Being the national energy company with status as a state enterprise and a listed on the Stock Exchange of Thailand, PTT realizes its mission of having a good and transparent management with equitable treatment of all stakeholders. The Company aims to develop itself as a role model in corporate governance, compliance with laws, rules, regulations, notification, the corporate governance principles of listed companies issued by the Securities and Exchange Commission (SEC) and the Stock Exchange of Thailand (SET), and the practice guideline of the State Enterprise Policy Office SEPO). PTT believes that the corporate governance principle is a management system that will create fairness and confidence among all stakeholders, enable the Company to have appropriate, efficient and effective operations, and promotes the corporate competitiveness and sustainable growth. The honest and transparent operations as well as Anti-Fraud and Corruption of all forms practice are the key factors promoting the Company’s competitive advantages in both short and long-term. Such practice will also increase confidence among the investors, financial institutions and business partners to work with the Company and jointly increase value for the shareholders and balanced benefits of all stakeholders.

The objectives of internal control and risk management are to create trust among stakeholders towards PTT’s operational efficiency, effectiveness, accountability, and compliance to related laws, rules, and regulations. The Company has in place the internal control system that is sufficient and appropriate for the assessed risk level. The Company considers the importance of the internal control, both at corporate and operational levels, which is in line with international standards related to internal control, the assessment of the sufficiency off internal system issued by the Stock Exchange of Thailand (SET), and the guideline on appropriate internal control measure issued by the National Anti-Corruption Commission (NACC). PTT has regularly prepared the summary of its internal control system’s efficiency and effectiveness assessment and submitted it to the regulating organizations on annual basis.

Management Approach

Fair Operating Practices^{GRI 102-17 , GRI 205-3}

PTT Board of Directors prioritizes conducting businesses on the foundation of honesty, fair and traceability, as well as Anti-Fraud and corruption, including anti-bribery. Therefore, PTT is committed in driving the business according to good corporate governance, Ethical Standard and Code of Business Ethics, and PTT Group's Sustainability Management Framework in order to continuously improve efficiency. PTT Board of Directors is well aware that transparent and ethical business establishes trust for all groups of stakeholders and facilitates corporate sustainable development.

PTT has in place a grievance policy to receive, address and resolve grievances in a timely manner, ensuring fairness and transparency as well as confidentiality of the information provider and grievance provider. Employees who report a grievance can track its status via the employee relations grievance system. The communication channels through which external parties can submit regarding violations of the Code of Business Ethics including the Customer Relations Center, 1365 Contact Center, Corporate Communications Function, the Office of the President and Corporate Secretary, Corporate Governance Regulation and Promotion Department and the Investor Relations Department.

In addition, PTT has designated a channel for “Whistleblowing” at www.pttplc.com and through “PTT Voice” (pttvoice@pttplc.com) as a means of communication for stakeholders to report observed incidents of corrupt activities or behaviors in the organization. Following reporting, the information will be sent directly to the appropriate department for further investigation and processed accordingly. PTT has published the Terms of Complaints and Whistleblowing against Fraud, Malpractice, Misconduct, and Non-Compliance with Laws and Corporate Rules 2021 to establish coherent guidelines and procedures, ensuring a clear and transparent direction in the supervision and investigation processes as well as consistency across the organization. Furthermore, measures have been clearly defined to provide protection and fairness to informants, whistleblowers, or any individual who cooperates in providing relevant information. 

In 2021, PTT received 15 complaints through our complaint channels for whistleblowing and reporting malpractice, misconduct, and non-compliance with corporate regulations. All complaints were investigated by our whistleblowing and complaints management process, which found 13 cases were unsubstantiated while the remaining two cases are still under further investigation. 

Additionally, the investigation / disciplinary investigation found four cases of employee breaches of the Code of Conduct, which arose from violation, circumvention, willful disobedience, or negligence of policies, laws, rules, terms, instructions, including lawful supervisory orders, which may or may not result in damage to PTT. We have completed investigations and enacted appropriate disciplinary action and punishment measures accordingly per human resources management procedures.

