ThaiBev has the intention for good corporate governance, along with a management system that’s efficient, transparent, and accountability. This means ThaiBev complies with all laws and regulations, and aims to be a role model: doing business professionally, transparently and ethically, to give total confidence to shareholders, investors, employees, customers, and stakeholders.

ThaiBev also reported on good corporate governance in its Annual Report 2018, which explained the structure and method of governance disclosure. The report also disclosed financial performance, a development plan for sustainability within the organization between board members, management and shareholders to further its competitiveness, and emphasized determination and support to develop our customers’ business potential for stronger and more sustainable growth, and adding value for shareholders in long term; while considering all stakeholders inside and outside the organization. ThaiBev has an annual knowledge-sharing plan on laws and regulations involving the Singapore Exchange; the Compliance Unit, Office of Corporate Secretariat, provides updates to the boards, executives, and employees. When there is any amendment of laws and regulations, the Board of Directors and the Executive Committee will be informed in the meetings or via email, as the case may be.

Furthermore, ThaiBev announced the use of Whistleblowing Policy as a way to emphasize the importance of receiving and responding to the concerns about suspected wrongdoings within the Company, which was raised from directors, executives, and employees. In 2018, there were no significant incidents of conflict found and no significant cases of grievances related to ethics which were investigated and found to be valid.

Business ethics are a key part of enabling business growth, stability, sustainability, and social acceptance. ThaiBev has established its Code of Business Conduct with the intention of emphasizing integrity, legal compliance, and the observance of morality and ethics. The executives, managers, and employees all have the responsibility to adhere to the Code of Business Conduct, so that ThaiBev achieves its objective of upholding ethical conduct and maintaining ethical standards.

ThaiBev has a duty to maintain transparency in its operations and protect the interests of its shareholders by considering market conditions and risk factors, both present and future. The company must act correctly towards employees, customers and all its trading partners. The company is committed that its employees truly understand the content and meaning of the Code of Business Conduct; at every level, ThaiBev personnel are bound to accept and follow the code. If every person connected with the company accepts and practices the Code of Business Conduct under the policy of good governance, the results shall be as follows:

• The company will uphold its responsibility toward society and all stakeholders
• Employees will work efficiently
• There will be fairness
• Employees will have dignity and integrity
• The company will be accepted by society
• The staff will be content

ThaiBev recognizes the importance of transparency and morality and adheres to the principles of fairness and compliance with the Code of Business Conduct, while striving to provide maximum benefits for all stakeholders in its business operations, in Thailand and abroad. ThaiBev’s anti-corruption policy has established practices to protect against corruption, and to serve as a guideline for promoting business sustainability and stability in the future.

In the case of changes to the business, regulations, standards, and the law, the President and CEO is responsible to monitor and implement an efficient anti-corruption system, report to the Chair of the Board of Directors and the Audit Committee; and review and revise policies to ensure they are up-to-date and responsive to any changes. The company has specified the roles and duties of all parties as follows:

• High-level executives are responsible for making sure that board members, supervisors and employees understand policy compliance, encouraging them to be vigilant and proactive.
• Board members and employees have the duty to maintain the highest standards when doing business.
• Employees must not turn away from, or neglect evidence of corruption.
• Employees must cooperate with investigations into the facts.

Failure to act in accordance with this policy is a severe disciplinary offence; it is a violation of the ThaiBev employment contract and a criminal offence. Furthermore, violating this policy may cause severe damage to the company’s reputation and status. If corruption is discovered, it should be reported to the employee’s line manager. If a person is discovered to commit an offence, they will be punished according to ThaiBev’s regulations and prosecuted under the law.

ThaiBev has a policy that all employees are obligated to file a complaint if they discover an act that may be considered wrongdoing.

• If a board member has a complaint, the board member should file the complaint to the Chairman of the Board to investigate.
• If an employee has a complaint, the employee should file the complaint in writing through the recommended channels, giving their name and contact details and file it with a responsible company official.
• Every employee may report suspicious information directly to the President and CEO through the email whistleblowing@thaibev.com, or send it directly to executives.
• ThaiBev is ready to protect any employee who files a complaint with a factual basis; confidentiality will be maintained while taking strict action against wrongdoing.
• An employee filing a complaint will be free of repercussions or damage if the complaint is filed in good faith.
• Appropriate action will be taken to protect executives and employees from any harm that may arise from filing the complaint.

When an employee files a complaint, ThaiBev will decide how to proceed. If it is found afterwards that the complaint was false, corrupt, malicious, careless, or for personal benefit, this will be considered a disciplinary offence as stated in the ThaiBev Employee Handbook. Channels for filing complaints are publicized through the company’s internal media.

