Members of the BOD, SB, and BOM are capable and qualified, and their services are free of conflicts of interest. They have performed their roles and duties effectively, contributing to help the Corporation to fulfill its annual production and business plan. The Corporation is constantly working to improve its governance management, heading towards successfully applying upstanding practices such as: improving the BOD’s governance efficiency, improving the supervision of the SB, implementing supportive solutions in management and administration of production and business: ERP, ISO, KPI management and performance evaluation systems, etc.

BOARD OF DIRECTORS

Structure of the BOD

The Board of Directors in 2023 was elected by the General Meeting of Shareholders, including five members. (The details of member of the BOD are presented in “PVFCCo Management”, pages 24-25). There is no subcommittee under BOD. The activities within BOD’s authority were specifically assigned to full-time members in charge of each field for inspection and verification so that the BOD could make decisions while supervising, directing, and urging the Corporation to implement the provided resolutions and executive decisions depending on assigned fields.

Activities of the BOD in 2023

As the highest management body, the BOD represents the interests of shareholders. In 2023, the current BOD had 5 incumbent members (1 independent member) who actively fulfilled their roles and responsibilities in compliance with good corporate governance standards.

In 2023, the BOD held 7 periodical meetings, in which they solicited written opinions from their members 75 times. Resulting from these requests, 89 resolutions, key executive decisions and many directional documents on critical matters were approved as follows:

Training to improve BOD’s corporate governance knowledge

At the time of their election or appointment, all members of the Board of Directors have expertise and training in Corporate Governance.

Implementation of corporate governance regulations

PVFCCo complied with all the legal governance regulations of a listed company:

• To assure an appropriate proportion of non-executive members to independent members of the Board of Directors.
• To hold Annual General Meeting of Shareholders in full compliance with provisions of laws on business and regulations of management for publicly listed companies. To organize meetings and pass the resolutions of the BOD according to the Charter of the Corporation and the law on enterprises.
• To discharge all periodic and extraordinary information disclosure obligations for publicly listed companies in a timely and transparent manner.
• To prepare annual report and reports for submission to the General Meeting of Shareholders with full content and information on financial and production management, administration and supervision of the Corporation.
• The Board of Directors has formulated and promulgated the Regulations on Internal governance, Operational regulation of the BOD, and Regulations on the evaluation of the level of accomplishment of tasks.
• On improving corporate governance capacity in accordance with regional and international governance standards: To conduct/participate in training courses for members of the BOM/ SB/BOD.

REPORT ON THE ACTIVITIES OF INDEPENDENT MEMBERS OF THE BOARD OF DIRECTORS

Non-executive and independent members of the BOD’s activities

Mr. Louis T. Nguyen and Mr. Ho Quyet Thang have served as non-executive independent members of the BOD, have attended or authorized to attend all meetings and given independent opinions and voted on issues decided by BOD; participated in supervising and directing the activities of BOM as assigned by BOD from their appointment until dismissal.

Comments from the independent members of the BOD on the governance/management of PVFCCo in 2023

• The Board of Directors and the Board of Management implemented their roles and duties in accordance with the laws on corporate governance, the Corporation charter and the executive decisions of the General Meeting of Shareholders and the BOD. The BOD and BOM’s members performed their duties and fully complied with the responsibilities and authorities assigned, as stipulated to protect the interests of all shareholders. The results were reflected in the production and business plans and targets that PVFCCo completed and exceeded in 2023.
• To approach and adhere to as closely as possible to the advanced corporate governance standards, the BOD was aware of and promoted the review and improvement of activities in the direction of enhancing the effectiveness of the management and supervision system while building up a strong and appropriate hierarchy to reduce its participation in executive activities. In 2023, the Corporation actively coordinated with professional consulting units to implement a restructuring program which would streamline the system while updating and perfecting the medium and longterm development strategy according to the orientation approved by the GMS.
• The independent members of the BOD have actively connected with the Management and functional divisions to continue communication to investors about the values and advantages of the Corporation and the efforts of the BOM, BOD to improve governance and ensure the interests of shareholders, as well as bringing contributions and ideas from investors to the Board of Directors on guidelines, development strategies, or directions on finding strategic investors. Based on the newly updated medium and long-term development strategy, the independent members have been assisting the Management in finding opportunities and potential partners in the production, distribution, marketing and sales of chemicals and sustainable fertilizer products. Among other companies which have changed from being wholly state-owned enterprises, the Corporation has demonstrated solid governance foundations.

