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MINUTES OF 2012 ANNUAL GENERAL MEETING
OF SHAREHOLDERS (THE 19TH MEETING)
THE SIAM CEMENT PUBLIC COMPANY LIMITED
The Meeting was held at Athenee Crystal Hall, 3rd Floor, Plaza Athenee Bangkok A
Royal Meridien Hotel, 61 Wireless Road, Patumwan, Bangkok 10330, on Friday, March 30,
2012 at 14:30 hours.
Mr. Chirayu Isarangkun Na Ayuthaya was the Chairman of the Meeting.
The Chairman informed the Meeting that there were 700 Shareholders present in
person, representing 2,949,717 shares, and 1,856 Shareholders represented by proxy,
representing 734,200,898 shares. In total, 2,556 Shareholders and proxies attended the
Meeting, holding a total of 737,150,615 shares, equivalent to 61.4292% of the total issued
shares of 1,200,000,000 shares which constituted a quorum pursuant to the Company’s
Articles of Association. The Chairman then declared the Meeting open and proposed that the
Meeting consider the following matters according to the agenda.
The Chairman assigned the Secretary to the Board to explain the details and meeting
procedures to the Meeting. The Secretary to the Board then introduced to the Meeting the
Directors, members of SCG Management Committee and representatives from the Auditor of
the Company, KPMG Phoomchai Audit Ltd., being witnesses during the voting process.
These persons were as follows:
Directors Attending the Meeting: 12 persons
1. Mr. Chirayu Isarangkun Na Ayuthaya Chairman of the Board and Member of
CSR Committee for Sustainable
Development
2. Air Chief Marshal Kamthon Sindhvananda Independent Director and Chairman of the
Audit Committee
3. Mr. Snoh Unakul Chairman of CSR Committee for
Sustainable Development and Member of
the Governance and Nomination
Committee
Attachment 1
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4. Mr. Sumet Tantivejkul Independent Director, Chairman of the
Governance and Nomination Committee,
and Member of CSR Committee for
Sustainable Development
5. Mr. Pricha Attavipach Independent Director and Member of the
Audit Committee
6. Mr. Panas Simasathien Member of the Governance and
Nomination Committee
7. Mr. Yos Euarchukiati Member of the Remuneration Committee
and Member of CSR Committee for
Sustainable Development
8. Mr. Arsa Sarasin Independent Director and Member of the
Governance and Nomination Committee
9. Mr. Chumpol NaLamlieng Chairman of the Remuneration Committee
10. Mr. Tarrin Nimmanahaeminda Independent Director, Member of the Audit
Committee and Member of the Governance
and Nomination Committee
11. Mr. Pramon Sutivong Independent Director, Member of the Audit
Committee and Member of the
Remuneration Committee
12. Mr. Kan Trakulhoon President & CEO and Member of CSR
Committee for Sustainable Development
The Secretary to the Board
1. Mr. Worapol Jennapar
Members of SCG Management Committee Attending the Meeting: 8 persons
1. Mr. Chaovalit Ekabut Vice President – Finance and Investment
& CFO and President – SCG Investment
2. Mr. Aree Chavalitcheewingul Vice President – Corporate Administration
3. Mr. Cholanat Yanaranop President – SCG Chemicals
4. Mr. Somchai Wangwattanapanich Vice President – Operations SCG Chemicals
5. Mr. Roongrote Rangsiyopash President – SCG Paper
6. Mr. Pramote Techasupatkul President – SCG Cement
7. Mr. Pichit Maipoom President – SCG Building Materials
8. Mr. Kajohndet Sangsuban President – SCG Distribution
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Auditors from KPMG Phoomchai Audit Ltd. : 2 persons
1. Mr. Supot Singhasaneh
2. Ms. Sureerat Thongarunsang
Representatives from the Auditor being Witnesses during the Voting Process:
2 persons
1. Ms. Plaisek Saleepan Representative from the Auditor
2. Mr. Worawut Tangporncharoensuk Representative from the Auditor
The Secretary to the Board explained to the Meeting regarding procedures of voting,
counting of votes, and announcing of voting results, which could be summarized as follows:
According to Clause 23 of the Company’s Articles of Association together with the
Public Limited Companies Act Section 102, the second, fourth, and fifth paragraphs of
Section 33 as well as Section 34, each Shareholder or a proxy authorized by any Shareholder
to vote on his/her behalf was entitled to vote equal to the number of shares held, whereby one
share would be equal to one vote. Votes were to be cast by raising hands.
In casting votes by raising hands, any Shareholder who wished to vote for, vote
against or abstain in such agenda shall mark the voting card accordingly with his/her signature
affixed. The officers of the Company shall scan the barcodes and collect the voting cards
only for the Shareholders who voted against or abstained to count the number of opposing and
abstaining votes for each agenda. All the voting cards for the Shareholders who voted for all
the matters shall be collected altogether when the Meeting adjourned.
In vote counting, a system of negative deduction shall be used whereby the
“disapprove” and “abstain” votes shall be deducted from the total number of votes attending
the Meeting for each agenda. The remaining votes shall then be counted as “approve” votes.
In counting and summing up the votes for each agenda, the votes indicated in Proxy forms shall
also be counted.
During the casting of the votes on each agenda, the votes shall be counted from the
total number of votes cast by the Shareholders present at the Meeting with the right to vote in
such agenda, which might vary from agenda to agenda since Shareholders might leave the
Meeting or later entered into the Meeting. The results of the vote count shall be announced at
the Meeting after the completion of counting of votes in each agenda. However, vote
counting for some agenda items might take longer. In such cases, the Chairman might request
the Meeting to proceed with the consideration of the next item on the agenda to avoid
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disrupting the meeting. The Meeting would be informed of the result as soon as the vote
counting finished.