No. of Complaints^{GRI 102-17 , GRI 205-3} (Case)

Code of Ethics

The Corporate Governance, Ethical Standards and Code of Business Ethics Handbook, or CG Handbook, is a set of guidelines defining standards in good business ethics that PTT employees must adhere to. The CG Handbook covers an exhaustive list of best practices in corporate governance, including establishing the Board’s role and responsibilities as the organization’s leader in creating sustainable business value; defining key corporate objectives and targets for sustainable business practices; strengthening Board effectiveness; recruiting and developing executive talent and personnel management; promoting innovation and responsible business conduct; ensuring effective risk management and internal controls system; maintaining financial integrity and disclosures; and advocating shareholder engagement and communication. The CG Handbook further discusses guidelines on ethical standards and code of business ethics in the context of legal compliance and respecting international human rights principles; anti-money laundering; political neutrality; vested interests, conflicts of interest, and connected transactions; information confidentiality, data safeguarding, and use of insider information; treatment of customers and consumers; treatment of business competitors; procurement and treatment of suppliers; corporate social responsibility; treatment of employees; treatment of creditors; internal controls and auditing; receiving and offering gifts, entertainment, or other benefits; security, safety, health, and the environment; intellectual properties and application of information technology; responsible communication; complaints regarding misconduct and Code of Ethics violations; and compliance with the no-gift policy, where related parties are asked to refrain from giving gifts to PTT employees in all occasions. All members of the Board of Directors, executives, and employees shall sign an acknowledgement of the CG Handbook to demonstrate a mutual commitment in embracing the best practices as set forth. As such, the CG Handbook serves as a disciplinary guideline all employees must strictly adhere to.

The Corporate Governance Committee is tasked with the responsibility to grant policies and management approach regarding corporate governance, operational risk management and internal control, legal and regulatory compliance, Anti-Fraud and corruption, including anti-bribery, sustainable management, as well as society, community, and environmental management. This ensures that PTT has an active campaigning to promote the importance of adhering to good corporate governance principles. PTT organizes for Governance Risk and Compliance Management Committee (GRCMC), of which senior executive vice president serves as the chair. The said committee serves as the focal point in PTT’s Anti-Fraud and Corruption Operation Center (ACOC) in State Enterprises, which responses to the state’s policy and working directions. The center works to ensure integrated approach in instilling values, preventing and tackling corruption within PTT. In this regards, Good corporate governance and Corporate Ethics Department establishes PTT Annual Action Plan for good corporate governance and Anti-Fraud and Corruption. This action plan has been approved by Corporate Governance Committee and PTT Board of Directors. Relevant functions then take actions according to the plan and policy. The functions also organize various forms of activities to foster responsibility per good corporate governance principles to the Board, Management, employees and relevant personnel. These activities comprise GRC Camp, PTT Group CG Day, CG Tips communication, CG Do & Don’t, GRC Lesson Learned through E-Mail and “CG Intranet” available in PTT Intranet. There is also “CG Channel” available on PTT Workplace website. Additionally, various training courses are also available for employees in all areas. The training includes courses in conflicts of interest, operational risk and control, pre-transaction risk assessment, and communication to employees in other functions, and serves as a learning tool to educate and inform employees on corporate governance best practices, Ethical Standards and Code of Business Ethics, and anti-fraud and corruption best practices. Furthermore, the Code of Ethics is designated as a competency area linked to employee development and annual performance evaluation.

The training includes courses in conflicts of interest, operational risk and control, pre-transaction risk assessment, and communication to employees in other functions, and serves as a learning tool to educate and inform employees on corporate governance best practices, Ethical Standards and Code of Business Ethics, and anti-fraud and corruption best practices. Furthermore, the Code of Ethics is designated as a competency area linked to employee development and annual performance evaluation.

Anti-Fraud and Corruption^GRI415-1

PTT enforces the PTT Anti-Fraud and Corruption Policy, including the No-Gift Policy, at all times. We have developed systems, tools, and measures to govern employee conduct and foster a work environment that prioritizes ethical values and strong work ethics, in line with the principles of good corporate governance. PTT does not tolerate fraud or corruption in any form, whether direct or indirect, in all circumstances. We focus on continuously raising awareness at all organizational levels, from the Board and executive management to staff-level employees and other related individuals. The scope of the PTT Anti-Fraud and Corruption Policy encompasses the following definitions:

• Fraud is any action intended to result in unlawful benefits or advantages, either for personal gain or for another person. This includes the following actions:  
  

  • Asset Misappropriation means possessing property or assets that belong to or is co-owned by another person and wrongly converting such property or assets for oneself or a third party.

