Manual on Corporate Governance
The CG Manual contains corporate governance principles, structures, and processes covering the rights of stockholders, the minimum qualifications of directors, and the primary roles and duties of directors and officers, among others. Together with the Articles of Incorporation, By-Laws, and Board Committee Charters, the Manual on Corporate Governance lays down the basic principles and governance framework that the Board and the officers of the Company are called to observe and practice alongside efforts to achieve the Company’s objectives.
The CG Manual is periodically reviewed to ensure that the Company’s corporate governance practices remain relevant and effective while the Company works towards the attainment of its corporate objectives.
Risk Management
We at Energy Development Corporation commit to proactively and effectively manage risk to ensure that the company achieves its corporate objectives. In order to fulfill our commitment, we will:
- Establish an enterprise risk management process that is aligned to international standards and best practices;
- Allocate appropriate resources to effectively manage risk;
- Ensure that the organization has the capabilities to manage risk;
- Establish a framework for setting risk management objectives and measuring risk management performance;
- Foster a robust risk culture across the organization by communicating, consulting, and cascading matters related to risk management in order to provide and obtain risk management information and to engage in risk dialogue with stakeholders, from the board level to the lower levels of the organization;
- Continually improve the company’s enterprise risk management program; and
- Comply with all relevant legal and regulatory requirements and other requirements related to risk management.
In 1994, Energy Development Corporation’s (EDC’s) risk management focused on the physical and insurable risks. In 2005, the company established an Enterprise Risk Management (ERM) system that covers both its tangible and intangible assets.
In 2010, EDC’s ERM system was aligned with ISO 31000:2009 (Risk Management – Principles and Guidelines). Below is an illustration of the company’s ERM process, which is based on ISO 31000:2009.
The company ensures that it achieves its corporate objectives by proactively managing risks through the conduct of risk assessments or risk reviews at the following levels of the organization:
EDC’s risk management process is embedded in the organization’s strategy execution process, which integrates ERM into the strategic planning, budgeting cycle, and organizational performance reviews. Through this process, the appropriate management levels and risk owners are made accountable for their strategies, targets, budgets, risks, and performance.
The Risk Management Committee (RMC) assists the EDC Board of Directors in its oversight responsibility for Management’s activities in managing risks involving strategic, natural hazards, operational, market, financial, credit, project, and other risks of the corporation.
The committee plays a vital oversight role and serves as an important liaison to the board of directors. The specific duties and responsibilities of the committee are as follows:
1. Conduct a yearly evaluation of the company’s risk assessment and enterprise risk management program and ensure that appropriate controls are in place.
2. Recommend to the board the company’s strategic risks, including the risk mitigation and control measures that require immediate or urgent implementation.
3. Meet periodically with the Audit and Governance Committee, key management, and internal and external auditors to understand and discuss the control environment.
4. Review the company’s risk tolerance, financial exposures, and investment guidelines, including the mitigating strategies, insurance, and other risk financing schemes being undertaken.
5. Review periodically the security, safety, and physical loss control measures and the specific Emergency Response Plan adopted by the company to ensure that all risks are adequately covered.
EDC has also established a Business Continuity Management (BCM) system that covers emergency response, crisis management, and business recovery. The activities under the BCM system are implemented to address risks that are identified during the risk assessment exercise.
Board and Management
At EDC, our leaders are composed of a diverse and balanced mix of competent individuals, where each member contributes their considerable know-how, experience, and independent judgment when formulating sound corporate strategies and policies for the company.
Plans to Improve
We at EDC continuously strive to live up to our stakeholder’s high standards of behavior and accountability. That’s why we strictly adhere to the corporate governance principles and sustainably review policies and processes that need improvement, and promptly address changes in government legislation, administrative regulations, and international best practices. We have strong partnerships with regulatory government agencies and SEC-accredited corporate governance institutions, and our Compliance Office is affiliated with corporate governance and ethics advocates and practitioners in the Philippines. These groups are from publicly-listed corporations that exercise good corporate governance practices.
We at EDC continuously strive to live up to our stakeholder’s high standards of behavior and accountability. That’s why we strictly adhere to the corporate governance principles and sustainably review policies and processes that need improvement, and promptly address changes in government legislation, administrative regulations, and international best practices.
We have strong partnerships with regulatory government agencies and SEC-accredited corporate governance institutions, and our Compliance Office is affiliated with corporate governance and ethics advocates and practitioners in the Philippines. These groups are from publicly-listed corporations that exercise good corporate governance practices.
Stockholders’ Meetings
Under the Company’s by-laws, the Annual Stockholders’ Meeting is scheduled every first Tuesday of May every year.
