2023 Corporate Governance Seal

Yes

See PNOC EC Manual for Corporate Governance, Section 8.3 (f), CORPORATE SOCIAL RESPONSIBILITY AND RELATIONS WITH STAKEHOLDERS (CUSTOMERS), page 35.

The Manual of Corporate Governance provided for the Corporate Social Responsibility and Relations with Stakeholders (Communities), Section 8.3 (e) page 34 of the GOCC (PNOC EC). It is guided by the following key principles:

1. Sustainability
2. Self-sufficiency and Empowerment
3. Transparency
4. Gender Sensitivity and Cultural sustainability

See PNOC EC’s Manual of Corporate Governance 

PNOC EC also has an approved CSR Policy.

See PNOC EC’s CSR policy 

Yes

PNOC EC issue a Memorandum dated 19 June 2007 regarding EHS Policy and Revised HSSE Policy Statement dated 06 September 2018.

For 2023, PNOC EC strictly follows all environmental commitments, regular monitoring of wastewater discharges, ambient air, and noise to reduce the environmental impacts of the Company’s project. Waste segregation, proper handling and disposal of hazardous wastes are continuously practiced in field sites. Recyclable materials were sorted in Material Recovery Facilities (MRF) to promote waste reduction and recycling. 

See 2023 Health, Safety, Security and Environment (HSSE) Annual Report

Yes

For 2023, PNOC EC, upon lifting of the State of Public Health Emergency throughout the Philippines due to COVID-19  on 19 July 2023, approved a workflow for employees with symptoms as part of PNOC EC's New Normal Health Guidelines . And consequently, updated the Guidelines on the New Normal Work Arrangement based on the latest Inter-Agency Task Force (IATF) Resolution No.8-C on the Nationwide Implementation of Alert Level System for COVID-19 Response.

The Company also coordinated with the local government unit for the administration of bivalent COVID-19 vaccines. It also maintained its support systems to employees  to assist in their general health care such as provision of health supplements and flu vaccines. 

See 2023 Health, Safety, Security and Environment (HSSE) Annual Report

Yes

For 2023, PNOC EC adheres to all environmental commitments by strictly complying with the ECC conditions of the Malangas Coal Operations through the conduct of periodic environmental inspections or audits, Multi-Partite Monitoring Team (MMT) meetings, compliance with the Environmental Management and Monitoring Plan (EMMP), and other improvements that include updates on best practices.

The EMMP, which includes the continuous monitoring of waste water discharges, ambient air, and noise, is in place to reduce the impacts of the project to the environment. PNOC EC’s environmental performance is regularly check and discuss by the project stakeholders during MMT meetings. Throughout the year, the Company supplies basic medicines and medical supplies to employees and conducts periodic laboratory analyses of drinking water supply.

Evaluation of pre-employment medical and annual physical examinations are constantly performed. In 2023, eye check-up was included to ensure the employees’ clear vision and good eye health. Monthly articles, information campaign and quarterly lectures are provided to enhance their awareness of health management.

See 2023 Health, Safety, Security and Environment (HSSE) Annual Report

Yes

For 2023, PNOC EC affirms its compliance with relevant environmental, economic, and social rules and regulations as evidenced by the acquisition and renewal of pertinent permits, clearances, and accreditations covering the Company’s various activities, and the submission of periodic reports to the Department of Environmental and Natural Resources - Environmental Management Bureau (DENR-EMB). In exploration sites, PNOC EC is steadfast in its commitment towards preservation of ecological balance through the following: 

(1) Use of environment-friendly and internationally accepted drilling fluids, equipment, and technology in drilling operations;

(2) Safe conduct of seismic survey and suspending activities during migration of marine mammals (e.g., whales and dolphins) and other endangered marine species, and by hiring Marine Mammal Observers (MMO) on board seismic vessels during operation to ensure the safety of these marine species; 

(3) Conduct of IEC campaigns as well as FPIC activities, as mandated by law, in the affected host communities prior to exploration work; 

(4) Strict adherence to the terms and conditions of the ECC and other permits and clearances; and 

(5) Keeping up with good oil and coal industry practices.

See 2023 Health, Safety, Security and Environment (HSSE) Annual Report

The Annual Report and website provides for the contact information where stakeholders can send or voice out their concerns and/or complaints. 

During the conduct of Information, Education and Communication (IEC) campaigns in the project host communities, the contact details are likewise provided in the presentation materials.

See 2022 PNOC EC Annual Report, page 2 and back page.
 

See PNOC EC Website under Contact Us.

Yes,

PNOC EC issue a Memorandum dated 19 June 2007 regarding EHS Policy and Revised HSSE Policy Statement dated 06 September 2018.

See 2023 Health, Safety, Security and Environment (HSSE) Annual Report

Yes,

PNOC EC's HSSE Department is submitting a monthly and annual safety performance report to the Management which includes data on occupational injury or illnesses.

For 2023, PNOC EC and its contractors recorded 777,038 and 226,750 safe manhours, respectively.