With no comments to the contrary, the Meeting acknowledged and approved the
voting procedures, vote counting and announcement of voting results as described above.
Prior to the consideration of the agenda, the Chairman informed the Meeting that the
Management would report on the progress of the Company’s project at Map Ta Phut and the
forgery case of the Company’s ordinary share certificates by a former employee after all
agenda items had been considered. The Chairman then proposed that the Meeting consider
the following agenda:
1. To approve the Minutes of the 2011 Annual General Meeting of Shareholders (The
18th Meeting) held on Wednesday, March 30, 2011 and the Minutes of Extraordinary
General Meeting of Shareholders No. 1/2012 held on Wednesday, January 25, 2012
The Chairman informed the Meeting that the Minutes of the 2011 Annual General
Meeting of Shareholders (The 18th Meeting) held on Wednesday, March 30, 2011, and the
Minutes of Extraordinary General Meeting of Shareholders No.1/2012 held on Wednesday,
January 25, 2012 were made within 14 days from the date of the General Meeting of
Shareholders and the Extraordinary General Meeting of Shareholders respectively. Both of
them were submitted to the Stock Exchange of Thailand and the Ministry of Commerce
within the period required by law and also posted on the Company’s website. Such copies of
the Minutes were also distributed to the Shareholders together with the Notice to all
Shareholders prior to this Meeting, the details of which were shown on pages 11-36.
The Chairman proposed that the Meeting consider and adopt the said two Minutes of
Meetings and announced that this agenda required a resolution of majority votes of the
Shareholders attending the Meeting and having the right to vote.
After the Shareholders’ suggestions and inquiries, the Chairman answered the
inquiries which could be summarized as follows:
(1) Voting to approve both Minutes of Meetings in one agenda
Any Shareholder disapproving of any or both of the Minutes shall cast his/her
vote to disapprove of the agenda item.
(2) Suggestion of recording in the minutes of meeting the names of the Shareholders
making suggestions or inquiries at the Meeting
The Company would take the suggestion into consideration.
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Resolution: The Meeting resolved to approve the Minutes of the 2011 Annual
General Meeting of Shareholders (the 18th Meeting) held on March 30, 2011 and the Minutes
of the Extraordinary General Meeting of Shareholders No.1/2012 held on Wednesday,
January 25, 2012 as proposed by the Board, by a simple majority vote of the total votes of
Shareholders attending the meeting and having the right to vote as follows:
Approved 750,147,997 votes, equivalent to 99.8561%
Disapproved 0 votes, equivalent to 0.0000%
Abstained 1,081,131 votes, equivalent to 0.1439%
2. To acknowledge the Company’s Annual Report for the Year 2011
The Chairman requested the President & CEO to give a summarized report on SCG
performance and major changes during the year 2011 to the Meeting, after which any
questions from the Shareholders were welcomed.
The President & CEO reported the performance of the Company for the year 2011 to
the Meeting, which could be summarized as follows:
In 2011, the global economic slowdown persisted as a consequence of the financial
crisis in Europe and the United States, while Asian economies, including Thailand, witnessed
steady growth. Toward the end of the year, Thailand was ravaged by its worst floods in
decades, causing the Thai economy to contract. However, its repercussions did not carry over
to the production capacity of SCG’s major products. Benefiting from its thoughtful business
approach and its effective Business Continuity Management (BCM) fundamentals, SCG
continued to be competitive, possessed solid financial position, and grew sustainably within
the region. In 2011, SCG reported revenue from sales of 368,579 Million Baht and profit for
the year 27,281 Million Baht.
In the efforts to become a sustainable ASEAN business leader, SCG employed two
key strategies in its organizational development: 1) expansion into the ASEAN region and 2)
the development of high value added products and services (HVA). Both of these strategies
would lend substantial benefits to SCG as the mechanisms and measures of the ASEAN
Economic Community (AEC) help drive cooperation among ASEAN countries. The AEC’s
key features included a single market and production base as well as the liberalization and
facilitation of the movement of products, services, In addition, the President & CEO also
informed the Meeting of SCG’s four major operating performances as follows:
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1. Striding Towards Becoming an ASEAN Sustainable Business Leader
SCG expanded continuously into the ASEAN countries, especially Indonesia,
Vietnam, and the Philippines.
Major investments in the ASEAN region in 2011 included:
- Acquisition of a 30% stake in PT Chandra Asri Petrochemical Tbk (CAP),
Indonesia’s leading petrochemical company.
- Acquisition of PT Keramika Indonesia assosiasi Tbk (KIA), a major ceramic
tile manufacturer in Indonesia.
- Acquisition of PT Kokoh Inti Arebama Tbk (KOKOH), a large distributor of
building materials with extensive sales network across Indonesia. The
investment was an extension for SCG’s ceramic business, which has already
established a production base in Indonesia and for the supply chain of SCG
building material products.
- Acquisition of the corrugated container business of Alcamax Packaging
(Vietnam) Joint Stock Company, Vietnam’s leading producer of corrugated
containers.
- Acquisition of a stake in a white cement plant of Buu Long Industry &
Investment Joint Stock Company.
- Establishing SCG Marketing Philippines Co., Ltd to develop a distribution channel
for building materials in the Philippines.
For the operating results of SCG in the ASEAN region exclusive of Thailand in
2011, revenue from sales amounted to 23,670 Million Baht, accounting for 7% of
total revenue, an increase of 17% from the previous year. As at year end of 2011,
SCG’s assets in ASEAN amounted to 46,000 Million Baht, or 12.5% of the
Group’s total assets.
