and encourages employees at all levels to fight corruption with a conscious mind. It has established a policy to govern business decisions and corporate actions and behavior of employees in conducting the business.

The anti-corruption policy sets standard in the conduct and responsibilities for preventing fraud. The Company clearly communicates and trains its employees in related functions especially those who operate in areas perceived at high risk, in recognizing and dealing with bribery and corruption with prudence. The Company ensures that the business and its partners, including suppliers, contractors, and agents, act in compliance with relevant laws and regulations, and refuse to engage in an act that involve an inappropriate or unlawful deed.

Whistle Blower Policy

The Company encourages employees and stakeholders to give comments, raise concerns about any issues or suspicion of malpractices to the Company at any time for the Company to take immediate necessary actions to resolve such issues or prevent severe damages to its operations or reputation. Employees and stakeholders can file report to designated channels or send email directly to AC@aapico.com if the case might be related to executives. The Audit Committee assigned by the Board of Directors receives complaints, verify the validity, and conduct preliminary investigation together with the management. The cases of rights violation, corruption, non-compliance with laws and ethical practices are reported to the Board of Directors.

The Company encourages the openness and will support anyone who raises genuine concerns in good faith. The Company has put in place the informant protection measures and does not require to reveal the name of the informant or the information source. The Company commits to ensure that no one will suffer from any unfair treatment as a result of refusing to take part in bribery or corruption, or because of reporting their suspicion that an actual or potential bribery or other corruption offenses have taken place or may take place.

In 2018, the Audit Committee did not receive any comments or concerns regarding the malpractices and misconducts within the organization for consideration.

Tax Policy

As a good corporate citizen, AAPICO sees tax as an important part of its responsibility to stakeholders. The Company has established the AAPICO's tax policy to provide guidelines and practices for the Group's operations. AAPICO aims to be tax compliant company and our tax policy reflects and supports our business. All taxes are paid according to laws and regulations of the local jurisdiction where the Company operates on timely basis.

Disclosure and Transparency

AAPICO has defined and administered measures concerning disclosures to investors and stakeholders. The disclosure of information, both financial and non-financial, are complete, sufficient, transparent, reliable and up-to-date, which reflect true status of the Company. The information is distributed equally and timely. The Company defines parties to handle the disclosure of information to public and also establishes guidelines for the disclosure of various type of information, and designates a period before public disclosure. The Company follows the laws, rules and regulations, and obligations as required by SEC, SET, and other relevant government bodies.

The Company ensures that the disclosure of financial results have been reviewed and audited by external auditor, and certified by the Audit Committee and the Board of Directors prior to the public release. The quarterly and annual financial statements and Annual Report (Form 56-1 and Form 56-2) were prepared fairly and accurately according to the general accepted accounting principles in a complete and accurate manner and was made available in the public domain as required.

The Company compiles and submits the reports related to directors and executives as required by law. The Company has a policy for directors and executives to report their interests relating to the management of the Company or subsidiaries and reports the changes in the holding of the Company's shares under own name or their related parties to the SEC in a timely manner as required. Information of directors, their duties and responsibilities, their attendance to meeting, trainings, and directors' remunerations are disclosed in the public domain and on the AAPICO website.

Information on the operations and investment structure of subsidiaries, associates, joint ventures, and other companies are disclosed in the Annual Report and the AAPICO website. The Company ensures that its key stakeholders, investors, shareholders, and the public are well-informed and that information of significant projects and developments are accurately and sufficiently provided as required by the SET.

Name Position Number of shares
At the book closing on March 15, 2018 Increases (Decreases) in 2018 At the book closing on March 15, 2019
Mr. Yeap Swee Chuan President and CEO 44,122,773 - 44,122,773
Mrs. Teo Lee Ngo Executive Director 31,811,346 - 31,811,346
Mr. Pipat R. Punya Independent Director - - -
Mr. Kenneth Ng Independent Director - - -
Mr. Wichian Mektrakarn Independent Director - - -
Mr. John Parker Independent Director - - -
Mrs. Vachira Na Ranong Independent Director - - -
Mr. Kaikhushru (Kai) Taraporevala Independent Director - - -
Mr. Veera Buanwongse Director - - -
Ms. Yeap Xin Rhu Director 25,646,760 193,000 25,839,760
Mr. Kawee Wasaruchareekul General Manager - - -
Mr. Sattha Petch-in Asst. Gen. Manager 85 - 85
Total   101,580,964 3,132,665 101,773,964


