The Company recognizes and places importance on fundamental rights of shareholders, both as investors and owners of the Company, such as the right to buy, sell, transfer their holding of securities, the right to receive a share of profits from the Company, the right to receive adequate information, various rights in shareholders' meetings, the right to express opinions, the right to participate in decision-making on important matters of the Company such as allocation of dividends, appointment or removal of directors, appointment of auditors, approval of important transactions which affect direction of the Company's business operations, and amendments to the Memorandum of Association and the Company's Articles of Association etc.

The Company has a mission to promote and facilitate the exercise of shareholders' rights as follows:

1. The Company will send the invitation letter to the meeting and supporting documents on agendas to the shareholders in advance and advertise such invitation in the local newspaper at least 7 days before the meeting date or any other period as prescribed by the relevant laws or regulations.
2. In the event that any shareholder is unable to attend the meeting in person, the Company will give the shareholder an opportunity to appoint independent director or any other person to attend the meeting on his behalf.
3. In organizing the shareholders' meeting, the Company will use a place that is convenient for traveling. The Company will choose an appropriate date and time and allocate sufficient time for the meeting in order to comply with the policy in facilitating shareholders of the Company.
4. In the shareholders' meeting, the Company will give all shareholders an opportunity to have equal rights to express their opinions, suggestions or questions on agendas concerned freely before voting on any agenda. The related directors and executives will participate in the shareholders' meeting to answer questions at the meeting.
5. After the shareholders' meeting is completed, the Company will prepare minutes of the meeting that accurately and completely record information on all matters for the shareholders to be able to countercheck.

Rights of Shareholders

The Board of Directors recognizes and gives importance to the rights of shareholders. It encourages shareholders to exercise their rights and does not violate on shareholders' rights which include fundamental rights, right to receiving appropriate, sufficient, and timely information, and right to attend meetings, vote and express opinions. The Board of Directors has established a policy for good corporate governance according to the principles of the Stock Exchange of Thailand, taking into account the rights of shareholders in addition to those specified by law. Please refer to details regarding this matter on the Company's website at https://www.sakolenergy.com/th/corporate-governance/corporate-governance-policy.

Shareholders’ Meetings

In addition to the fundamental rights provided by the Company to shareholders, the Company has taken action on various matters which promotes the exercise of shareholders' rights in the year 2023:

Determining date, time, and venue of the shareholders’ meeting

The Board of Directors organizes a shareholders’ meeting as an annual general meeting once a year within 4 months from the end of the Company's fiscal year and may call an extraordinary meeting of shareholders on a case-by-case basis if there is an urgent need to propose a special agenda that affects the interests of shareholders. In the year 2023, the Company plans to hold the 2023 Annual General Meeting of Shareholders on Friday, 21 April 2023 at 1:00 p.m. through electronic means (e-AGM).

In selecting the meeting format, not only considering convenience of the shareholders, but the Company is also aware of the importance of health and safety of the shareholders.

The Company has stipulated that all shareholders are treated equally whether it is a major shareholder or a minor shareholder, or executive or non-executive, or Thai or foreign shareholder. The details are as follows:

1. In conducting each shareholder meeting, the Company will provide equal opportunity to all shareholders. Before starting the meeting, the chairman of the meeting will explain the methods in exercising of voting rights and counting votes of the shareholders who must vote on each agenda. The Company will also provide an opportunity for all shareholders and proxies attending the meeting to express their opinions, suggestions, and ask questions on each agenda item with appropriate and sufficient time. The chairman of the meeting will proceed the meeting according to the pre-determined agenda.
2. In respect of an agenda regarding appointment of directors, the Company will support individual appointment.
3. The Company has required the directors to report their interests in any meeting agenda before considering such agenda in the Board of Directors' meeting and such interests shall be recorded in the minutes of the Board of Directors' meeting. In addition, directors who have significant interests in a manner that they cannot express their opinions independently on any relevant agenda are prohibited from participating in the meeting on that agenda.
4. The Company has established guidelines for keeping and preventing the use of internal information of the Company by prohibiting any person or entity with knowledge of inside information to disclose such information to an unrelated agency or other person. Disclosing such information or using such information for his own or others' benefit or conducting transactions that may cause conflicts of interest by any person is considered a serious offense and such person will be subject to disciplinary action.