2. Promoting Research and Development to Address Every Customer
Need through Creative Marketing
- In 2011, the Group invested over 1,111 Million Baht in R&D, representing an
increase of 21% from the previous year, to develop high value added products
and services (HVA) and ‘SCG eco value’ label. Examples included
compostable plastic that would decompose in natural composting and landfill
environments, ‘Green Carton’ eco-friendly corrugated containers that reduced
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paper consumption yet offer 25% higher structural strength, and SCG House
Cooling Systems that reduced household power consumption.
- SCG’s sales of HVA grew steadily from 29% of revenue from
sales in 2010 to account for 32% of revenue from sales in 2011, while sales of
‘SCG eco value’ products accounted for 13% of revenue from sales in 2011.
- Moreover, SCG highlighted the ‘Human Value Marketing’ concept, a new
development in marketing designed to satisfy customer demand with enhanced
and innovative products and services while building a better quality of life and
sustainable future.
3. Building Upon the Sustainable Development Concept and Joining
Forces to Create Value for Communities
- SCG conducted its business in accordance with the concept of sustainable
development, focusing on achieving a balance among economic, social and
environmental commitments. The Group employed advanced,
environmentally-friendly production technology and worked in collaboration
with various organizations to enhance the quality of life for its employees,
surrounding communities and society as a whole.
- In 2011, SCG organized the ‘Thailand Sustainable Development Symposium’
for the second consecutive year. The objectives were to share experiences in
managing sustainable development and to offer opportunities for all sectors to
work together to find solutions to mitigate the challenges and impacts by
adopting the sustainable development concept as a key strategic tool in
business operations. The symposium was attended by scores of executives
from the government, business, and education sectors as well as independent
agencies and the press, both local and foreign.
- Beyond this, SCG, the sustainable development role model, had been
ranked as Sector Leader in DJSI Building Materials & Fixtures by Sustainable
Asset Management (SAM). SCG had been in ‘Gold Class’, the highest group,
for 4 consecutive years.
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4. Business Continuity Management during Crisis
In late 2011, SCG managed to cope with the flood effectively. The Group’s
Business Continuity Management Unit (BCM) kept close track of comprehensive
information from various sources. Based on this, analysis and evaluation of the
situation was carried out to create an emergency-preparedness plan and made
informed decisions. At the same time, SCG provided support and relief to its
employees and their families as well as the general public. Efforts to assist
victims of the deluge were categorized into four concrete approaches: providing
flood prevention materials, distributing immediate relief, rebuilding after water
receded, and developing innovations that could accommodate future disasters.
After the Shareholders made suggestions and inquiries, the Chairman, the President &
CEO, President – SCG Chemicals, and Vice President – Operations, SCG Chemicals
answered the inquiries which could be summarized as follows:
(1) Investment in petrochemical business in Indonesia
SCG’s acquisition of PT Chandra Asri Petrochemical Tbk (CAP), an integrated
petrochemical business in Indonesia, was a long-term strategic investment as
Thailand and Indonesia were the only two ASEAN nations with the integrated
petrochemical businesses. Today, Indonesia remains a net importer of
petrochemical products. The global business nature of the petrochemical products
that was transportable across countries coupled with the close proximity of
Indonesia to the target markets and international trade liberalization among the
AEC which reduced barriers to trade would provide promising investment
opportunities for SCG. This was a departure from making a financial investment
in buying stock and selling it at a higher price or buying stock to earn dividends
(Financial Investment) since SCG appointed a high-level technical executive to
CAP’s Executive Board to oversee the overall production. Both companies started
to foster synergistic collaboration in many areas which would help drive costs
down and enhance production efficiency. Outlooks for the petrochemical industry
in the second half of 2012 were expected to be positive.
SCG paid an acquisition premium for CAP to ensure the deal got closed and
because SCG viewed that the synergies generated by the combined entities would
increase more value in the future.
23
(2) Investment in research and development of medical plastic products
SCG is the manufacturer of plastic resins for use in the manufacture of medical
disposables not the manufacturer of medical disposables per se. Examples
included polypropylene used for the production of intravenous (IV) tubing and
PVC used for the production of intravenous (IV) bags and blood bags. SCG
committed itself to producing plastic for medical purpose because the products
enjoyed wide acceptance and steady growth over the years. Sales of plastic for
medical use now accounts for 4% of the total HVA sales. SCG devised and
implemented a strategy to develop the products continuously.
(3) Production of compostable plastics
SCG produced plastic resins for a wide range of applications such as compostable
plastic bags. The conversion process of these specially formulated plastics was
developed jointly with plastic converters. SCG produced compostable plastics for
exports and sale in the domestic markets.
(4) Reverse Osmosis systems installation project
Reverse Osmosis systems installation project was designed to treat waste water
for recycling as part of SCG’s 3R initiative. The project was capable of treating
water to attain different purity levels including water of distilled or potable
quality. Instead of using raw water to produce tap water, SCG treated wastewater
to tap water quality for recycling. The return on investment of the project had
been assessed.
(5) Monomer recovery unit installation project
The project was designed to recover monomers by evaporating wastewater from
machine cleaning for reuse and reducing raw material consumption. The project
also contributed to a better environment and conserves energy for the wastewater
treatment system.
(6) Improving wastewater treatment through anaerobic wastewater treatment system
project
Conventional aerobic treatment produces waste sludge which had to be eliminated
by incineration. To protect the environment, SCG had resorted to anaerobic
treatment system in which anaerobic digestion significantly reduces excess sludge
production. The system also produced methane, which could substitute for
natural gas.
