ThaiBev is committed to embracing principles of good corporate governance in accordance with its Code of Business Conduct and all applicable laws, rules, and regulations, including the Listing Manual of Singapore Exchange Securities Trading Limited (SGX) and the principles and provisions of the Code of Corporate Governance 2018 of Singapore. The company aims to excel in its sustainability and risk management efforts, which are in line with sustainability development guidelines. It seeks to adequately disclose information to build confidence among shareholders, investors, employees, customers, and all other stakeholders. ThaiBev is dedicated to meeting all of its customers’ needs, and also to providing its stakeholders with stable, sustainable, value-added growth over the long term.

The Board is responsible for organizational leadership, setting up the direction, strategy, and operational objectives for the long-term success of companies in the ThaiBev Group. The leadership team seeks to ensure that ThaiBev operates in accordance with its business plan, which is created with input from its shareholders. ThaiBev’s business plan also ensures that the company operates in good faith and in compliance with all applicable laws, rules and regulations. Lastly, it makes sure that companies in the ThaiBev Group comply with applicable regulations of SGX and other related stock exchanges. (For more information on ThaiBev’s organizational structure and corporate governance, view ThaiBev’s 2023 annual report on www.thaibev.com)

With effect from 1 July 2023 and in line with Singapore’s transition towards living with COVID-19, SGX amended Practice Note 7.5 of the SGX Listing Manual which provides, among others, that SGX-listed companies holding their general meetings outside Singapore without allowing Singapore-based shareholders to participate using virtual meeting technology should hold information meetings for shareholders at a physical place in Singapore. As there are restrictions under Thai law that prevent depositors in Singapore holding ThaiBev shares through The Central Depository (Pte) Limited from participating virtually in ThaiBev’s general meeting held in Thailand (view ThaiBev’s 2023 annual report on www.thaibev.com for more information), ThaiBev is required to hold an information meeting for shareholders at a physical place in Singapore. On 12 July 2023, ThaiBev held its annual information meeting (“AIM”) in Singapore, giving directors and senior management of the ThaiBev Group the opportunity to meet and engage with our shareholders in Singapore.

Our President and CEO, as well as members of our senior management, delivered a comprehensive presentation covering the business and operations of ThaiBev Group, financial highlights, and our key product groups. Attendees were able to participate in a question and answer session on the business and operations of ThaiBev Group with ThaiBev’s key directors and senior management during the AIM. ThaiBev also promptly made available the presentation slides shown during the AIM on the SGXNET to ensure that all shareholders of ThaiBev were kept updated.

Lastly, to emphasize its commitment to listening to feedback, ThaiBev has initiated a whistleblowing policy and contact channel for receiving complaints from ThaiBev’s directors, executives, and employees. In 2023, no significant conflicts or ethical complaints were received. ThaiBev established its Code of Business Conduct to pursue integrity, legal compliance, morality, and ethics, including prevention of conflicts of interest.

The company has implemented broad rules on the prevention of conflicts between personal and collective interests. As mentioned in the Employee Code of Conduct, Article 4.1, Responsibility to the Company (2), employees must not commit any act which is contrary to the interests of the company or take any action which may cause the company to lose benefits or receive less benefits than it should, or which is a distribution of benefits from the company. In addition, Clause 15 of the employment contract (further information can be seen at: https://sustainability.thaibev.com) requires employees to seek written consent from the company before engaging in any actions that conflict with the company’s interests.

ThaiBev has a duty to maintain transparency in its operations, to protect the interests of its shareholders by considering present and future market conditions and risk factors, and to treat employees, customers, and business partners ethically. The company is committed to ensuring that its personnel understand, accept, and follow its Code of Business Conduct. This will positively support :

• the company’s ability to uphold its responsibility to society and stakeholders
• employees’ work efficiency
• fairness within the organization
• employees’ dignity and integrity
• the company being socially accepted
• employees’ well-being.

There are three groups of communication channels for the codes of conduct:

• Communication channels for employee relations and complaints handling
• Communication channels for customers and consumers – customers can file any concerns via the Dhospaak call center service
• Communication channels for suppliers and business partners – our suppliers and business partners can submit any feedback or concerns to a procurement service center

In 2023, the company found a total of 102 cases of disciplinary violations related to the Code of Business Conduct. There were 100 cases of offenses related to fraud and two cases related to harassment. Corruption is a criminal offense that affects free competition and breaches the company’s Code of Business Conduct. It causes damage to ThaiBev’s reputation, stakeholders’ confidence, and the company’s profits.

In order to ensure policy compliance, it is mandatory for all employees and suppliers to attend lectures on fraudulent conduct and corruption, and the legal consequences or employee disciplinary actions that will arise from such behavior. Self-assessment shows that ThaiBev’s operations have no significant risk related to anti-corruption.