ThaiBev requires that all employees must comply with its rules and regulations and the laws of countries that ThaiBev operates in. Any breach of applicable regulations in terms of ethics, organizational standards of excellence, or violations of human rights on the business premises must be stopped immediately and appropriate measures taken.

In 2018, some minor cases were reported. Breaches were categorized by the monetary value of the action. Major cases involve a monetary value of 300,000 baht or more; minor cases involve less than 300,000 baht. To prevent breaches of the regulations, ThaiBev has set the following policies to reduce corruption:

• ThaiBev provides orientation to new employees and executives.
• Online training courses are provided.
• ThaiBev communicates business ethics to employees and executives and makes efforts to ensure they understand.
• ThaiBev strives to communicate the Code of Business Conduct to employees and executives and make sure they understand they are required to follow the code.
• If fraud is discovered, decisive action will be taken. This may involve legal action.
• Internal audits for corruption will be conducted periodically.

ThaiBev operates its business in accordance with the principles of corporate governance, with efficient management systems that are transparent and under a basic framework of fairness and accountability. ThaiBev participates with and supports, state entities for commercial benefit and production, namely the Chamber of Commerce, Board of Trade of Thailand and the Federation of Thai Industries. This is to increase the company’s competitive potential and to create a strong network with other companies in the beverage sector. The company provides budgetary support and participates in the sharing of information. ThaiBev supports the activities of these entities, offering suggestions and guidelines for the common benefit of the business sector and consumers. ThaiBev has the intention of coordinating private and public policy, to support and promote industry in general, to develop and grow sustainably.

• Financial support for the Chamber of Commerce and Board of Trade of Thailand comes in the form of a membership fee. ThaiBev helps to facilitate and encourage correct practices that line up with the vision and plans determined by government policies, such as Announcements from the Office of the Prime Minister, Ministerial regulations and Excise regulations for the greatest benefit of the industry.
• Financial support is provided for the Thai Institute of Packaging and Recycling Management for Sustainable Environment (TIPMSE) through the Federation of Thai Industries, promoting the 3Rs: Reduce, Reuse, Recycle. This is to support society’s dedication to conserving the environment.
• Support is given to the Federation of Thai Industries to grant research scholarships that study packaging management, in order to reduce environmental impacts and be more sustainable.

ThaiBev maintains a role in stating opinions and/or making decisions through the Board of Directors, or at the Annual General Meeting of the Chamber of Commerce and Board of Trade of Thailand. In this way, ThaiBev stays informed about changes in regulations and specifications and has the opportunity to review government draft policies and regulations. This enables ThaiBev to develop measures to mitigate any possible impacts on business, and to formulate plans to cope with changes initiated by the government, while maintaining the company’s good reputation and creating the greatest benefit for the industry.

As for the Federation of Thai Industries, ThaiBev supports research and development for environmental sustainability and promotion of the 3Rs through communication channels, training, and exchanging knowledge between partners in the beverage industry. This includes cooperation with the private sector to dispose of packaging waste with integrated and sustainable solutions. This reduces environmental impacts in Thailand, and helps the state reduce waste management costs.

• Risk management is imperative for current business operations, which are undergoing continuous change, to create confidence that ThaiBev can attain both short term and long term objectives and goals. Meanwhile, risk management can reduce losses and damages to an acceptable level, or even create business opportunities for ThaiBev to increase its competitiveness and growth.
• Therefore, ThaiBev has determined a systematic framework and approach for the management of any risk that might occur throughout the organization. Understanding has been created with management and every employee about opportunities and risks which may arise. There have also been plans formulated to mitigate risk with systems of monitoring, and evaluation of risk management to discover emerging risks in the future.
• Besides risks that may occur during normal operations, ThaiBev analyzes risks which might impact ThaiBev’s sustainability, and has found the following four significant changes in economic, social and environmental aspects:
  • Changes in demographic structure and the onset of an aging society.
  • Changes in climate.
  • Changes in technology causing changes in business formats.
  • Threats to the security and safety of information systems.

All of these are considered Emerging Risks which may hinder the business in reaching its goals and lead to losing business opportunities, as well as compromising the organization’s reputation, stability or sustainability. Divided into the corporate level and the product group or business unit level:

At the corporate level:
There is a Sustainability and Risk Management Committee¹ (SRMC) which comprises ThaiBev directors and senior executives from each product group or business unit appointed by the Board of Directors. They are tasked with determining policies to manage sustainability and risk management, and strategically supervise the business in sustainable development effectively and efficiently. They are required to specify operational frameworks for ThaiBev’s risk management, including monitoring, screening, and giving ideas or suggestions in regards to the matters of concern.

At the product group or business unit level:
Senior executives of each product group or business unit are tasked with controlling and monitoring risk management at their product groups or business units and reporting to the SRMC.