The Company discloses information in multiple channels in both Thai and English for equal access of information for its stakeholders. In addition to the public news release via the SET Portal and the AAPICO website, the Company also uses other channels which are available to disclose information to public and investors' communities. These channels include:

  • The Opportunity Day conference at SET on quarterly basis.
  • Company visit for shareholders, investors, and analysts on annual basis and upon request.
  • Roadshow and/or conference meeting with analysts and investors both local and international.
  • Forums or panel discussion events for knowledge sharing.
  • Communication via email, intranet, internal bulletin board, and activities for communications with employees,
  • The Company's website at www.aapico.com and email address at aapicohitech@aapico.com.

The Investor Relations (IR) Department is assigned to be the primary contact window for communication with shareholders, investors, analysts, SEC, SET and other relevant authorities. The IR department ensures that the disclosure of corporate news and information are in compliance with the SET regulations. The IR department also arranges activities and manages executives' schedule to attending meetings and events both local and overseas to increase accessibility and interaction with the Company's stakeholders. These activities in 2018 include

  • The Opportunity Day at SET for local individuals and institutional investors.
  • The SET digital roadshow for foreign and overseas investors.
  • Roadshows and Corporate Day conference arranged by securities companies in Thailand and Singapore, where the President and CEO, CFO, and IR team met the analysts and institutional investors. These events included the DBS Pulse of Asia Singapore in January, the CGS-CIMB Thailand Corporate Day, the CGS-CIMB Thai Auto Conference, the Maybank Invest ASEAN, Thailand Focus, BLS Thai Corporate Day, the UBS AG LVMC conference, and nondeal roadshow (NDR) with Phatra Securities.
  • Analysts' meeting
  • The annual shareholders' visit to factory.
  • Company visits to meet with managements, including one-on-one meetings and conference calls to allow investors to inquire about the business and operations, or clarifications of financials.

Responsibilities of Directors

The Board of Directors plays an important role in overseeing and advising the business to ensure that the operation is run for the best benefit of shareholders in the long run. The Board of Directors comprises of respectable, knowledgeable, and competent persons with skills and experience in areas that are relevant and beneficial to the Company.

Structure of the Board of Directors

The Company sets the size of its Board of Directors to be appropriate to the size of its business. The AAPICO's Board of Directors comprises of eight members, of which two members are executive directors and six independent directors. The Board of Directors also comprises of two female members. The Company provides its directors' composition with diversity in gender and various skills, as well as experience in different areas of the Company's business.

The Company ensures that the number of independent directors constitute more than half of the total number of directors. Each director holds the qualification as required by law and does not in any way indicate a lack of fit to be entrusted with the administration of the Company.

Qualification of Directors

The Board of Directors has defined the qualification of the Company's directors as follows:

  1. Possess qualification according to the rules and regulations by the Securities and Exchange Act, the Stock Exchange of Thailand, the Public Company Act B.E. 2535, and have no prohibited characteristic or manner indicating a lack of trustworthiness to manage the Company from the view of shareholders by law or by the Articles of Association.
  2. Not disqualified under Section 68 of the Public Company Act B.E. 2535.
  3. Have knowledge, skills, and experience in the automotive industry and/or capable to perform directors' duties with diversified background which are beneficial to the Company's business.
  4. Able to devote time especially for making key decisions and handle duties for the best interest of the Company and able to attend all board meetings and shareholders' meetings.
  5. Do not perform any actions in ways that affect the interest or benefit of the Company.

Qualification of Independent Directors

Independent director is a director who does not have any related business or work that may affect his or her independent decision. The Board of Directors defines qualification of independent director in compliance with the minimum requirement of the SEC and SET. The Company's independent director shall comply with, but not limited to, the following requirements:

  1. Shall not hold shares exceeding one percent of total number of voting shares of the Company, subsidiary, associate, major shareholders, including shares held by related persons of such an independent director.
  2. Shall not be or have been an executive director, employee, staff member, advisor who receives salary from the Company, subsidiary, associate, major shareholders, or juristic person with conflict of interest.
  3. Shall not be a person related by blood or legal registration as father, mother, spouse, sibling, or child, including spouse of child, of the Company's executive or major shareholders.
  4. Shall not be or have been an auditor of the Company, subsidiary, associate, major shareholders, unless the relationship has ceased not less than two years prior to the date of becoming an independent director.
  5. Shall not be or have been a provider of any professional services including legal advisor or financial advisor who receives service fees exceeding Baht 2 million per year from the Company, subsidiary, associate, major shareholders, unless the relationship has ceased not less than two years prior to the date of becoming an independent director.
  6. Shall neither have nor ever had a business relationship with the Company, subsidiary, associate, major shareholders, unless the relationship has ceased not less than two years prior to the date of becoming an independent director. The term "business relationship” refers to any normal business transactions in the amount more than Baht 20 million or more than 3% of net tangible assets after deducting the liabilities and equity of minority shareholders, whichever is lower.
  7. Shall not be a director appointed as representative of the Company's directors or major shareholders.
  8. Shall not operate or be part of a business that operates in the same industry or in direct competition with the Company's operations.
  9. Shall be capable to perform duties, give opinions, and report results of work performance according to the duties entrusted by the Board independently from the control of management or major shareholders of the Company.

Terms of Service for Directors Years of Service in each rotation

The Company's Articles of Association indicates the number of years served on the Board of Directors in accordance with the Public Limited Company Act, which specifies that one-third of total number of directors must retire from the office at the Annual General Meeting. If it is not possible to divide total number of directors evenly by three, the number closest to one-third is applied. In choosing directors to retire, the have served the longest years are the most eligible to retire. Nevertheless, the retiring directors are eligible for re-election.

Apart from the aforementioned retirement by rotation, directors may be removed from the office by the following reasons.

  • Death.
  • Resignation (with effect from the date the Company receives the resignation letter).
  • Being disqualified or being under any of the prohibition under the Public Company Act and laws governing securities and stock exchange.
  • Removal by resolution of a shareholders' meeting.
  • Removal by a court order.

Number of Consecutive Terms of Service

The Board of Directors have been approved by shareholders' meeting and are highly qualified individuals with knowledge and expertise beneficial to the Company's business. These directors are also respected for their morality and ethics, as well as consistent good performance of duties. The Company respects the right of shareholders for their decisions to re-appointing directors to the Board. Therefore, the Company does not indicate the number of consecutive term of service for directors. The Company however commits to good corporate governance practices and encourages terms of service of directors in line with the SET guideline for not more than nine consecutive years.

Limits on Directors’ Positions in the Listed Companies

The Board of Directors sets a policy to limit the number of position held in the board of listed companies other than the Company's own subsidiaries to not more than five companies. Directors shall not sit in the board of the Company that operates in the same industry or is in direct competition with the Company's operations. The holding of positions as directors in other companies shall also be reported to the Board of Directors for acknowledgement.

Company Secretary

The Board of Directors assigns duties and responsibilities of the company secretary to organize meetings for the board, committees, shareholders, and to coordinate activities and trainings for directors. The company secretary is responsible for preparing notice of meeting, minute of meeting annual report, as well as filing of documents as required by law and relevant regulations by SEC and SET. The Board of Directors determined the qualification of the company secretary to have but not limited to knowledge in law and/or finance and accounting.

Roles and Responsibilities of the Board of Directors

The Board of Directors has roles and responsibilities clearly separated from the Company's management to ensure that business is conducted in a lawful and ethical manner and operations are run efficiently and effectively. The Board of Directors' roles and responsibilities include but not limited to the following:

  1. Consider, advise, and approve key business matters e.g. the Company's vision and mission, business strategy, financial targets, business risks, annual operation plan, and budget, as well as to ensure that the management operates in an effective and efficient manner.
  2. Consider and review the corporate governance policy and monitors the compliance to the policy at least once a year.
  3. Provide the Company's code of conduct in writing for directors, executives, and employees. Ensure they are aware of the Company's ethical standards and that they act in compliance with the code of conducts.
  4. Define guidelines for related transactions with conflict of interests for the benefit of the Company and shareholders, where persons with vested interest cannot participate in the voting or decision-making process of that issue. Ensure that the Company complies with the regulations and that disclosure of transactions with conflict of interests are correct and complete.
  5. Ensure that an internal control system is in place and in effect, financial reporting and operations are in compliance with rules and regulations, and assign a person or unit to independently audit and report on the Company's internal control system to the Board of Directors at least once a year.
  6. Establish the risk management policy and assign a team to manage the Company's risks and to look for business opportunities that may arise from these risks and report to the Board of Directors on a regular basis.
  7. Provide adequate disclosure of information to public and stakeholders and ensure that disclosure of information is correct, concise, transparent and reliable.
  8. Understand the roles and responsibilities of the Board of Directors and the Company's nature of business and always expresses opinion independently.
  9. Perform duties with honesty and due care, taking into account for the best interest of the Company and fair treatment of shareholders.
  10. Oversee and monitor business operations by requiring financial reports that are accurate and complete and devotes sufficient time and effort to the Company.

Board of Directors’ Meeting

The Company plans the schedule of board meetings for the year in advance. The Board of Directors schedule to meet at least six times per year, four of which are general meetings to consider and approve financial statements and two performance review meetings to review the business operations and business plans. In case there are matters requiring the board approval, special meetings may be arranged on ad hoc basis. Directors are kept informed of the meeting schedule for their availability.

Directors are encouraged to attend the board meetings, the performance review meetings, as well as shareholders' meeting. The attendance of directors for meetings in 2018 is disclosed in the Management section in the Annual Report. Directors are encouraged to propose relevant agenda to the Chairman to consider and conclude in the notice of meeting The Company sends the notice of meeting and supporting documents or information to directors at least seven days prior to the meeting day. At the meeting, the Chairman counts the number of attending directors to form a quorum as specified in the Articles of Association to convene the meeting. The Chairman considers the meeting's agenda in order as stated in the notice of meeting.

The Chairman allocates sufficient time to discuss each agenda carefully and thoroughly. Directors are encouraged to give comments and express their opinion freely and openly before casting their votes. Each director has one vote. The meeting requires at least two-third of total number of directors present for voting of each agenda. Director who has vested interest in a particular agenda is excused or shall abstained from voting for that agenda.

Performance Evaluation

The Board of Directors conducts the self-assessment of its own performance on an annual basis. The Company applies the assessment criteria according to the guideline from SET. There are three sets of assessment forms for the evaluation of the Board of Directors as a collective body and as an individual, and the assessment of committees' performance. The Board of Directors are assessed in 6 areas as follow:

  1. Structure and characteristics of the Board
  2. Roles and responsibilities of the Board
  3. Board meetings
  4. The Board's performance of duties
  5. Relationship with management
  6. Self-development of directors

The self-assessment of directors' performance for the year 2018 were conducted with full participation of directors. The assessment results for the year 2018 have improved in all three questionnaires.

The results of the self-assessment of the Board of Directors as a collective body had improved from very good level at 88% in 2017 to excellent level at 93% in 2018, with improvements in every categories. The self-assessment as an individual score had improved from an average of 90% in 2017 to 92% in 2018. The self-assessment of committees performance also improved from an average of 87% in 2017 to 88% in 2018. The CEO performance has also been assessed by independent directors and the score has slightly declined from 88% in 2017 to 86% in 2018, which was still at good level. The key areas of improvements were the execution of strategy and the succession planning.

Remuneration for Directors and Executives

The Board of Directors approved the remuneration of the Board of Directors and its committees according to the principles and policies set by the Nomination and Remuneration Committee which is within the framework and limits as approved by shareholders' meeting. Directors' remuneration is considered based mainly on the scope of duties and responsibilities, directors' performance, the comparison with other listed companies engaged in the same business regarding the performance, business size, and directors' accountability. The directors' remuneration is proposed to the Board of Directors for approval before passing for approval at the Annual General Meeting of Shareholders.

The Board of Directors has delegated the responsibility to the CEO and the Company's management to approve remuneration for executives, which is considered based on their duties and responsibilities, individual performance, and the performance of business under their supervision.

Training and Development

The Company encourages directors to continuously develop and enhance their skills and knowledge in relation to their duties and responsibilities. Directors are provided with useful information which are relevant to the Company's business as well as details of duties and responsibilities of the Board of Directors and committees. The Company Secretary sends information about trainings, conference, and seminars that are relevant to the Company's business or directors' duties and responsibilities to directors.

