Corporate Governance Principles, the company’s rules and regulations, are clearly defined through the Corporate Governance, Ethical Standards and Code of Business Ethics Handbook.

PTT International Trading Business Unit is strongly committed to operating its business and creating sustainable value by adopting management system based on the corporate governance principles, ethics, transparency and responsibility towards all stakeholders. Our strong foundation of policy and governance gives us the advantage of broadening our viewpoints and technical judgement through committees and policies. As a result, our stakeholders and trading partners can always rely on our integrity, disciplines and protocols which is continuously evolving to meet the ever changing environment.

Overview

OUR WAY OF GOVERNANCE

PTTT has established a policy on good corporate governance with the aim of enabling organizational management and employees to efficiently conduct the business through good corporate governance, excellent management, business ethics, transparency and accountability.

Overview

PTT WAY OF
CONDUCT
GOVERNANCE
AND OVERSIGHT

OUR WAY OF GOVERNANCE

INTEGRATED GRC

An important challenge for TBU concerns the strict adherence to and compliance with various laws and regulations that are relevant to business operations These include criteria on good governance, such as the Corporate Governance Code of the Securities and Exchange Commission (SEC), the Principles and Guidelines on Corporate Governance for State-Owned Enterprises, and the Guidelines and Enterprises Quality Assessment System issued by the State Enterprise Policy Office (SEPO). In order to respond to the transforming of environment, business context, competitiveness, rules and regulations, PTT must apply appropriate management principles to ensure a balance in its role as both to support compliance and achieve stakeholders' expectations. It is the PTT’s aspiration to become a model organization on Governance, Risk management, and Compliance (GRC). These principles therefore serve as the foundation for the development of a management system that ensures fairness and trust for all stakeholders, and which enables the creation of a faithful, ethical, and transparent organization that opposes corruption in all forms.



PTT Group Way of Conduct describes framework mechanisms and principles in overseeing policies and the operation of companies in PTT Group at an appropriate level of their business through teamwork and effective group governance.

KEY RISKS AND CONTROL

COUNTERPARTY RISK

We have developed an extensive counterparty due diligence process on all new suppliers and customers before entering into any transactions. We have combined hands on experience in performing risk management and control procedures to mitigate counterparty’s risks associated to the company’s trading activities. These procedures include assessing counterparty credit worthiness, establishing appropriate credit reserves for both new and existing counterparties, monitoring daily mark to market credit exposure, and reviewing counterparty credit upgrades and/or downgrades. Additionally, we have expanded a close relationship with international counterparts and global financial institutions for best practice and recognized financial structure for risk management solutions to reinforce our trading competitiveness in the dramatically changing global trade and economics.

PRICE RISK

As a middle office, we are responsible for monitoring pricing exposures, tracking profits and losses, and ensuring that all required trading compliance documents are completed. With policy and regulation set by our Bangkok headquarters, we constantly monitor market fluctuations, identify risks, and apply our Global Book, Global Control, and Global Information to maintain the same standards in all our transactions worldwide.

Since 2006, we have established our own structure of best practices and functionality to protect our business from any unforeseen market situations. By applying well-known risk control tools such as Stop Loss Limit and Value at Risk (VaR) through our international-standard Commodity Trading Risk Management (CTRM) system, we can ensure the critical information is distributed to top management and individual traders in timely manner. This advance technology connecting every aspect of business helps the decision makers to mitigate any incoming risks in real time.

OPERATIONAL RISK

With dynamic business environment, we encounter a variety of operational risk unavoidably. Operational risk is mainly categorized into 2 types, 1) Internal operations risk and 2) External operations risk. Internal operations risk involves normal task or daily activity not properly processed due to human error, minor mistake, or insufficient operating standard. We effectively utilize various internal control measures to detect, correct, and prevent such occurrence and to ensure that such risk is prevented or minimized. External operations risk involves the uncertainty that the producer, supplier, customer, storage facility, or other physical plant and equipment may fail to perform properly. Also, the physical operation risk includes the risk associated with storage, logistics, stock loss, or even off specification or contamination. We have set out a protocol to closely manage, monitor, and alert for any physical operation risk incident from all related activities carried out before, during, and after the period of cargo operation. This shall establish prevention and mitigation measures related to operational incident to ensure that such incident can get resolved and issue is addressed to the right level of management in time.

CONTRACT RISK

Contract is one of the written instruments to abide the parties legally by the agreed terms and conditions and also the risky part the trading business. Since the risk is inherent in any commercial and non-commercial clauses in the contract and, in most cases, unavoidable then must be managed and minimized such risk to the fullest extent possible. Our analyst along with PTT corporate support functions (e.g. Corporate Legal, Tax, Accounting, and Finance Teams) always mitigate such contract risk in the timely and professional manner, ensuring the contract is issued with standardized clauses that complies with PTT's Rules & Regulations and Law. With proper contract risk management practice, we are confident this shall effectively mitigate any possible risks occurred to PTT International Trading Business Unit.

COMPLIANCE RISK

Governance, Risk and Compliance (GRC) becomes one of the most important business requirements in international trading business. The implementation of GRC principle into trading business activities enables TBU to ensure that all internal and external trading activities comply with rules and regulations to meet international standards and requirements. We provide an in-house service that effectively supports business areas to comply with relevant laws and regulations, sanction policies and internal procedures. Moreover, we emphasis on preventing fraud, corruption, and tax evasion as stated in our policy both proactively and by way of risk-based review.

KEYS RISKS AND CONTROL
chart

Policy & Governance :
Our strong foundation of policy & governance gives us the advantage of broadening our viewpoints and technical judgement through committees and policies.

Organizational Structure & Functions :
Our organizational structure and function provides us with clear roles and responsibilities to deliver a thorough Checks and Balances system.

Technology :
The advanced technology which connects every aspect of our business and functions, allows our expert teams to monitor and mitigate any incoming risks in real time.

OUR POLICY

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