General Responsibilities, Specific Duties and Responsibilities of the Board and its Directors, Board Meetings, Training/Orientation Process

Compliance with the principles of sound corporate governance instituted in this Manual shall be the paramount responsibility of, and shall start with the Board.

The Board shall exercise the corporate powers and conduct and manage the business and affairs of the Company in consonance with the principles of sound corporate governance instituted in this Manual and shall be responsible for fostering the long-term success of the Company and securing its sustained competitiveness.

Consistent with a director’s  three-fold duty of obedience, diligence and loyalty to the corporation he serves,  the Directors shall:

1. Act within the scope of power and authority of the Company and the Board as prescribed in the Articles of Incorporation, By-laws of the company and in existing laws, rules and regulations;
2. Exercise their best care, skill, judgment and observe utmost good faith in the conduct and management of the business and affairs of the Company;  and
3. Act in the best interest of the Company and for the common benefit of the Company’s stockholders and other stakeholders.

A Director’s office is one of trust and confidence.  As such, a Director shall act in a manner characterized by transparency, accountability and fairness.

Specific Duties and Functions of the Board

To ensure a high standard of best practice on governance for the Company and to promote and protect the interest of the Company, its stockholders and other stakeholders, the Board shall conduct itself with honesty and integrity in the performance of, among others, the following duties and functions:

• Install a process of selection to ensure a mix of competent Directors and Officers each of whom can add value and contribute independent judgment to the formulation of sound corporate strategies and policies, and adopt an effective succession planning program for Management;
• Elect the President and other Officers;
• Adopt a professional development program for Officers and succession planning for the Company Executives;
• Determine or validate the Company’s purpose, its vision, mission and strategies to carry out its objectives;
• Ensure that the Company complies with all relevant laws, rules and regulations and codes of best business practices
• Identify the Company’s major and other stakeholders and formulate a clear policy on communicating or relating with them through an effective investor relations program;
• Adopt a system of internal checks and balances and regularly evaluate applicability thereof under changing conditions;
• Identify key risk areas and key performance indicators and monitor these factors with due diligence
• Ensure the continuing soundness, effectiveness and adequacy of the Company’s internal control environment;
• Properly discharge Board functions by meeting regularly, and give due consideration to independent views during Board meetings, which meetings shall be duly minuted;
• Adopt procedures for the Directors, either individually or as a group, in furtherance of their duties, to take independent professional advice and to have access to management;
• Keep Board authority within the powers of the institution as prescribed in the Articles of Incorporation, By-Laws and in existing rules and regulations.
• Approval of items reserved to the Board, such as, but not limited to
  • Annual Report and Financial Statements
  • Dividends
  • Financial Policies
  • Budget
  • Retirement Plan and selection/appointment of Trustees
  • Safety/Asset Integrity Matters
  • Others
• Provide sound strategic policies and guidelines to the corporation on major capital expenditures. Establish programs that can sustain its long-term viability and strength. Periodically evaluate and monitor the implementation of such policies and strategies, including business plans, operating budgets and Management’s overall performance
• Formulate and implement policies and procedures that would ensure the integrity and transparency of related party transactions between and among the corporation and its parent company, joint ventures, subsidiaries, associates, affiliates, major stockholders, officers and directors, including their spouses, children and dependent siblings and parents, and of interlocking director relationships by members of the Board.
• Establish rules for an alternative dispute resolution system in the corporation that can amicably settle conflicts or differences between the corporation and its stockholders, and the corporation and third parties, including the regulatory authorities.
• Appoint a Compliance Officer who shall have the rank of at least vice-president. In the absence of such appointment, the Corporate Secretary, preferably a lawyer, shall act as Compliance Officer.
• Perform such other functions which may be required under existing laws, issuances and regulations.

Specific Duties and Responsibilities of a Director

A Director shall have the following duties and responsibilities:

1. To conduct business transactions with the Company fairly, ensuring that personal interest does not affect his independent judgment and the Board’s;
2. To devote time and attention necessary to properly discharge his duties and responsibilities;
3. To act judiciously on matters brought before the Board, thoroughly evaluating the issues involved before making any decision;
4. To exercise independent judgment;
5. To have a working knowledge of the statutory and regulatory requirements affecting the Company and its operations, including the provisions of the Company’s Articles of Incorporation, By-Laws, the requirements of the Commission and, where applicable, the requirements of other regulatory agencies having jurisdiction over the Company; and
6. To observe confidentiality on non-public information acquired by reason of his position as a Director;
7. To ensure the continuing soundness, effectiveness and adequacy of the Company’s, control environment.

Board Meetings and Quorum Requirement

The Board shall schedule and hold regular meetings and convene for special meetings when required by business exigencies. Every Director shall attend such meetings, to ensure that the quorum requirement will be met, unless his absence thereat is due to justifiable causes.

In any meeting of the Board, an Independent Director must always be in attendance.

Justifiable causes include, but are not limited to, grave illness, death of an immediate family member or serious accidents.

To monitor the directors’ compliance with attendance requirements, the Company shall submit to the Commission via SEC Form 17-C, on or before January 30 of the following year, a sworn certification about the director’s record of attendance in Board meetings duly signed by the Corporate Secretary and the Chairman.

Adequate and Timely Information (New Subject)

To enable the members of the Board to properly fulfill their duties and responsibilities, Management should provide them with complete, adequate and timely information about the matters to be taken in their meetings.

Reliance on information volunteered by Management would not be sufficient in all circumstances and further inquiries may have to be made by a member of the Board to enable him to properly perform his duties and responsibilities. Hence, members should be given independent access to Management and the Corporate Secretary.

The Members, either individually or as a Board, and in furtherance of their duties and responsibilities, should have access to independent professional advice at the corporation’s expense.

Training/Orientation Process

The Board undertakes to require a newly elected member of the Board to attend, within a reasonable period after his election to the Board, a seminar on corporate governance conducted by any duly recognized private or government institution.

In addition, newly-elected members of the Board should familiarize themselves with the Corporation’s operations, senior management and business environment. They should be inducted in terms of their fiduciary duties and responsibilities as well as in respect of the Board’s expectations.

Appropriate training opportunities for both existing and potential directors may, from time to time, be identified and undertaken.