ThaiBev operates its business transparently and morally, adheres to the principles of fairness, and complies with its Code of Business Conduct, while striving to provide maximum value for stakeholders in Thailand and abroad. ThaiBev’s anti-corruption policy establishes practical protection measures and serves as a guideline to create a stable and sustainable future. The President and CEO is responsible for monitoring and implementing an efficient anti-corruption system, reporting to the Chairman of the Board of Directors and the Audit Committee; and for reviewing and revising policies to ensure they are up-to-date and responsive to any change to the business or regulations. The company has specified the roles and duties of all parties as follows:

• Senior-level executives are responsible for ensuring policy compliance and collaborating with Board members, managers, and employees in compliance monitoring.
• Board members and employees have the duty to maintain the highest standards when doing business.
• Employees must not neglect evidence of corruption.
• Employees must cooperate in investigating the facts.

Failure to act in accordance with ThaiBev’s anti-corruption policy is a severe disciplinary offense, violates the company’s employment contract, and is a criminal offense. Violating the anti-corruption policy can cause severe damage to the company’s reputation. If corruption is discovered, it should be reported to the employee’s line manager. Any person found to violate the policy will be disciplined in accordance with ThaiBev’s rules and prosecuted under the law.

The company conducts a transparent and rigorous investigation process as stipulated in the code of conduct, which also stipulates fair and reasonable penalties for employees who fail to observe the policy. In fiscal year 2023, there were some minor cases of employees failing to act in accordance with ThaiBev’s anti-corruption policy that were detected by the company. Most of them involved intentional use by the employees of the powers of their position in order to seek undue benefit for themselves or others. All 100 cases resulted in termination penalty. There were no cases of fraudulent acts by partners. All employees are obligated to file a complaint when discovering an act that may be considered wrongdoing. Channels for filing complaints are publicized through the company’s internal media. Employees who file a fair and truthful complaint shall not face any repercussions or harms from the complaint. The process for filing complaints is as follows:

• A Board member should file any complaint with the Chairman of the Audit Committee.
• If an employee has a complaint, they should file it in writing with a responsible company official through the recommended channels, giving their name and contact details.
• Every employee can report suspicious information directly to the President and CEO via email at whistleblowing@thaib
ev.com or file the complaint to their line manager.
• Confidentiality will be maintained while taking strict action against wrongdoing.
• When an employee files a complaint, ThaiBev will decide how to proceed, which may involve an internal investigation or reporting to an external organization to conduct an investigation.
• If it is found afterwards that the complaint was false, corrupt, malicious, careless, or for personal benefit, this will be considered a disciplinary offense as stated in the ThaiBev Employee Handbook.

ThaiBev requires that all employees comply with its rules and regulations, and the laws of the countries that the company 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 2023, some minor cases were reported (breaches are 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 implemented the following procedures:

• Conduct orientation for new employees and executives.
• Provide online training courses for employees.
• Communicate business ethics to employees. Require all employees to follow the Code of Business Conduct. Take decisive action when fraud is discovered as it may involve legal action. Conduct regular internal audits by the Internal Audit Office to ensure that ThaiBev follows rules and regulations under the law.

ThaiBev Group monitors regulatory and legal changes in Thailand through its legal department. The Group tracks law changes through being a membership of the Thai Chamber of Commerce, the Federation of Thai Chambers of Commerce, and the Federation of Thai Industries, as well as seeking legal information laws and news from the websites of government agencies such as the Secretariat of the Prime Minister, the Secretariat of the Cabinet, the Secretariat of the House of Representatives, the Thai government gazette, the Office of the Council of State, and the Revenue Department. In the fiscal year 2023, ThaiBev Group has adjusted its operating policy to be in line with the legal measures as follows:

• The Civil and Commercial Code Amendment Act (No. 23) B.E. 2565
  This Act took effect on February 7, 2023, and amended several provisions regarding limited companies, such as allowing limited companies to use electronic methods in board meetings, reducing the notification requirements for calling shareholder meetings of limited companies with only registered shares and no bearer shares to only sending a registered letter to shareholders by mail without advertising the notice in a local newspaper, and increasing the quorum for shareholder meetings to require at least two shareholders or proxies to be present.
  
  In the case of notification of shareholder meetings, ThaiBev Group’s articles of association were prepared in accordance with the old laws. With the amendment of the laws, the companies’ articles of association needed to be amended to comply with the new laws. As a result, the companies will be able to send a registered letter to shareholders by mail without advertising the notice in a local newspaper. ThaiBev Group is preparing to amend the articles of association of all limited companies registered under Thai law in accordance with the amended laws at the annual general meeting to be held after the end of the 2023 fiscal year. This is to ensure that each company can be more efficient in sending notifications of shareholder meetings in the future.
• Notification of the Ministry of Industry on the Management of Waste or Unused Materials B.E. 2566
  According to the Ministerial Regulations No. 3 (B.E. 2535) issued under the Factory Act B.E. 2535, as amended by the Ministerial Regulations No. 28 (B.E. 2566), Clause 8; factories, as defined in the Factory Act, that generate or contain waste or unused materials, or that dispose of, treat, or handle waste or unused materials, are required to prepare a report on waste or unused materials. The Department of Industrial Works, Ministry of Industry, has therefore amended and improved the criteria for managing waste or unused materials in factories as defined by the Factory Act.
  
