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Corporate Governance
Corporate Governance
Corporate Information > Corporate Governance
Click to download or view SMC Amended Articles of Incorporation
Semirara Mining Corporation is committed to the principles and leading practices of good corporate governance that will promote a compliance culture of accountability and transparency, provide effective oversight of the Company’s business, and ensure long-term shareholder value.
The Board of Directors and Management support this commitment to meet or exceed the regulatory governance requirements and are guided by the Company’s Amended Manual on Corporate Governance, along with the Charters of the Board Committees and Codes of Conduct of Directors and Employees.
The Board of Directors. The Board is responsible for the overall corporate governance of the Company. It establishes key policies, provides strategic guidelines and ensures adequate control mechanisms are in place to manage and conduct the affairs of the Company.
The full Board consists of eleven (11) members. It has two (2) Independent Directors in compliance with the Philippine regulatory requirement for publicly-listed companies.
Separation of the Roles of Chairman and CEO. The roles of the Chairman and Chief Executive Officer (CEO) are made separate to ensure an appropriate balance of power, increased accountability and greater capacity of the Board for independent decision-making. The Chairman oversees and leads the Board on behalf of the shareholders, while the CEO implements the key strategies set by the Board. The Vice Chairman concurrently holds the position of CEO.
Meetings. The Board had six (6) meetings, including its organizational meeting in May 2006, during the year. The Directors are regularly informed of the Company’s operating and financial performance by presentation of the Executive Management, and are provided the opportunity to discuss issues and actions during Board meetings. The Independent Directors bring an objective mindset to Board discussions.
Remuneration. Total compensation paid to Directors and key management are disclosed annually in the Definitive Information Statement submitted to Securities and Exchange Commission (SEC) and sent to shareholders.
Board Committees. The Board created three (3) Committees in aid of good governance to support its fiduciary functions and to achieve effective checks and balances. In 2006, the Board approved the Charters of these Committees to define their purposes, duties and responsibilities. Nena D. Arenas, Officer on Good Governance and Atty. John R. Sadullo, Corporate Secretary and Counsel provide support to the Committees.
Nomination and Election Committee
The Nomination and Election Committee’s main function is to review, recommend and promulgate guidelines involving the nomination process and criteria for the Board of Directors.
In 2006, the Committee reviewed the qualifications of the nominees for directorship and endorsed the final list of nominees for election. It also improved procedures and guidelines involving the nomination and election process of the Board Directors and endorsed changes in executive management requiring Board appointment.
Compensation and Remuneration Committee
The Compensation and Remuneration Committee’s main function is to establish a formal and transparent procedure for developing a remuneration policy for Directors, officers and key employees consistent with the Company’s culture, strategy and control environment.
The Committee implemented a form on Full Business Interest Disclosure requiring officers to declare their existing business interests or shareholdings that may directly or indirectly cause conflict of interest in the performance of their duties.
Audit Committee
The Audit Committee members possess requisite levels of financial and accounting competencies, and have an adequate understanding of the Company’s mining business and related industries.
The Committee had nine (9) meetings in 2006. Meetings were scheduled at appropriate points to address matters on a timely basis. Written agenda and materials were distributed in advance to allow for meaningful review and full discussion during meetings. Nestor D. Dadivas, CFO is regularly invited to the Committee meetings to discuss updates in financial performance.
In 2006, the Committee assisted the Board in fulfilling oversight of the following functions:
Financial reporting
The Committee reviewed the quarterly and annual financial statements before submission to the Board. It ensured that financial statements are in accordance with the required accounting and reporting standards. It promoted the adequacy of financial reporting disclosures, including significant related party transactions to provide a transparent and fair view that meet shareholder needs.
Internal control environment
The Committee’s internal control review initiative aims to strengthen checks and balances within the organization. The Committee has recommended improvements in management structures and processes involving accounting, treasury, capital expenditures, fixed asset movement, information technology, sales and procurement, which were implemented or for subsequent implementation by Management.
