Key Points
- The Securities and Exchange Commission (SEC) and The Stock Exchange of Thailand (SET) have established six pillars of standard knowledge for directors of Thai listed companies to deepen their knowledge and understanding about their roles and responsibilities of directors while promoting continuous self-development which will contribute to strengthened confidence of shareholders and investors. This initiative also provides a framework for training institutions to expand their education programs based on these essential domains.
- The six pillars encompass: 1) Board Roles & Responsibilities: Enhancing Performance and Effectiveness, 2) Board Responsibilities related to Laws and Regulations, 3) Board Responsibilities related to Accounting and Financials, 4) Strategic Risk Management, 5) Business Sustainability, and 6) Reporting & Disclosure.
SEC Secretary-General Professor Dr. Pornanong Budsaratragoon underscored SEC’s commitment to fostering corporate governance practices and standards among Thai listed companies. She noted that strong corporate governance begins with leadership. Boards of directors and senior executives must set the tone at the top by exemplifying accountability, transparency and integrity to foster a robust corporate culture of good governance. With the growing number of directors in listed companies, SEC and SET have jointly established the Six Pillars of Standard Knowledge to comprehensively strengthen director competencies, equipping them with insights into their roles and responsibilities as well as knowledge critical for their performance effectiveness. Also, SEC encourages listed companies to reinforce self-discipline through internal mechanisms in line with the Corporate Governance Code. This approach enhances transparency and credibility, ultimately bolstering the confidence of shareholders and stakeholders while fostering sustainable growth across businesses, society, and the capital market.
SET President Asadej Kongsiri reaffirmed SET’s dedication to promoting business sustainability through robust corporate governance. Listed companies are encouraged to conduct their businesses with responsibility and fulfil the stakeholder expectations on corporate governance practices through robust oversight by the boards of directors that honor their fiduciary duties to protect the best interest of their companies. While acknowledging that cases of fraud, misconduct, and breaches of director duties occur in only a small percentage of listed companies, he emphasized that such incidents are undesirable and undermine market confidence. SET is committed to developing tools that enhance oversight while strengthening governance systems for measurable outcomes.
SEC and SET have jointly defined the six key pillars of professional knowledge for directors covering: 1) Board Roles & Responsibilities: Enhancing Performance and Effectiveness, 2) Board Responsibilities related to Laws and Regulations, 3) Board Responsibilities related to Accounting and Financials, 4) Strategic Risk Management, 5) Business Sustainability, and 6) Reporting & Disclosure.
The identification of these six key pillars serves two main purposes. First is to ensure that all directors acquire a comprehensive set of foundational and up-to-date knowledge essential for their fulfilment of duties in line with the corporate governance principles defined by SEC and SET, with their learning and development activities disclosed in the Form 56-1 One Report. Second is to provide a blueprint for domestic and international institutions to design development programs that meet the standards jointly identified by the capital market sector, ensuring that directors are well-equipped to responsibly and effectively fulfil their duties.
Beyond these six knowledge pillars, directors are encouraged to master additional relevant expertise, including company-specific knowledge, cybersecurity and AI governance, and crisis management. At present, there are several training institutes in Thailand which offer development programs that match these standard knowledge pillars, notably the Thai Institute of Directors (Thai IOD) which dedicates to professional development of directors, as well as the Federation of Accounting Professions (TFAC), the Thailand Management Association (TMA), and the Institute of Research and Development for Public Enterprises (IRDP).
