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Corporate Governance

JG Summit Holdings, Inc. (“JGS” or the “Company”) advocates and continues to affirm its commitment to the highest standards of corporate governance, applying the principles of transparency, integrity and accountability in all activities. Along with the Company’s fostering commitment of creating sustainable value for stakeholders, achieving growth, balancing the short-term with long-term goals and protection of the interests of its shareholders, JGS believes that good corporate governance is a fundamental component to sound strategic business management and will improve the economic and commercial vitality of the Company. Further, JGS acknowledges that the enhancement of corporate governance is fundamental to fulfilling corporate social responsibilities and to enhancing corporate value. Going forward, the Company shall continue to promote initiatives in line with the purpose of the Corporate Governance Code, working to further increase corporate value.

Corporate Governance Highlights

The corporate governance principles and practices are institutionalized in the Revised Corporate Governance Manual (RCGM). The principles adopted, which guide the daily conduct of business, are pursuant to the recommendations provided in the Code of Corporate Governance for Publicly Listed Companies (PLCs). JGS aims to uphold the highest ethical standards, acting in good faith and in the best interests of all stakeholders at all times.

The Company submitted the Integrated Corporate Governance Report (I-ACGR) to the Securities and Exchange Commission (SEC) and Philippine Stock Exchange (PSE) on July 9, 2020. The I-ACGR is a reportorial requirement under SEC Memorandum Circular No. 15 series of 2017 to all PLCs to disclose the Company’s compliance/non compliance with the recommendations provided under the Corporate Governance Code for PLCs. With the “comply or explain” approach, voluntary compliance to recommended CG best practices is combined with mandatory disclosure.

As the Company continues to raise the bar of good governance by pursuing measures to bring up the level of awareness and practices in the organization, the Company has revised and submitted to the Commission and Exchange its amended Revised Corporate Governance Manual and Material Related Party Transactions (MRPT) Policy on December 22, 2020.

Corporate Governance Policies

As a supplement to the RCGM and to reinforce the governance framework, the Company has put in place and adopted the following policies: Code of Business Conduct and Ethics, Board Diversity, Board Nomination and Election, Succession Planning and Remuneration, Material Related Party Transactions, Insider Trading, Whistleblowing, Stakeholders Health, Safety and Welfare, Information Security, Data Privacy, Supplier Accreditation, Directors, Officers, Stockholders and Related Interests (DOSRI).

The above-mentioned corporate governance documents and policies may be accessed in the Governance section of the Company’s website,

Duty to Shareholders and Other Stakeholders

JGS is transparent and fair in the conduct of its annual and special Shareholders’ meetings. To foster active shareholder participation, the Board sends the Notice of Annual and Special Shareholders’ Meeting with sufficient and relevant information at least fifteen (15) business days before the meeting, which also complies with the Securities Regulation Code. The Shareholders are encouraged to attend such meetings. Shareholders who are unable to attend are apprised ahead of time of their right to appoint a proxy. Subject to the requirements of law, rules and regulations and the By-Laws, the exercise of that right shall not be unduly restricted and any doubt about the validity of a proxy shall be resolved in the favor of the shareholder.

The Company is committed to ensuring fair and equitable treatment of all shareholders, including the minority, and the protection of their rights that include the right to vote on all matters that require their consent or approval, right inspect corporate books and records, right to information, right to dividends and appraisal right.

The Company recognizes and places importance on the interdependence between business and society, and promotes a mutually beneficial relationship that encourages the Company’s sustainable growth, while contributing to the advancement of the society where it operates. The Company employs value chain processes that take into consideration Economic, Environmental and Social Governance (EESG) issues and concerns.

Customer’s Welfare

The Company adopts customer relations policies and procedures to protect the customer’s welfare. This includes providing and making available the customer relations contact information. Customer relations is empowered to address and attend to customer questions and concerns.

Supplier/Contractor Selection

The Company follows the Supplier Accreditation Policy to ensure that the Company’s suppliers and contractors are qualified to meet its commitments. Apart from the accreditation process, suppliers and contractors also undergo orientation on Company policies and ethical practices.


