CHO : Sustainable Development Report 2017

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Message from President and CEO In the past year of 2017, CHO has a satisfied turnover from the 2nd quarter to the 4th quarter. When considering from the works we have in hands, we believe that our return for the year 2018 will be better especially in terms of the income. This is a relief for our management. Like every year, in the last period of 2017, we had been reviewing our business strategy which has been continually updating for more than 4 years. The strategic was named “CHO 2023” which will lead our company to grow sustainably. It is included a short-term, a medium-term, and a long-term plans. They do not only stress to promote the growth of our company but also, they have applied the social development and environmental stewardship as well. In terms of the economic aspect, CHO 2023 will show how we plan ourselves to grow stability and sustainably. We target to work on projects which are helping to develop the society and the environment. For example, the SMART CITY Bus Khonkaen project which will help people in every status to be able to access the convenience and it will reduce generating pollutions to the atmosphere. CHO is committed to using our policies as a tool to drive the business growth, the social development, and the environmental stewardship under the “CHO 2023” strategic. We will strictly operate as the plans and will create a sustainable business for our stakeholders. And Thai society.

Head Office and Factory

265 Moo 4, Klangmuang Road, Muangkhao, Muangkhonkaen, KhonKaen 40000, Thailand

Authorized Capital and Paid-up Capital Company Establishment :

November 18, 1994

(As of December 31st, 2017)

May 13rd, 2013

Cho Thavee Public Company Limited Total Registered Capital in the Stock Stock Ownership (As of December 29th, 2017) Exchange of Thailand and Paid-up Capital 1,182,941,941,773 shares Total revenue of Par Value per Share: 0.25 baht the year 2017: (As of December 31st, 2017) Stock Ownership of CHO in its subsidiaries (TMT)

1,595.82 million Baht

99.99 % Total employee:

39.613 %

693 persons Majority Holders (First 11 holders)

2

Baht

Registered in the Market for Alternative Investment (mai) :

Minority Holders

(Mr. Suradech Taweesaengsakulthai) President and Chief Executive Officer

295,735,443.25

60.387 %

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

CHO THAVEE PUBLIC COMPANY LIMITED Our Business

STRONG, BRAVE AND DIFFERENT Mission

Vision

• To build our unique knowledge of CHO and develop our employees’ skills • To expand perceive and increase awareness to our brand as well as to build up the confidence in CHO brand. • To produce environmentally friendly products with concerning for safety and sustainability. • To create a happy workplace for our employees and Stakeholders. • To research and constantly develop new technology. • To be excellence in financing and marketing. • To be awarded from our products’ quality, continually be awarded by the National Innovation Agency awards, and be patented at least 5 projects per annum. • To build the“ CHO” species identity within our employees.

CHO 2023 STRONG BRAVE DIFFERENT CHO is aiming to become the leader in designing, creating, and manufacturing with the world’s leading technology, and integrating with our professional managing skill and unique knowledge to strive for excellence, to build trustworthy and satisfaction to its customers with its consciousness in doing corporate social responsibilities and concerning the environment. CHO targets to bring its quality products under brand CHO to the world class level with its pride but not limited to build a happy workplace for its partners, in order to enhance its competitiveness and moving forward to be the innovative technology leader of Thailand.

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The Taweesaengsakulthai family (or CHO Thavee group) by Mr. Cho Taweesaengsakulthai and Ms. Usa Taweesaengsakulthai pioneered the logistics vehicle business in KhonKaen province. They established the company as the first distributor of logistics vehicle since 1968. Later, they have expanded their business to be a manufacturer and an assembler of bus body. In the year 1980, they have expanded their manufacturing and assembling for trailer body, semi-trailer body, and transportation vehicle body. CHO Thavee group has constantly developed its trailers technology and commercial vehicles technology. In the second generation of CHO Thavee group leading by Mr. Suradech Taweesaengsakulthai, a son of Mr. Cho Taweesaengsakulthai and Ms. Usa Taweesaengsakulthai who graduated from automotive engineering program and business administration program from Japan, foreseen a lot of demand in logistics system with the large size of specialized trailers. He also viewed the important of the innovative technology of assembling trailers body, which applies the leading technology from abroad, that it will play the more important role in the trailers and semi-trailers industrial in the future. Then, he decided to establish Cho Thavee Dollasien Company Limited (“Cho Thavee Public Company Limited” or “CHO”) on November 18th, 1994. The company is the joint stock company between the Taweesaengsakulthai family’s company named Khon Kaen Cho Thavee (1993) Company Limited. (“CTV-1993”) and the leading trucks body and trailers manufacturer company from Germany named Doll Fahrzeugbau GmbH (“DOLL”). Cho Thavee Public Company Limited was established for designing, manufacturing, assembling the body, and installing of engineering system pertaining to the trucks body, the trailers, and the commercialized transportation vehicles. The company’s registered capital was 10 million baht which 74% of the capital held by CTV-1993 and the group of Thai shareholders and the others 26% of the capital held by DOLL. In addition, CHO has joined with a French businessman in the year 2005 to establish a company named “Cho Thavee Thermaltech Company Limited” (“CTV-TMT”) with registered capital of 10million baht. The registered capital was held by CHO and the French businessman in 80% and 20% respectively. CTV-TMT established in purposing to do designing, manufacturing, assembling, and installing refrigerated lightweight-fiberglass truck bodies for cargo, fresh and dried foods delivery. The truck bodies will preserve the quality, the shape and the temperature of the products similarly to ones before they were loaded into the truck until they arrived at the destination. Currently speaking, CHO held 99.99% of the registered capital of CTV-TMT.

C = Creativity to drive innovative developments

H = High Perfomance

Organization under Good Governance

O = One of a kind along with identity of “CHO” species

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Major developments 1994 Established the company under the name “Cho Thavee Dollasien Company Limited” (Currently changed to “Cho Thavee Public Company Limited” or “CHO”)

1996 - The company started to sell its products to overseas customers. - The Company derived the trust from DOLL in moving the production base of the Catering hi-loader truck to CHO.

2006 The Company developed the special catering hi-loader truck(X-Cat) for airbus A-380. The first truck has been delivered to Emirates Flight Catering

1997

2007 The company signed cooperated investment agreement with Japan Asia Investment Co., Ltd. (“JAIC”)The agreement was for financial support for CHO.

