Corporate Governance Seal

C:\Users\ccmaligalig\Desktop\Corporate Governance Seal.png

CORPORATE GOVERNANCE SCORECARD

 

QUESTION

LINK SOURCE

 

  • Stakeholder Relationships

 

 

1. Does GOCC disclose a policy that:

 

 

 

a. Stipulates the existence and scope of its effort to address customer’s welfare?

 

 

See PNOC EC Manual for Corporate Governance, 

Section 8.3 (f), CORPORATE SOCIAL RESPONSIBILITY AND RELATIONS WITH STAKEHOLDERS (CUSTOMERS), page 31

 

 

b. Elaborates its efforts to interact with the communities in which they operate?

 

 

See PNOC EC Manual for Corporate Governance, 

Section 8.3 (e), CORPORATE SOCIAL RESPONSIBILITY AND RELATIONS WITH STAKEHOLDERS (COMMUNITIES), pages 30-31

 

 

c. Ensure that its value chain is

 environmentally friendly or is 

 consistent with promoting sustainable 

 development?

 

 

See PNOC EC Manual for Corporate Governance,

Sections 8.4, HEALTH AND SAFETY and 8.5, ENVIRONMENT, page 33

 

2. Does the GOCC disclose the activities that it has undertaken to implement the abovementioned policies?

 

 

 

 

a. Customer health and safety

 

 

PNOC EC ensures compliance by customers and contractors to the Company’s Health and Safety Policies through Safety Orientation Programs and monthly meetings of the HSSE committee.

 

             

b. Interaction with the communities

 

 

PNOC EC conducts regular interaction with communities within its areas of operation.

See PNOC EC 2015 Annual Report, pages 16 and 18.

 

           

 c. Environmentally-friendly value chain

 

 

In exploration projects, PNOC EC preserves ecological balance by doing the following:

 

  • Using environment-friendly drilling fluids, equipment, and technology in drilling operations which is accepted worldwide;

  • Not conducting seismic shooting during migration of marine mammals (e.g., whales, dolphins) and other endangered marine species (e.g., pawikans); PNOC EC has marine mammals observers onboard seismic vessels during operations to ensure this;

  • Conducting Information, Education, and Communication campaigns (IECs) in affected host communities for any exploration work; 

  • Ensuring responsible disposal of waste materials and restoration of drill sites to, as much as possible, their original state and condition;

  • In case drill sites are located in forested or wooded areas, trees are balled and relocated;

  • Strictly adhering to the terms and conditions of the Environmental Compliance Certificate (ECC), which is regularly monitored by a multi-partite monitoring team; and

  • Following good oil industry practices

 

The Company also complies with relevant environmental legislation and regulations as evidenced by acquisition/renewal of pertinent permits, clearances and accreditation covering the Company’s various activities and the submission  of periodic reports to Environmental Management Bureau (EMB).

 

3. Does the GOCC have a separate Corporate Social Responsibility (CSR) report/section or sustainability report/section?

 

 

See PNOC EC Manual for Corporate Governance,

under Section 8, CORPORATE SOCIAL RESPONSIBILITY AND RELATIONS WITH STAKEHOLDERS, pages 26 – 33. Refer to PNOC EC Website under GCG Requirements.

 

 

4. Where stakeholder interests are protected by law, stakeholders should have the opportunity to obtain  effective redress for violation of their rights.

 

 

 

 

           

      Does the GOCC provide contact details

  via the Company's website or Annual Report which stakeholders (e.g. customers, suppliers, general public, etc.) can use to voice their concerns and/or complaints for possible violation of their rights?

 

 

Stakeholders may contact MS MYRANNOR B HANDIG, Social Performance Specialist, at

mbhandig@pnoc-ec.com.ph, or at 497-9400 Local 444. See PNOC EC 2015 Annual Report, Company and Field Offices, inside back cover.

 

5. Performance-enhancing mechanisms for employee participation should be permitted to develop.

 

 

 

a. Does  the GOCC explicitly mention the     

    health, safety and welfare policy for its 

    employees?

 

 

See EHS Policy Manual.

 

 

b. Does the GOCC publish data relating to  

    health, safety and welfare of its 

    employees?

 

 

See Safety Statistics Report.

 

 

c. Does the GOCC have training and 

    development programmes for its 

    employees

 

 

See Competency Development Framework.

