Corporate Governance

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PNB adheres to the highest principles of good corporate governance as it subscribes to the philosophy of integrity, accountability, and transparency in the manner of doing business.

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ACGR Details

 Shareholders

Rights 

Equitable Treatment 

 Stakeholders

Roles 

 Disclosures 

Corporate Objective

Dividend Policy    [Amended Registration Statement page 48]

Whistleblower Policy

Intellectual Property Rights Policy

Biographical Details of Directors    [p. 90-103 of 2016 Annual Report]

Training / Continuing Education of Directors    [p. 27-28 of 2016 ACGR]

Scheduled Board Meeting in a Year    [p. 32 of 2016 ACGR]

Remuneration of Directors    [p. 36-37 of 2016 ACGR]

Compliance with the code of Corporate Governance    [p. 23-24 of 2016 Annual Report]

Disclosure of RPTs    [p. 137-139 of 2016 Annual Report]

Disclosure of Bank Shares, Trading of Directors and Key Officers

Disclosure of Non-Audit Fees    [p. 78 of 2016 ACGR]

Fairness of the Annual Financial Statements    [p. 60 of 2016 Annual Report]

Disclosure of Compliance with the Code    [p. 23-24 of 2016 Annual Report]

 2016 CG Disclosure Survey  

Business Strategy  

Well-Structured and Functioning Board  

2.1 Board composed of directors of proven competence and integrity  

2.2 Be led a chairman who shall ensure that the board functions in an effective and collegial manner  

2.3 At least three (3) or thirty percent (30%) of Directors as independent directors  

2.4 Written manuals, guidelines and issuances that routine procedures and processes

2.5 Audit, Risk, Governance and Nomination and Election Committees  

2.6 Chairman and CEO positions held separately by individuals who are not related to each others   

2.7 Director nomination and election process that ensures that all shareholders are given the opportunity to nominate and elect directors individually based on the number of shares voted  

2.8 Formal board and director development program  

2.9 Corporate Secretary  

2.10 No shareholder agreement, by-laws provisions, or other arrangements that constrains the directors' ability to vote independently

Robust Internal Audit and Control System  

Integrity of Financial Reports as well as its External Auditing Function  

5.1 Board Audit Committee approve all non-audit services conducted by the external auditor  

5.2 External auditor is credible, competent, and should have the ability to understand complex related party transactions, its counterparties, and valuations of such transactions  

5.3 External auditor has adequate quality control procedures  

5.4 Relevant information on the external auditors  

5.5 External audit firm is selected on the basis of a fair and transparent tender process  

5.6 Audit committee conduct regular meetings and dialogues with the external audit team without anyone from management present  

5.7 Financial reports attested to by the Chief Executive Officer and Chief Financial Officer  

5.8 Policy of rotating the lead audit partner every five years  

Rights of its Shareholders, Particularly those that Belong to the Minority or Non-Controlling Group  

6.1 Principle of "one share, one vote."  

6.2 All shareholders of the same class are treated equally with respect to voting rights, subscription rights and transfer rights  

6.3 Effective, secure and efficient voting system  

6.4 Effective shareholder voting mechanisms such as supermajority or "majority of minority" requirements to protect minority shareholders against actions of controlling shareholders  

6.5 Provide all shareholders with the notice and agenda of the annual general meeting (AGM) at least thirty (30) days before a regular meeting and twenty (20) days before a special meeting  

6.6 Allow shareholders to call a special shareholders meeting, submit a proposal for consideration at the AGM or the special meeting, and ensure the attendance of the external auditor and other relevant individuals to answer shareholder questions in such meetings  

6.7 Relevant questions during the AGM are answered  

6.8 Treatment of minority shareholders  

6.9 Avoid anti-takeover measures or similar devices that may entrench ineffective management or the existing controlling shareholder group  

6.10 Accurate and timely information regarding the number of shares of all classes held by controlling shareholders and their affiliates  

6.11 Communication strategy to promote effective communication with shareholders  

6.12 At least thirty percent (30%) public float to increase liquidity in the market  

6.13 Transparent dividend policy  

Internationally-Accepted Disclosure and Transparency Regime  

7.1 Written policies and procedures designed to ensure compliance with the PSE and SEC disclosure rules, as well as other disclosure requirements under existing laws and regulations  

7.2 Existence, justification, and details on shareholders agreements, voting trust agreements, confidentiality agreements, and such other agreements that may impact on the control, ownership, and strategic direction of the company  

7.3 Director and executive compensation policy  

7.4 Names of groups of individuals who hold five percent (5%) or more ownership interest in the company, significant cross-shareholding relationship and cross guarantees, as well as the nature of the company's other companies if it belongs to a corporate group  