The Board also establishes policies, programs and procedures that encourage employees to actively participate in the realization of the Company’s goals and its governance, including but not limited to:

  • Health, safety and welfare;
  • Training and development; and
  • Reward and compensation.
Performance-enhancing mechanisms for employee participation

The Company abides by the standards and policies set by the Department of Labor and Employment. Likewise, the Company has Security and Safety Manuals that are implemented, reviewed and regularly updated to ensure the security, safety, health, and welfare of the employees in the workplace.

The Company continuously provides learning and development opportunities for its employees through the John Gokongwei Institute for Leadership and Enterprise Development (JG-ILED), the leadership platform for systematic and sustained development programs across the conglomerate. Its mission is to enable a high performing organization that will facilitate the learning process and develop the intellectual and personal growth of all employees through targeted and customized trainings and development programs.

During the time of pandemic and community quarantine, the Company has launched the JGILED Virtual Learning Program. Through the initiative of the Corporate Human Resources (CHR) – Leadership and People Development Team, this presented another avenue for the organization to continue learning new skills. The learning opportunity offered, among others, relevant topics to help boost productivity as the employees adjust to the new work arrangements. The employees could access any of the training courses, which were released twice a week, at their own pace.

Moreover, in support of the Digitalization thrust, the Company focused on the rapid acceleration and use of ready online delivery platforms. It even mapped out a competency-based learning architecture with more expansive and curated content linked to the JGS Competencies. The Company partnered with LinkedIn Learning, a content-rich platform that houses a number of curated courses ranging from Leadership, Functional and Digital programs. This partnership provided on-demand flexibility to the learners, as well as the opportunity to experience an immersive learning experience in a self-paced learning environment. This made managing the multifaceted process of Learning & Development more efficient as it covers end to end training administration using a single interface.

The Company also recognized that the pandemic had a profound emotional and mental toll on people around the world. The pandemic may be an “equalizer” in the sense that most people are affected by it and the same is true for its impacts on mental health. In the JG-ILED Virtual Curriculum, the Company recognizes that mental wellness is really all about coping, which is individualized. Thus, it integrated various mental health and wellness live webinar sessions for employees with interesting and relevant topics for everyone.

Anti-corruption programs and procedures

The ethical and behavioral standards that are expected of Directors, Officers and Employees are set out and embodied in the Company’s Code of Conduct and Ethics, Anti-Corruption programs, Company Policies and Offenses Subject to Disciplinary Action (OSDA), among others. The same are disseminated to all employees across the Company through trainings to embed them in the Company’s culture. New employees are oriented regarding policies and procedures related to Business Conduct and Ethics and similar policies. Further, all concerned employees of the Conglomerate are required to comply with the Self Disclosure Activity on Conflict of Interest and Declaration of Gifts Received on an annual basis.

The Company also has an established suitable framework for whistleblowing and ensures its enforcement to allow employees and other stakeholders to freely communicate their concerns about illegal or unethical practices, without fear of retaliation. They also have direct access to an independent member of the Board or a unit created to handle whistleblowing concerns.

The anti-corruption programs and procedures of the Company are summarized below:

Business Conduct & EthicsPolicy StatementWhistleblowingConflict Resolution Respect for Trade Secrets/Use of Non-public Information

The Board of Directors

The Company continuously strives to strengthen and improve its corporate governance framework by adopting best practices that include building a competent board, aligning strategies with goals, managing risk effectively, adhering to high standards of ethics and integrity, and promoting accountability by defining roles and responsibilities.

The Board of Directors (“The Board”) is primarily responsible for the governance of the Company and provides an independent check on management. JGS is headed by a competent board to foster the long-term success of the Company, and to sustain its competitiveness and profitability in a manner consistent with its objectives, goals, strategies and measures (OGSM) and the long-term best interests of the shareholders and other stakeholders.