    

  d. Does the GOCC publish data on training

       and development programmes for its 

       employees?

 

 

See Training and Development Programs for 2015.

 

6. Stakeholders including individual employee and their representative bodies, should be able to freely communicate their concerns about illegal or unethical practices to the board and their rights should not be compromised for doing this.

 

 

 

a. Does the GOCC have procedures for

 complaints  by employees concerning

 illegal (including corruption) and unethical behavior?

 

 

PNOC EC will develop a Whistle Blowing Policy, taking into consideration GCG Memorandum Circular No. 2014-04, or the Whistle Blowing Policy on the GOCC Sector, among other relevant regulations. 

See GCG's Whistle Blowing Web Portal.

 

 

b. Does the GOCC have procedures to 

    protect an employee/person who 

    reveals illegal/unethical behavior from 

    retaliation?

 

 

PNOC EC will develop a Whistle Blowing Policy, taking into consideration GCG Memorandum Circular No. 2014-04, or the Whistle Blowing Policy on the GOCC Sector, among other relevant regulations.

See GCG's Whistle Blowing Web Portal.

 

 

  • Disclosure and Transparency

 

 

7. Quality of Annual Report. 

     Does the GOCC’s annual report disclose the following items:

 

 

 

a. Corporate objectives

 

 

PNOC EC has disclosed its Corporate Objectives in its 2015 Annual Report. See PNOC EC 2015 Annual Report, page 21-23.

 

 

b. Financial performance indicators

 

 

PNOC EC has disclosed its Financial Performance Indicators in its 2015 Annual Report. Refer to pages 24-25.

 

 

c. Non-financial performance indicators

 

 

PNOC EC has disclosed its Non-Financial Performance Indicators in its 2015 Annual Report. Refer to page 23.

 

             

d. Details of whistle blowing policy

 

 

PNOC EC will include its Whistle Blowing Policy in the 2016 Annual Report. 

 

             

e. Biographical details of directors

 

 

PNOC EC included the biographical details of its Board of Directors in its 2015 Annual Report. Refer to page 28.

 

           

  f. Training and/or continuing education    programme attended by each

      director

 

 

PNOC EC will include in its 2016 Annual Report the training programs attended by its Directors.

 

 

8. Are the Annual Reports downloadable from the GOCC’s website?

 

 

See PNOC EC Annual Reports.  

 

 

9. Corporate Governance Confirmation Statement

 

 

 

 

   Does the Annual Report contain a 

    statement confirming the company's 

    full compliance with the code of 

    corporate governance and where there 

    is non-compliance, identify and explain 

    reasons for each such issue?

 

 

This is to confirm that PNOC EC, the members of the Board of Directors, its officers and employees have fully complied with the provisions of the 

Manual of Corporate Governance mandated by Section 5 (c) of Republic Act No. 10149, GCG Memorandum Circular No. 2012-07 dated November 2012 and PNOC EC’s Manual of Corporate Governance dated January 2014. Refer to PNOC EC 2015 Annual Report, page 21.

 

 

10. Timely filing/release of annual/financial reports

 

 

 

 

a. Are the audited annual financial 

   report/statement released within 60  

   days upon receipt from COA?

 

 

PNOC EC released its 2016 Annual Audit Report 7 days after receipt from COA.

 

AUDIT REPORT

Year

of the Report

Date Published

Date of Receipt from COA

2016

June 9, 2017

June 2, 2017

 

 

 

 

 

b. Is the annual report released within 90

   days from release of audited financial report?

 

 

PNOC EC released its 2014 Annual Report 15 days after release of Annual Audit Report.

 

AUDIT REPORT

Year

of the Report

Date Published

Date of Receipt from COA

2014

July 1, 2015

June 16, 2015

 

 

 

 

 

c. Is the true and fairness/fair 

    representation of the annual financial 

    statement/reports affirmed by the 

    board of directors and/or the relevant 

    officers of the company?

    

 

 

The true and fair representation of the annual financial statements/reports is affirmed in the Statement of Management Responsibility signed by the President and CEO and the VP for Management Services/CFO. 

 

See page 36 of the Annual Report 2016.