The Company has given importance to the rights of all groups of stakeholders whether it is internal stakeholders such as shareholders and employees of the Company or external stakeholders such as trade partners and customers etc. The Company realizes that the support and opinions from all groups of stakeholders will be beneficial in the operations and development of the Company's business. The Company will comply with relevant laws and regulations so that the rights of such stakeholders are well taken care of. In operating the business, the Company considers the rights of all stakeholders according to the following guidelines:

Stakeholders may ask for details, report a complaint or clue to legal offense, inaccuracy of financial reports, defective internal control system or violation of the Company's business ethics through independent directors or the Audit Committee of the Company. Complaints and clues reported to the Company will be kept confidential. The independent director or the Audit Committee will instruct the information review and find a solution (if any) and report to the Board of Directors.

1. The Company attaches importance to the Company's financial statements and financial information provided in the annual report. The Audit Committee will review the quality of financial reports and internal control system, including sufficient disclosure of important information in the notes to the financial statements, and report to the Board of Directors. The Board of Directors also encourages the preparation of Management Discussion and Analysis to support the disclosure of the financial statements on a quarterly basis.
2. The Company will arrange to disclose information about each director, roles and duties of the Board of Directors and the Company's sub-committees, number of meetings and attendance at the Company's head office in the past year.
3. The Company will disclose audit fees and fees for other services provided by the auditor.
4. The Company will provide a summary report on the approved corporate governance policy, business ethics, risk management policy, and policy on social and environmental responsibilities, results of implementation of such policies and, in case of non-compliance with any policy, such non-compliance and reasons for non-compliance shall be reported.

1. Structure of the Board of Directors and sub-committees

   The Board of Directors consists of individuals who have knowledge, abilities and experiences that can benefit the Company. It plays an important role in formulating policies and the overall picture of the organization. It also plays an important role in supervising, auditing, and evaluating the Company's performance in accordance with the plan

   At present, the Board of Directors consists of 9 members including 4 executive directors and 5 non-executive directors. There are 5 independent directors, which is more than one-third of the total number of directors of the Company. This will create a balance and appropriateness in considering and voting on various matters. In this regard, the Board of Directors has a term of office of not exceeding 3 years as required by the laws. An independent director has a term of office of not exceeding 9 years, unless the Board of Directors deems that such person should continue to be an independent director of the Company for the best interest of the Company. In addition, the Company's directors and executives can take up positions of directors or executives of affiliated companies or other companies but must comply with applicable laws or regulations, which must be notified to the Board of Directors' meeting for acknowledgment

   In addition, the Board of Directors has also appointed sub-committees to assist in the corporate governance of the Company as follows:

   • Audit Committee consists of at least 3 members of the Audit Committee who serve to support the Board of Directors in overseeing and auditing the management, internal control and compliance with relevant laws, including the preparation of financial reports to ensure that the Company's operations and information disclosure are transparent and reliable.
     Remark: Assist. Prof. Dr. Attawoot Papangkorn is a director who has knowledge and experience in reviewing the Company's financial statements.
   • Executive Committee consists of at least 3 executive directors who serve to support the Board of Directors in managing the Company's business in accordance with policies, plans, regulations, and orders, including specified goals within the framework as assigned by the Board of Directors.
   • Nomination and Remuneration Committeeconsists of at least 3 members of the Nomination and Remuneration Committee. The committee has the duties to recruit qualified persons to hold positions of directors and high-level executives, consider the form and criteria of remuneration payment to directors and high-level executives in order to present their opinions to the Board of Directors for consideration and approval and/or to propose to the shareholders' meeting for further approval (as the case maybe), and develop the Company’s senior management.

   In addition, the Company has the Company Secretary who performs duties relating to the Board of Directors' meetings and shareholders’ meetings and acts as support for the Board of Directors’ works by providing advice on legal and regulatory requirements relating to the performance of duties of the Board of Directors. The Company Secretary also coordinates to ensure compliance with the resolutions of the Board of Directors.

2. Roles, Duties and Responsibilities of the Board of Directors

   The Board of Directors is responsible to shareholders regarding the Company's business operations. The Board of Directors is also responsible for determining the policies and directions of the Company and supervising the management to be in accordance with the goals and guidelines for the long-term benefits of shareholders under the framework of laws and code of conduct, taking into account the interests of all stakeholders. The details of duties and responsibilities are as stipulated in the Charter of the Board of Directors.