  These criteria were outlined in the Notification of the Ministry of Industry on the Management of Waste or Unused materials B.E. 2548. The amendment aims to make the criteria more suitable, and a new announcement was issued in B.E. 2566 (replacing the previous one) to establish criteria for reporting the management of waste or unused materials. This includes an expansion of the responsibility of the waste generator.
  
  Unlike the previous practice where responsibility ended upon delivery to the waste processor responsible for managing waste or unused materials, now the responsibility concludes when the waste or unused materials have been managed to completion. The waste generator must control the waste processor to manage waste or unused materials appropriately, in accordance with academic principles, safely, without adverse environmental impacts, and within the legal timeframe. This is in line with the principle that the polluter pays, known as the Polluter Pays Principle (PPP).
  
  The aforementioned announcement came into effect on November 1, 2023, except for the reporting of the management of waste or unused materials, which became effective from June 1, 2023, onwards. Therefore, ThaiBev Group has adjusted its processes for managing waste or unused materials to comply with the amended laws. ThaiBev Group has reported on the management of waste or unused materials within the specified timeframe. Additionally, ThaiBev Group has implemented measures to control and oversee its waste processors responsible for managing waste or unused materials, ensuring strict compliance with the newly revised criteria.
  
  This is to prevent adverse impacts on the surrounding areas, the environment, and society from the operations of ThaiBev Group. Furthermore, ThaiBev Group has prepared contingency plans in case the waste processors responsible for managing waste or unused materials fail to complete the management within the legally defined timeframe. This proactive approach ensures prompt handling of waste or unused materials in the event of such occurrences.
• The Ministerial Regulation on Liquor Production B.E. 2565
  According to the Excise Tax Act B.E. 2560, any person who wishes to produce liquor shall submit an application to the Director General of the Excise Department. The application for and issuance of a license shall be in accordance with the criteria, methods, and conditions prescribed in the Ministerial Regulation.
  
  Before the issuance of the Ministerial Regulation on Liquor Production B.E. 2565, liquor producers were required to comply with the Ministerial Regulation on Liquor Licensing B.E. 2560 (“the Ministerial Regulation B.E. 2560”).
  
  The Ministerial Regulation B.E. 2560 divided applicants into two categories:
  1) large-scale liquor industries that are factories under the Factory Act using machinery with a total capacity of at least 5 horsepower and/or employ at least 7 workers. These industries must also meet the qualifications and characteristics of a factory for the type of liquor they are licensed to produce, as specified in the Ministerial Regulation B.E. 2560; and
  
  2) community liquor production facilities that are not factories under the Factory Act, using machinery with a total capacity of less than 5 horsepower and/or employ less than 7 workers. In 2022, the government issued the Ministerial Regulation on Liquor Production B.E. 2565 (“the Ministerial Regulation B.E. 2565”), which replaced the Ministerial Regulation
  
  B.E. 2560. The Ministerial Regulation B.E. 2565 took effect on November 2, 2022. The Ministerial Regulation B.E. 2565 revised the categories of applicants to align with the definition of “factory” under the Factories Act B.E. 2535 (as amended in 2019).
  
  The Ministerial Regulation B.E. 2565 divides applicants into three categories:
  1) large-scale liquor industries which must be factories under the amended Factories Act using machinery with a total capacity of at least 50 horsepower and/or employ at least 50 workers. These industries must also meet the qualifications and characteristics of a factory for the type of liquor they are licensed to produce, as specified in the 2022 Ministerial Regulation;
  
  2) medium-sized liquor industries that use machinery with a total capacity of at least 5 horsepower but less than 50 horsepower and/or employ at least 7 workers but less than 50 workers; and
  
  3) small-scale liquor industries that use machinery with a total capacity of less than 5 horsepower and/or employ less than 7 workers. The revision of these criteria allows small-scale liquor producers who have held a liquor production license for at least one year to apply for a license to expand their production capacity to medium-sized liquor industries that use machinery with a total capacity of at least 5 horsepower but less than 50 horsepower and/or employ at least 7 workers but less than 50 workers.
  
  In addition, the Ministerial Regulation B.E. 2565 revised the criteria for obtaining a license to produce fermented liquor in type of beer under the Ministerial Regulation
  
  B.E. 2560. The Ministerial Regulation B.E. 2565 revokes the requirement of a minimum registered capital of 10 million Baht and a minimum production capacity of 10 million liters per year (for applicants who are industrial producers of fermented liquor in type of beer that are not produced for sale at the production site) and 100,000 liters per year but not more than 1 million liters per year (for applicants who are industrial producers of fermented liquor in type of beer that are produced for sale at the production site (Brewpub)). This revision of the criteria makes it easier to obtain a license to produce fermented liquor in type of beer under the Ministerial Regulation B.E. 2565 as there are no longer any restrictions on registered capital or minimum production capacity.
  
  ThaiBev Group must therefore prepare for the changes in the law by maintaining the quality and standards of its existing products, developing new products continuously to meet the needs of consumers, and creating brand recognition for ThaiBev Group products. In addition, ThaiBev Group has a business opportunity to increase the production of fermented liquor in type of beer for sale at the production site to provide a new option for consumers.