The Company supports directors to attend basic trainings as required by the SEC. Such training provides an overview for directors to understand their roles and responsibilities, the corporate governance concept, applicable laws, financial reporting, risk management, strategy and effectiveness of the board. The Company's independent directors have all passed the fundamental training courses organized by Thai Institute of Director (IOD) or other similar courses, which can be summarized as follows:

  1. Mr. Yeap Swee Chuan attended
    Director Certification Program (DCP108/2008).
  2. Mr.Pipat R.Punya attended
    Director Accreditation Program (DAP11/2004) and Role of Chairman Program (RCP35/2014).
  3. Mr.Kenneth Ng attended
    Director Certification Program (DCP189/2014).
  4. Mr. Wichian Mektrakarn attended
    Director Certification Program (DCP107/2008) and Board that Makes a Difference (BMD3/2016) Role of Chairman Program (RCP40/2017)
  5. Mrs. Vachira Na Ranong attended
    Director Accreditation Program (DAP61/2007) and Role of Compensation Committee (RCC2/2007) and Director Certification Program (DCP124/2009)
  6. Mr.Kaikhushru (Kai) Taraporevala attended
    Listed Company Director Program from Singapore Institute of Directors, and Master Class for Directors, Institute of Directors (IOD) India.

Other than the IOD trainings, directors and executives have also attended seminars and conferences to enhance their knowledge and network with executives of other listed and non-listed companies in the same industry or similar. These conferences included those arranged by the SEC, SET, banks and securities companies, as well as the customers' supplier conference such as the Ford Asia Top Supplier Meeting and Nissan Annual Supplier Meeting, and others.

Power and Duties of the Board of Directors

The Board of Directors is responsible to oversee and govern the Company to operate in compliance with laws, objectives, the Articles of Association, and resolution of shareholders meeting, and acts in accordance with criteria and regulations of the SET and SEC with honesty and care for the best interests of the Company and shareholders. In line with good governance principles, the Board of Directors shall have the authority and responsibility to approve the following matters.

  1. The quarterly business performance and financial statements of the Company in comparison to the forecast and budget and the consideration of future trends of the year.
  2. Related party transactions among the Company, subsidiaries, associates, and related companies or individuals so that they do not violate the regulations of the SET and SEC.
  3. Any transactions that would materially affect the Company's capital structure, financial position, business operation, strategy, and reputation.
  4. Payment of interim dividends.
  5. Employment of the President and senior executives.
  6. Determination and change of the approval authority of the Company.
  7. Acquisitions and disposals of business and assets including investment in joint venture that have value of transaction which requires the board's approval according to SET announcement. These transactions shall not violate any rules of the SET relating to the acquisition and disposal of assets and connected transactions.
  8. Contracts that are not related to an ordinary course of business or contracts that are significant in value and material to the Company's business.
  9. The change of policy and operations that have material impact on accounting, risk management, and internal audit.
  10. The appointment and determination of authority of the sub-committees.
  11. The proposal, appointment, and termination of the Company's directors and secretary.
  12. Any other actions in accordance with laws, objectives, Articles of Association, and resolutions of shareholders' meetings.

The Board of Directors may authorize directors or the committee to perform any acts on their behalf, except the following subjects, which can be done only upon the approval from shareholders' meeting.

  1. Subject which the law requires of the approval from shareholders' meeting
  2. Transactions which directors have interests therein and that the law or regulations of the SET requires resolution of shareholders' meeting. Director who has vested interest in the issues or have conflict of interest with the Company or affiliated company shall be excused from voting.

The following cases must be approved by the Board of Directors and the shareholders' meeting with a vote of not less than 3/4 of total votes of the shareholders attending who are entitled to vote:

  1. Any sale or transfer of the entire or significant part of the Company's business.
  2. Any purchase or taking over of other firms by the Company.
  3. Any making, amendment or termination of contracts with respect to the granting of a lease of the whole or significant part of the business of the Company, the assignment of the management of the business of the Company to any other person or the amalgamation of the business with other persons with the purpose of profit and loss sharing.
  4. The amendment to the Article of Association and the Memorandum of Association.
  5. The increase and decrease of capital, the issuance of debentures, the amalgamation or dissolution of the Company.

Committees

The Board of Directors has delegated some of its duties and responsibilities to its committees, comprising of independent directors, to assist the Board in reviewing and providing their independent opinion on particular matters. These committees are

  1. Audit Committee
  2. Nomination and Remuneration Committee
  3. Risk Management Committee.

Audit Committee

The Audit Committee comprises of 3 members, with Mr. Pipat R. Punya acted as Chairman and Mr. Kenneth Ng and Mr. Kaikhushru (Kai) Taraporevala as members.