24
(7) SCG’s giving importance to minority shareholders, SCG Corporate Governance,
and shareholders’ suggestions on the development of SCG products for flood
prevention
A minority shareholder thanked SCG for providing opportunities for minority
shareholders to learn about SCG businesses and operations through various
channels such as a visit to SCG Pavilion at BOI Fair and the organization of a
corporate social responsibility (CSR) activity for minority shareholders. It was
suggested that SCG organize activities for shareholders’ children, enabling them
to have good knowledge and understanding about SCG business operations since
most minority shareholders held SCC shares for long- term and would like their
heirs to inherit the shares. The Chairman thanked the shareholder for the
suggestion and affirmed that SCG had attached significance to fostering
relationships with minority shareholders and would continue to further develop
the relationship well into the future.
In addition, the Chairman concluded that SCG had stressed the importance of
good corporate governance and set its sights on taking good care of all aspects. In
other words, SCG did not focus solely on making profit, but the Group was also
concerned with the environment and the benefits of all stakeholders.
The Chairman thanked the Shareholders for suggestions about the research and
development of building materials for flood prevention.
(8) Investment in SCG Muangthong United Football Club
The main objective of the investment was to build SCG brand through sport
marketing. SCG Muangthong United had been a highly capable team with huge
potential to compete in ASEAN matches, which would help promote the SCG
brand region-wide. Buying a stake in the club had many advantages over being a
title sponsor. For example, SCG’s involvement enabled the Group to secure name
rights on the stadium, changing its name to SCG Stadium and to put the SCG logo
on the football shirts.
With no further inquiries, the Chairman proposed that the Meeting acknowledge
the Company’s Annual Report for the year 2011.
Resolution : The Meeting acknowledged the Company’s Annual Report for the Year
2011.
25
3. To consider and approve the financial statements for the year ended December 31,
2011
The Chairman informed the Meeting that in compliance with the Public Limited
Companies Act of B.E. 2535 which stated that the company shall prepare its financial statements
at the end of the fiscal year of the company and arrange for it to be audited and certified by the
company’s auditor before submission to the shareholders for approval, the Board recommended
the Meeting to approve the financial statements for the year ended December 31, 2011 as duly
audited and certified by the auditors of KPMG Poomchai Audit Ltd. and reviewed by the Audit
Committee. The President & CEO reported the following details to the Meeting:
The details of the financial statements of the Company appeared in the 2011 Annual
Report on pages 91-208, which was distributed to the Shareholders prior to the Meeting together
with the Notice. It could be summarized as follows:
The statements of financial position and income statements
Unit: Million Baht
Consolidated Company
Total Assets 374,738 184,980
Total Liabilities 211,769 119,199
Revenue from sales 368,579 22,548
Profit for the year 27,281* 16,831
Earning per share (Baht/Share) 22.73* 14.03
* Represents profit for the year attributable to equity holders of the parent company.
The Chairman, the President & CEO, and Vice President-Finance and Investment &
CFO then answered the Shareholders’ inquiries, which could be summarized as follows:
(1) Revenue from sales of High Value-added products and services (HVA)
In 2004, SCG’s sales of HVA from all business units totaled 7,800 Million Baht
on total sales of 200,000 Million Baht, 4% of the total sales. Back then, SCG
invested some 40 Million Baht in research and development (R&D). The
Company has since continued to increase in R&D investment. In 2011, total
investment in R&D amounted to 1,111 Million Baht. Sales of HVA rose to
118,000 Million Baht on total sales of 368,000 Million Baht, or 32% of the total
sales. Earnings before interest, taxes, depreciation, and amortization (EBITDA)
accounted for 50% of SCG’s total EBITDA.
26
(2) Profit (loss) attributable to owner of the parent non-controlling interests
(Consolidated Income Statements as shown in the 2011 Annual Report on page
94)
In 2011, loss attributable to the owner of the parent non-controlling interests
amounted to 3,500 Million Baht compared to 123 Million Baht in 2010. It was
the share of loss in a jointly-own company which was divided by the equity
participation ratio. The loss was attributed to the dismal performance of the
upstream petrochemical business which was faced with increased production costs
due to surging oil prices that pushed the prices of naphtha, the main feedstock of
petrochemicals to rise. This coupled with the sagging demand resulted in a lower
product-to-feed margin, hence, the loss. Nevertheless, the downstream
petrochemical business was still profitable. For 2011, SCG reported net profit of
27,000 Million Baht compared to 37,000 Million Baht in 2010. Part of the profit
of nearly 10,000 Million Baht came from the sale of shares in PTT Chemical
Public Company Limited. In the fourth quarter of 2011, a number of associates
were affected by the country’s worst floods in decades, resulting in a decline in
profit.
(3) Impact from the minimum wage increase
SCG is already paying most of its employees higher than the statutory minimum
wage. However, its business partners are to pay their workers the new minimum
wage as stipulated by law, inevitably increasing their costs. Yet, it is believed that
the measures taken to cut costs as well as the lower tax rates will help offset the
higher labor costs.
As there were no further questions, the Chairman requested the Meeting to approve the
financial statements for the year ended December 31, 2011. This agenda required a resolution of a
simple majority vote of the total votes of the Shareholders attending the Meeting and having the
rights to vote.
Resolution: The Meeting, by a simple majority vote of the total votes of Shareholders
attending the meeting and having the rights to vote, approved the financial statements for the year
ended December 31, 2011 as follows:
Approved 749,723,586 votes, equivalent to 99.8585%
Disapproved 0 votes, equivalent to 0.0000%
Abstained 1,062,131 votes, equivalent to 0.1415%
27
4. To consider and approve the allocation of profit for the year 2011
The Chairman informed the Meeting that the Company had a policy to distribute dividend
at the rate of 40-50% of the net profit as specified on its Consolidated Financial Statement. The
Company might consider changing the dividend distribution in cases of necessity or extraordinary
circumstances.