There are also risk coordinators of each product group or business unit who assist in supervising and monitoring risk management operations in their product groups or business units, including coordinating with the Corporate Risk Management Working Team.

In addition to the management of risks which may arise in normal operations in each product group or business unit, ThaiBev also manages risk associated with strategic planning, investment, and setting business plans which have been considered by the relevant committees, such as the Raw Material Procurement Committee, the Management Committee, the Investment Committee, or the Executive Committee. Corporate risk must be reported to the Company’s Board of Directors and the Audit Committee, to be confident that every risk is managed according to the specified measures.
¹Note On November 23 2017, the Company’s Board of Directors Meeting No. 5/2017 approved the renaming of the “Risk Management Committee” to the “Sustainability and Risk Management Committee” and extending the scope of its responsibilities to cover the oversight of strategies to bring about efficient and effective sustainable development.

ThaiBev’s risk management process is Integrated Risk Management, divided into two different kinds: Top-down and Bottom-up Enterprise Risk Management. For instance, senior management has a role in identifying and evaluating ThaiBev’s strategic risk by analyzing the relevant internal and external factors, and considering a risk management plan alongside business plans, yearly operational plans and investment plans, with the continuous follow-up of risk management.

At the operational level, the head of a department and its staff must identify and evaluate operational risks, develop a risk management plan, implement it and report the results continuously at every level, from department and subsidiary company to product group or business unit, and at the corporate level.
Integrated Risk Management comprises the following procedures:

• 1. Define objectives of ThaiBev and the product groups or business units to be consistent.
• 2. Identify risks faced by ThaiBev or the business units, or those which are latent in operations, which may arise and have a negative impact on ThaiBev or the business achieving its goals.
• 3. Analyze and assess risks to find their cause; categorize and prioritize existing risks by evaluating the chances of a risk incident, and the impact or level of severity of the damage that might occur.
• 4. Plan risk management actions.
• 5. Implement the action plan.
• 6. Follow up, report and evaluate risk management by comparing Key Risk Indicators, specified as criteria to evaluate the results of operations for middle management upwards.

To engender knowledge and understanding and to instill risk management into the awareness of every employee, and develop it to be part of corporate culture in order to help ThaiBev to grow sustainably, the following measures have been taken:

• Held special trainings in risk management for the risk coordinators of each product group or business unit, as well as training activities for employees and orientation sessions for new employees. These are to understand ThaiBev’s risk factors, the processes of risk management, and the management tools used to address risk consistently in both general and particular cases. This is to prepare our employees for any incident which may occur in the course of operations, whether short term, medium term, or long term.
• Encouraged and supported employees to discuss or communicate matters of risk or safety at ThaiBev, including proposing opinions about managing risk in meetings and at training sessions.
• Established internal agencies such as the Office of Legal Affairs, the Compliance Unit of the Office of Corporate Secretariat, the Corporate Risk Management Working Team, and the Office of Internal Audit to examine and monitor operations, and give advice and suggestions on improving operations for product groups, business units and other departments across the organization.
• Initiated the Ways of Work Awards (WOW Awards) project for employees to present projects which may be a concept or method of operations which supports the ThaiBev’s sustainable development. Employees may enter the WOW Awards competition, which is judged by senior management. They choose work that is interesting and will benefit ThaiBev when implemented in real life contexts.

Besides this, employees can report potential risks to ThaiBev in writing to their line managers, or they can report to the Office of the President and CEO using the dedicated email account, after which the President and CEO will consider and take further actions deemed appropriate.

1. Risks from changes in demographic structure and the onset of an aging society, which include:

• The increase of the older population in many countries including Thailand, which is bringing about a society of the elderly, in which the proportions of working age people and children are reduced.
• Changes in consumer behavior featuring a greater interest in health.
• Consumers are consuming a wide range of goods and services with an expectation of improved quality and higher standards.
• The government sector prioritizes promoting health among the elderly to reduce the burdens of care, and provides health services to the elderly, including through the amendment of various relevant regulations concerning goods and services in order to impact consumers’ health and safety.

2. Risks from climate change, including:

• More severe and frequent natural disasters, whether drought or floods.
• Movements to conserve the environment in various forms.
• Increasing measures by government agencies to care for the environment, or regulate the use of natural resources by issuing new laws or strengthening existing laws.

 

3. Risks from changes in technology causing changes in business formats, including:

• Rapid development of digital technology impacting the market and products in various industries, including food and beverages.
• Many companies, and competitors in particular, have changed business formats to deal with change and create competitive advantages by reaching new groups of customers by offering new products and services which use technologies.

 

4. Risks to the security and safety of information systems, including:

• Threats of cyber security attacks, which are frequent in many companies or agencies and have severe impacts.