See 2023 Health, Safety, Security and Environment (HSSE) Annual Report

The PNOC EC has its Manpower Development Program and Competency Development Framework aimed at maintaining and upgrading the quality of its personnel by enhancing their core and technical expertise needed for the efficient and successful delivery of operational activities and strategic programs aimed at achieving business targets and corporate objectives.

See Manpower Development Plan and Competency Development Program

The PNOC EC has disclosed its Corporate Objectives.

See Strategic Objective and Measurement in the 2023 Performance Scorecard.

The PNOC EC has disclosed its Financial Performance Indicators.

See 2023 Financial Highlights based on Unaudited Financial Statement

The PNOC EC has disclosed its Non-Financial Performance Indicators.

See Non-Financial Indicator in the 2023 Performance Scorecard.

Consistent with the GCG Memorandum Circular No. 2016-02 "Revised Whistleblowing Policy for the GOCC Sector", the PNOC EC Whistleblowing Policy Guidelines includes, among others, procedures of its whistle-blowing policy for its stakeholders.

Yes. See Board of Directors included in PNOC EC's 2022 Annual Report, pages 36-43

*PNOC EC’s annual report, will be published in June as scheduled after review and approval by COA of its Financial Statement.

See PNOC EC's Annual Reports.

PNOC EC’s 2022 Annual Report (page 29) includes a statement which reads: “PNOC EC affirms its full compliance with the provisions of the Code of Corporate Governance (GCG Memorandum Circular No. 2012-07 dated November 2012) and PNOC EC’s Manual of Corporate Governance dated January 2014, revised and approved by GCG on August 2021 in compliance with SEC Memorandum Circular (MC) No. 24, Series of 2019 and SEC MC No. 19, Series of 2020. As a model GOCC, PNOC EC continuously lives up to such status through practice of good corporate governance towards active promotion and pursuit of corporate governance reforms and conscious observance of the principles of accountability and transparency."

Yes. See 2022 Annual Report, page 29

*PNOC EC’s annual report, will be published in June as scheduled after review and approval by COA of its Financial Statement.

PNOC EC released its 2022 Annual Audit Report 27 days after receipt from COA.

PNOC EC released its 2022 Annual Report 63 days after release of its Annual Audit Report.

The true and fair representation of the annual financial statements/reports is affirmed in the Statement of Management's Responsibility signed by the Chairman of the Board, the President and CEO and the Acting Treasurer

See 2022 Annual Report, page. 48

The Board of Directors reviewed the Company's Strategy Map and Performance Scorecard, among others, during PNOC EC's 2023 Strategic Planning Session held from December 14-15, 2022.

See PNOC EC's 2023 Board Planning Session Program

PNOC EC regularly holds an Annual Planning Session attended by members of the Board of Directors and Management, where the Company’s Vision and Mission are deliberated on. The Board of Directors and Management also discuss the implementation of the Company’s plans and programs aligned with its corporate strategies.

See 2023 Board Planning Session – Agreed Action Items

The PNOC EC Board of Directors, Management, and employees are covered by and are required to comply with the following: 

1. Republic Act No. 6713
2. Republic Act No. 6713 IRR
3. Company Policy on Discipline
4. Table of Penalties
5. Rules and Regulations on Discipline of Corporate Officers and Secretary Certificate on Board Resolution No. 7-7, S’2012.
6. Republic Act No. 10149
7. GCG Memorandum Circular No. 2012-05
8. Anti-Sexual Harassment Policy

As a practice, the PNOC EC Board of Directors schedules a Board meeting at least once every month, the date of which is subject to the availability of the Secretary of the Department of Energy – PNOC EC’s Ex Officio Chairman of the Board.

Although the By-Laws and existing rules mandate that the Board must be provided the materials two (2 days) before a meeting, as a practice, materials for Board Meetings are provided to the Board at least three (3) working days in advance of all Board Meetings.

See PNOC EC Manual for Corporate Governance, page 8-11

The Board of Directors hold at least one (1) meeting every month.

See Board and Committee Meetings Attendance 2023

The Board of Directors held eighteen (18) meetings in 2023.

See Board and Committee Meetings Attendance 2023

At least 90% of the Board Meetings were attended by all appointive Member of the Board.

See Board and Committee Meetings Attendance 2023

See Board and Committee Meetings Attendance 2023

Although the By-Laws and existing rules mandate that the Board must be provided the materials two (2 days) before a meeting, as a practice, materials for Board Meetings are provided to the Board at least three (3) working days in advance of all Board Meetings.

See PNOC EC's Laws, pages 4-5

PNOC EC's Corporate Secretary and Assistant Corporate Secretaries, appointed by the Board of Directors as such, are members in good standing of the Philippine Bar.

See PNOC EC Corporate Secretary and Assistant Corporate Secretaries in 2023

PNOC EC has an existing Guidelines on Risk Management. The Company intends to employ an organization-wide strategy to identify and prepare for uncertainties in its finances, operations, and objectives by establishing an Enterprise Risk Management System.

