2022 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

For 2022, the operations of PNOC EC head office and COC 41’s Coal Operations Group and Mine 3 were recipients of Safety Excellence Award granted by the Safety and Health Association of the Philippine Energy Sector (SHAPES) during the 18th Energy Safety, Health and Environment Conference held in Meralco Compound, Pasig City.

PNOC EC consistently complied with the Department of Energy (DOE) COVID-19 Response Protocol which provides additional guidelines for the management of COVID-19 pandemic for the stakeholders of the energy sector. Likewise, government issuances such as the Inter-Agency Task Force for the Management of Emerging Infectious Diseases (IATF-EID), Department of Health (DOH) and as well as from the local government were regularly monitored. Whenever the Company recorded COVID-19 confirmed cases, contact tracing, intensive disinfection and swab testing of close contacts followed.

See 2022 Health, Safety, Security and Environment (HSSE) Annual Report

For 2022, 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.

See 2022 Health, Safety, Security and Environment (HSSE) Annual Report

For 2022, 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 animals;

(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 2022 Health, Safety, Security and Environment (HSSE) Annual Report

A form is provided in the Contact Us page of the PNOC EC Official Website for stakeholder issues and concerns.

The Company also maintains a mobile number that can be reached thru messaging app (i.e., Viber, Messenger, SMS) and is being monitored real time by the External Relations Department thru its Manager, MS. SHARON H. NER.

The mobile number, including other contact details are also posted on the Company's Annual Reports as well as signages positioned on the field office.

See PNOC EC Official Website Contact Us page and 2021 Annual Report

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 2022, PNOC EC recorded 823,044 safe man-hours without any lost-time injury.

See 2022 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 2022 Performance Scorecard included in PNOC EC's 2022 Annual Report.

The PNOC EC has disclosed its Financial Performance Indicators.

See 2022 Financial Highlights based on Unaudited Financial Statement

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

See Non-Financial Indicator in the 2022 Performance Scorecard included in PNOC EC's 2022 Annual Report.

See Corporate Governance - Conflict of Interest included in PNOC EC's 2021 Annual Report, page 28

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

Yes. See Board of Directors included in PNOC EC's 2021 Annual Report, pages 33-36.

*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 2021 Annual Report (page 26) 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. 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 2021 Annual Report, page 26

*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 2022 Strategic Planning Session held from December 20-21, 2021.

See PNOC EC's 2022 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 2022 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.

See PNOC EC Manual for Corporate Governance, page 8-11, Sec 3.4

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

See Board and Committee Meetings Attendance 2022

The Board of Directors held twenty-three (23) meetings in 2022.

See Board and Committee Meetings Attendance 2022

All the appointive Members of the Board attended all the duly-called Board meetings for 2022.

See Board and Committee Meetings Attendance 2022

See Board and Committee Meetings Attendance 2022

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 2022

PNOC EC discloses its internal control procedures/risk management systems in the existing Risk Management Manual that is in place since 1993. Included in the Manual is the Risk Management System/Process which provides for the identification of risks, risk management/analysis, risk selection techniques, implementation of risk management techniques and monitoring and improving the risk management system. Financial Risk and Capital Management is also disclosed in the PNOC EC 2021 Annual Audit Report, pages 84 to 90.

"PNOC EC’s 2022 Annual Report will be published on June 2023 as scheduled, after review and approval by COA of its Financial Statements."

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 2021 Annual Report, pages 26 to 31.

Refer to Manual of Corporate Governance, page 21, 3.15e (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 2021 Annual Report, pages 26 to 31.

Refer to Manual of Corporate Governance, page 21, 3.15e (i)

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

For 2022, PNOC EC’s Ex-Officio Chairperson is Alfonso G. Cusi (Secretary, Department of Energy), while its President and CEO is Lt Gen Rozzano D Briguez (Ret) until June 30, 2022. Thereafter, 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 Executive Order No. 39 and Secretary’s Certificate for Board Resolution No. 2-3, Series of 2020 and Secretary's Certificate for Board Resolution No. 8-1, Series of 2022

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 2022

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 2021, the Board of Directors conducted its assessment during the first quarter of 2022.

See Board Assessment Questionnaire.

The Board of Directors conducts an annual assesment 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 strenghts and weaknesses.

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 2021, the respective members of each Board Committee conducted the assessment of their respective Committees during the first quarter of 2022.

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.