The Board formulates the Company’s vision, mission, strategic objectives, policies and procedures that guide its activities, including the means to effectively monitor Management’s performance. It provides direction and approval in relation to matters concerning the Company’s business strategies, policies and plans, while the day-to-day business operations are delegated to the Executive Committee.

The Board exercises care, skill and judgment and observes good faith and loyalty in the conduct and management of the business and affairs of the Company. It ensures that all its actions are within the scope of power and authority as prescribed in the Articles of Incorporation, By-Laws, and existing laws, rules and regulations. To uphold high standard for the Company, its Shareholders, and other Stakeholders, the Board conducts itself with honesty and integrity in the performance of its duties and responsibilities.

Board Duties and Responsibilities

The roles, duties and responsibilities of the Board of Directors in compliance with relevant laws, rules and regulations are defined in the Company’s Revised Corporate Governance Manual: Corporate
Governance Manual
Balanced Board Composition

The Company recognizes the benefits of having a diverse Board and its value in maintaining sound corporate governance while achieving strategic objectives and sustainable growth. The Board Member’s biographical details are set out in the Information Statement. The Board is diverse in terms of expertise, gender and professional experience. As of May 14, 2020, the Board has 10 Directors, 9 of these Directors are Non-Executive and 3 of which are Independent Directors. The Board also has 2 women forming part of the Non-Executive Directors. Furthermore, the posts of Chairman and Chief Executive Officer of the Company are separate to ensure a clear distinction between the Chairman’s responsibility to manage the Board and the Chief Executive Officer’s responsibility to manage the Company’s business. The division of responsibilities between the Chairman and the Chief Executive Officer is clearly established and set out in the Revised Corporate Governance Manual.

Board Independence
The Board has three (3) Independent Directors that possess all the necessary qualifications and none of the disqualifications to hold the position. The Company reinforces proper mechanisms for disclosure, protection of the rights of shareholders, and equitable treatment of shareholders. The accountability of the Board and Management are in place. In cases of conflicts of interest, Directors with a material interest in any transaction with the Company abstain from participating in the deliberation of the same.
Board Meetings

The Board schedules meetings at the beginning of the year, holds regular meetings in accordance with its By-Laws and convenes special meetings when required by business exigencies. The notice and agenda of the meeting and other relevant meeting materials are furnished to the Directors at least five (5) business days prior to each meeting. Meeting minutes are duly taken. The Independent Directors shall always attend Board meetings. Unless otherwise provided in the By-Laws, their absence shall not affect the quorum requirement. However, the Board may, to promote transparency, require the presence of at least one (1) Independent Director in all its meetings.

Attendance of Directors
Boa r d D a t e o f E l ec t ion N ame N o. o f m e e t in g s h e ld du r ing t he year N o. o f m e e t in g s a t t e nd e d % Di r ec t o r , Chairman J ames L. Go M a y 14, 2 0 20 14 14 100 100 100 100 100 100 100 100 100 100 14 14 14 14 14 14 14 14 14 14 14 14 14 14 14 14 14 14 M a y 14, 2 0 20 M a y 14, 2 0 20 M a y 14, 2 0 20 M a y 14, 2 0 20 M a y 14, 2 0 20 M a y 14, 2 0 20 M a y 14, 2 0 20 M a y 14, 2 0 20 M a y 14, 2 0 20 Di r ec t or Lily G . Ngoc h ua Di r ec t or P a t r i ck Henry C. Go Di r ec t or J ohnson R o be r t G. G o , J r . Di r ec t or R o b ina Go k ong w e i- P e Independe n t Di r ec t or J ose T . P a r do Independe n t Di r ec t or Ren a t o T . De G uzman Independe n t Di r ec t or A n t on i o L. Go N o n -E x ec u t iv e Di r ec t or Cirilo P . N oel Di r ec t o r , P r es i de n t and CEO Lance Y . Go k ong w e i
The Board Committees
To enable better and more focused attention on the affairs of the Company and aid in the optimal performance of its roles and responsibilities, the Board delegates particular matters to the Board Committees set up for the purpose mainly (a) Audit Committee, (b) Corporate Governance Committee (c) Board Risk Oversight Committee (BROC) and (d) Related Party Transactions Committee
A. Audit Committee

The Audit Committee provides oversight over the Company’s financial reporting, Internal Control System, Internal and External Audit processes, and monitor compliance with applicable laws and regulations. It ensures that systems and processes are put in place to provide assurance in areas including reporting, monitoring compliance with laws, regulations and internal policies, efficiency and effectiveness of business operations, and proper safeguarding and use of the Company’s resources and assets.