Internal audit function
The Committee established an internal audit charter to enhance the internal audit function.
External audit function
The Committee recommended to the Board the reappointment of SGV & Co. as external auditor. It approved audit work engagements, scope, fees and terms. It reviewed and discussed with the external auditor and Management significant financial reporting issues, audit adjusting entries noted or proposed, including audit findings and ensured that Management responded appropriately with timely corrective action.
Risk management
The Committee assessed and reviewed the Company’s key policies and management of risks on economic dependency, mine operation, insurance, credit, liquidity, interest rates and foreign currency exchange. It recommended changes to the risk management of insurance and financial risks to become more cost-effective and strategic which were implemented by Management.
Compliance with regulatory and legal requirements
The Audit Committee held substantive meetings with the Compliance Committee on environmental, safety, tax, legal, SEC and other regulatory compliance matters.
Enterprise Risk Management. The Board sets the tone and establishes the risk appetite level for the Company’s enterprise risk management system which provides reasonable assurance that risks are identified, assessed, managed and monitored in a timely manner. The Audit Committee assists the Board in risk management oversight. The Board reviews the risk strategies and agrees on policies for managing these risks.
Compliance. Nestor D. Dadivas, CFO is appointed by the Board as Compliance Officer who is designated to ensure adherence to corporate principles and best practices, as well as compliance to the Company’s Amended Manual on Corporate Governance. He leads the Compliance Committee tasked with assurance reporting to the Board on compliance matters.
Good Governance Program. The Company’s good governance program aims to promote a culture of compliance, transparency and accountability within the organization and ensure long-term shareholder value.
It has adopted Codes of Conduct for Directors & Executive Officers, and Employees to affirm the Company’s standards of professional and ethical business conduct, workplace safety and environmental responsibilities. Directors, Officers and Employees are required to annually certify compliance with the Codes.
The Company annually conducts an assessment and review of its corporate governance performance through a self-rating and evaluation system. The Audit Committee conducts its own annual self-assessment review, and obtains feedback from Executive Management of its Committee performance.
The Board’s good governance Committees shall annually review and reassess the adequacy of Committee Charters, and recommend any proposed changes to the Board for approval.
Shareholder Rights and Relations
Semirara Mining Corporation promotes a good governance culture of transparency and equal respect of shareholders rights embodied in its Amended Manual on Corporate Governance. It maintains a share structure that gives all shares equal voting rights.
To sustain investor confidence, the Company maintains a policy of open and constant communication and disclosure of its activities, subject to insider information guidelines. It engages in conference calls and/or meets with institutional shareholders and prospective investors, as appropriate. Corporate information is communicated to shareholders by timely and adequate disclosures to the SEC and Philippine Stock Exchange.
Good Governance Committees and Officers
Nomination and Election Committee
Isidro A. Consunji, Committee Chairman, Chief Executive Officer
Victor C. Macalincag, Independent Director
Federico E. Puno, Independent Director
Audit Committee
Victor C. Macalincag, Committee Chairman, Independent Director
Federico E. Puno, Independent Director
Victor A. Consunji, President and COO
Compensation and Remuneration Committee
Cristina C. Gotianun, Committee Chairman, Vice President - Administration
Victor A. Consunji, President and COO
Victor C. Macalincag, Independent Director
Compliance Committee
Nestor D. Dadivas, Compliance Officer, Chief Finance Officer
George G. San Pedro, Vice President – Operations and Resident Manager
George B. Baquiran, Vice President – Special Projects
Atty. John R. Sadullo, Corporate Secretary and Counsel
Compliance Officer
Nestor D. Dadivas, Chief Finance Officer
Good Governance Officer
Nena D. Arenas
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| Semirara Mining Corporation 2F DMCI Plaza. 2281 Chino Roces Avenue Extension, Makati City, Philippines 1231 T +632 867-3379 F +632 816-7185 |