Power and Duties of Audit Committee

  1. Review the company's financial statements every quarter and on an annual basis to ensure that its financial position is true, correct, and in accordance with general accepted accounting standards and relevant laws.
  2. Review and ensure appropriateness and effectiveness of internal control system and internal audit, so that the operations have been carried out in compliance with rules, policies, and relevant guidelines. Evaluate the independence of the internal auditor by reviewing its performance and report including reporting structure, and approve the appointment, transfer, and termination of the internal auditor.
  3. Review the performance of the external auditor. Consider, propose, and appoint external auditor by considering their independence and set audit fee to propose to Board of Directors. Arrange meetings with the external auditor without management presence at least once a year.
  4. Review and support compliance with the Securities and Exchange Act and the SET regulations, as well as relevant laws and regulations concerning the business of the Company.
  5. Establish and review the corporate governance policy in compliance with the good governance principles of SET at least once a year.
  6. Review disclosure of information, particularly related transaction or transactions that may have conflict of interest, to be transparent, correct, and complete and in accordance with relevant SET regulations.
  7. Review complaints and concerns from stakeholders and report to the Board of Directors.
  8. Report the Audit Committee's performance to the Board of Directors every quarter. Prepare the report of Audit Committee and disclosure in the Annual Report.
  9. Consider and review duties and responsibilities, and evaluate performance of the Audit Committee on an annual basis.
  10. Perform any other matters as assigned by the Board of Directors.

Nomination and Remuneration Committee

The Nomination and Remuneration Committee comprises of 3 members, with Mr. Pipat R. Punya acted as Chairman and Mr. Kenneth Ng and Mr. Kaikhushru (Kai) Taraporevala as members.

Power and Duties of Nomination and Remuneration Committee

  1. Considers criteria and procedures for the nomination of qualified directors according to the Company's requirements and in consideration to the Company's strategy.
  2. Consider criteria, type of remunerations, and other benefits provided to the Board of Directors and its committees, and propose for approval to the Board of Directors and shareholders' meeting respectively.
  3. Selects and nominates qualified individuals and proposes to the Board of Directors to be appointed as the Company's directors and top executives.
  4. Review proportion and size of Board of Directors and experience of individual directors whether suitable for the Company's business and that adjustments are appropriate in response to the changing environment.
  5. Establishes guidelines for evaluating performance of directors and adjustment of directors' remuneration, taking into account the duties, responsibilities, and risks involved.
  6. Considers succession plan for CEO and executives in key management positions and reviews the list of qualified candidates.
  7. Performs any other matters as assigned by the Board of Directors.

Risk Management Committee

The Risk Management Committee comprises of 3 members, with Mr. John Parker acted as Chairman and Mr. Wichian Mektrakarn and Mrs. Vachira Na Ranong as members.

Power and Duties of Risk Management Committee

  1. Establishes the Company's risk management policy and determines risk appetite. Gives advice on the risk management plan for the organization and ensures that control measures are adequate and appropriate.
  2. Considers and recommends the Board of Directors regarding the management, strategy, direction and resources used in risk management process, as well as risk tolerance level for approval.
  3. Conducts risk assessment and review corporate risks at least once a year and follows up on the risk management plan.
  4. Reviews and recommends to the Board of Directors on overall risk management and standard practices in order to improve risk management processes of the organization.

Nomination of Directors and Executives

Appointment of Directors

The Company's Articles of Association stipulates that the Board of Directors shall comprise of at least five directors and not less than half of whom shall have residence in Thailand. The Nomination and Remuneration Committee is responsible for selecting qualified candidates to be the Company's directors, taking into account their knowledge, education, expertise, ethics, integrity, and availability to perform directors' duties. The Company provides opportunity for shareholders to nominate persons to the Board of Directors and shareholders' meeting.

The nomination of directors shall replace the retiring directors on rotation at the end of their terms, or whatever the case may be. The appointment of directors must receive more than half of votes of shareholders attending the meeting in person and by proxy in accordance with the following rules and procedures which are as follows:

  1. Each shareholder shall have voting right equal to one share per one vote.
  2. Each shareholder may exercise all the votes he/she has under a) to elect one or several persons as director or directors but cannot split share voting.
  3. The candidates shall be ranked in descending order from the highest to the lowest number of votes received and shall be appointed in that order until all the director positions are filled. Where there is an equal number of votes casted for candidates causing the number of directors to exceed the allowed number, the Chairman of the meeting shall have a deciding vote.

In case a director leaves his/her position for reasons other than retirement by rotation, the Board of Directors may appoint qualified persons to replace the resigned director at the next Board of Directors' meeting, given that remaining term of service must be longer than 2 months. The appointment of replacing directors must receive more than 3/4 of votes of remaining directors, and replacing directors are eligible to stay in the board right up to the remaining term of service of the resigned directors.

Appointment of Executives

The appointment of executive is considered by executive directors and the Company's management. The Company's executives are professional who perform their duties independently from the major shareholders and other shareholders. Top executives are appointed based on their knowledge, skills, and experience suitable and beneficial to the Company's operations. Their good understanding of business and cycle of automotive industry are key factors to driving business growth and achieve the Company's target.

The Governance of Subsidiaries and Associates

AAPICO has put in place effective and efficient corporate governance, risk management, and internal controls that conform to the international standards and regulations of the respective authorities. The Company's subsidiaries and associates are align with the same principles. The Company has established mechanism and process to overseeing and monitoring the management and operations of the subsidiaries and associates. To that effect, the Board of Directors has empowered the President/CEO to perform such duties as selecting representatives to be executives of that entities and reporting to the Board. The number of representatives in each entity is determined by the percentage holding of the Company in that entity.

The management of the Company is responsible to carry out operations to achieve target and drive business growth, control costs, reduce expenses, and monitor capital investments in line with business plan. Their responsibilities cover the human resource management, resolve problems or conflicts affecting the organization, and maintain effective communication throughout the organization. Significant issues requiring the board resolution are proposed to the Board for approval before taking any action. The Company has a process and mechanism to oversee the operations and management of subsidiaries and associates. The head of each business unit shall report on the operating results of subsidiaries and associates to the management at the corporate review meeting on monthly basis, and present their budget and the progress of their operating plan to the Board of Directors at the performance review meeting on semiannual basis.

The scope of duties and responsibilities of the management of subsidiaries shall be in compliance with the Company's policies. The management of subsidiaries shall ensure that it provides guidelines and procedures in compliance with rules and procedures of the SET regulations regarding connected transactions between subsidiaries and related parties, acquisition and disposal of assets, financial transaction and approval of credit facilities from financial institutions, guarantee, or any related transactions, so that these transactions are handled in an appropriate and complete manner. Subsidiaries shall apply the same regulations as the Company regarding the disclosure of information, filing of documents, the accounting records, and shall prepare its financial statements to the Company for consolidation on timely manner.

For the effective and efficient management of subsidiaries and associates, the Company has the agreement on mutual understanding concerning issues such as the scope of authority, the separation of duty in management, fair distribution of profit for all concerned parties. The Company has simple philosophy in dealing with business partners and respect their rights with all due fairness and cooperates fully with its partners to ensure successful operations of the joint ventures.

The Company and its subsidiaries and associates act in compliance with good corporate governance principles of listed companies and the guideline of SET regulations, such as the attendance of directors in the Board of Directors' meeting and its committee's meeting. More information is provided in the organization and management section.

Auditors and Auditors’ Remuneration

The Board of Directors, with approval of shareholders' meeting, has appointed EY Office Limited as its external auditor to audit the Company's financial statements for fiscal year 2018 ended as of December 31, 2018. The remuneration of auditor can be described in details as follows:

Audit Fee

The Company and subsidiaries paid audit fee to EY Office Limited in the year 2018 at an amount of Baht 9,450,000, of which Baht 2,450,000 is audit fee for the Company including the review of annual report.

Not all subsidiaries of the Company are using the auditing service from EY Office Limited as some of its businesses are not complicated and the contribution to the group is not significant. In such cases, the Company decided to use local audit firms where costs are more appropriate.

Non-Audit Fee

In addition to audit fee, the Company and some of its subsidiaries have engaged non-audit services from EY Office Limited for compliance audit related to the conditions stipulated in the investment promotion certificate (BOI audit). Total payment for BOI audit service in 2018 was a total of Baht 650,000, of which the BOI audit fee for the Company amounted to Baht 130,000.