Po sition Director Chairman Mem bers An t onio L. Go (ID) Ren at o T . De Gu zman (ID) Jose T . P ardo (ID) Cirilo P . Noel (NED) James L. Go – Ad visory Mem ber
C. Board Risk Oversight Committee

The Board Risk Oversight Committee (BROC) oversees the establishment of ERM framework that effectively identify, monitor, assess and manage key business risks and assess the effectiveness of risk management strategies. The BROC is responsible for defining the Company’s level of risk tolerance and providing oversight over its risk management policies and procedures to anticipate, minimize, control or manage risks or possible threats to its operational and financial viability.

Po sition Director Chairman Mem bers Ren at o T . De Gu zman (ID) An t onio L. Go (ID) Jose T . P ardo (ID) Lance Y . Gok ongw ei
B. Corporate Governance Committee

The Corporate Governance Committee oversees the development and implementation of Corporate Governance principles and policies and recommends a formal framework on the nomination, remuneration and evaluation of the performance of the Directors and key Management Officers consistent with the Company’s culture, strategies and the business environment.

Po sition Director Chairman Mem bers Jose T . P ardo (ID) Ren at o T . De Gu zman (ID) An t onio L. Go (ID)
D. Related Party Transactions Committee

The Related Party Transactions Committee ensures that there is group-wide policy and system governing Material Related Party Transactions (MRPTs), particularly those that breach the materiality threshold. The policy shall include the appropriate review and approval of MRPTs, which guarantee fairness and transparency of the transactions.

Po sition Director Chairman Mem bers Jose T . P ardo (ID) Ren at o T . De Gu zman (ID) Cirilo P . Noel (NED)
The Corporate Secretary

The Corporate Secretary assists the Board and the Board Committees in the conduct of their meetings, including preparation of the annual schedule of Board and Committee meetings and the annual Board calendar. She also assists the Board Chairs and its Committees in setting agendas for the meetings, safekeeps and preserves the integrity of the minutes of the meeting of the Board and its Committees, as well as other official records of the Company.

The Corporate Secretary keeps herself abreast on relevant laws, regulations, all governance issuances, relevant industry developments and operations of the Company, and advice the Board and the Chairman on all relevant issues as they arise. She works fairly and objectively with the Board, Management and Shareholders and contributes to the flow of information between the Board and Management, the Board and its Committees, and the Board and its Stakeholders, including Shareholders.

Atty. Maria Celia H. Fernandez-Estavillo is the Senior Vice President and General Counsel of JGSHI since March 1, 2017. She was appointed as Corporate Secretary of JGSHI, Universal Robina Corporation and JG Summit Petrochemical Corporation on October 1, 2020. She was also appointed as Assistant Secretary of Gokongwei Brothers Foundation, Inc. on October 1, 2020. Prior to her appointment in JGSHI, Atty. Fernandez-Estavillo was the Head of the Legal and Regulatory Affairs Group, Corporate Secretary and member of the Board of Directors of Rizal Commercial Banking Corporation. She was Assistant Vice President of Global Business Development of ABS-CBN. She also held positions in government as Head of the Presidential Management Staff, Assistant Secretary at the Department of Agriculture and Chief of Staff of Senator Edgardo J. Angara. She began her legal career in ACCRA. She graduated from the University of the Philippines with a Bachelor of Science degree in Business Economics (Summa Cum Laude) and a Bachelor of Laws degree (Cum Laude). She completed her Master of Laws (LLM) in Corporate Law from New York University School of Law. She received the highest score in the Philippine Bar examinations of 1997.

The Compliance Officer

The Compliance Officer monitors, reviews, evaluates and ensures the compliance by the Company; its Officers and Directors with the provisions and requirements of the Corporate Governance Manual and the relevant laws, the Corporate Governance Code, rules and regulations and all governance issuances of regulatory agencies. He also ensures the integrity and accuracy of all documentary submissions to the regulators; identifies possible areas of compliance issues and works towards the resolution of the same. He assists the Board and the Corporate Governance Committee in the performance of their governance functions, including their duties to oversee

the formulation or review and implementation of the Corporate Governance structure and policies of the Company.

Mr. Francisco M. Del Mundo is the Senior Vice President, Chief Financial Officer (CFO) and Compliance Officer of JG Summit Holdings Inc. (JGSHI). He is also concurrently the CFO of Universal Robina Corporation (URC) and Aspen Business Solutions, Inc. (ABSI). In 2013, he joined JGSHI as Vice President for JG Summit and Affiliates Shared Services. He was appointed as CFO of URC International the same year, concurrent with his Shared Services role. He brings with him 27 years of experience in all aspects of the finance career. He has built his career from 17 years of rigorous

training in Procter & Gamble (P&G) and 3 years in Coca-Cola prior to joining the JG Summit Group. He has worked in three different markets: Manila, Thailand and Singapore, and has held numerous CFO and Regional Finance Head positions, namely: CFO for ASEAN, Head of Accounting Shared Services for Central and Eastern Europe, Middle East and Africa, and Asia Hub Manager for Internal Controls for P&G. During his stint with Coca-Cola, he was the CFO for Coca-Cola Bottlers Philippines, Inc. and concurrently the CEO of Coca-Cola Bottlers Business Services, the company’s global shared service handling Philippines, Singapore and Malaysia.

Enterprise Risk Management,
Accountability and Audit

The Company recognizes the increasing importance of sound risk management practices to drive business growth and sustainability. The Company implemented systems and processes to facilitate proper risk identification, monitoring and control, which are key to effective corporate governance. Timely and accurate management and financial reporting systems, internal controls, and audits are also employed to protect and maximize stakeholders’ value.

The Board oversees Management’s adoption and implementation of a sound risk management framework for identifying, monitoring and managing key risk areas. The Board of Directors reviews Management reports with due diligence to enable the company to anticipate, minimize, control and manage risks or possible threats to its operational and financial viability.

Enterprise Risk Management

Through a sound Enterprise Risk Management (ERM) framework, the Company effectively identifies, monitors, assesses and manages key business risks. The framework guides the Board in identifying units/business lines and enterprise level risk exposures, as well as the effectiveness of risk management strategies.

The ERM framework revolves around the following eight interrelated risk management approaches:

  1. Internal Environmental Scanning It involves the review of the overall prevailing risk profile of the Company to determine how risks are viewed and addressed by the management. This is presented during the strategic planning, annual budgeting and mid-year performance reviews of the Company.
  2. Objective Setting The Company’s Board mandates Management to set the overall annual targets through strategic planning activities, in order to ensure that management has a process in place to set objectives that are aligned with the Company’s goals.
  3. Event Identification It identifies both internal and external events affecting the Group’s set targets, distinguishing between risks and opportunities.
  4. Risk Assessment The identified risks are analyzed relative to the probability and severity of potential loss that serves as basis for determining how the risks will be managed. The risks are further assessed as to which risks are controllable and uncontrollable, risks that require management’s action or monitoring, and risks that may materially weaken the Company’s earnings and capital.
  5. Risk Response The Company’s Board, through the oversight role of the Internal Control Group ensures action plan is executed to mitigate risks, either to avoid, self-insure, reduce, transfer or share risk.
  6. Control Activities Policies and procedures are established and approved by the Company’s Board and implemented to ensure that the risk responses are effectively carried out enterprise-wide.
  7. Information and Communication Relevant risk management information is identified, captured and communicated in form and substance that enable all personnel to perform their risk management roles.
  8. Monitoring The Internal Control Group of the respective Company and BUs as well as Corporate Internal Audit constantly monitor the management of risks through audit reviews, compliance checks, revalidation of risk strategies and performance reviews.
Internal Controls