  • Embezzlement means wrongfully deceiving a person through false representation or by concealing facts which should have been revealed to obtain the property or assets of the deceived person or a third party, or causing the deceived person or third party to execute, revoke, or destroy any type of ownership documents.

  • Financial Statement Fraud means deliberately altering financial reports by taking advantage of accounting loopholes and various options in valuation and disclosure methods to intentionally misrepresent financial information for wrongful purposes  

  • Corruption means wrongfully demanding, accepting or agreeing to accept, giving, asking, or proposing / committing / promising to give assets or any other benefits to a government official, a government agency, an officer of a private organization, or a private organization, so as to induce such person or agency to abuse their authority in committing, refraining from, hastening, or delaying an action to obtain unlawful benefits for oneself or another person, maintain one’s business, or keep any other inappropriate benefits or interests, unless laws, traditions, or local customs stipulate otherwise.
• PTT Personnel refers to PTT directors, management, and employees at all levels.
• PTT Related Persons include contractors, representatives, consultants, subsidiary companies, or any person acting for or on behalf of PTT, regardless of whether they have the power or authority to take such action.

For the third consecutive term, PTT is a member of Private Sector Collective Action against Corruption (CAC) having had membership since 2014. This affirms that PTT has been acknowledged by external functions for the capacity in transparent and traceable business operations; committing to fight against all forms of corruptions. In addition, PTT is a political neutrality organization and has no policy to support both financial and non-financial to any political party. Besides, PTT is transparent in providing charitable donations and sponsorships, as stipulated in its Anti-Fraud and Corruption measures covering the formulation and review of Anti-Fraud and Corruption policies, internal audit reporting, relevant performance reviews, Fraud and Corruption Risk Assessment and appropriate reviews of Anti-Fraud and Corruption measures. PTT actively communicates with stakeholder groups in order to prevent potential incidents of Fraud and Corruption in the organization and to build trust amongst external parties who can be confident in the organization's reputation for transparency.

Transparency ^GRI102-25

PTT maintains transparency in every aspect of its operations. Regarding financial aspects, PTT reports its financial performance in the Annual Report and Annual Information Registration Statement/ Annual Report 2021 (Form 56-1 One Report), which is required to be submitted to the Securities and Exchange Commission (SEC) on a yearly basis. In addition, to evaluate employee compensation, PTT defines the compensation criteria for employees, top management and the Board of Directors, which are published in the Annual Information Registration Statement/Annual Report 2021 (Form 56-1 One Report). For internal control, PTT conducts Control Self-Assessment (CSA). There is internal control assessment integrated with comprehensive risk assessment, addressing compliance to laws, regulations, rules, operational risks, and GRC Assessment-related risks in every process and support process. In addition, performance is reported through Annual Information Registration Statement/Annual Report 2021 (Form 56-1 One Report), which are verified by an external organization. These practices reflect PTT's good corporate governance and transparency.

PTT requests that all employees disclose any conflict of interests, whether their own, their relatives, or any related individuals, that may contract PTT’s interests. This is reported through an annual conflict of interest report, upon an incidence via conflict of interest system. Furthermore, good corporate governance and Corporate Ethics Function consolidates information and prepare a summary report on conflicts of interests for the highest Management of each business line. The report is also presented to Corporate Governance Committee annually. Additionally, the information serves as a baseline information when there are grievances on conflicts of interests at work. It also aids supervisors in appropriate task allocation to employees, according to principles of transparency, business ethics on conflicts of interest and stakeholders.