 

 

  • Responsibilities of the Board

 

 

11. Corporate Vision and Mission/ Strategy

 

 

 

a. Has the Board of Directors reviewed   

    the vision and mission/ strategy in the 

    last financial year?

 

 

PNOC EC holds an annual strategic planning workshop attended by members of the Board and Management, where the Company’s corporate vision and mission/ strategy are deliberated on.

See Secretary Certificate for Board Resolutions

No. 9-2, S’2013 and No. 7-7, S’2015.

 

 

 

b. Does the Board of Directors 

    monitor/oversee the implementation 

    of the corporate strategy?

 

 

PNOC EC holds an annual strategic planning workshop attended by members of the Board and Management, where the Company’s corporate vision and mission/strategy are deliberated on.

 

 

12.  Did the GOCC achieve 90% in the PES?

 

 

PNOC EC achieved 95.59% in its 2015 Performance Scorecard.

See PNOC EC's 2015 Performance Scorecard.

 

 

13. Code of ethics or conduct

 

 

 

 

a. Are the details of the code of ethics or 

    conduct disclosed?

 

 

 

PNOC EC follows 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

 

 

b. Does the GOCC disclose that all

    Directors, senior management

    and employees are required to comply

    with the code?

 

 

c. Does the company disclose how it

    implements  and monitors compliance

    with the code of  ethics or conduct?

 

 

14.  Does the Board appoint a Nomination and

     Compensation / Remuneration Committee?  

 

 

Pursuant to Republic Act No. 10149, or the GOCC

Governance Act of 2011, members of the board of GOCC’s shall be appointed by the President.

 

PNOC EC created a Nomination and Remunerations Committee, whose functions where merge with the existing Compensation, Education and Employee Welfare Committee, and renamed to Nomination, Remuneration, Education, and Employee Welfare Committee.

 

Said Committee is composed of the following:

 

From July 2013  - May 2015

Chairman     Mr. Armando P. Galimba

Members    Mr. Rufino B. Bomasang 

Atty. Luis Ma. G. Uranza 

Atty. Francisco T. Ignalaga, Jr.

 

From July 14, 2015  -  present

Chairman    Ralph Pastor A. Salazar

Members    Rufino B. Bomasang 

 Fernando V. Barreiro

 Joseph L. Emnas

 Rafael M. Iriarte

 Emmanuel K. Veloso

 Leopoldo E. Petilla

 Gemiliano C. Lopez, Jr. 

 Pedro A. Aquino, Jr.

 

See Annual Report 2014, page 21 and Secretary's Certificate for PNOC EC Board Resolution No. 5-9, Series of 2016.

 

 

15.  Did the Nomination and

      Compensation/Remuneration Committee meet at least twice during the year?

 

 

For 2015, the Compensation, Education and Employee Welfare Committee, later merged with and renamed to Nomination, Remuneration, Education and Employee Welfare Committee, held two (2) meetings on August 24, 2015 and December 17, 2015.

 

See GCG Requirements, 2(d) Breakdown of Board and Committee per Appointive Member 2015.

 

 

16.  If yes, is the report of the Nomination and

      Compensation/Remuneration Committee publicly disclosed?

 

 

See Compensation, Education and Employee Welfare Committee Report 2015.

 

17.  Does the Board appoint an Audit Committee?

 

      

 

Pursuant to Republic Act No. 10149, or the GOCC

Governance Act of 2011, members of the board of GOCC’s shall be appointed by the President.

 

PNOC EC formally combined the Audit Committee

and Risk Management Committee into the Audit

and Risk Management Committee pursuant to Section 16.6 of the GCG Code of Corporate 

Governance, as well as Section 3.15(f) of the 

PNOC EC Manual of Corporate Governance. 

 

The PNOC EC Audit and Risk Management

Committee is composed of the following:

 

From July 2013  -  May 2015

Chairman     Mr. Rafael E. del Pilar

Members     Atty. Leopoldo E. Petilla 

Atty. Luis Ma. G. Uranza 

Atty. Francisco T. Ignalaga, Jr.

 

From July 14, 2015  -  present

Chairman     Leopoldo E. Petilla

Members     Ralph Pastor A. Salazar

Rafael M. Iriarte

Joseph L. Emnas

Fernando V. Barreiro

Emmanuel K. Veloso

 

See Annual Report 2014, page 21 and Secretary's Certificate for PNOC EC Board Resolution No. 4-2, Series of 2016.