2013

The Company started the manufacturing and exporting of the catering hi-loader trucks to airlines’ catering companies for the international market.

2009 The Company got a project management in building the Navy Offshore Patrol Vessel: OPV#1. The vessel is the first vessel which was built by Thai and in Thailand. It was designed by BAE SYSTEM Company in the United Kingdom.

2014

- The company register to be Public Company Limited and changed its name to be “Cho Thavee Dollasien Public Company Limited”. - The company’s stocks have been registered in The Market for Alternative Investment (MAI). - The company has been accredited for the quality standard of factory in modifying truck in equivalent to factory quality of MAN Truck & Bus AG. (“MAN”) Germany, in modifying the truck of MAN requested from MAN’s customer. This was the first factory outside Europe. - The company has been appointed only one in Thailand by BAE Systems Overseas Inc. from The United Kingdom as a solely sale distributor of spare parts and the technical supporting for the products concerning all of the vehicles system, and parts in repairing and supporting for armed system, and all of the supporting products, except for gunned ship with the source from U.S.A. - The company has been appointed from Morooka rubber crawler carrier, Japan as the importer and sale distributor of for Thai market.

- The Company considered appointing the Corporate Social Responsibility Committee (CSR) - The Company considered appointing The Corporate Governance, Risk Management, Nomination and Compensation Committees. - The company had its first Sustainability Development report.

1998

2005

The Company was the initiator in designing and manufacturing of semi-trailer for the six-wheeled aluminum container with shutter door for loading carbonated soft drink to Thai Namthip Co., Ltd.

Established the subsidiary company named Cho Thavee Thermotech Co., Ltd. (“CTV-TMT”). CTV-TMT produces light-weight fiberglass panel and assembles them into a container to sell to CHO. The containers from CTV-TMT will be assembled as part of CHO’s trucks, catering trucks, and large-sized trucks for domestic logistics.

2011 The Company acquired the whole common stocks of CTV-TMT from French shareholder, making the Company to hold the shares in CTVTMT for 99.99% of registered capital.

2012 - the company signed an agreement for the cooperation with Hanaoka Sharyo Co., Ltd. from Japan who is the manufacturer of GROUN support equipment used in worldwide airports. - The company got a Project management in repairing and maintenance of trucks for more than 1,000 units for Linfox Transport (Thailand) Co., Ltd. and Tesco-Lotus.

2015

2016

- The company collaborated with FRAMO GmbH Company in Germany. It brought the innovation and transferred the technology to improve the electric drive systems for transportation vehicles. - The company was the contractor of KKU Smart Transit, an NGV public transportation which will be operated in the area of Khon kaen University for the five-year contract - The company signed a Memorandum of Understanding (MOU) with CP ALL and Panyapiwat Institute of Management for innovation of first commercial electric vehicle. - The company established a southern maintenance base in Phun Phin, Surat Thani province, Thailand. - The company brought electric drive system cars to test with CPALL. - The company received the Thailand Sustainability Investment (THSI) 2015 in the sustainability category.

2017 - On May 6th, 2017, the company has expanded its Service Center to open 24 hours maintenance service center under the name “Sib Lor 24 hours by CHO”. The first branch is in Chonburi province. - On December 7th, 2017, the company has established a consortium with Scan Inter Company Limited. It named “SCN-CHO collaboration group”.

- The company received the Thailand Sustainability Investment (THSI) 2017 in the sustainability category. - The company received the OUTSTANDING Sustainability Awards 2017 in the sustainability category.

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- The company has planned and installed an ERP program, SAP Business by Design On Cloud. - The company changed its name from Cho Thavee Dollasien Company Limited to be Cho Thavee Public Company Limited. - The company received the Thailand Sustainability Investment (THSI) 2016 in the sustainability category. - The company received the OUTSTANDING Sustainability Awards 2016 in the sustainability category.


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

The Employment, Employees Benefits and Development

Sale Proportion of the ProductsGroup

The Employment

Head Office and Factory (Khon kaen) Lum Lukka

111 50

582

47.49%

40 30

19.26%

0

Standard products

Special design products

Project Managing and Services

5%

Japan

Rescue vehicle, Rescue Truck

2% Hong Kong

Catering Hi-Loaders Truck

4%

Catering Hi-Loaders Truck, Fire Truck

8

Bangkok Sales Office (Laksi)

2015 660 persons

2016 672 persons

Sam Khok

Suratthani

13

11

persons Pattaya

Tha Phra 14 persons

Work location in the year 2015

persons

7

Work location in the year 2016

persons

Work location in the year 2017

KhonKaen

Bangkok (Laksi)

All Service centers

KhonKaen

Bangkok (Laksi)

All Service centers

KhonKaen

Bangkok (Laksi)

All Service centers

Total employees (by location)

510

17

133

525

14

133

516

41

136

New employees

211

6

45

163

1

34

94

17

40

Resigned employees

126

1

40

155

0

31

94

4

42

Contractors

27

0

0

28

0

0

51

0

0

Chief officers

10

3

0

9

4

0

10

3

0

1.Employment

84%

2%

569

Thailand

Fire Truck, Fiber Body Truck, Semi-trailer Low-bed่ Truck, Catering Hi-Loaders Truck, and etc.

Vietnam

persons

41 persons

565

The Employment

Other Countries

Catering Hi-Loaders Truck, Fire Truck, Truck

11

Female Male

Sales Proportion by Country

Wang Noi 17 persons

103

95

10

persons

Bang Bua Thong

2017 693 persons

33.25%

20

15

516 persons

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SUSTAINABLE DEVELOPMENT REPORT 2017

Human Resource

Cho Thavee Public Company Limited

Units

2015

2016

2017

Number of employees (the company has no temporary employees) Number of employees by age Age more than 50 year old

Person

60

46

65

Age between 30-50 year old

Person

369

358

394

Age less than 30 year old

Person

231

268

234

Male Female

10

25

600

8

20

500

6

15

4

10

400

200

2

5

0

0

Number of managers

250

100

2015 2016 2017

0

2015

2016

2017

Person

4

3

6

Person

3

3

6

Units

2015

2016

2017

Hour per person Hour per person Hour per person

31.36

55.33

11.58

50.76

72.36

23.63

12.61

18.35

7.70

Average training hour Managing level Lower than Managing level Male

Percentage

70

70

84

Female

Percentage

30

30

16

2015 2016 2017

Number of general employees 200

60

The Employment

50

200

Units

Number of employees who taken the operational development test

300

Number of chief officers

Maternity leave Number of employees taken maternity leave Number of employees who resumed to work after taken maternity leave Training Executive level