7.5 Annual and quarterly consolidated reports, cash flow statements and special audit revisions. Consolidated financial statements shall be published within ninety (90) days from the end of the financial year, while interim reports shall be published within forty-five (45) days from the end of the reporting period  

7.6 Disclose to shareholders and the Exchange any changes to its corporate governance manual and practices, and the extent to which such practices conform to the SEC and PSE CG Guidelines  

7.7 Publish and/or deliver to its shareholders in a timely fashion all information and materials relevant to corporate actions that require shareholder approval  

7.8 Trading of the corporation's shares by directors, officers (or persons performing similar functions) and controlling shareholders  

7.9 Principal risks to minority shareholders associated with the identity of the company's controlling shareholders  

Rights and Interest of Employees, Community, Environment, and Other Stakeholders  

8.1 Clear policy statement that articulates the company's recognition and protection of the rights and interests of key stakeholders specifically its employees, suppliers and customers, creditors as well the community, environment and other key stakeholder groups  

8.2 Workplace development program  

8.3 Have in place a merit-based performance incentive mechanism such as an employee stock option plan (ESOP) or any such scheme that awards and incentivizes employees, at the same time aligns their interests with those of the shareholders  

8.4 Have in place a community involvement program  

8.5 Have in place an environment-related program  

8.6 Have clear policies that guide the company in its dealing with its suppliers, customers, creditors, analysts, market intermediaries and other market participants  

Does Not Engage in Abusive Related-Party Transactions and Insider Trading   

9.1 Develop and disclose a policy governing the company’s transactions with related parties  

9.2 Clearly define the thresholds for disclosure and approval for RPTs and categorize such transactions according to those that are considered deminimis or transactions that need not be reported or announced, those that need to be disclosed, and those that need prior shareholder approval. The aggregate of RPT within any twelve (12) month period should be considered for purposes of applying the thresholds for disclosure and approval  

9.3 Establish a voting system whereby a majority of non-related party shareholders approve specific types of related party transactions in shareholders meetings  

9.4 Have its independent directors or audit committee play an important role in reviewing significant RPTs  

9.5 Be transparent and consistent in reporting its RPTs. A summary of such transactions shall be published in the company's annual report  

9.6 Have clear policy in dealing with material non-public information by company insiders  

9.7 Have a clear policy and practice of full and timely disclosure to shareholders of all material transactions with affiliates of the controlling shareholders, directors or management  

Culture of Ethics, Compliance and Enforcement  

10.1 Code of ethics and proper conduct that guides individual behaviour and decision making, clarify responsibilities, and inform other stakeholders on the conduct expected from company personnel  

10.2 Formal comprehensive compliance program covering compliance with laws and relevant regulations  

10.3 Not seek exemption from the application of a law, rule regulation especially when it refers to a corporate governance issue

10.4 Have clear and stringent policies and procedures on curbing and penalizing company or employee involvement in offering, paying and receiving bribes  

10.5 Have a designated officer responsible for ensuring compliance with all relevant laws, rules, and regulation, as well as all regulatory requirements  

10.6 Respect intellectual property rights  

10.7 Establish and commit itself to an alternative dispute resolution system so that conflicts and difference with counterparties, particularly with shareholders and other key stakeholders, would be settled in a fair and expeditious manner  

 Board of Directors

Responsibility 

The Bank adheres to the highest principles of good corporate governance as embodied in its Amended By-Laws and Articles of Incorporation, Code of Conduct and Corporate Governance Manual. It subscribes to the philosophy of integrity, accountability and transparency in its manner of doing business; dealing fairly with its clients, investors, stockholders, the communities affected by the Bank’s activities and its various publics. The Bank espouses professionalism among its Board of Directors, executives and employees of the Bank in managing the company, its subsidiaries and affiliates; and respect for laws and regulations. The Bank practices a philosophy of rational checks and balances and adopts a structured approach to its operating processes.

The Bank operations is managed through an established organizational structure with adequate policies and procedures embodied in manuals approved by management and board committees and the Board. These manuals are subjected to periodic review and update to be consistent with the new laws, regulations and generally conform to international best practices. The Bank has adopted the Revised Corporate Governance Manual aligned with recently issued regulatory guidelines and new reportorial disclosures for entities within the group structure and significant transactions among related parties with particular focus on the Related Party Transaction (RPT) Policy. This is in accordance with the SEC and BSP regulations.

The Bank is a proud recipient for two consecutive years (2011-2012) of the Silver Award for good corporate governance from the Institute of Corporate Directors (ICD), in recognition of the institution’s existing organization composed of dedicated corporate directors and senior management committed to the professional practice of corporate directorship in line with global principles of modern corporate governance.