As disclosed in the Company’s Annual Report, the Board of Directors oversee the risk management functions, particularly in the areas of managing credit, market liquidity, operational, legal, reputational, and other risks of PNOC EC. The Company’s Management regularly reports to the Audit and Risk Management Committee and to the Board of Directors all matters concerning PNOC EC’s material controls and risk management system.

It is in the policy that PNOC EC’s Board of Directors perform risk management function as mandated and guided in its Manual Corporate Governance series of 2019.

Refer to Corporate Governance section, of the 2022 Annual Report, pages 29 to 34.

Refer to Manual of Corporate Governance, page 21, 3.1e (i)

*PNOC EC’s annual report, will be published in June as scheduled after review and approval by COA of its Financial Statement.

The annual report contains a statement that the Board of Directors oversee the risk management functions, particularly in the areas of managing credit, market liquidity, operational, legal, reputational, and other risks of PNOC EC. The Company’s Management regularly reports to the Audit and Risk Management Committee and to the Board of Directors all matters concerning PNOC EC’s material controls and risk management system.

Refer to Corporate Governance section, of the 2022 Annual Report, pages 29 to 34.

Refer to Manual of Corporate Governance, page 21, 3.1e (i)

*PNOC EC’s annual report, will be published in June as scheduled after review and approval by COA of its Financial Statement.

For 2023, PNOC EC’s Ex-Officio Chairperson is Raphael Perpetuo M. Lotilla (Secretary, Department of Energy), while its President and CEO is Franz Josef George E. Alvarez.

See Secretary's Certificate for Board Resolution No. 8-1, Series of 2022 and 2022 Annual Report, page 40

The Office of the Corporate Secretary holds an orientation session for new directors, covering the following topics: (1) Company overview; (2) Role of PNOC EC Board of Directors; and (3) PNOC EC Operations.

See Briefing Materials for New Directors

One of the functions of the Governance Committee is to recommend to the Board the continuing education of Directors.

Furthermore, the Annual Work Program and Budget of PNOC EC contains provision for the attendance of all members of the Board of Directors to training programmes and seminars as part of the continuous professional educational programme.

See PNOC EC Manual for Corporate Governance, page 20, Sec 3.15 (c)(iii)

Yes.

See Directors Seminar for Year 2023

The Board of Directors conducts an annual assessment of its performance for the year based on an appraisal system developed for the purpose. For its performance for the year 2023, the appraisal of the Board of Directors will be conducted in the first quarter of 2024.

See Board Assessment Questionnaire.

The Board of Directors conducts an annual assessment of Its performance for the year based on an appraisal system developed for the purpose, which determines, among others, (a) the adequacy of the Boards structure and composition; (b) whether the Board has fulfilled its responsibilities for PNOC EC's performance; (c) whether the members of the Board work well as a team and communicate properly; and (d) their strengths and weaknesses.

For the year 2023, the appraisal of the Board of Directors will be conducted in the first quarter of 2024. 

The Office of the Corporate Secretary, as the repository of Board Assessment Questionnaire, individually sends and collects the Performance Appraisal Form of each Member of the Board to assure the integrity and confidentiality of such. 
 

See Board Assessment Questionnaire.

The Board of Directors conducts an annual assessment of Its performance for the year based on an appraisal system developed for the purpose, which determines, among others, (a) the adequacy of the Boards structure and composition; (b) whether the Board has fulfilled its responsibilities for PNOC EC's performance; (c) whether the members of the Board work well as a team and communicate properly; and (d) their strengths and weaknesses.

For the year 2023, the appraisal of the Board of Directors will be conducted in the first quarter of 2024.
 

See Board Assessment Questionnaire.

The Board of Directors Committees conducts an annual assessment of its performance for the year based on an appraisal system developed for the purpose which determines, among others, (a) the adequacy of the Committee's structure and composition; (b) whether the Committee has fulfilled its responsibilities for PNOC EC's performance; (c) whether the members of the Board work well as a team and communicate properly; and (d) their strengths and weaknesses. 

For the performance of each Board Committees in the year 2023, the respective members of each Board Committee conducted the assessment of their respective Committees during the first quarter of 2024.
 

See Board Committee Assessment Questionnaire – Audit and Risk Management Committee, Board Committee Assessment Questionnaire – Nomination, Remuneration, Education, and Employee Welfare Committee, and Board Committee Assessment Questionnaire – Project Development and New Ventures Committee.

For the 2022 PNOC EC Annual Report, the following sections are referenced to the Global Reporting Initiative (GRI) standards: About the Report, About PNOC EC, Report from the President and CEO, Operational Highlights, Corporate Social Responsibility, HSSE, People Development, and Corporate Governance Section.

See Annual Report 2022

PNOC EC released its 2022 Annual Audit Report 25 days
after receipt from COA.

No PNOC EC Board Member holds more than five (5) positions in GOCCs and PLCs.

See Secretary's Certificate for Appointive Directors do not hold 5 Positions in any GOCC

 As far as the Compliance Office is aware, PNOC-EC is awaiting GCG validation for its 2022 Good Governance Conditions.