Number of employees

2015 2016 2017

Human Resource

150 40

150 30

100

100 20

50

50

New employees

10

0

2015 2016 2017

Contractors

0

2015 2016 2017

Resigned employees

0

2015 2016 2017

New employees by age

Units

2015

2016

2017

Age more than 50 year old

Person

12

7

11

Age between 30-50 year old

Person

102

83

69

Age less than 30 year old

Person

148

102

60

Age more than 50 year old

Person

7

9

11

Age between 30-50 year old

Person

54

66

69

Age less than 30 year old

Person

106

95

60

CHO set the policy to support considering promote the employees for new position by selecting the employees with knowledge and ability, proper qualify for such position. In case of inability to select the proper one, CHO will recruit the one from outside. The qualification of the applicant, CHO welcome all gender, nationality, religion with age over 18year old in order to fairly and effectively select the applicants who are able to work in each position.

Resigned Employees by age

10

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Employees’ compensation and benefit • • • • • • • • • • • •

Salary Living allowance Other Allowance Residential allowance Bonus Social security fund and Workmen’s compensation fund Provident fund / Saving and Credit Cooperative Life insurance for employees Uniform Protective equipment Posthumous relief Retirement welfare for the employees who still can potentially work would be continually employed under work contract. • Professional compensation and other compensation according to the Company regulation Note: The company has added life insurance for employees starting from the year 2017.

Education & Training The Company offered opportunity for all employees to be trained from inside and outside organization in order to enhance and develop understanding of their roles and characteristics of work. The training was planned accordingly to the career path for employees. The most obviously seen benefits were the improvement of their work efficiency by applying the knowledge of work and also building royal to organization. For the individual benefits for each employees were their improvement of knowledge, skills and work development opportunity according to the monitor and observation found that the employees tend to focus to their works resulted more efficient of works.

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2017 Education and Training’s operating results Guidelines On the job Trainings

In-house Trainings

External Trainings

Methodology

Results by 2017

Using matrix skill which helps Allowing the trainee to practically act at real to measure the employees’ workplace under their supervisors’ advisory skill level easily. Basic training course Practices training course Supplement training course Qualitative management training course Selecting training course Sending employees to attend the course organized by external institution

28 courses 843 attendants Average training hours 7.22 hr./person/year 62 courses 114 attendants Average training hours 1.88 hr./person/year

Expenses

(in Thai Baht)

-

430,770

430,743

In-House Trainings

External Trainings

The company held in-house trainings for employees at any level to have them gaining their knowledge and improving their working skills as per the career path, combining with leadership skills for them to be able to adapt with their everyday jobs.

The company gives opportunities to every employee to train in the courses that they need to improve their capability and gain their knowledge. Then they can develop the company’s competitiveness in the market. It leads to the enhancement of the organization in every aspect for more capability and efficiency of the company. In addition, the company will continuously gain the profits.

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Supply Chain Management

The Sustainable Development within the Employees In the year 2017, CHO’s skilled technicians have passed the standard test from the “Starred Labour” project held by the Department of Skill Development which under the Ministry of Labour of Thailand. The company has 25 technicians passed the test as of June 6th, 2017. The Six-pointed star mark means that labour who passes the standard test has their competency in all six aspects. Aspect no.1 Working based on safety Aspect no.2 Saving the material use Aspect no.3 Using equipment and machine worthily Aspect no.4 Working under the proper period of time Aspect no.5 Working on the correct process

1 person

SERVICES

Business Partners Products of CHO, high-end qualities

(The first one in Thailand who got 3 stars)

4 persons

Labour Management and Establish through the CHO School for Labour Development

Technology develop- Reduction Working Hour ment by research and and increase the efficiently development continuby R2R Projects (Routine & Research) ously.

Product Development

20 persons The employees can benefit from passing the test and got the star marks for improving their skills and enhancing their salary standard at the proper level that they received. Whether in the case of technician contractors, they can assure the hirers that they have the proper standard for the job or helping their customers make their decision easier.

Products delivery

Products and Usage SERVICES

Service Center

**CHO’s plans to expand new service centers and extend over domestic and overseas.**

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Business Partners

Designing

After Sales Services

CHO has its policy to select its business partners with the potentiality, globalized management, high standards, as well as they should have the production technology that was continually developed who located both domestics and overseas. The company’s business partners are both the manufacturers and distributors.

The E-ticket rental project for the Bangkok Mass Transport Authority (BMTA) includes the installation of the E-ticket machine and fare collecting machine on buses. The project was to increase the efficiency in collecting the fare and decrease the personnel cost. The passengers will be more convenient, get faster transportation. This project is a business innovation which was considered as a sustainable supply chain. CHO’s Designer Team was brighten up with the modern technique, carbon footprint. So, products of CHO created under concepts of lowering the environment impact. New container, BIG BAO, the good issue from CHO with the improved specifications, 3 metric tons of mass reduced, more fuel save of haulage truck, the wall of container made of polyurethane or PU - very good for thermal insulation, the cold gel were used, cooling system can be reduced up to 30% both size and power. In the case of the cooling system out of controlled, temperature inside the container room still continuously under zero of Celsius-48 hours slowly warming up to room temperature, longer. The specification of new model container is very good to used as backing up storage for any fresh items. This product won the 3rd award of the top 10, the best of National Innovation Contest-2010.

CHO has after sales services management which categorized by domestic customers and overseas customers after sales services. The purposing is to be easily to manage the services to ensure its customers’ confidence in its products and satisfy its customers to gain their loyalty to the brand. The company has planned to visit customers once a month as well as provided the services record report to its customers every time they had the service in the long-term. In addition, CHO has provided the After Sales Services for customers to call in case of an inquiry after sales 24 hours by telephone 089-711-2198. In regarding to the year 2017, the After Sales service served up to more than 200 customers.