   • Corporate Governance Policy

     The Company has established a written corporate governance policy to propose to the Board of Directors meeting to approve the said policy. The preparation of the Corporate Governance Manual is intended to serve as a guideline for directors, executives, and employees to comply with such policies. The Company will arrange to review such policies annually.

   • Code of Business Conduct

     The Company has the intention to operate the Company's business with transparency, morality, and responsibility to stakeholders, society, and environment. The Company has established the code of conduct in writing for the Board of Directors, executives, and employees to adhere to the following practices:

     • Code of conduct relating to responsibilities to shareholders
     • Code of conduct relating to customer relations
     • Code of conduct relating to relationship with trade partners, competitors and creditors
     • Code of conduct relating to responsibilities to employees
     • Code of conduct relating to social and environmental responsibilities

     In this regard, the Company will announce and notify the code of conduct to all employees for their acknowledgment and strict compliance.

   • Conflict of interest

     The Company has a policy of eliminating conflicts of interest carefully with honesty, reasons and independence, under a good ethical framework for the benefits of the Company by requiring those who are involved in or connected to the transaction that is being considered, to disclose to the Company information about their interests or their related party’s interests. Such person must not participate in the consideration and having no authority to approve such transaction.

     The Company has a policy to enter into connected transactions and transactions with conflicts of interest in accordance with the applicable laws or regulations.

     Prevention of Conflict of Interest

     The Board of Directors considers conflicts between personal interests and the interests of the Company as an important policy. This matter is determined as a policy regarding good corporate governance. Practice guidelines have been determined for directors, executives, and employees under the Code of Ethics in conducting business. Directors, executives, and employees are required to report their interests and interests of their related persons to avoid taking advantage of their positions as directors, executives, or employees by seeking personal benefits. The Company has established practice guidelines for directors, executives, and employees as follows:

     1. Avoiding entering into any connected transaction with oneself that may cause conflicts of interest with the Company.
     2. If it is necessary to enter into a connected transaction for the Company’s benefits, such transaction must be conducted on an arm-length basis. However, any director or executive who has an interest in such transaction is prohibited from consideration and approval of the transaction.
     3. Not seeking benefits for oneself and related persons by using or disclosing inside information that has not yet been disclosed or is confidential to third parties.
     4. Not using documents or information obtained from directors, executives or employees of the Company in conducting business that competes with or is related to the Company’s business.

     The Company considers the conflict of interest policy as an important policy. Therefore, the Company has established a policy regarding prevention of conflict of interest and it has been reviewed regularly. The most recent review was during the Board of Directors' Meeting No. 4/2023 held on 10 November 2023 to ensure that the control system is standardized and the management is transparent in accordance with the principles of good corporate governance. In addition, all directors, executives and employees have signed to acknowledge and agree to comply with the policy.

     In approving a connected transaction, the responsible agency will initially assess the transaction. The agency will obtain information and analyze whether the transaction is reasonable and for the benefits of the Company and whether the transaction cost is a fair price. For instance, in purchasing a property, an investment return analysis must be prepared, which may involve hiring an outside expert to provide additional opinions. Then, the information obtained will be presented according to approval steps and process. Directors or executives who have vested interests will not be involved in approving such transaction. In addition, the Audit Committee will jointly review the connected transaction whether it is necessary and charged at a fair price.

     In the year 2023, the Company did not find any actions that violated the policy regarding prevention of conflict of interest.

   • Internal control

     The Company has established an effective internal control system for supervision and internal control at the management level and the operational level. The Company has established an internal audit office to assess sufficiency of the internal control system and report the results to the Audit Committee according to the audit plan.

     The Board of Directors places importance on establishing a good and effective internal control system by clearly announcing this matter in the Company's corporate governance policy. We believe that having a good internal control system will help reducing risks and preventing damage incurred from the Company's business operations and will allow the Company to achieve its vision, mission, and goals. Therefore, the Audit Committee has been assigned with the authority and responsibilities to review that the Company has an appropriate and effective internal control system (Internal Audit). The Audit Committee has reported that the Company has an appropriate internal control and internal audit system based on results of assessment of adequacy of the Company's internal control system, which has been developed from the international internal control system framework of COSO (The Committee of Sponsoring Organizations of the Treadway Commission).