In 2011, the Company had a net profit of 27,281 Million Baht on its Consolidated
Financial Statement. Taking into account the Company’s retained earnings for allocation of
the dividends and to create confidence among investors, Shareholders and all stakeholders,
the Board proposed the allocation of dividends to Shareholders for the year 2011 at the rate of
12.50 Baht per share amounting to 15,000 Million Baht, or 55% of the net profit listed on the
Consolidated Financial Statement which was a higher rate than the dividend policy but was
the same amount as in the previous year. The Company already paid 5.50 Baht per share
totaling 6,600 Million Baht as an interim dividend on August 25, 2011. The final payment of
dividend shall be 7.00 Baht per share, totaling 8,400 Million Baht. The Chairman assigned
the Secretary to the Board to explain the details as follows:
The above dividend distribution shall be payable to the shareholders entitled to receive
the dividend according to the Company’s Articles of Association and listed in the record date
on Tuesday, April 10, 2012 and whose names were collected on Wednesday, April 11, 2012
for the right to receive the dividend. The dividend payment will be made on Thursday, April
26, 2012. The receipt of such dividend shall be within 10 years. Such dividend payment was
derived from the profit which was subject to corporate income tax of 30%. Therefore, the
natural person shareholder shall be entitled to a tax credit equaling the product of dividend
times 3/7. Details are as shown on page 3 of the Notice of the Meeting.
After that, a Shareholder inquired about the allocation of dividends to Shareholders at
a higher rate than the dividend policy. In answer, the Chairman explained that in considering
the distribution of profit, the Company attached significance to every Shareholder especially
minority shareholders to create confidence in the Company. After comparing the dividend
allocation to the preceding year, the Board recommended the distribution of dividend for the
same amount as in the previous year.
As there were no further questions, the Chairman proposed that the Meeting approve
the distribution of dividends for the year 2011 at 12.50 Baht per share, as proposed by the
Board of Directors. This agenda required a resolution of a simple majority vote of the total
votes of the Shareholders attending the Meeting and having the rights to vote.
28
Resolution: The Meeting approved the distribution of dividends for the year 2011 as
proposed by the Board by a simple majority vote of the total votes of Shareholders attending
the Meeting and having the rights to vote as follows:
Approved 747,157,987 votes, equivalent to 99.5184%
Disapproved 100 votes, equivalent to 0.0000%
Abstained 3,615,531 votes, equivalent to 0.4816%
5. To consider and approve the election of directors in replacement of those who
are retired by rotation
In compliance with the Public Limited Companies Act and Clause 36 of the
Company’s Articles of Association, one-third of the directors must retire from office by
rotation at the Annual General Meeting of Shareholders. Four Directors who were retired by
rotation in this Meeting included:
1) Mr. Snoh Unakul Chairman of CSR Committee for
Sustainable Development, Member of the
Governance and Nomination Committee.
2) Mr. Panas Simasathien Member of the Governance and
Nomination Committee.
3) Mr. Arsa Sarasin Independent director and Member of the
Governance and Nomination Committee.
4) Mr. Chumpol NaLamlieng Chairman of the Remuneration Committee.
During September 1 - November 30, 2011, when the Company gave the minority
shareholders an opportunity to propose the agenda and to propose qualified nominees to be
appointed as directors of the Company, no shareholder proposed a qualified nominee to be
appointed as a director of the Company.
The Board of Directors, excluding the Directors having conflicts of interest, had
extensively discussed and considered the nomination of directors by taking into consideration
the qualification of nominees, who were knowledgeable with expertise from various
occupations, had leadership, far-sighted vision, high principles and ethics, had transparent and
clean work records, were capable of expressing their opinions independently and had suitable
qualifications. Moreover, for all four retiring directors according to this Agenda, the Board
also considered their performance as directors of the Company, and found that they performed
their duties as directors and subcommittee members well. The Board of Directors thus agreed
with the Governance and Nomination Committee and recommended the Meeting to reelect all
four retiring directors, i.e., Mr. Snoh Unakul, Mr. Panas Simasathien, Mr. Arsa Sarasin, and
Mr. Chumpol NaLamlieng, to retain office for another term. The curricula vitae of the
29
nominated persons, number of shares held in the Company, positions as director of
managerial level in the listed company and other businesses, including relationship of the
nominated persons, were shown on pages 37-45 of the Notice of the Meeting.
As there were no further questions, the Chairman proposed that the Meeting elect all
of the said four Directors to continue their directorship pursuant to the Company’s Articles of
Association. This agenda required a resolution of a simple majority vote of the total votes of
Shareholders attending the Meeting and having the rights to vote.
Resolution: The Meeting resolved to elect all of the four Directors, i.e., Mr. Sanoh
Unakul, Mr. Panas Simasathien, Mr. Arsa Sarasin, and Mr. Chumpol Na Lamlieng as
directors of the Company by a simple majority vote of the total votes of Shareholders
attending the Meeting and having the rights to vote as follows:
Approved 730,005,541 votes, equivalent to 97.2337%
Disapproved 19,707,946 votes, equivalent to 2.6250%
Abstained 1,060,631 votes, equivalent to 0.1413%
6. To consider and approve the appointment of auditor and audit fee for the year
2012
The Chairman informed the Meeting that in 2011 the Audit Committee considered and
selected KPMG Phoomchai Audit Ltd., the former auditor, to be the auditor of the Company
and its subsidiaries for the years 2012-2014 because KPMG Phoomchai Audit Ltd. had high
professional standards, with expertise in auditing and good performance. In addition, audit
fees charged by KPMG Phoomchai Audit Ltd. were appropriate, compared to fees for similar
quantities of work charged by other auditing firms at the same professional level.
