Corporate Governance Framework

Corporate governance is the most essential element for insurance business as the business is based on trust, integrity and accountability to insured and citizens. In order to achieve sustainable and robust business amidst rapid changes, a company is required to implement checks and balances, comply with laws and establish systematic enterprise risk management.

In this regard, Muang Thai Life Assurance Public Company Limited (“Company”) has developed this Corporate Governance Framework as principles or guidelines for Board of Directors to supervise the Company in conducting the business with transparency, trustworthy, and responsibility to stakeholders. By concerning long-term benefits, the Company is fully aware that the Board of Directors is the key to providing business direction, core policies, and business strategies. The Board of Directors is responsible for ensuring that the Company has internal control process and mechanism, effective audit procedure, clear performance monitoring guideline as well as a distinct separation between the functions of governance and those of management. In addition, subcommittees are appointed to support the Board of Directors by considering essential issues of the Company in various aspects and ensuring that the Company conducts the business with stability, transparency, and responsibility to insured and stakeholders, and eventually achieves business sustainability.

Objectives of Corporate Governance Framework

1) To provide the Board of Directors with clear corporate governance process or guideline to ensure business transparency, responsibility to insured and stakeholders and long-term benefits for the Company’s stability and sustainability
2) To ensure that the Company is trustworthy, transparent, able to operate the business firmly and continuously, as well as adaptable to rapid changes in current and future business environment
3) For the Board of Directors to be aware of its roles and responsibilities in supervising the Company and ensuring that the Company has an effective internal control system, comply with laws, and implement enterprise risk management system

1) Board of Directors means the Board of Directors as prescribed by the laws of life insurance.

2) Director means a person who serves as a director in the Board of Directors.

3) Executive Director means a director who is an executive or a director responsible for operations like executives. It shall include an authorized director unless it is evident that such signing is made according to the Board of Directors’ resolution and it is co-sign with other directors.

4) Executive means a manager or the first four top-ranking executive after the manager level as well as all other 4^th ranking equivalent, and accounting or finance executives of department executive level and up.

The Board of Directors is responsible for determining key strategies and policies, ensuring the availability of effective risk management and governance, monitoring the Executive’s performance in alignment with the strategies and policies efficiently and effectively. The Board of Directors must ensure that the Executives report key issues of the Company and establish a reporting process to provide the Board of Directors with adequate and updated information and allow the Board of Directors to fully exercise its authority, duty and responsibility. Therefore, the Company is able to conduct the business with fairness, transparency, responsibility to stakeholders under the Corporate Governance Code and achieve long-term value.

The Board of Directors appoints the Executive Committee to act as if it is a management committee. The Executive Committee shall be in charge of discussing strategies and collaborating with the Management to ensure an alignment with business plan and budget. The Executive Committee shall ensure that the Company complies with policy for other businesses, outsourcing service policy and market conduct by mainly considering customers’ benefits which include product development, insurance and mutual fund sales offering processes that do not cause misunderstanding or take advantage from customers’ misunderstanding, customer service life insurance benefits payment and delay of life Insurance indemnification and fair management of complaints made by customers, include data privacy. In terms of investment, the Board of Directors appoints the Investment Committee to ensure the Company’s compliance with investment policy and real estate business policy. In addition, the Board of Directors has appointed the Product Governance Committee to launch the products in accordance with the vision, strategy, financial goals and plans prescribed by the Board of Directors.

The Board of Directors has also appointed the following subcommittees to support its duties.

1) Audit Committee

2) Risk Management Committee

3) Nomination and Remuneration Committee

4) Corporate Governance and Sustainability Committee

1) Structure and Composition of Board of Directors

1.1) Structure and Composition of Board of Directors

The structure and composition of Board of Directors is developed to be suitable with business size and complexity and allows the Board of Directors to perform its duties effectively in accordance with Public Limited Companies Act B.E. 2535, Life Insurance Act B.E. 2535, OIC’s Notification Re: Corporate Governance of Life Insurance Companies B.E. 2562 and other related laws.

The Company’s Articles of Association, Article 31: “The Company shall have the Board of Directors, consisting of no more than sixteen (16) Directors, to conduct its operation. No less than one-half (1/2) of the total number of Directors shall reside in the Kingdom of Thailand and no less than three-quarters (3/4) of the total number of Directors shall be Thai nationals.”
Charter of Board of Directors: Prescribes the structure of the Board of Directors below.

Executive Directors shall not be more than one-third (1/3) of the total number of Directors.
Independent Directors shall not be less than one-quarter (1/4) of total number of Directors.
Chairman of the Board of Directors must be an Independent Director or Non-Executive Director.

1.2) Qualifications of Directors

According to the Charter of Board of Directors, the Directors must have no prohibited characteristics under laws of life insurance, laws of public limited companies, laws of securities and exchange, notifications of Office of Insurance Commission and other laws related to Director’s duties.

1.3) Qualifications of Independent Directors

According to the Charter of Board of Directors, Independent Director must have no prohibited characteristics under laws of life insurance, laws of public limited companies, laws of securities and exchange, notifications of Office of Insurance Commission and other laws related to Independent Director duties.

1.4) Roles and Responsibilities of Directors

The Board of Directors must perform the following roles and responsibilities.

1) The Board of Directors shall determine direction and strategic target of the Company as well as consider and approve policy and annual budget of the Company. Business strategies should be in line with the risk management framework and the risk management policy as well as the Company’s risk appetite.

2) The Board of Directors shall consider and approve Investment Management Guideline and other businesses, monitor, and control investment and other businesses of the Company to be suitable with situation and obligation.

3) The Board of Directors shall govern and oversee the matters related to Sustainability Development, which encompasses Environmental, Social, Governance, and Economic aspects, ensuring compliance with laws, regulations of regulators. The best practices and international standards related to sustainability shall be also taken into account.

4) The Board of Directors shall consider, review and approve the risk management framework, the risk management policy and the risk appetite as well as reporting overall risk management and assessment including the Company’s financial stability, process and risk management control of the Company in order to be in line with the regulations of the regulators.

5) The Board of Directors shall operate the Company to have efficient internal control and audit system.

6) The Board of Directors shall govern and oversee the Company’s risk management to be in line with the risk appetite as well as formulating reports of risk status and compliance with the risk management policy, monitoring the Company’s capital to be stable, solvent and sufficient for both current and future business operations and providing support to Risk Management Committee and related department in order to allow them to perform duties effectively and completely with adequate resources.

7) The Board of Directors shall, honestly and by protecting the Company’s interest, perform their duties in accordance with the laws, objectives and Articles of Association of the Company and resolutions of the shareholders’ meetings.

8) The Board of Directors shall appoint subcommittees, which have authority and responsibility as determined by the Board of Directors.

9) The Board of Directors shall elect a person who has the qualifications and who possesses no prohibited characteristics under related laws as Director in case there is vacancy in Director’s seat due to other reasons rather than being retired by rotation.

10) The Board of Directors shall appoint or authorize any other person to operate the Company under control of the Board of Directors when it is deemed appropriate by the Board of Directors.

11) The Board of Directors shall consider and approve the quarterly, half year and annual financial statements that have been audited by the external financial auditor and reviewed by the Audit Committee.

2) Appointment of Subcommittees to Support Board of Directors

The Board of Directors has appointed the following subcommittees to support its duties.

2.1) Audit Committee

Audit Committee is in charge of supervising and monitoring the Company to comply with the policies below.

Internal control policy justifies the Company’s performance and ensures that the Company can achieve its goals and long-term benefits. It ensures that the Company has reliable financial and performance reports which are aligned with laws, rules and regulations in order to prevent any potential damage to the Company’s reputation. It also promotes checks and balances as well as compliance with laws.
Anti-corruption policy has guidelines and provisions regarding business operation and management which need to be conducted based on integrity, transparency, and responsibilities to society and all stakeholders according to the good corporate governance with a purpose of prohibition on any kinds of corruption. Directors, executives, employees as well as a third party relating to the Company, either for benefits of the Company or oneself, family, friends, or acquaintances, must not commit corruption.
Whistle-Blowing Policy which includes effective whistle-blowing policy and procedure in order to detect and report potentially illegal activities which do not comply with policy, rule, internal process, and code of conduct
Anti-money laundering and counter-terrorism financing policy
Fraud risk management policy to mitigate, prevent, detect, report, manage and recover damages from fraud effectively.

Audit Committee must ensure that the Company has accurate and reliable financial reporting processes, and discloses key information correctly, sufficiently and timely to the public and regulators as specified by related laws and standards. Audit Committee shall also supervise the Company’s audit to comply with policies related to external auditors, covering the following:

1) Consider, appoint and terminate an independent person to perform a duty as independent auditor of the Company, including determining the appropriate remuneration and proposing to the Board of Directors and the shareholders’ meeting for consideration and approval.

2) To consider a management letter the auditor and propose comments the report to the Company’s top Executives.

3) Meetings between Audit Committee and auditors of the Company at least once a year without participation of the Executives.

4) Govern and supervise use of other services of the auditors that must not disrupt independence of the auditors.

Audit Committee supervises and ensures that the Company has an efficient and effective risk management system, an adequate internal control which complies with laws and regulations related to its business operations. In case of corruption issue is found, it must be urgently reported to the BOD. Moreover, statistics or corruption complaints must be reported to the BOD for acknowledgement regularly. It also ensures that the Executives report key and sufficient information to the Board of Directors so that the Board of Directors can fully perform its authorities, roles and responsibilities.

2.2) Risk Management Committee

The Risk Management Committee must perform the following roles and responsibilities.

To determine the risk management policy which cover the significant risks of the Company to be proposed to the Board of Directors, and regularly review the risk management policy and other risks-related policies.
To ensure that the Company has clear risk management regarding authority, duty, responsibility, and risk report procedures which comply with rules, regulations, and criterion that regulate business of the Company.
To ensure that the Company has appropriate, sufficient and effective risk management process that comply with the Company’s risk management policy, rules, regulations, and criterion that regulate business of the Company, and be in line with the good corporate governance. The risk management process should include identification, assessment, response, monitoring, review and report are required. Moreover, data must be reported to the BOD for acknowledgement according to the laws including the preparation of crisis testing, establishing a business continuity plan, specifying a reliable and consistent testing model, having accurate and trustworthy data systems that are complete and can be used for decision-making.
To provide advice to the Board of Directors on the risk management or any matters relating to the Company’s risk regarding appropriate directions, including any advice on matters that may lead the Company to violate related regulations, rules or criterion.
To oversee and provide advice to the Board of Directors on the adequacy and sufficiency of infrastructure, tools, resources, systems, and documents for efficient risk management in a timely manner.
To review and give recommendations to the Board of Directors about expected risk, acceptable deviation range, risk limit as well as assumptions related to risk management models.
To monitor and give recommendations about current and future capital adequacy to the Board of Directors regularly.
Consider and prepare a risk mitigation plan to cope with emergency situations.

2.3) Nomination and Remuneration Committee

Nomination and Remuneration Committee’s roles and responsibilities could be divided into following two dimensions:

1.Nomination

In the case of a vacancy on the Board of Directors or the expiration of the Director’s term of office, Nomination, Remuneration, and Corporate Governance Committee shall be in charge of considering, nominating and selecting person who possesses proper qualifications based on related laws and regulations by considering his/her useful qualifications and suitable experience for the Company.

2.Remuneration

Nomination, Remuneration, and Corporate Governance Committee shall be in charge of determining and considering the remuneration for the Board of Directors and Subcommittees, including attendance fee, annual bonus, and other fringe benefits both in financial and non-financial values. It shall ensure that the Board of Directors and Subcommittees receive appropriate remuneration in comparison to their dedication, value, and fiduciary duties as prescribed by laws. The Directors shall be liable to both civil and criminal offences for non-compliance.

In addition, the Nomination and Remuneration Committee will consider the related risks, as well as strategies and long-term goals for sustainable business operations, taking into account the impact on the Environment, Social, and Governance and Economic. Furthermore, the remuneration of directors will be benchmarked against those in the insurance industry at a similar level.

Nomination and Remuneration Committee is in charge of supervising and monitoring the Company to comply with the policies below.

Nomination and remuneration policy for the Directors as well as remuneration policy for Executives and personnel in controlling units and major risk-taking staff are established in accordance with objectives and risks of each unit and taken into account the Company’s long-term stability. Besides, they should not lead to high-risk transaction that might potentially impact the Company’s stability and the insured’s interest.

2.4) Corporate Governance and Sustainability Committee

Corporate Governance and Sustainability Committee’s roles and responsibilities the following:

To determine and review Corporate Governance Framework, Corporate Governance Policy, Code of Conduct, including various policies to align with relevant regulators and international practice.
To agree and approve Sustainable Development Framework and Policy.
To monitor and advise to ensure good governance and sustainable development which leads to continuous practice that is appropriate for the Company’s business.
and ensure that the Company’s operations are in line with good governance.
To report to the Board of Directors about the Company’s good governance and sustainable development, as well as advice about practice and improvements as needed.
To appoint subcommittees and working teams as needed.

Corporate Governance and Sustainability Committee is in charge of preparing self-assessment form for evaluating the performance of the Board of Directors and subcommittees as a whole and individual. Then, it shall be proposed to the Board of Directors for consideration and approval to evaluate the performance every year. After the Corporate Governance and Sustainability Committee processes the assessment data, the Committee shall present the data to the Board of Directors to use it as a guideline for improving the Company’s performance and effectively support the duties of the Board of Directors. This also assures that the Board of Directors continues to perform its roles and responsibilities efficiently.

In addition, Corporate Governance and Sustainability Committee shall report the performance assessment of Executives to the Board of Directors on annual basis.

Corporate Governance and Sustainability Committee is in charge of supervising and monitoring the Company to comply with the policies below.

Sustainability Development Framework and Policy cover 3 aspects, i.e, Environmental Aspect, Social Aspect and Governance and Economic Aspect. Sustainability development policy and initiative are established for all units to implement in the operations concretely.
Corporate Governance Framework is a guideline for the Board of Directors to be aware of and understand its roles and responsibilities. As a corporate leader, the Board of Directors shall ensure that the Company applies good management system which contributes to good and reliable long-term performance as well as business sustainability.
Corporate governance policy includes 5 sections i.e. 1. Rights of shareholders, 2. Equitable treatment of shareholders, 3. Role of stakeholders, 4. Disclosure and transparency and 5. Responsibilities of the Board of Directors.
Code of conduct is a guideline and a standard of good governance management which shall be applied by the Directors and all employees of the Company.
Conflict of Interest Policy which prevents any activities that might seek personal or related party’s interest, create conflict of interest, and not take the Company’s key risk into account. Directors, executives and employees must not act in a way which may cause conflict of interest.

Other Policies

Code of Conduct

12/15/2022