• Domestic vendors: The company will • Foreign vendors: The company purchaspurchase materials and equipment from es the special material from the foreign domestic vendors for the products that can vendors. The company sets its policy in be purchased within the country such as purchasing directly from the manufacturer truck’s head, chassis, metal, aluminum, wire, or the distributor of each type of material. painting, supplies. The company will check Also, the company has cooperated with its raw material price with 3-5 vendors who business partners to develop have passed primary basis consideration, the products too. in each time of purchasing each type of material, such as branding of product (in case that required by customers), the quality of material, the quantity of the products. The price will be quoted and compared to the terms and conditions such as branding, quality, pricing, discounts, and delivery time, prior to the decision making and agree on the procurement. • The company will do the evaluation of the vendors in each 6 months by evaluating from the monthly-recorded delivery. The company sets its procurement policy in selecting new vendor into the vendor list in each month with 2 vendors for every group of material.

Products delivery Procurement According to the international procurement standards, For the highest qualities, the Company has set procurement procedures, not allow any piracy goods as parts of the CHO products. The Company also supports the local economy’s prospects of CHO’s customer, for example, purchasing a truck head unit from clients country. Therefore, once the company finished the installation and launched the ERP system which is the SAP by design on cloud that helps to run the higher efficiency inventory and databases system. Then, the company’s procurement system can improve to the better efficiency.

Products delivering, either domestic or aboard, follows through the nationwide procedures. Under process of delivery, means that all products will be on the customer hands on time, in good condition with the absolutely satisfaction of our customers.

Repairing and Services Center CHO was trusted by Linfox Transport (Thailand) Company Limited and Aekkachai Distribution System Limited (Tesco-Lotus) to manage their repairing services and services center for trucks and semi-trailers project. In this regard, the company responded in repairing to maintain the Preventive Maintenance (PM) of their vehicles. The total vehicles in responding are more than 2,000 vehicles. There are 6 repairing centers in the area of Tesco-Lotus’s distribution centers where are in Lum Look Ka, Wang Noi, Sam Kok, Bang Bua Thong, Khon Kaen, and the most recent one in Suratthani province. CHO has its plan to expand the branch of the repairing and services center across Thailand. The expansion will operate under the name “Sib Lor 24 hours by CHO” and will expand the branch in overseas later on.

HOTLINE 24 Hrs. Tel. 089-711-2198

ERP

16

After Sales Service

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Products and Services Manufacture with the company’ design to fit every usage for private sector and public sector, to serve both domestics and overseas customers. The products were categorized into 3 groups.

1.Standard Products

CHO’s standard products are the products which will be produced according to the company’s standard. They are suitable for the regular commercialized task of products without any special engineering system or technology on them. The products will be designed according to the requirement of customers in order to fit the tasks and giving the best value for customers. The products are not limited to commercial trucks such as transport trucks, Trailers and semi-trailers, light-weight fiberglass body trucks, and seminar container room trucks.

3.Project Management and services 3.1Project Management

Project Management for the Thai Navy’s Offshore Patrol Vessel project (OPV). This is the first and biggest building vessel project in Thailand. The project adopted the vessel’s model and manufacturing technology from BAE systems (United Kingdom) The Project management included both operation and financial management of the project. The project was completed in the year 2015. Nowadays, the Royal Thai Navy has been given the name of the OPV named “HTMS Krabi”. In 2017, the company has been a part of project man agent, with production of some block for the second OPV. It is expected that there will be a project management of the third OPV in 2020.

2.Special Design Products

These products are needed to have a special design to include the complicated technology and precision engineering systems. They are made for the commercial use in the industrial, aviation logistics and others such as trucks, trailers, semi-trailers, catering trucks, Ambulance trucks for airport use, Fire trucks for airport use, Maintenance platform, belt checking cars, and other special purposes tailor-made from customers’ requirement. The company’s team can design whichever trucks or cars to suit the need of clients. In addition, the company can develop a specialized product for the right job such as armored vehicles.

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Project Management for the repair and maintenance truck project for Tesco-Lotus and Linfox. This project is mainly focused on preventive maintenance (PM) for cars located in the distribution centers of Tesco-Lotus. Nowadays, there are 6 maintenance service centers in the distribution centers. In addition, there are 3 maintenance service centers located outside of the distribution centers as well as a maintenance service center located in Vietnam.

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Project Management for local transportation within Khon Kaen University or KKU Smart Transit KKU smart transit is a local transportation within Khon Kaen university area. The project uses smart transit system through electronic devices, IT systems, and application. Recently, it is a role model for Smart Transit projects to many other organizations in terms of the Smart Transportation operation system.

Electronic ticket Systems (E-ticket) and E-ticket Equipments project On June 15th, 2017, the company has signed a rental contract with Bangkok Mass Transit Authority (BMTA) for installing and renting e-ticket system and the equipments on BMTA’s buses. The contract included 2,600 buses for a 5-year period.

3.2 Services Center Truck’s Body Maintenance Service Center There 3 truck’s body maintenance service center located in Khon Kaen, Wang Noi, and Pattaya. The centers are for repairing and Service additional as maintenance service centers for the project management service of Tesco-Lotus’s trucks as well as for the other customers. One Stop Service Centers CHO has a project to invest in One Stop services centers under the name of “SIB LOR 24 hours by CHO”. The company has opened the first branch in Chonburi province and will open another 7 branched in Thailand within the year 2020. The investment for the branches are approximately 480 million baht. The service centers will provide services in repairing and maintenance for the engines, Body, electrical systems, fully systems. The services at the service centers are initiated from the company’s original services center which opened for business since 2011 and the operating incomes have been satisfying. In addition, the survey of the domestic logistics businesses in Thailand found that this type of service center is in demand. The company plans to expand its services to the vehicle registration service, renew license, plate service, ready-to-purchase vehicle insurance service, and accessories parts for sales and services. The services will be provided by the professional engineers and modern technology as well as the services will be recorded into a profile which every of the company’s service centers can access to each vehicle records.

NGV buses purchase project for BMTA which included repairing and maintenance services SCN-CHO collaboration group, which has established by Scan Inter Public Company Limited and Cho Thavee Public Company Limited, has signed the contract and was purchase repairing and maintenance 489 NGV buses for Bangkok Mass Transit Authority (BMTA). The agreement was signed on December 27th, 2017. The project cost (included Vat) is 4,261 million baht which separated to be the buses cost (included Vat) is 1,891 million baht and PM. services 2,370 million Baht (includinged VAT).

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Risk Management of Organization

Board of Directors

Risk management is a challenge for management because it can happen and significantly affect the operation of the business. Also, some of the risk can affect in a positive way as well. Then, CHO has implemented the risk management plan to set its strategy and operation plan in order to reduce the cause of negative impact to its stakeholders and the society. The strategy and plan are associated to reduce both the direct and indirect impact. Thus, the risk management is helping the company to grow sustainably.

Audit Committee

Executive Committee

Risk Management Committee

The Risk Management Policy of CHO CHO Thavee public company limited has realized the importance of implementing the risk management.It is an important part of the good corporate governance and advocating the business to achieve the goals. The risk management helps businesses foresee the obstacles and risks that can happen in the future. Then, a company can prepare a plan or change its strategy in doing business whether for approaching or defending by the time the risk happens. The well-prepared plan and strategy will reduce the impacts which can occur to an acceptable level. This is one of the parts to create the confidence in the business from investors, shareholders, and stakeholders.

Furthermore, the risk management is part of the support to grow a business sustainably. So, the company has stressed to implement the internal control policy and the risk management policy by Audit committee to auditing and evaluating the internal control system. The procedure will assure that the company has the proper internal control in place for its business practices. The firm has applied the international internal control’s operating framework of COSO to develop the plan with the Enterprise Risk Management (ERM) framework. It works as a tool for the management team to develop the control system and manage the risk concisely.

Risk management is one of the significant principles of CHO. The company focusesto implement the risk management in the department level, and passing to risk management in the organizational level. The purposing are as following:-

Internal Audit Dept. Mgr.

VP

Chief Financial Officer (CFO)

Chief Marketing Officer

Chief Design Engineering Officer

Chief Production Officer

Chief Administration Officer

Chief Risk Management Officer

Risk Manager

Risk Manager

Risk Manager

Risk Manager

Risk Manager

Risk Manager

Risk Coordinator

• For the good corporate governance to create the confidence in performing the business with ethics and properly. • To enhance the efficiency of business operation by controlling and preventing damages that may occur in both financial and non-financial aspects. CHO has been continuouslylearning, updating,revising, and developing in its own operation. • To have the excutive committee , the management and employees at any levelparticipate in implementing risk management to use in business operations across the organization. • To gain confidence that the company can achieve its visions, missions, and goal strategies at the risk tolerance level. (Risk Appetite & Risk Tolerance)

CHO has the committee of Corporate Governance, Risk Management, Nomination and Compensation by appointing the committee in the year 2014 with clearly authorization and responsibility, for the purpose of managing the risk with systematic effectiveness. The company has the dimensional control in many aspects corresponded to COSO such as the strategic risk, the operational risk, the financial risk, the compliance risk, the business risk, the reputation risk and the environmental impact.In addition, the company’s subordinate line has contained the incurring risk in the regulation of ISO 9001 system for the decreasing of the violent, including the monitor of reporting the risk to CHO’s Board of Directors in each quarter.

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

The element of ERM: (COSO Enterprise Risk Management)

Type of Risks

Structure

1.Internal Environment

Level of Corporation

8.Monitoring 2.Objective Setting

7.Information & Communication

ERM

3.Event Identification

The company has managed the organization risk to cover these 4 aspects as following:1. Strategic Risk

6.Control Activities

• The risk in having a new business under a contract with the government agencies and the government’s policy. • The economic fluctuations and uncertainty of the incomes. • The industry independence and the intensity of the competition. • Finding potential business partners in terms of technology and finance.

4.Risk Assessment 5.RIsk Response

1. The organization’s environment is the basis element of the other elements of risk management because it concerns 2 things; people and systems. 2. The objective setting shall be written clearly and concordance to the strategic goals and the risk tolerance. 3. The event identification which has happened in the past and the forecasts for the future. 4. The risk assessmentis the process after the organization has identified the risk which consists of 2 dimensions that are the likelihoodof the risk and the impact from the risk. 5. The risk response is for reducing the likelihood and the impact of the risk by the 4 risk responding practices as following: • Risk Acceptance • Risk Reduction / Risk Control • Risk Avoidance • Risk Sharing / Risk Transfer 6. The control activities are policy and procedure assuring its businesses will operate in accordance with the business strategy to the management. This activities can prevent and help to foresee the risks in doing the business which can affect the corporate objectives. 7. Information and communication are tools which the management will use to communicate the policy, supervise, and monitor the operation. 8. To provide a robust and effective risk management mechanism, the company has managed to install the regularly monitoring system. It is a cycle which every unit needs to be informed and be evaluated by the setting routines, for example; monthly, quarterly, or every end of the fiscal year.

24

Note: for more details, please refer to the company’s Annual report for the year 2017 on page 129-131

2. Operation Risk

• The Risks of delayed deliveries. • The Risks from quality control as stated on the contracts. • The Risk of errors and management skillsof ERP. • The Risk of hiring subcontractors. • The Risk of skilled labor shortages. Note: for more details, please refer to the company’s Annual report for the year 2017 on page 130

3. Financial Risk • • • • • •

The Risk from fluctuations in foreign exchange rates Insufficient funding sources. Increasing of financial costs. Higher Debt-to-Equity Ratio Higher interest rates. The Risk from late payment of receivables

Note: for more details, please refer to the company’s Annual report for the year 2017 on page 130

25


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Corporate Governance

4. Compliance Risk (Legal issue)

• The lack of caution in the acting which contrary to the SET regulations or laws. • The corruption prevention, anti- corruption, and the internal and external fraud. • Legal disputes with customers.

Risk Management Structure For 2017 The risk management independent committee’s structure of the year 2017 consisted of 6 persons from the Corporate Governance, Risk management, Nomination and Remuneration committees, 3 persons from the firm’s management, 1 persons from the legal department, and 2 persons from the independent board of director who are the audit committee as well. The company organizes the Executive committee meeting every month and the Corporate Governance, Risk management, Nomination, and Remuneration committee meeting every quarter. The meetings were set in order to perform risk management functions according to the scope of authority which assigned by the Board of Directors. The risk management committee also reports the performances to the Board of Directors on a quarterly basis as follows: • Provide recommendations for policy strategies and guidelines for enterprise risk management, and establish a clear and concise risk management framework as per the international standards. It includes providing approvals for acceptable risk levels and precautions before undertaking any project, especially with government agencies. In addition, it includes presentation of financial figures and review the risk management system in a systematic and effective way. • Review the organization’s overall risk management process Give approvals on the COSO ERM 2017 update with changes in the risk management which need to do with the strategic plan and budget plan. Including key risk indicators to signal the company in advance of the risks. This is for adjusting the risk management to be up-to-date and considering an opportunity for the other risks. This includes are commendation which can support the long-term corporate strategic planning which is for example; the risk from an action which may against the Government Procurement and Supplies Management Act B.E. 2560. • Reporting performances to the Board of Directors and the Audit Committee. By concluding whether the Corporate Governance, Risk management, Nomination, and Remuneration Committee has continually monitored the company’s risk management and in line with the changing circumstances. The company has set an executive management meeting every month to consider the urgent and important risks. This creates an effective plan or strategy which create the least impact on the business. Thus, it creates the sustained growth of the company’s value to its stakeholders.

26

CHO’s business abides on good codes of conducts, transparency, emphasizing on system control, auditing and risk management with ethical and moral on business operation and equally treatment to all stakeholders, also concerning on humans resources development for a better quality of life.

Administration and Management Structure CHO clearly determine the administration and management structure comprising of the Audit committee, the Corporate Governance, Risk Management, Nomination and Compensation committee, Executive committee including the Internal auditor to be directly under the Audit committee in order to conduct on a sustainable organization and human resources development as per CHO 2023’s strategic plan. On July 28, 2014, CHO considered appointing the manager and Corporate Social Responsibility (CSR) committee. Which has the President and Chief Executive Officer act as the center of sustainable business movement as follows.

Board of Directors

Coporate Govermance, Risk Management, Nonimation and Compensation Committee

Social and Community Activity (SCA) Environment Special Activities (SPA)

HAPPY WORK PLACE

Execution Committee

Audit Committee

Internal Audit Dept. Mgr. President & Chief Executive Officer (CEO) Company Secretary

Corporate Social Responsibility Committees Senior Vice President (SVP)

27

Vice President (VP)


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Corporate Social Responsibility (CSR) committee As of December 31st, 2017, CHO has the Corporate Social Responsibility (CSR) committee members as follows:

Mr. Suradech Taweesaengsakulthai

Ms. Somnuk Sangin

President and CEO Vice President

Mr. Siriwat Taweesangsakulthai Mr. Apichai Chumsri Mr. Nopparat Sangsawang Mr. Prasobsuk Boonkwan

the Executive Board Executive Vice President – Risk Executive Vice President – Production Executive Vice President – Domestic business development

Chairman of the Committee. Vice chairman of the committee CSR committee CSR committee CSR committee CSR committee

Mr. Niruth Sumongkol

Executive Vice President – Engineering design

CSR committee

Mr. Chatchai Kanviruth

Executive Vice President – Organization Excellence

CSR committee

Mr. Phad Pimrin

Mr. Winyu Ingo Mr. Prawit Sarapoom Mr. Kittpisit Yarnkittinukul

IT Manager Domestic Sales Manager

Security Manager E-ticket Project Manager

CSR committee& Chairman of the Social and Community activities committee CSR committee & Chairman of the Special Activities committee CSR committee & Chairman of the Environmental activities committee CSR committee & Chairman of the HAPPY WORK PLACE committee

An importance of sustainable organization’s strategy is to focus on a learning process of human resources development of employees in each level, aiming to Learning Organization. CSR Committee Structure therefore connects and can be transferred the strategic plan from Directors to Committees and directly to President and Chief Executive Officer. However, CSR sustainable organization’s pattern concentrates on individual’s cooperation instead of each of parties’ responsibility separately.

CSR committee History

CSR Committee Operation

CHO’s policy of CSR activity is to let everyone in every department cooperate accordingly, by proposing the representative from each of department to be CSR committees • To Consider appointing by the President and Chief Executive Officer • To Acknowledge the appointment of CSR Committee in the Executive Committee’ Meeting No.5/2014, held on June 12, 2014 • CSR committeecomprising of Social and Community Activity (SCA), Environment, Special Activity (SPA) and Happy Workplace, are voluntary and nominated, both from management parties and other parties within the organization in order to focus on stakeholders impacts from organization • In the 2/2017 meeting of the board of directors on February 24th, 2017, appointed Mr. Siriwat Taweesangsakulthai, director and executive committee, as a CSR committee.

• To plan annually and fix budget for approval • To operate as plan and review its results accordingly • To report CSR operating results to The Executive Committee’ meeting monthly • President and Chief Executive Officer is a Chairman of consultant by position • To report by the Executive Committee’ secretary, the CSR operation results to the Board of Directors’ Meeting in the agenda of acknowledging of the Executive Committee’ Meeting report. • To do a public relation on CSR activity, operating results and related parties via CHO’s website, www.cho.co.th and on Facebook by searching the names CHO Thavee Csr, CHO CSR Happy workplace , CHO CSR Environment , CHO CSR Special Activities – SPA, and CHO CSR Social community and activity

Mr. Nikom Polsoongnern Repairing Center Manager CSR committee Mr. Natthaporn Assistant Manager of Law CSR committee Muangchantra department Ms. Wanitchaya Assistant Manager of QMR Secretary of the committee Chansom department Including 30 employees who are part of the working committee. Note: In the 2/2016 meeting of the CSR committee on April 8th, 2016, the committee has agreed to appoint new CSR committee members due to the old members were ended the 2-year term. And agreed by the executive committee in the 5/2016 meeting on June 3rd, 2016.

28

29


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Term of Office • CSR committee who is from CHO’s Board Directors can occupy for 2 years and in order to let CSR continually operate, CSR committees who retiring by rotation may be re-elected back to the term of office again.

CSR Committee Responsibilities 1. To determine CSR activity’s policy, plan, budget and code of conduct 2. To consider selecting CSR Activities Committee for each activity and propose the appointment to the President and Chief Executive Officer 3. To determine CSR strategy and policy for each party 4. To control and follow up CSR’s operating results from each party 5. To review and sign on related document of CSR 6. To determine CSR rules and regulations 7. To review CSR results and arrange the criteria of CSR global standards

All employees in each level from each department will be participated in all activities. Each employee also will be listed in each activity according to the assignment from the head of each party this will be resulted a learning process development. In every learning process will focus on helping and paying respect and good attitude to each other, not aiming for competition neither award nor compensation.

