Guideline for Culture Creation and Compliance with Rules and Regulations
The Bank, as a financial institution conducting commercial banking business, is required to comply with the laws, rules, regulations, standards and practices applicable to various transactions both from government agencies in authority and financial institution supervisory agencies, including internal operating regulations, which tend to be more diverse and complex. This is to create a good corporate culture of compliance for the Bank's employees so they are aware of the importance and necessity of performing in accordance with applicable laws and regulations. The Bank considers compliance with the rules as a duty of all employees. Therefore, the compliance risk management plays an important role in governance to prevent the Bank from performing non-compliance that will cause the Bank to be liable as required by laws such as being prosecuted under the law and will also affect the Bank's operational status and reputation.
The Bank has established a compliance risk management guideline which identifies and assesses risks from the impact or change of events in conducting business of the Bank in accordance with the regulations of the relevant regulators as the Compliance Program, which had been approved by the Compliance Committee, to supervise and manage the Bank's compliance risk to be more efficient and effective. The Compliance Program consists of Preventive Action plan and Monitoring & Testing plan, including supervising regulatory compliance in other important areas to prevent or mitigate the likelihood that the Bank may not comply with the regulations. This is in accordance with the guidelines of the Bank of Thailand, the compliance policy of the Bank and the Compliance Unit Charter.
Moreover, compliance communication and compliance training are part of creating a culture of compliance in the Bank. The Bank has followed up the announcement of new regulations of regulators related to the Bank's business operations in order to communicate with all departments' employees of the Bank in forms of circulars, notifications to relevant business units and short articles (CLMG Post) via employees' emails to make them understand. Furthermore, the Bank also emphasizes all employees to comply with the specified rules and regulations with prudence and take into account the damages that may arise from the non-compliance with the rules and regulations.
In 2021, the Bank communicated its Anti-Bribery and Corruption Policy to its employees via various communication channels. It also incorporated training programs in the form of classroom training as well as e-learning and video conference to ensure that every employee can access the training. The Bank trained its employees based in the head office and in regional areas, as well as the employees of its affiliated companies, throughout the year to continuously improve their understanding and awareness of the matter.
During 2021, clues have been informed through various channels and actions have been taken. A total of 42 whistleblowing cases were under the procedures, categorized into 22 cases involving non-compliance with rules and guidelines, 14 cases of no actions as informed, 3 cases of fraudulent activity, and is in the process of reviewing 3 cases. In all cases, the Bank has carried out the prescribed procedures, including investigations and appropriate judgments of the offenders, as well as reporting the results of each case to the relevant committees. The Bank takes the information received for further consideration and improvement of the various risk-prone issues in the future.
Furthermore, the Bank will make payment to vendors only once the hirer and/or the acceptance committee appointed by the hirer have inspected the supplies/work and accepted that they are fully in accordance with the contract/agreement. The payment will be made within the agreed period of time from the day the hirer and/or the acceptance committee accepted the supplies/work and received the invoice. The Bank also trains and educates its business partners about sustainable operations, for example, safety, environmental sustainability, human rights, equality in employment, etc.
Code of conducts - Responsibilities, Accountabilities and Reporting Lines
Krungthai Bank (KTB) is determined to operate its business transparently, fairly and with integrity in line with good corporate governance principles. KTB’s aim is to become an efficient organization that excels in operating its business ethically and takes into account the benefits of all stakeholders. This establishes public confidence and generates benefits to shareholders, who are vital to the bank’s sustainable growth and success.
The Board of Directors’ overarching policy is for KTB to conduct business in accordance with good corporate governance. To support this, KTB has issued its CG Policy, Code of Ethics and Code of Conduct. These are continually updated to ensure they are complete, accurate and current, and comply with international standards. They are used as guidelines for the Board of Directors, executives and employees and to ensure that changes to KTB’s vision, mission, strategy and business context are appropriate. All employees are encouraged to adhere to and perform with responsibility, honesty, transparency and fairness. This is the brand DNA and the focus of the bank’s corporate culture. Supervisors at all levels are designated to monitor and ensure compliance with the Code of Conduct, which underpins employee behaviour.
KTB regularly promotes awareness of and adherence to corporate governance principles and the Code of Conduct for employees throughout the organization. Information is presented through communication channels such as CG training courses for senior executives, new employee orientation, and self-access learning materials including e-learning, Intranet, and classroom based learning.
KTB inform employees about code of conduct training (online and offline) through exhibition boards, activity booths, and PR media channels, which includes: the intranet, HR email news, digital signage and the One Krungthai APP. Furthermore, KTB conducts annual employee surveys on their perceptions, understanding and implementation of corporate governance, anti-corruption, and the Code of Conduct. Survey results are used as data for improvement in the following year’s operations.
KTB’s organisational structure is designed to promote principles of good corporate governance, with the duties and responsibilities of each business unit clearly segregated.
We’ve developed a working plan to improve our unusual incident reporting process. We now have standardised channels for reporting fraud or suspicious incidents so we can swiftly deal with fraud cases and minimise damage to KTB.
When encountering a violation of a rule or regulation, employees can send a report or complaint to the Office of the President or the division specified in the Whistleblowing Policy (as identified in the Code of Conduct). In addition, all business unit heads report any suspicious behaviour or breaches of the Code of Conduct to the disciplinary employee committee, which is responsible for disciplinary processes. This committee can also hear breach cases from other channels, including the Internal Audit team, whistleblowing and the HR Center where employees can formally contact the committee about cases related to the Code of Conduct.
If employees have questions about whether or not an operation violates KTB's Code of Conduct, or how they and their departments should operate correctly, the Regulatory Compliance Department has arranged a consultant who has a Helpdesk to help employees operate in accordance with KTB's Code of Conduct.
Breaches of the Code of Conduct are treated seriously and may result in disciplinary action. KTB's operating rules link disciplinary penalties to salary compensation. If employees are penalised with a salary cut, they’re not entitled to receive a bonus. Also, if employees receive a probation penalty, they won’t get a bonus above the second-rate ranking set by the bank. KTB also notifies all employees that they must operate according to the bank’s official rules and that the bank has measures to prevent illegal acts. KTB sets KPIs which reduce individual employee performance appraisal scores whenever illegal activities are performed, or official rules are broken.
Also, KTB has developed a centralised disciplinary data plan (Krungthai Application). This has improved information collection related to disciplinary processes and helps the bank more easily locate problems, apply actions and effectively coordinate within KTB’s internal business units.