     Based on self-assessment of the Audit Committee's performance for the year 2023, the Audit Committee has performed its duties and responsibilities as specified in Charter of the Audit Committee by using sufficient knowledge, capabilities, caution, prudence, and independence and has provided opinions and suggestions and has been effective. The laws, regulations of the Stock Exchange, and related laws have been accurately and completely complied with. There has been a continuous development to support the Company to have sustainable corporate governance.

     Internal Control

     Sakol Energy Public Company Limited places importance on internal control according to international standards COSO 2013 (The Committee of Sponsoring Organizations of the Treadway Commission) so that the Company achieves the objectives of internal control in all 3 areas: operations, reporting, and compliance with laws and rules relating to the Company's business operations.

     During the Board of Directors' Meeting No. 1/2024 held on 29 February 2024, the Board of Directors reviewed adequacy of the Company’s internal control system by considering the assessment form of the Securities and Exchange Commission (SEC) as performed by the internal audit department. The assessment was reported to the management team and the assessment results of the internal control system had been reviewed by the Audit Committee. The Board of Directors has considered and is of the view that the Company's internal control system is adequate and appropriate. The Company provides sufficient personnel to operate works according to the internal control system with efficiency. It has an internal control system that can monitor and supervise works appropriately.

   • Risk management;

     The Company has established a risk management policy to cover the entire organization. The Company also has a system or risk management process to appropriately reduce the impact of risks on the Company's business.

   • Report of the Board of Directors

     The Audit Committee is responsible for reviewing financial reports in which the accounting department and auditors attended the meeting and present the financial reports to the Board of Directors every quarter. The Board of Directors is responsible for the consolidated financial statements of the Company and its subsidiaries, including financial information memorandum.

3. Meetings of the Board of Directors and Self-assessment

   The Company arranges a meeting of the Board of Directors at least quarterly and special meetings are organized as needed. The meeting agenda was clearly determined in advance with an agenda regarding update on operating performance on a regular basis. The Company will send the invitation letter to the meeting, together with the meeting agenda and supporting documents to all directors at least 7 days in advance of the meeting date so that the Board of Directors has sufficient time to study the information before attending the meeting, except in case of urgency or necessity. Minutes of the meeting will be recorded and certified documents will be collected for reference and review. At every meeting, executives and related parties should attend the meeting to provide accurate and timely information and details for decision-making.

   In respect of voting at the Board of Directors' meeting, the resolution of the Board of Directors shall be made by majority votes and one director shall have one vote. Directors who have interests in any agenda will neither attend the meeting nor exercise their right to vote in that agenda. The chairman of the meeting shall have one more vote as a casting vote.

   In addition, the Board of Directors encourages performance assessment at least once a year to improve and correct the business operations. The topics to be discussed are clearly defined before the assessment. Opinions will be collected and presented to the meeting.

4. Remunerations

   Director's remuneration includes monthly remuneration and meeting allowances, which must be on average compared to remuneration of the same industry, by considering sufficiency for the performance of duties and responsibilities by the Board of Directors. Executives will receive monthly salary and annual bonus, taking into account the Company's operating performance as an important criteria. The annual remuneration of the Board of Directors and executives in aggregate shall not be unusually high compared to the average remuneration of directors and executives of companies listed in Stock Exchange of Thailand by considering the best interests of shareholders.

   In this regard, the Company has established the Nomination and Remuneration Committee to consider format and criteria for payment of remuneration to directors for proposal to the shareholders' meeting for approval.

5. Development of Directors and Executives

   The Board of Directors has a policy to promote and facilitate training and knowledge to those involved in the Company's corporate governance system, such as the Company's directors, the Audit Committee, executives, and the Company Secretary etc. For continuous improvement of operations, trainings and education may be conducted within the Company or through the services of external institutions.

   In case of change of director or appointment of new director, the management will provide documents and information useful for the performance of duties by the new director. The management shall ensure that the new director receives an introduction on the nature of business and information regarding business directions of the Company.

   The Board of Directors will arrange for rotation of assigned tasks according to aptitudes of the management and employees by mainly considering suitability of work and time. The Chief Executive Officer will determine time and consider results on performance of such work as a development and succession plan of the Company's works. This is to develop the management and employees to have better knowledge and capabilities and be able to work interchangeably.