For 2012, the Board agreed with the Audit Committee to select KPMG Phoomchai
Audit Ltd. to be the auditing firm and recommended the 2012 Annual General Meeting of
Shareholders to consider and approve the appointment of the auditors and audit fee as
follows:
1) To appoint the auditors from KPMG Phoomchai Audit Ltd. for the Company for
the year 2012 as follows:
- Mr. Supot Singhasaneh (Certified Public Accountant No.2826)
- Mr. Winid Silamongkol (Certified Public Accountant No.3378)
- Mr. Charoen Phosamritlert (Certified Public Accountant No.4068)
- Ms. Sureerat Thongarunsang (Certified Public Accountant No.4409)
30
The auditors had qualifications that comply with the guidelines of the Securities and
Exchange Commission, details of which appear in “Note” of Agenda 6 on page 6 of
the Notice.
2) To approve the audit fee for the Company’s financial statements of 2012 in the
amount of 250,000 Baht. (The audit fee for the year 2011 was 254,000 Baht.)
The proposed auditing firm and auditors had no relationship or conflict of interest with
the Company or the managerial staff of the Company or majority shareholders, or persons
related to the said persons.
The President & CEO further reported information to the Meeting that the annual
audit fee for the Company’s Financial Statements for 2012 amounted to 250,000 Baht while
the annual audit fee and quarterly review fee of 114 subsidiaries and consolidated financial
statements amounted to 26.85 Million Baht. The total audit fee of the Company and
subsidiaries added up to 27.10 Million Baht.
A Shareholder inquired about the factors contributing to the lower audit fee in 2012
compared to the previous year despite an increase in the number of subsidiaries. The
Chairman and the Vice President – Finance and Investment & CFO explained that to
consolidate the Company’s work process, the Company has embraced the Shared Services
Concept, providing the same accounting services to different business units. This facilitates
the accountants’ work and reduce their working hours, allowing the auditing firm to lower
their audit fee.
As there were no further questions, the Chairman proposed that the Meeting approve
the appointment of the auditors and the audit fee for the year 2012. This agenda required a
resolution of a simple majority vote of the total votes of Shareholders attending the Meeting
and having the rights to vote.
Resolution: The Meeting, by a simple majority vote of the total votes of Shareholders
attending the Meeting and having the rights to vote, approved the appointment of Mr. Supot
Singhasaneh, Mr. Winid Silamongkol, Mr. Charoen Phosamritlert and Ms. Sureerat
Thongarunsang of KPMG Phoomchai Audit Ltd. as the auditors of the Company for year
2012 and the audit fee for the year 2012 of 250,000 Baht. The Meeting acknowledged the
annual audit fee and quarterly review fee of 114 subsidiaries and consolidated financial
statements of 26.85 Million Baht, with the total audit fees for the Company and all
subsidiaries amounted to 27.10 Million Baht. The details were as follows:
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Approved 749,693,287 votes, equivalent to 99.8587%
Disapproved 0 votes, equivalent to 0.0000%
Abstained 1,060,731 votes, equivalent to 0.1413%
7. To consider and approve the amendments to the Company’s Articles of
Association
The Chairman assigned Mr. Sumet Tantivejkul, Chairman of the Governance and
Nomination Committee, to explain the details on this matter.
Chairman of the Governance and Nomination Committee informed the Meeting that to
comply with the practices of other listed companies, the Governance and Nomination
Committee proposed the amendments to 2 Clauses of the Company’s Articles of Association
as follows:
Clause 25 of the Company’s Articles of Association
Existing Provision
Clause 25 A shareholder, or a proxy who has any special interest in a
resolution cannot vote on such resolution, except for voting on the election of
Directors.
Proposed Provision
Clause 25 A shareholder who has any special interest in a resolution cannot
vote on such resolution, except for voting on the election of Directors.
Rationale for the proposed amendment
To enable a proxy to vote on a resolution as authorized by a shareholder.
Clause 30 of the Company’s Articles of Association
Existing Provision
Clause 30 The election of Directors shall be carried out in accordance with
the following rules and procedures:
(1) In case the number of candidates nominated for Directors does
not exceed the number of Directors required for that election,
the meeting shall elect all of them as Directors.
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(2) In case the number of candidates nominated for Directors
exceeds the number of Directors required for the election, it
shall be decided by votes of the shareholder meeting. The
shareholders may elect the candidates nominated for Directors,
but not exceeding the number of Directors required for that
election and the Directors shall be individually elected. Each
shareholder or proxy shall have one vote for each share he
holds or represents for the election of each Director. The
candidates shall be ranked in order descending from the
highest number of votes received to the lowest, and shall be
appointed as Directors in that order until all of the Director
positions are filled. Where the votes cast for candidates in
descending order are tied, which would otherwise cause the
number of Directors to be exceeded, the remaining
appointment shall be made by the chairman of the meeting
who shall have a casting vote.
Proposed Provision
Clause 30 The election of Directors at a shareholders’ meeting shall be
carried out in accordance with the following rules and procedures:
(1) A shareholder or a proxy shall have one vote for each share he
holds or represents.
(2) At the election of Directors, the shareholders shall vote for
each individual candidate nominated for Directors, but not
exceeding the number of Directors required for that election.
The vote shall not be distributed.
(3) The candidates shall be ranked in order descending from the
highest number of votes received to the lowest, and shall be
appointed as Directors in that order until all of the Director
positions are filled. Where the votes cast for candidates in
descending order are tied, which would otherwise cause the
number of Directors to be exceeded, the remaining
appointment shall be made by the chairman of the meeting
who shall have a casting vote.
Rationale for the proposed amendment
To enable a shareholder to vote on individual candidate which shall support
the principle of good corporate governance.