Since 2014, PTT has been utilizing information and digital technology systems to enhance transparency and manage conflicts of interest in the workplace. We developed the Continuous Control Monitoring and Auditing System (CCMS), which will alert involved parties if an employee-vendor relationship that meets set criteria is detected and will notify supervisory groups accordingly to verify and determine next steps. Enhancements were also made to the PTT Corporate Governance (CG) Report System to increase its efficiency. These information systems  are regularly reviewed and improvements are made as needed to ensure they continue to function efficiently and effectively. In 2021, the following key developments were made:

• Enhancements to the PTT CG Report System to include reporting on conflicts of interest, future securities trading, and receipt of gifts.
• Enhancements to the conflict of interest reporting system, through data input from the CMMS, to increase the efficiency of executive and employee information review

Key Performance

Overview of Progress Achieved ^GRI205-1

Workplan	2020 Target	2020 Performance	2021 Target	2021 Performance	2022 Target
Implementation of PTT’s corporate governance and anti-corruption activities.	Improve grievance and whistleblowing requirements and practice guidelines to increase the process’ effectiveness and build confidence for stakeholders of all sectors	The improved grievance and whistleblowing requirements and practice guidelines are pending approval from committees involved	Review and implement: Corporate Governance, Ethical Standard, and Code of Ethics Handbook (CG Handbook) PTT Anti-Fraud and Corruption Policy Fraud and Corruption Risk Assessment Manual	Reviewed and implemented: PTT’s Corporate Governance Policy, effective as of July 2021 PTT’s Anti-Fraud and Corruption Policy, effective as of July 2021 Corporate Governance, Ethical Standard, and Code of Ethics Handbook (CG Handbook), effective as of December 2021 PTT Anti-Fraud and Corruption Policy, effective on January 25, 2022.  The Fraud and Corruption Risk Assessment Manual was approved and effective as of December 2021.	Improve grievance and whistleblowing requirements and practice guidelines to increase the process’ effectiveness and build confidence for stakeholders of all sectors
Membership certification in the Private Sector Collective Action Coalition Against Corruption (CAC)	Submit 3rd term membership recertification in the Thai Private Sector CAC. Participate in the CAC Change Agent program to encourage partners to acknowledge and join the CAC.	Completed the application to recertify membership in the Thai Private Sector CAC. Communicated to partners at the annual Supplier Day of the guidelines and benefits from being a member of the CAC.	Pass the Thai Private Sector CAC membership recertification for the 3rd consecutive term.	Completed membership recertification in the Thai Private Sector CAC for the 3rd consecutive term on March 31, 2021. Conducted fraud and corruption risk assessment through evaluation of internal controls per the Governance, Risk, and Compliance (GRC) Assessment guidelines for divisional departments  and direct-reporting units. There were three processes classified as very high-risk; however overall scores show controls are sufficient and internal control measures are being adhered to on a consistent basis.	Review application criteria and requirements for renewal of the CAC certification per new assessment criteria and requirements. Make improvements to policies, processes, etc. per observations and findings from Internal Audit.

Code of Ethics ^GRI205-2

By emphasizing best practices in corporate governance and business ethics through various communication channels, employees continue to gain more knowledge and understanding of CG principles and therefore are able to effectively apply them at work. This enables PTT to become an organization that not only has fair operating practices and a strong corporate governance structure but also a reduced risk from business ethics violations, achieved through a focus on the following:

1. Training on Ethical Standards and Code of Business Ethics, such as good corporate governance and anti-corruption training and other courses for executives and employees: The training includes courses on conflicts of interest, operational risk and control, pre-transaction risk assessment, and communication to employees in other functions. These provide the relevant knowledge and encourage best practices and behaviors in corporate governance, Ethical Standards and Code of Business Ethics, and anti-fraud and corruption.
2. Communication through various channels and seminar activities, such as video clips of interviews with PTT directors and executives to raise awareness within the organization on good corporate governance, risk management, compliance with laws, regulations, and organizational rules, as well as emphasize adherence to CG principles and anti-fraud and corruption measures.
3. The GRC Camp, currently ongoing for the eighth consecutive year, fosters knowledge and understanding of corporate governance, risk management, and compliance with laws, regulations, and organizational rules among executives and employees, enabling them to apply these principles properly at work. In 2021, activities were held in a Virtual Camp format, where senior executives participated to share their knowledge and experiences in the business units’ GRC operations. This not only allows employees to practically apply the lessons learned to their work but also encourages a corporate culture on Business Integrity within PTT.
4. PTT Group CG Day, currently ongoing for the thirteenth consecutive year, reflects our prioritization of good corporate governance for all PTT Group subsidiaries, in line with our management direction. We have appointed the PTT Group Corporate Governance Committee whose goal is to elevate the standards of corporate governance across all our subsidiaries to be at similar levels. The Committee shall also continue to develop action plans and strategies in proactive public relations through activities in the “PTT Group CG Day.” This serves to promote, support, and circulate information on the good corporate governance practices of our flagship companies, such as PTT, PTTEP, GC, TOP, IRPC, GPSC and OR, to stakeholders in all sectors, including the Stock Exchange of Thailand (SET), Securities and Exchange Commission (SEC), Thai Institute of Directors (IOD), Office of Ombudsman, as well as suppliers, Board of Directors, management, and PTT Group employees.

