Corporate Governance

Rights of Shareholders

Shareholders: Rights of Shareholders

To ensure that all processes and procedures for shareholders meeting allow equitable treatment of all shareholders, the Annual General Meeting Invitation coupled with necessarily supporting documents were distributed to all shareholders 14 days prior the meeting date. In the Annual General Meeting of Shareholders 12/2007 and the Extraordinary Meeting of Shareholders No. 1/2007, the proxy form was encouraged to be used for the minority of shareholders to nominate candidates for director positions and shareholders who cannot vote in person.

Meeting of Shareholders

The company had one Annual General Meeting (AGM) in 2007, meeting number 12/2550 on April 24, 2007. This AGM covered topics regarding the company’s 2006 operating performance and dividends to be made and the appointment of the Audit Committee.

The Annual General Meeting of Shareholders (AGM) 12/2007 and the Extraordinary Meeting of Shareholders No. 1/2007 were attended by the company’s directors, company management executives and other specialists, including the company’s appointed auditor and attorneys who were responsible for the recording minutes of the meetings and to provide unbiased and transparent legal advice where needed.

The Chairman of the AGM offered company shareholders to express their views and to raise any questions they had regarding the company’s operations. Executive summaries of both the Annual General Meeting of Shareholders (AGM) 12/2007 and the Extraordinary Meeting of Shareholders No.1/2007 were presented to the Stock Exchange of Thailand (SET) within the specified period.

Additionally, the Board of Directors introduced the use of voting ballots in 2007 for all agendas covered in the AGM to ensure full transparency and allow of a thorough review of any disagreements and conflicting issues.

Equitable Treatment of Shareholders

The Board of Directors realized the importance of preventing inside information utilization, thus have established “Business Ethics” practice which is specified in writing. This new “Business Ethics” practice is used as the code of business conduct for all company employees to ensure business manners and employee performance follows the company’s set guidelines.

Additionally, the company specified that all members of the Board of Directors and Management Executives must disclose the numbers of shares they held in accordance with the Securities & Exchange Act B.E. 2535 Section 59. The company also delivers all information obtained from the SET and the SEC to the Board of Directors and Management Executive.

Conflict of Interests

The Board of Directors has provided the policies and procedures preventing the executives and concerned parties from exploiting internal information. The Directors and Executive Directors should strictly follow the notifications and conditions of the Stock Exchange of Thailand on price stipulation as if contacting with the external party. The responsibilities of executives are to accurately report on the Company’s stock activities and strictly follow the notifications of the Stock Exchange of Thailand.

Role of Stakeholders

The Company strongly believes in the rights of stakeholders. All parties including company employees must be treated equally, fairly, and in compliance with Thai laws and other related rules and regulations. STP&I also places priority to safety and quality issues to ensure our products fully meet the customer’s satisfaction. The company will ensure all competition will be handled in accordance with business ethics, transparency, and sufficiency of information disclosure.

Disclosure and Transparency

Policy on Corporate Good Governance

The Board of Directors recognizes the importance of corporate good governance in order to gain the company’s sustainable growth and management efficiency. The review of sufficient internal control system has been performed annually since 2002 in order to ensure the efficient company’s operations, and supervising the executives to obtain the management efficiency.

The company disclosed all information required by SET in bilingual (Thai and English) via the company’s website.

Report of the Board of Directors

The Board of Directors Report on the company’s financial performance has been issued. The report clearly stated the integrity, accuracy, completeness, and appropriateness of book keeping of financial data which met the Generally Accepted by Accounting Standards.

Relations with Investors

The company has set up an investor relations unit to provide the company’s information both financial and non-financial issues to the investors. The company has to disclose all important information correctly, completely and transparently. In case of further information required, the investors can phone 02-260-1181 or send an email to ir@stpi.co.th.

Responsibilities of the Board of Directors

Leadership and Vision

The Board of Directors approved all company’s policy, business plan, and also monitor the company’s operations to ensure all activities are conducted in accordance with relevant laws and ethical standards.

The Board of Directors reviewed and approved key business matters such as the vision and mission of the company, strategy, financial targets, risks, internal control system and auditing system. To conduct the best interest of the shareholders, the Board of Directors, the Audit Committee, and the Executive Directors have their own roles and responsibilities to perform their duties transparently and independently.

The Board of Directors set the approval authority line for the Executive Directors for managing day-to-day business operations. The brief guideline of the approval transactions with no conflict of interests was set so that the transactions are conducted for the best interest of the company and all shareholders. In the past, there was no limit of approval line set due to minimal amount of investment. However, the limit of approval line will be set in the future for the auditing purpose.

Business Ethics

A written Business Ethics is used as code of business conduct for everyone in the company to ensure the appropriate business manners and performance. Compliance of the code is closely monitored by the Board of Directors.

Balance of Power Aggregation or Segregation

The company’s Board of Directors consist of 7 members. Of these 7 member, 2 are executive managements and 1 non-management executive with 4 independent executives. The proportion of independent executives is 1 to 3 of the total member of the Board of Directors.

Remuneration of Board of Directors and Management Executives

The Board of Directors remuneration was set in accordance with SET regulations and within the limit approved by shareholders. The appropriate remuneration has been offered according to each director’s qualifications, experiences, obligations, scope of work, accountability and responsibilities and contributions. Members of the Board of Directors who were assigned to more tasks such as committee, have received higher remuneration.

Executives’ salaries, bonuses, and other long-term compensation have corresponded to the company’s performance and that of each executive.

Board of Directors and Audit Committee – 2006 and 2007 Remuneration

Remark : * Dr. Chavarat Charnvirakul has resigned from the Board of Directors effective as of January 31, 2007.

Total remuneration in 2006 were paid to 7 members of the Board of Directors and the Audit Committee. Total 2007 remuneration in the form of monthly salary and bonuses were paid to 8 members of the Board of Directors and the Audit Committee.

Board of Directors Meetings

In 2007, the company held 6 Board of Directors meeting which was attended by company executives to discuss the topic regarding the company’s Board of Directors.

For the best interest of the company, the Board of Directors concentrated on the Quarterly Financial Performance and the Report of Audit Committee coupled with the business risk which could affect the company’s performance.
The secretary of the Board of Directors is responsible for minutes taking, distributing the meeting notifications with other relevant documents to all directors at least 10 days prior the meeting date. Minutes of the Board of Directors of Meetings were certified by the Board and filed properly as reference.

Board of Sub-Committee

The Board of Sub-Committee appointed the Audit Committee and Management Executives to perform and monitor the company’s operations. Their duties and responsibilities have been defined clearly in the Management Structure section.

Internal Control System and Internal Audit

Internal auditors are responsible for the company’s financial activities to compliance with the SET requirements and other relevant laws. The company’s performance has to be reported directly to the Audit Committee and the Board of Directors for their consideration.

Employee

There were 705 company employee and staff in 2006 and 2007 consisting of 705 and 1,197 employees divided as follows