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The Chairman and the Managing Director of SCG Legal Counsel Limited then
answered the inquiries of Shareholders which were summarized as follows:
(1) A Shareholder questioned whether the amendment to Clause 25 of the
Company’s Articles of Association would enable a shareholder who had any
special interest in a resolution to assign a proxy with no special interest in a
resolution to vote on such resolution or not.
The Managing Director of SCG Legal Counsel Limited explained that the
existing provision stipulated that a shareholder or a proxy who had any special
interest in a resolution cannot vote on such resolution. As a consequence, in
case where a shareholder who had no special interest in a matter assign a proxy
having any special interest in a matter to vote on his/her behalf, the proxy could
not vote as authorized by the shareholder which impaired the shareholder’s
rights in voting. This is especially in the event where a shareholder specified
his/her voting intention, a proxy merely represented a shareholder at the
Meeting. He/she was not entitled to cast votes at his/her discretion. The
Company, therefore, deemed it appropriate to propose the amendments to the
Company’s Articles of Association.
In the case of a shareholder who had any special interest in a resolution, he/she
could not vote on such resolution nor could he/she assign a proxy to vote on
his/her behalf. The proposed provision was clear and left no room for
interpretation. The statutory provision was similar to those of other companies.
(2) A Shareholder proposed the wording “special” before the word “interest” in
Clause 25 be deleted to avoid interpretation as to which case could be construed
as having special interest.
The Managing Director of SCG Legal Counsel Limited explained that the phrase
“special interest” was a legal term. To determine if a case would be construed as
having special interest should follow precedent, for example, decisions of the
Supreme Court and guidelines set by government agencies. Should the
Company stipulate only having “interest” in the Company’s Articles of
Association, it would be stricter than the law and might impair the rights of
shareholders, hurting their benefits. The Company thus proposed the
amendments as prescribed by law.
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(3) A Shareholder inquired if the amendment to Clause 25 of the Company’s
Articles of Association would enable a proxy having special interest in a matter
and authorized to cast vote at his own discretion to vote on such matter.
The Managing Director of SCG Legal Counsel Limited informed the Meeting
that a proxy-grantor would decide whether he/she wanted to assign a proxy with
special interest to exercise his/her voting rights. A proxy grantor could either
authorize the proxy to cast votes independently as to his/her consideration or to
cast votes in accordance with the voting intention of the proxy grantor. In
practice, where a case was concerned with having special interest, the Company
would notify Shareholders in the Notice to the Meeting. For instance, in the
Notice of Annual General Meeting of Shareholders in the previous year, the
Company informed Shareholders that an independent director who was assigned
as a proxy shall not vote on a matter in which he/she might have special interest.
(4) A Shareholder asked if the amendment to Clause 25 of the Company’s Articles
of Association was the result of the Extraordinary General Meeting of
Shareholders No. 1/2012 where the directors having special interest in a matter
were invited to temporarily leave the meeting room.
The Chairman answered that the act of the directors having special interest in a
matter temporarily leaving the meeting room was to maintain high ethical
standards. In fact, the rationale for the proposed amendment was to make the
issues of authorization of proxy and the proxy clearer not as the result of such
Extraordinary Meeting.
(5) A Shareholder remarked that the proposed provision of Clause 30 stipulated that
a Shareholder could not divide shares between nominees and where the votes
cast for candidates in descending order were tied, the remaining appointment
would be made by the Chairman of the Meeting who had a casting vote. The
Shareholder questioned if such act was splitting votes.
The Managing Director of SCG Legal Counsel Limited clarified that the
proposed provision conformed to practice of those of other companies. For
example, if a Shareholder had 100 shares, he/she received 100 votes. Where the
number of Directors required for that election was three, the Shareholder shall
cast 100 votes for each of them until total of 3 nominees were voted. He/she
could not cast 150 votes for one of the nominees. In the case where the votes
cast for candidate 3 and 4 were tied, for example, at 1,000,000 votes, the
35
Chairman of the Meeting would cast the deciding vote. Such practice is in
conformance with the law.
(6) A Shareholder inquired how the Company would react in the case where a
Shareholder did not learn from the Notice to the Meeting that a certain
independent director has any special interest in a matter and assigned such
independent director as his/her proxy.
The Managing Director of SCG Legal Counsel Limited explained that the
amendment to Clause 25 as proposed would enable the independent director to
vote on the matter at his own discretion following his due considered discretion.
(7) A Shareholder suggested a phrase be added to the proposed provision of Clause
25 to be read as follows: “A shareholder who has any special interest in a
resolution or his/her proxy cannot vote on such resolution, except for voting on
the election of Directors.” in order to make it clearer.
The Managing Director of SCG Legal Counsel Limited informed the Meeting
that as the Company had delivered the Notice to the Meeting to Shareholders in
advance and there were Shareholders who had already assigned proxies to cast
votes in accordance with their voting intention, any material change might affect
the voting intention of the proxy-grantors. However, without taking into
consideration the matter associated with voting, the proposed addition of
wording by all means made it clear that a proxy of a Shareholder who has any
special interest in a resolution cannot vote on such resolution which made no
difference to the meaning.
(8) A Shareholder inquired whether (if it might be construed) the amendment to the
Shareholders’ Meeting agenda items would be postponed to the next
shareholders’ meeting or not.
The Managing Director of SCG Legal Counsel Limited answered that as there
were Shareholders who had already assigned proxies, if there were any changes
to an agenda requested for resolution, it would be acceptable where the changes
considered minor and meant for clarification. However, if the changes were
material, it might be construed as an amendment to the Shareholders’ Meeting
agenda items.
The Chairman informed the Meeting that since the proposed amendments to Clauses
25 and 30 of the Company’s Articles of Association were not urgent matters and that
Shareholders had made many useful remarks and suggestions, the Board of Directors deemed
36
it appropriate to withdraw the matter from this Meeting without putting the matter to vote.