Indicators: 

Employee Understanding of CG (Percentage)

Corporate Governance Policy and Anti-Fraud and Corruption Policy Implementation Outlook (Percentage)

Employee Satisfaction on GRC Communications (Percentage)

Remark:

2018 - 2019 reflects employee satisfaction on CG communications

Anti-Fraud and Corruption

Every PTT employee can become a whistleblower (person notifying any unusual ongoing) to ensure transparency, good corporate governance, and corporate sustainability. In 2014, PTT announces PTT’s and PTT Group’s Anti-Fraud and Corruption Policy to be implemented across PTT for Management and employees for acknowledgement and to uphold as standard of practice. The policy is disseminated to all stakeholder groups for their acknowledgement and practice. PTT also takes on Certification Process for Private Sector Collective Action Against Corruption (CAC) to certify PTT’s status as member of CAC. The process consists of “Self-Evaluation Tool for Countering Bribery” to assess the strengths, comprehensiveness and effectiveness of PTT’s Anti-Fraud and Corruption policy and measures. PTT was certified for the third consecutive term on March 31^st,2021. Presently, PTT is committed to inviting and promoting business partners, such as suppliers, sales representatives, to be part of the coalition, in order to remove corruption risks in its entity from the supply chain.

Related Awards

Year	2018	2019	2020	2021
The National Anti-Corruption Commission (NACC) Integrity Award	8th NACC Integrity Award	9th NACC Integrity Award	-	10 NACC Integrity Award - Consolation Prize
Integrity & Transparency Assessment (ITA)	Excellent Level	Level A	Level A	Level A
Other Awards	Thai Chamber of Commerce (TCC) Outstanding Business Ethics Award	-	-	รางวัล ASEAN Corporate Governance Scorecard: ASEAN TOP 20 PLC และ TOP 3 PLC (Thailand)

The NACC Integrity Award and ability to maintain excellent level at the Integrity & Transparency Assessment of government agency by the National Anti-Corruption Commission (NACC) are PTT’s pride and testimony of the Company’s commitment to operating business by adhering to transparency and integrity, which is beneficial to corporate development and becomes trusted by all stakeholders.

Transparency

PTT requests all employees to disclose a conflict of interest report annually and notify suspected conflicts of interest to their supervisors. If a conflict is found, supervisors would develop corrective action plans, for example, by defining temporary measures or rotating employees in order to reduce potential risks.

Employee Conflict of Interest Reporting (Percentage)

Featured Projects and Activities^{SDGs 16.5, 16.6}

PTT strives to become a trusted company in order to support our organization's operations, business growth, and expansion, which requires our ability to respond quickly to various changing conditions. In parallel, we must also still maintain transparency in all aspects of our operations under the Governance, Risk, and Compliance (GRC) approach, which encompasses good corporate governance, risk management, anti-fraud and corruption, sufficient and appropriate internal controls, and compliance with laws, regulations, and rules. As such, we have developed an operational framework and made improvements to processes in auditing, transparency, and governance of third-party transactions (Third Party Screening Program) to ensure reliability and build confidence with our partners and stakeholders. In 2021, the aforementioned processes were tested in two pilot areas, procurement and international trading process, while we explore options in using the database and systems that audit third-party transparency as a center in retrieving information needed to assess risks and manage transactions appropriately.

Future Plans

In order to ensure efficiency, convenience, and speed, PTT plans to develop a database system for auditing the transparency of third-party transactions (Third Party Screening Program). The database will serve as a center in retrieving information needed to assess risks and manage transactions appropriately as well as taking into consideration the opinions of involved parties. Our goal is to drive transparency in third-party transactions, ensuring the coverage of all related processes, and evaluate the possibility of exchanging information on third-party transaction risks between PTT group subsidiaries in the future.