 

 

18.  If yes, is the report of the Audit Committee

      publicly disclosed?

 

 

See Audit and Risk Management Report 2014 and Audit and Risk Management Report 2015.

 

19.  Does at least one member of the Audit 

      Committee have an audit, accounting or 

      finance background (qualification or 

      experience)?

 

 

See Directors’ and Executive Officers’ (current) resume and Directors’ and Executive Officers’ (previous) resume.

 

20.  Did the Audit Committee meet at least four times during the year?

 

 

For 2014 and 2015, the Audit and Risk Management Committee held at least four (4) meetings on each year.

See Breakdown of Board and Committee per Appointive Member 2014 and Breakdown of Board and Committee per Appointive Member 2015.

 

 

21.  Does the Board appoint a Risk Management

        Committee?

 

 

Pursuant to Republic Act No. 10149, or the GOCC

Governance Act of 2011, members of the board of GOCC’s shall be appointed by the President.

 

PNOC EC formally combined the Audit Committee

and Risk Management Committee into the Audit and Risk Management Committee pursuant to

Section 16.6 of the GCG Code of Corporate 

Governance, as well as Section 3.15(f) of the 

PNOC EC Manual of Corporate Governance. 

 

The PNOC EC Audit and Risk Management

Committee is composed of the following:

 

From July 2013  -  May 2015

Chairman     Mr. Rafael E. del Pilar

Members     Atty. Leopoldo E. Petilla 

Atty. Luis Ma. G. Uranza 

Atty. Francisco T. Ignalaga, Jr.

 

From July 14, 2015  -  present

Chairman     Leopoldo E. Petilla

Members     Ralph Pastor A. Salazar

Rafael M. Iriarte

Fernando V. Barreiro

Joseph L. Emnas

Emmanuel K. Veloso

 

See Annual Report 2014, page 21 and Secretary's Certificate for PNOC EC Board Resolution No. 4-2, Series of 2016.

 

 

 

22.  If yes, is the report on Risk Management 

      Committee publicly disclosed?

 

 

See Audit and Risk Management Report 2014 and Audit and Risk Management Report 2015.

 

23.  Does at least one member of the Risk

      Management Committee have a background in finance and investments?

 

 

See Directors’ and Executive Officers’ (current) resume and Directors’ and Executive Officers’ (previous) resume.

 

24. Board meetings and attendance

 

 

 

a. Are the Board of Directors meetings 

    scheduled at the beginning of the year?  

    (end of Q1)

 

 

As its practice, PNOC EC Board holds its Regular Board Meeting every second Tuesday of the Month and its Special Board Meeting on the last 

Tuesday of the month.

 

 

b. Does the Board of Directors meet at    

     least monthly?

 

 

See Breakdown of Board and Committee per Appointive Member 2014 and Breakdown of Board and Committee per Appointive Member 2015.

 

 

c. Did the Board of Directors meet on at 

    least 75% on their scheduled meetings?

 

 

See Breakdown of Board and Committee per Appointive Member 2014 and Breakdown of Board and Committee per Appointive Member 2015.

 

 

d. Has each of the 

    directors attended at least 90% of all

    the board meetings held during the

    year?

 

 

See Breakdown of Board and Committee per Appointive Member 2014 and Breakdown of Board and Committee per Appointive Member 2015.

 

 

e. Did the Board of Directors meet 

     separately least once during the year 

     without the President/CEO present?

 

 

The PNOC EC Board of Directors held a meeting on July 13, 2016 without the President/CEO present.

 

25. Access to information

 

 

 

a. Does the GOCC have a policy that 

    stipulates board papers for Board of 

    Directors  meetings be provided to the Board at least three (3) working days in advance of the board 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.

 

b. Is the Board Secretary trained in legal, accountancy or company secretarial practices?

 

 

See Directors’ and Executive Officers’ resume for the previous Corporate Secretary and Curriculum Vitae of the current Corporate Secretary.

 

 

26. Internal Audit

 

 

 

a. Does the company have a separate internal audit function?

 

 

PNOC EC has a separate internal audit function

and has appointed an Internal Audit Manager.

See Management Team Section.

 

 

b. Does the appointment and removal of the internal auditor require the approval of the Audit Committee?

 

 

See PNOC EC Manual for Corporate Governance, 

Section 3.5 (b) (vi).

 

27. Risk Oversight

 

 

 

a. Does the company disclose the internal control procedures/risk management systems it has in place?

 

 

PNOC EC ensures the integrity of the accounting and financial reporting system. The PNOC EC Board is responsible in assuring that the financial and operational controls are in place and working throughout the organization. Refer to PNOC EC 2015 Annual Report, page 53, Financial Risk and Capital Management.

 

 

b. Does the Annual Report disclose that the Board of Directors has overseen a review of the company's material controls (including operational, financial and compliance controls) and risk management systems?

 

 

PNOC EC included in its 2015 Annual Report a statement that its Board has reviewed the Company’s material controls and risk management systems. Refer to Paragraph 12, Corporate Governance section, Page 22.

 

c. Does the company disclose how key risks are managed?

 

 

PNOC EC manages key risks affecting the Company. See Risks and Strategies.

 

d. Does the Annual Report contain a statement from the Board of Directors or Audit Committee commenting on the adequacy of the GOCC's internal controls/risk management systems?

 

 

PNOC EC included a statement in its 2015 Annual Report commenting on the adequacy of PNOC EC’s internal controls/risk management systems. Refer to Paragraph 12, Corporate Governance section, Page 22. 

 

28. Board Chairman 

 

 

 

    Do different persons assume the roles of Chairman and CEO?

 

 

PNOC EC’s Chairman is Gemiliano C. Lopez, Jr., while its CEO is Pedro A. Aquino, Jr. See Board of Directors Section of the PNOC EC website.

 

 

29. Board of Directors Development

 

 

 

a. Does the GOCC have orientation programs for new Directors?

 

 

PNOC EC will implement an orientation 

program for its new directors.

 

b. Does the GOCC have a policy that encourages Directors to attend on-going or continuous professional education programmes?

 

 

See PNOC EC Manual for Corporate Governance, 

Section 3.5 (i), page 10.

 

c. Did all Appointive Directors attend at least 1 training for the calendar year?

 

 

In 2014, the members of the PNOC EC Board attended the Orientation Seminar on Public

Corporate Governance sponsored by the Development Academy of the Philippines.

 

 

30. Board Appraisal

 

 

 

a. Is an annual performance assessment conducted of the Board of Directors?

 

 

The PNOC EC Board has an annual performance Assessment pursuant to GCG Memorandum Circular No. 2014-03 on Performance Evaluation for Directors.”

 

 

b. Does the GOCC disclose the process followed in conducting the Board assessment?

 

 

PNOC EC follows the process in conducting Board assessment as outlined in GCG Memorandum Circular No. 2014-03 on Performance Evaluation for Directors.

 

 

c. Does the GOCC disclose the criteria used in the Board assessment?

 

 

PNOC EC follows the criteria in conducting Board assessment as outlined in GCG Memorandum Circular No. 2014-03 on Performance Evaluation for Directors.

 

 

31. Committee Appraisal

 

 

 

 

     Is an annual performance assessment conducted of the Board of Directors Committees?

 

 

PNOC EC will implement an annual performance assessment for the Board of Directors Committees.

 

BONUS

 

 

 

Stakeholder Relationships  

 

 

 

  • Does the GOCC practice Global Reporting Initiative (GRI) on its annual reports?

 

 

PNOC EC is in the process of aligning the preparation of its Annual Report with the Global Reporting Initiative (GRI) standards.

 

                                                            

Disclosure Transparency

                                      

 

 

  • Quality of Annual Report

 

 

 

Are the audited annual financial report/statement released within 30 days upon receipt from COA?

 

 

PNOC EC released its 2016 Annual Audit Report 7 days after receipt from COA.

 

AUDIT REPORT

Year

of the Report

Date Published

Date of Receipt from COA

2016

June 9, 2017

June 2, 2017

 

 

 

 

 

PENALTY

 

 

 

Responsibilities of the Board

 

 

 

  • Are there members of the Board of Directors who hold more than five (5) positions in GOCCs and PLCs?

 

 

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

 

  •  Is there non-compliance with Good Governance Conditions?

 

 

PNOC EC is fully compliant with all Good Governance Conditions.

 

 

(page update December 23, 2016)