The Company would take into consideration the remarks and inquiries made by Shareholders
today. There was no objection from Shareholders.
8. To Acknowledge the Board of Directors’ and Sub-Committees’ Remuneration
8.1 To Acknowledge the Board of Directors’ Remuneration
According to Clause 42 of the Company’s Articles of Association, the Board of
Directors' remuneration and bonus were to be approved by the Shareholders’
Meeting. The following was the Board’s remuneration as approved by the 11th
Annual General Meeting of Shareholders held on March 24, 2004, effective from
the date of approval until the Meeting resolves otherwise.
Board of Directors' monthly remuneration and bonus
- Monthly remuneration
The Board would receive monthly remuneration at the amount of 1,800,000 Baht
which would be distributed among the Directors in such manner as they
themselves determined.
- Bonus
The Board of Directors would receive a bonus in the amount not exceeding 0.5
percent of the dividend distributed to the Shareholders. The Board of Directors
would fix the appropriate amount which would be distributed among the Directors
in such manner as they themselves determined.
The Board agreed, in accordance with the recommendation of the
Remuneration Committee on the Board’s remuneration for the year 2012,
which had taken into account various reference data, to retain the remuneration
for the Board of Directors in the year 2012 in accordance with the above rule
which was approved by the 2004 Annual General Meeting of Shareholders and
recommended the Meeting to acknowledge.
In 2011, the remuneration and bonus paid to the Board of Directors did not exceed
the amount pursuant to such rule. Details were as shown on pages 79-80 in the
Annual Report for the year 2011.
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8.2 To Acknowledge the Sub-Committees’ Remuneration
The 18th Annual General Meeting of Shareholders held on March 30, 2011,
approved the remuneration for the Sub-Committees of the Company, effective
from the date of approval until the Meeting resolves otherwise as follows:
Position Fixed remuneration
(Baht/person/year) Attendance fee (Baht/person/time)
Chairman 180,000 45,000 Audit Committee
Member 120,000 30,000
Chairman 150,000 37,500 Governance and Nomination Committee / Remuneration Committee
Member 100,000 25,000
The Board agreed with the recommendation of the Remuneration Committee
to maintain the remuneration for the Sub-Committees in the year 2012, in
accordance with the rule approved by the above Annual General Meeting of
Shareholders and recommended the Meeting to acknowledge. Details of the
roles and responsibilities of the Sub-Committees, and the remuneration paid to
the Sub-Committees in the year 2011, were as shown on pages 59-62 and 79-
80 respectively in the Annual Report for the year 2011.
As there were no inquiries, the Chairman proposed that the Meeting acknowledge the
Board of Directors’ and Sub-committees’ remuneration.
Resolution: The Meeting acknowledged the Board of Directors’ and Sub-
committees’ remuneration as recommended by the Board of Directors.
9. Other business (No business matter proposed by the Board of Directors)
The Chairman assigned the President & CEO to report on the progress of the project at
Map Ta Phut and the case of the forgery of the Company’s ordinary share certificates by a
Company’s former employee to the Meeting.
The President & CEO informed the Meeting on the progress of the project at Map Ta
Phut that the Central Administrative Court previously ruled that the concerned government
agencies revoked only the operating licenses of the projects or activities considered harmful
severely to the communities and continue to put them temporarily on hold. As a consequence,
the projects which were not deemed harmful severely to the communities could resume
operation while those that were considered harmful severely would commence operations only
after complying with the requirements of Section 67, Paragraph 2 of the 2007 Constitution, for
example, conducting Environmental and Health Impact Assessment (EHIA) report.
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SCG had only one project which was deemed harmful severely to the communities – a
vinyl chloride monomer expansion project of Thai Plastic & Chemical Public Company
Limited. The company has already prepared EHIA report which was now under the
consideration of the Committee of Experts. Upon the approval of the Committee, the
authorization agency would send the report to the independent environmental and health body
for consideration. As for the ongoing lawsuit, the plaintiffs and the defendants have filed an
appeal with the Supreme Administrative Court. The case was now under the deliberation of the
Supreme Administrative Court. For its part, SCG did not appeal as the Company was not a
party to the lawsuit.
A Shareholder then asked about other projects whose licenses were not revoked to
which the President & CEO answered that all the projects had already resumed operations.
As there were no further inquiries, the Chairman asked the President & CEO to report
on the progress of the case of the forgery of the Company’s ordinary share certificates by a
Company’s former employee. The President & CEO referred the Meeting to a civil lawsuit
lodged to a civil court by heirs and estate administrator of a shareholder whose share
certificates were forged, against the Company, relevant individuals and juristic persons (9
parties altogether) alleging a joint liability on tort and claiming for restitution of the forged
shares and damages totaling 223 Million Baht.
On November 30, 2011, the civil court decided that Mr. Praphan Shumuang, a former
employee of the Company, committed a tort against the plaintiff and ordered Mr. Praphan to
return 672,000 shares of the Company to the plaintiff. If the returning of the shares is not
possible, Mr. Praphan should pay the share price of 164 Million Baht together with interest of
7.5% per annum from the commencement date of tort until the payment would be made in full
together with the dividend that the plaintiff should have received. The court also decided that
the Company, as the employer of Mr. Praphan, would be jointly liable to the plaintiff. The
Company had already lodged an appeal to the appellate court.
As there were neither inquiries nor suggestions from the Shareholders, the Chairman
asked the Secretary to the Board to explain about the collection of the remaining voting cards
for reference. He then thanked the Shareholders for attending the Meeting and expressing their
opinions on various matters and declared the Meeting adjourned.
The Meeting was adjourned at 17.15 hours
(Mr. Chirayu Isarangkun Na Ayuthaya)
The Chairman of the Meeting
