Code of Business Ethics for Members of the Board of Directors

Statement of Policy

It is the policy of the Security Bank Group of Companies to maintain its high reputation for ethical behaviours and fair dealings in the conduct of its business.  Board members are expected to behave in an ethical manner, and comply with the requirements of laws and regulations.  Directors represent the ultimate tone at the top, and when directors act in an ethical manner, they send a clear signal to the whole team.

This written Code of Business Ethics will serve as guide to the Board members of the Group on their business conduct, establish an agreed set of ethical principles, promote and maintain confidence and trust in the Security Bank Group, and prevent the development and acceptance of unethical practices by the Group.

The Code of Business Ethics shall apply to all members of the Board of Directors of the Security Bank Group. All members of the Board shall uphold and promote the principles of this code.

Principles of the Code of Business Ethics

Members of the Board shall observe the highest standards of ethical conduct.   They will avoid any action or inaction, which could in any way, impair the Bank’s capacity to carry out its duties, or compromise its reputation for integrity, fairness, honesty and transparency.

A Board Member is expected to:

  1. Be fit and proper for the duration of his term. He shall:
    • Possess unquestionable credibility to make decisions objectively and resist undue influence;
    • Treat board directorship as a profession and have clear a understanding of his duties and responsibilities, as well as his role in promoting good governance;
    • Maintain his professional integrity, exercising objective independent judgement on corporate affairs requiring Board decision.
    • Continuously seek to enhance his skills, knowledge and understanding of the activities that the Bank/subsidiary is engaged in, or intends to pursue so as to meaningfully contribute to the Board’s work
    • Safeguard the institution’s competitiveness with his working knowledge of the statutory and regulatory requirements, the contents of the institution’s articles and by-laws, the requirements of the BSP and other regulatory agencies, as well as the developments in the industry through continuing professional development activities.
    • Devote time and attention necessary to properly discharge duties and responsibilities,
    • Attend and actively participate in Board and Committee meetings, requesting and reviewing materials, making reasonable inquiries, and requesting explanations.
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  3. Act in a financially responsible manner, understanding  financial reports, audit reports and other financial materials that are presented to the Board
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  5. Act judiciously. He shall
    • Thoroughly evaluate the issues before deciding on matters brought before the Board for decision making.
    • Understand the financial, strategic and other implications of decisions.
  6. Use his position appropriately. He shall
    • Treat other directors with professionalism, courtesy and respect.
    • Work cooperatively with fellow members towards agreed goals while accepting the obligation to be independent in judgement and actions.
    • Use the Group’s resources or time for official purposes and not for personal gain, for the benefit of persons or organizations not connected with the Group, or for the benefit of competition
    • Conduct fair business transactions and ensure that personal interest does not bias Board decisions, nor would the position be used to seek an undue advantage for yourself, family members and associates.
    • Where possible, avoid situations that would compromise his impartiality or give rise to a conflict of interest.  If such transactions with conflict of interest cannot be avoided, these should be done in the regular course of business and upon terms not less favourable to the institution than those offered by others.
    • Promptly and fully disclose to the Chairman of the Board, the Chairman of the Corporate Governance Committee or the Corporate Secretary, any conflict of interest, whether of an actual or potential nature, and whether involving his personal (including family or close personal friends) or business affairs.
    • When encountering potential conflicts of interest, depending on assessed significance, take one of the following courses of action (in order of increasing significance):   (a) refrain from voting on a relevant matter during a Board meeting, (b) withdraw from discussion of relevant matter(s) during a Board meeting, (c) take a leave of absence from the Board for a period, or (d) resign from the Board.
  7. Act with honesty and good faith, with loyalty and in the best interest of the institution and its stakeholders. He shall
    • Be open and transparent in his dealings
    • Avoid activities that may bring disrepute to the institution and to himself
    • Not engage in any outside business, professional or other activities that would directly or indirectly materially adversely affect the institution
    • Give due regard to the rights and interests of other stakeholders.
    • Deal fairly with customers, suppliers, competitors and employees, not taking unfair advantage of stakeholders through manipulation, concealment, abuse of privileged information, misrepresentation of materials facts or any unfair-dealing practices.
    • Promote and respect safety and health of all employees, customers and other third parties with whom he comes in contact with
    • Provide equal opportunities to all employees and aspirants for employment, irrespective of gender, religion or race, with merit being the sole discriminating factor.
    • Minimize any detrimental impact of Security Bank Group operations on the environment.
  8. Encourage the reporting of any illegal or unethical behaviour. He shall
    • Promote ethical behaviour and take steps to ensure that the Company encourages employees to (a) talk to appropriate personnel when in doubt about the best course of action in a particular situation, (b) report violations of laws, rules, regulations, or the Company’s Code of Conduct, and (c) inform employees that the Company will not allow retaliation for reports made in good faith.
  9. Use information appropriately. He shall
    • Ensure information gained as a Director is only applied to proper purposes and is kept confidential and not used for personal benefit.
    • Exercise discretion regarding Board information which is not in the public domain, as well as information handled via facsimile or other electronic transmission devices to ensure that this is not inadvertently made available to unauthorized parties.
    • Strictly maintain confidentiality of Information, even if he is no longer a member of the Board;
    • Not give tips to others on trading of shares on the basis of material information before it is made publicly available.   Such information includes news about acquisitions, investments, new business relationships, financial results, important management changes, and other information that has the potential to affect the stock price of publicly listed Security Bank Corporation.
  10. Ensure compliance to regulatory / legal requirements. He shall
    • Ensure and actively promote compliance by employees, officers and other directors with laws, rules and regulations applicable to the company, including insider trading laws.
    • Ensure appropriate disclosures to the Company Secretary on details of outside employment, business interests or interests of any of family members which may be in conflict or potential conflict with businesses of the Security Bank Group.
  11. Exercise due care in accepting gifts, favours and entertainment.
    • Accepting occasional gifts and entertainment in role as Director may be appropriate in developing business relationships.
    • Gifts and entertainment should further the business interests, and should not be lavish or in excess of the generally accepted business practices in the industry.
    • Soliciting or requesting personal gifts, entertainment or services is not acceptable.
    • Accepting gifts of cash or cash equivalents is also always unacceptable.
    • Position should not be exploited to provide individual preferential treatment from vendors in pricing or terms.
  12. Demonstrate leadership and stewardship.  He shall
    • Promote and support the application of the values of the Security Bank Group
    • Act in accordance with this Code of Business Ethics.

Where issues arise that cannot be specifically foreseen in this Code, directors shall be expected to exercise sound judgement and behaviour, consistent with the General Principles mentioned above.

Upon completion of engagement as a Director, the director is expected to:

  1. Immediately deliver to the Company all property in his possession that belongs to the Company.
  2. Not to represent himself as being in any way connected with the Company (other than as owner of financial interests such as shares).
  3. Repay to the Company any amount due and payable to the Company.

Enforcement

Any member of the Board requiring clarification of this Code may contact the Corporate Secretary or any officer specifically designated by the Board of Directors.

Directors should communicate any suspected violations of this Code promptly to the Chairman of the Board, or the Chairman of the Corporate Governance Committee for deliberation of non-compliance issues for sanctions and penalties.