Bankard, Inc. recognizes the importance of adopting leading practices on good corporate governance in fulfilling its commitment to excellence, providing unparalleled product and service quality and sustaining increased value for its various stakeholders.
The company has defined its corporate governance rules and principles which are institutionalized in the entire organization through the company’s Manual on Corporate Governance. This Manual embodies the rules of the Revised Code of Corporate Governance which took effect on July 15, 2009.
The Manual provides the governance structure and the designated roles of the different components of the company’s governance system. The governance structure is comprised of the Board of Directors and the various Committees which were constituted to aid the Board in complying with the principles of good corporate governance, the Chairman of the Board, the Vice Chairman of the Board, the President & CEO, the Corporate Secretary, the designated Compliance Officer and the Internal and External auditors who collectively ensure that management enhances the value of the Corporation. The roles, responsibilities and function of each component of the governance structure are identified and defined to ensure compliance with the governance standards. The Manual also includes the composition and functions of board committees.
Consistent with leading practices on good corporate governance, we have maintained our Board’s independence from Management through the separation of the posts of the Board Chairman and the President and CEO, with each position having distinct and separate duties and responsibilities as provided for in the company By-Laws. The Board of Directors, which is primarily responsible for the governance of the corporation, includes two independent directors which meets the minimum required number of independent directors based on the Securities Regulations Code of at least 2 or 20% of the members of the board whichever is lesser. More independent directors are appointed as and when appropriate. A new director is required to attend a corporate governance seminar before assuming such function. All of the company’s directors have attended seminars on corporate governance which is in accordance with best practice.
The CG Manual is available for inspection by any stockholder of the company. This is disseminated to employees through the new hires orientation program and each department is also provided a copy. Aside from this, the Manual is also made publicly available through the company website.
The CG Manual provides policy on disclosure and transparency. All required reports or disclosures are prepared and submitted. Financial reports and other material information are disclosed, submitted through the appropriate channels, and posted in the company website.
The following measures are also in place to improve corporate governance within the company:
- Training of select officers who will serve as leading proponents of good corporate governance in the organization to increase their awareness of leading practices on good corporate governance. As of December 2012, 35% (7 of the 18) of the company’s Senior Officers have attended trainings on corporate governance.
- Regular review of operations by the Audit Committee and the members of the Board to ensure compliance with established policies and procedures.
- Overseeing by the Risk Management Committee of the company’s overall risk management program which is currently integrated with that of parent company, RCBC.
- Establishment of formal and transparent procedures for developing a policy on remuneration of directors and officers by the Compensation Committee to ensure that compensation is consistent with the Corporation’s culture, strategy and the business environment in which the Corporation operates.
- Assurance by the Corporate Governance and Nomination Committee of the Board’s effectiveness and due observance of corporate governance principles and guidelines.
To measure the level of compliance of the Board of Directors and top-level management with its Manual of Corporate Governance, the Company has established a monitoring and evaluation system which includes the following:
- Regular reporting of each board committee and Management to the Board of Directors;
- Establishment of an internal self-rating system for both the Board and Management to measure their performance in accordance with the Code of Corporate Governance;
- Accomplishment of the Corporate Governance scorecard or such other document required by the Commission to monitor extent of the Company’s compliance with the Code of Corporate Governance. A compliance report on the PSE Corporate Governance Guidelines was also accomplished and submitted to the Philippine Stock Exchange as required;
- Annual certification on the Company’s compliance with the Manual on Corporate Governance as prepared by the Compliance Officer and concurred by the President/CEO;
- Independent audit mechanism wherein an Audit Committee composed of three members of the Board, two of whom are independent directors, regularly meets to review results of internal and external audits with focus on compliance with accounting standards, tax, legal and other regulatory requirements and performs oversight functions in the area of risk management. The Audit Committee also discusses and evaluates the year-end financial statements before submission to the Board. In 2012, the Audit Committee conducted a self-assessment exercise and correspondingly reviewed and revised its charter. A report signed by the Chairman of the Audit Committee and the Chairman of the Corporate Governance/Nomination Committee was submitted to the SEC in compliance with SEC Memorandum Circular No. 4, series of 2012. (Note: In 2013, the Audit Committee and the Risk Management Committee was merged into the Audit and Risk committee with the Chairman of the Board sitting as non-voting member).
In 2010, the Philippine Stock Exchange issued its Corporate Governance Guidelines for Listed Companies. These are concepts and best practices which the Exchange believes should be adopted by a well-governed publicly listed company. These are designed to guide listed corporations in improving their corporate governance practices. Bankard, Inc. has substantially adopted the recommendations stated in the Guidelines. A compliance report indicating the company’s assessment of the level of adoption of the recommendations stated in the Guidelines for 2012 was submitted to the Exchange as required.