With the leadership of the Company’s Chief Financial Officer (CFO), internal control is embedded in the operations of the company and in each Business Unit and Corporate Center Unit. Thus, increasing their accountability and ownership in the execution of BU’s internal control framework. To accomplish the established goals and objectives, BU’s implement and efficient process controls to ensure:

  1. Compliance with policies, procedures, laws and regulations
  2. Economic and efficient use of resources
  3. Check and balance and proper segregation of duties
  4. Identification and remediation control weaknesses
  5. Reliability and integrity of information
  6. Proper safeguarding of company resources and protection of company assets through early detection and prevention of fraud
Accountability and Audit

The Board ensures that its Shareholders are provided with a balanced and comprehensible assessment of the Company’s performance, position and prospects on a quarterly basis. Interim and other reports that could adversely affect its business are also made available in the Company website including its submissions and disclosures to the SEC and PSE.

Management formulates the rules and procedures on financial reporting and internal control for presentation to the Audit Committee in accordance with the guidelines: set out in the Company’s Revised Corporate Governance Manual. Corporate Governance Manual
Internal Audit

The Corporate Internal Audit is focused on delivering its mandate of determining whether the governance, risk management and control processes, as designed and represented by management, are adequate and functioning in a manner that provides reasonable level of confidence that:

  1. Employees’ actions are compliant with policies, standards, procedures, and applicable laws and regulations;
  2. Quality and continuous improvement are fostered in the control processes;
  3. Programs, plans, and objectives are achieved;
  4. Resources are acquired economically, used efficiently, and protected adequately
  5. Significant financial, managerial, and operating information is accurate, reliable, and timely;
  6. Significant key risks are appropriately identified and managed; and
  7. Significant legislative or regulatory issues impacting the Company are recognized and properly addressed.

Opportunities for improving management control, profitability and the Company’s reputation may be identified during audits.

Other Matters

External Auditor and their fees
Ph p5,500,000 Ph p3, 790,000 Ph p9,290,000 Na me of Au dito r Au dit and Au dit-Related Fees 2020 S yCip , Gorres, V ela y o & Co . All Other F ees To ta l
Ownership Structure

Holding 5% shareholding or more (as of December 31, 2020)

Gok ongw ei Brothers Fo und at ion, Inc. PC D No m in e e C o r p o r at io n ( F ilip in o ) RSB- TIG No . 030- 46-000001-9 2,096 ,9 30,273 1,817 ,37 6,033 27 .881% 2 4.164% PCD P articipan t s & their clie nt s 1,084, 985,186 14. 426% PCD Nominee Corporation (Non-Filipino) 912, 902, 24 4 12.138% PCD P articipan t s & their clie nt s Shareholde r Nu mber o f Shares Pe rc en t S ame as r eco r d o wner
Dealing in securities (Shareholdings of Directors and Key Officers)

A. Elected Directors for the calendar year 2020

15 6,113,638 5 68, 930,503 2.1% 7. 6% 407 , 418 0.0 % 98,175 0.0 % 188, 4 33,000 2.5% 1 0.0 % 1 0.0 % 22,838 0.0 % 1 0.0 % 1 0.0 % Na me of Director Nu mber of Direct Share s % to T otal Ou tstanding Shares James L. Go Lance Y . Gok ongw ei Lil y Ng o-Ch ua Pat rick Henry C. Go Ro bina Y . Gok ongw ei-P e Johnson Ro bert G. Go , J r. Jose T . P ardo Ren at o T . De Gu zman An t onio L. Go Cirilo P . Noel

B. Elected Officers for the calendar year 2020

Senior V ice Presi de nt , St ra t egic I nv es tm e nt s 0 0.0 % Po sition/ Designatio n Nu mber of Sha re s Bach