SUPERVISORY BOARD REPORT

Income statement of PVFCCo and report on performance of the BOD and the President and CEO

Corporation’s production results

Implementation of investment projects

The BOD is considering approving the NH₃-NPK project capital settlement. We’ve finalized the Business Cooperation Contract with PVChem for the Hydrogen Peroxide (H₂O₂) production plant project, currently under review. The construction of a 20,000-ton finished product warehouse at the Phu My Fertilizer Plant is completed. We’re completing the investment efficiency assessment for the H₃PO₄ acid tank project and the feasibility report for the EU dust washing water tank construction at the NPK Plant. Other investment projects are progressing.

Regarding restructuring and completion of the governance and administration

We will expedite the construction of the overall organizational restructuring model for the Corporation’s 2020-2025 phase. This involves establishing the new Center of Research and Application Branch, the Digital Transformation Project Steering Committee, and restructuring the BOD Office into a General Affairs Committee. We’ll maintain the operational model of the four regional companies, review the internal regulatory document system, suspend restructuring phases 2 and 3 as proposed, and retain the headquarters at 43 Mac Dinh Chi while allocating workspace for 2 Committees within the Phu My Fertilizer Plant compound. We’ve updated and reported the plan to increase the charter capital for the 2023-2025 period to the relevant authorities.

Objectives

Strengthened transparent and timely information disclosure; Ensuring equal treatment and safeguarding shareholder rights to enhance corporate governance quality and adherence to sustainable development standards.

• Committed to consistently implementing principles in shareholder relation activities, ensuring compliance with regulations on information disclosure for listed companies, based on transparency and access to information in a fair manner.
• Had a focal point of implementing investor relation activities to ensure that the information disclosed to the outside was consistent, approved, directed and supervised from the highest level of leadership in the Corporation.
• Ensured that all shareholders had fair and favorable access to information through various forms of communication (direct, indirect, intermediary organizations etc.).

In 2023, the IR department implemented the following main activities

• Meetings with shareholders: and participated in 25 meeting events, interacting with over 500 investors and shareholders periodically and on request. Quarterly, the IR department held online and in-person meetings with representatives of domestic and foreign investment funds and analysts from major brokerage organizations in the market place to update information on business results and respond to investors about issues of their interest.
• Safeguarding shareholder rights and ensuring equitable treatment for all shareholders: The IR department supports the Management in conscientiously safeguarding shareholder rights in accordance with the principles and regulations outlined in the Corporation’s Charter and Vietnamese law.
• Executed regular and ad-hoc information disclosures, along with specialized communication materials tailored for shareholders and investors: Investor newsletters issued biannually and Annual Reports, quarterly meetings to update and address inquiries regarding regular operations through both in-person and online meetings with investors and brokerage firms domestically and internationally.
• Organized the 2023 Annual General Meeting of Shareholders according to regulations: IR department actively implemented coordination and connection to ensure timely provision of information to shareholders before, during and after meetings in accordance with regulations and support procedures related to the full implementation of shareholders’ rights at meetings.

In 2024, following the foundation and orientations on Investor Relations activities, under the direction and support of the Corporation’s Board of Directors, the IR segment will continue to be consolidated and deployed in order to connect with the strategic goals of the Corporation with the goal of constantly improving the quality of corporate governances; transparency in information disclosure in all fields; ensuring compliance with regulations and principles of fair treatment of shareholders; heading to stable, sustainable development and constantly adding value to Vietnamese society, shareholders, partners and employees.

To effectively oversee and minimize risks, ensuring the secure operation of business activities and investments in 2023, PVFCCo has pinpointed critical risk categories and executed efficient risk management measures to meet its goals.

• Ensured the safe operation of Phu My Fertilizer Plant in the context of equipment degradation, highly fluctuating raw material costs and increasingly fierce competition in the consumption market.
• PVFCCo continued its diversification into new products while still developing its traditional products to affirm the leading position in fertilizer production and trading in the domestic market.
• Operated new investment projects with new products, deployed and traded fertilizer and chemical products manufactured by PVFCCo, in order to fulfill its long-term strategic objectives.

To realize the above-mentioned goals for the sustainable development and best protection of shareholders’ interests while fulfilling social responsibilities in 2023, PVFCCo successfully managed the following key risk groups: