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Enterprise Risk Management System

Pepsi Cola Products Philippines, Inc. (PCPPI) implements a strong Enterprise Risk Management System to monitor and manage its strategic, regulatory, operational and financial risks. ERMS helps manage risks by collaborating with internal departments and external stakeholders to identify most proper and ideal practices, controls, and processes to address the needs of PCPPI.

Whistleblowing Policy

The aim of this policy is to encourage employees and others who have serious concerns about any aspect of the PCPPI’s work to come forward and voice those concerns. Through the use of the Speak Up Line Directors, Senior Managers, and Employees can report corporate concerns so that proper action may be taken. The policy is designed to ensure that employees can raise their concerns about wrongdoing or malpractice within the company without fear of victimization, subsequent discrimination, disadvantage or dismissal.

Conflict of Interest Policy

Places requirements for all directors, officers and employees of PCPPI to observe the highest degree of transparency, selflessness and integrity in line with the company’s core values in the performance of their duties and responsibilities, free from any form of conflict with personal interest. It aims that employees should avoid any activity and interest that could influence, or appear to be influenced, by personal or family interests.

Insider Trading Policy

This policy regulates and guides trading of shares by PCPPI’s executives, officers and employees with direct access to unpublished information relating to the company’s financial and operating results, in the interest of corporate governance and transparency. Unless authorized or legally mandated by Directors, Senior Management, and Employees shall maintain and safeguard the confidentiality of any information entrusted by the company and other parties with whom the company relates.

Related Party Transactions

This relates to company’s policies and procedures for the review, approval or ratification, monitoring and recording of related party transactions between and among the company and its parent, joint ventures, subsidiaries, associates, affiliates, substantial stockholders, officers and directors, including their spouses, children and dependent siblings and parents and of interlocking director relationships of members of the Board.

Related party relationship exists when one party has ability to control, directly or indirectly, through one or more intermediaries, the other party or exercise significant influence over the other party in making the financial and operating decisions. Such relationship also exists between and/or among entities which are under common control with the reporting enterprises, or between and/or among the reporting enterprises and their key management personnel, directors, or its stockholders.

Related Party Transactions Policies and Procedures
(1) Parent Company The Company does not have any parent company, joint venture arrangement and any subsidiary.
(2) Joint Ventures
(3) Subsidiaries
(4) Entities Under Common Control Related party transactions, including overlapping interests in the company, shall be disclosed to the Board and any material transaction involving such interests shall be similarly disclosed
(5) Substantial Stockholders
(6) Officers including spouse/children/siblings/parents
(7) Directors including spouse/children/siblings/parents Related party transactions shall be conducted in terms that are at least comparable to normal commercial practices to safeguard the best interest of the Corporation, its stockholders, creditors, policyholders and claimants.

Material Related Party Transactions

It is the policy of Pepsi-Cola Products Philippines, Inc. that all related party transactions are conducted on an arm’s length basis and under fair terms. In order to ensure that no stakeholder is unduly disadvantaged by RPTs, the Company shall evaluate on an ongoing basis the existing relations with counterparties to ensure that all Related Parties are continuously identified, RPTs are continuously monitored, and subsequent changes in relations with counterparties are captured and disclosed.

Pursuant to this policy, the Board of Directors has adopted this Policy on Material Related Party Transactions. This Policy complies with the minimum requirements set out in Securities and Exchange Commission Memorandum Circular No. 10, Series of 2019, or the Rules on Material Related Party Transactions for Publicly-Listed Companies. The Policy shall be revised from time to time as the Board of Directors may see fit, including to ensure that the Policy reflects the prevailing laws, regulations, and good governance practices.

Business Conduct & Ethics
Corporate Social Responsibility

The Company’s 2020 Corporate Governance Manual sets out the duty of the Board on Corporate Social Responsibility which is to adopt a globally-recognized standard or framework and  a clear policy on the disclosure of non-financial information and reporting sustainability and non-financial issues, with emphasis on the management of economic, environmental, social and governance (EESG) issues of its business, which underpin sustainability. 

Enterprise Risk Management

The Audit Committee Charter provides for the Audit Committee’s role with respect to Enterprise Risk Management. It shall assist with the Board oversight capability over the Company’s Enterprise Risk Management responsibilities to ensure its functionality and effectiveness.

In the exercise of its oversight responsibility for the risk management process of the Company, the Committee has the following duties and functions as set forth in the Audit Committee Charter:

(a) Develop a formal Enterprise Risk Management plan which contains the following elements: (i) common language or register of risks, (ii) well-defined risk management goals, objectives, and oversight, (iii) uniform processes of assessing risks and developing strategies to manage prioritized risks, (iv) designing and implementing risk management strategies, and (v) continuing assessments to improve risk strategies, processes, and measures;

(b) Oversee the implementation of the Enterprise Risk Management plan. The Committee shall conduct regular discussions on the Company’s prioritized and residual risk exposures based on regular risk management reports and shall assess how concerned units or offices are addressing and managing these risks;

(c) Evaluate the risk management plan to ensure its continued relevance, comprehensiveness, and effectiveness; The Committee shall revisit defined risk management strategies, look for emerging or changing material exposures, and stay abreast of significant developments that seriously impact the likelihood of harm or loss;

(d) Advise the Board on its risk appetite levels and risk tolerance limits;

(e) Review at least annually the Company’s risk appetite levels and risk tolerance limits based on changes and developments in the business, the regulatory framework, the external economic and business environment, and events or occurrences that are considered to have a major impact on the Company;

(f) Assess the probability of each identified risk becoming a reality and estimate its possible significant financial impact and likelihood of occurrence. Priority areas of concern are those risks that are most likely to occur and to impact the performance and stability of the Company and its Stakeholders;

(g) Provide oversight over Management’s activities in managing credit, market, liquidity, operational, legal, and other risk exposures of the Company. This includes regularly receiving information on risk exposures and risk management activities from Management; and

(h) Report to the Board on a regular basis, or as deemed necessary, the Company’s material risk exposures, the actions taken to reduce the risks, and recommend further actions or plans, as necessary.