The Assessment of the Good Corporate Governance CHO was inspected the Corporate Governance Report of Thai Listed Companies (CGR) which organized by Thai Institute of Directors.

2017

90%

Excellent

The average score of the companies in SET 80%

2016

89%

CHO was assessed in organizing the company’s ordinary shareholders’ meetings by the AGM checklist project for the year 2017 which held by Thai Investors Association. The results of the assessment for the year 2014-2017 are as following.

Score of CHO

90.13 (Total 100 scores) Very Good

The average score of the companies in SET 91.35

Responsibilities for each party 1. Social and Community Activity (SCA) is responsible for Anti-Corruption, Human Right for both inside and outside communities. 2. Environment is responsible for both inside and outside environmental organization, the most important things is to develop the environmental innovation in accordance with CHO’s main capacity. 3. Special Activity is responsible for all special activities both from inside and outside organization; the main role is to connect all supporting from the organization to outside parties and advocate the organization for sustainability. 4. Happy Workplace is responsible for operating a happy activity in 8 fields according to the organization’s happiness standards. In order that filling happiness to individually spiritual and mental part for sustainable happiness development.

The Assessment in Organizing the Ordinary Shareholders’ Meetings

Very good

2014

Score of CHO

Score of CHO

(Total 100 scores)

(Total 100 scores)

Very Good

Very Good

Very Good

The average score of the companies in SET 92.68

The average score of the companies in SET 91.62

The average score of the companies in SET 91.97

2015

2016

2017

100

100

Score of CHO

96

(Total 100 scores)

The average score of the companies in SET 78%

Code of Business Conduct

2015

87%

Very good

The average score of the companies in SET 75%

2014

66%

Satisfactory

In order to conduct CHO’s business abiding on good codes of conducts, transparency, fairness, accountability, also fairly treats to labor. Internal Audit department conduct auditing on risk in each party according to rules and regulations by the Audit committees’ approval and the results will be reported quarterly to the Board of Directors. Moreover, in order to be as a guideline and Good Corporate Governance, CHO determined the policies related to the code of business conduct in the Company Code of Business Conduct manual, for more details please go to the Company’s website as follows: http://cho.listedcompany.com/misc/cg/code_of_conduct-en.pdf

The average score of the companies in SET 72%

30

31


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Anti-Corruption To affirm that CHO has a proper policy determining responsibility, guideline, and regulation as a tool to prevent corruption from all business transactions in 2017, CHO has improved Anti-Corruption Policy and communicated through the employees, trading partner and outsider in order to improve the Good Corporate Governance, for more details please go to the Company’s website at http://cho.listedcompany.com/anti_corruption_policy.html

Receipt of Complaint Management Procedure CHO has the website www.cho.co.thand the email address at auditcom@cho.co.th where customers or anyone can submit their complaints or any concerns regarding the act of corruption directly to 3 company’s audit committees. The internal audit, which is an in dependent unit and report directly to the Audit Committee. Mrs. Apsorn Suriya, who is the committees’ was assigned internal audit manager, is in charge of reviewing the complaints’ email. She is the only one who has the access to the email address for the security of the receiving information from submitters, but she does not have any authorize to delete or edit any information sending to the email. The company also has the menu on the website where the complainer can access to the company’s complaint channels. As of the year 2017, the company did not receive any complaints from any available channels.

The improved Anti-Corruption Policy was considered approving by the Corporate Governance, Risk Management, Nomination and Compensation Committees in order to carefully make a decision on any course of action that could possibly lead to corruption and to serve as an apparent guideline in performing business and effectively developing to sustainability organization. CHO’s continuously conducts and communicates the policy against Corruption through CHO’s public relation board and published as a manual for all employees, also, informs the policy to the Executive Directors’ Meeting and assigns employees from related parties to attend seminars with public and private sectors such as Stock Exchange of Thailand (SET), Thai Institute of Directors (IOD) and Securities and Exchange Commission (SEC).

32

Channel of Complaint To record the receipt of complaint To review and determine the complaint To resolve the problems To summarize the results To assess the satisfaction

Channel of Complaint Receipt of Complaint Box

For the convenience, CHO puts this box outstandingly at the Head office

Letter

Internal Audit Manager Cho Thavee Public Company Limited 265 Moo 4, Klangmuang Road, Muangkhao, Mungkhonkaen, Khon Kaen 40000

E-mail

auditcom@cho.co.th

Website

www.cho.co.th

Telephone

043-043880-90 Extension 1235

Facsimile

043-043889

The Company’s Directors

E-mail: info@cho.co.th Post : Board of Directors Cho Thavee Public Company Limited 265 Moo 4, Klangmuang Road, Muangkhao, Mungkhonkaen, Khon Kaen 40000

The Independent Directors and Audit committee

Investor relations

E-mail: auditcom@cho.co.th Post : The Independent Directors and Audit committee Cho Thavee Public Company Limited 265 Moo 4, Klangmuang Road, Muangkhao, Mungkhonkaen, Khon Kaen 40000 E-mail: ir@cho.co.th Post : Investor relations Cho Thavee Public Company Limited 265 Moo 4, Klangmuang Road, Muangkhao, Mungkhonkaen, Khon Kaen 40000

CHO’s continuously conducts and communicates the policy against Corruption through CHO’s public relation board, also, informs the policy to the Executive Committee’ Meeting and assigns employees from related parties to attend seminars with public and private sectors such as Stock Exchange of Thailand (SET) and Securities and Exchange Commission (SEC). In 2015, CHO to participate in “Private sector Collective Action Coalition (CAC) against corruption” in order to establish best practices standards, CHO then proposes the mentioned intention above through CHO’s website. The standard will set as a business practice which follows the company’s policy. In 2017, the company is in a process of preparation to join the CAC again because CHO is revising its organization’s rules in accordance with the internal standards.

33


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Receipt of Complaint Box For the convenience, CHO puts this box outstandingly and the company’s audit committee are responsible for opening the receipt of complaint box. The box will be opened once a month, then the complaints will be reported to the meeting of the audit committee and will be determined later, they will be presented to the board of directors’ meeting for further processing in having the approval from the board of directors on the methodology to solve the issue. As of the year 2017, there is no complaint via the complaint box.

Visiting the Company Activity CHO and its subsidiaries have welcomed various agencies and group of organizations to visit the company, for example; government agencies, private companies, business partners, customers, schools, universities, and shareholders. The visiting was educating for further education in terms of the production procedure, quality control, safety control, and environment control.

2017 Receipt of Complaint and suggestion Website

Telephone

Receipt of complaint box

Letter

-None-

-None-

-None-

-None-

Others

-None-

Human Resources Complaints

Unit

2015

2016

2017

• Number of complaints

case

1

0

0

• Complaint of discrimination

time

0

0

0

• Number of complaints have been resolved

case

1

0

0

Society Complaints • Number of complaints relating to social effect

Human Rights case

0

0

0

• Number of complaint

case

1

0

0

• Number of complaints have been resolved

case

1

0

0

• Number of complaints on labor

time

0

0

0

• Number of complaints on human right

time

0

0

0

• Number of complaints have been resolved

case

0

0

0

Environment Complaints

Human Right Complaints

34

CHO has complied with human rights law and constitutional law. CHO has focused on equality of employees. It does not discriminate unfairly against individuals whether by races, languages, ages, education, institutions, sex, physical or mental disability, status, and social or financial status. CHO requires its employees must be aged at least 18 years which has no forced labors. It opens to hire disability labors and compliance with the Empowerment of Persons with Disabilities Act, B.E. 2550 (2007). The company provides monthly welfare and develops the disabilities’ well-being in order to advocate the social opportunity for them in the future.

35


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Economic Operations

Revenue

CHO and its subsidiaries’ performance of the year 2017 had the revenues from working contracts, sales, and services which increased from the year 2016 at 49.07%. The result came from the increased demand for commercial vehicles in the logistics and public transportation, as well as the increased truck sales. In addition, the 2017 performance has included the adjusted products which applied the technology for the better societyin the form of the Platform Business Model. The business model is pairing our product and services together such as security systems, trucks with fewer airpollutions. This model has helped the company gained more income. Furthermore, the company has started to use a new software of SAP by Design which works on the “Cloud” or “Cloud Data center”. It has an efficiency to expand the business to other areas without limitation and to analyze the data quickly. In the same manner, the company has invested in Creative Innovation and Research and Development (R&D) that focusing on the strategic, human resources development, creating an enterprise culture in terms of the professional engineering applied with the creation of products, services, and innovations. This will serve the demand of our customers in applying technology 4.0 to create the Society 5.0 and increase the life quality for the community. In the year 2017, CHO and its subsidiaries have the total revenue of 1,595.82 million baht which increased at 525.30 million baht or 49.07% from the year 2016. This has been an effect from the domestic orders of the commercial transportation businesses, public transportation, and vehicle repairing services. In the 1st quarter, CHO had the expenses in R&D and the cost of the new software purchasing to establish a new management system. This has affected a loss of 73.28 million baht. Then, CHO and its subsidiaries had the profits of 17.31 million baht in the 2nd quarter, 14.69 million baht in the 3rdquarter, and 21.78 million baht in the 4th quarter of the year 2017. Thus, in the year 2017, the company had the net loss of 19.50 million baht which became lower at 71.79 million baht from the same period of the year 2016 or 78.64% diminished.

In 2017, total revenue of the Company and its subsidiaries were 1,595.82 million baht which included revenue from contractsat 1,390.94 million baht, revenue from sales and services at 194.96 million baht, and other revenuesat 9.91 million baht. The revenue from contracts was increased at 464.78 million baht or 50.18% from receiving more orders from customers in public transportation, truck head sales, and made-toorder products. The revenue from sales and services was increased at 62.89 million baht or 47.61% from the truck repairing services and the truck repairing center named “Sib-Lo 24 hours” which has opened for business in the year 2018.

Revenues and Expenses Comparing Chart of the year 2016 and 2017 (Unit: Million baht)

Administrative Expenses

Total Revenue Gross Profit

Million Baht Million Baht

800

601.66

600

Profit (loss) EBITDA

2000

700

Sale and Administrative expenses

1,595.82 1500

500

428.35

400

1000

300 210.85

200 100 0 -100

500 57.75

63.39 39.01 42.22 17.31

66.97 40.37 41.00 14.69

71.31 36.53 46.76 21.78

(10.62) (51.48) (73.28)

Q1/2017

Q2/2017

Q3/2017

Q4/2017

216.04 140.74 0

-500

36

In 2017, the Company and its subsidiaries reported total cost at 1,394.86 million baht which are from the cost of the working contracts at 1,244.85 million baht and the sales and services cost at 150.01 million baht. This has increased at 477.36 million baht or 52.03% because the company had a new product that manufactured according to customer’s order. The cost of this R&D was recorded as a cost of the working contracts in the 1st quarter of 2017. Also, the company had the increased revenue portion from the truck head sales and the made-to-order products. In 2017, the Company’s sales and administrative expenseswere 173.65 million baht, decreased by 42.38 million baht or 19.62% from 2016. This resulted from the record of the year 2016 in the cost of the NGV buses auction, the cost of SAP design software which helps to control the administrative expense that increasing the efficiency to expand the business, and the lower network cost.

Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA)

1,070.52

354.95

Cost and Expenses

(9.49) (91.29)

Year 2016

191.04 173.65

81.26

(19.50)

Year 2017

In 2017, CHO and its subsidiaries had EBITDA at 81.26 million baht whichincreased by 90.75 million baht or 956.27% from 2016. This reflected from the net loss of the year 2017 at 19.50 million baht which decreased by 71.79 million baht or 78.64% from the year 2016.

37

Savings and Credit Cooperatives

Cho Thavee Khon Kaen Saving and Credit Cooperative Limited was registered under the Cooperative Act B.E. 2542 (1999) on May 14, 2004 for the purpose of encouraging the habit of saving, helping each other among members and providing loan services to members according to the rules and regulations of cooperative’s law. The Cooperative received the monthly shares deposit for cooperative funds, equal to the cooperative member’s shares, from Cho Thavee Public Company Limited and the member from other company. A member, who held shares for more than 5 years, will be ended as a member of the cooperatives when he/she resigns from the company. And, he/she will receive the accumulated shares by the Company. As of December 2017, the Cooperative’s total member was 693 persons withtotal grant funds were 2,472,950.00 Baht. As of December 2016, the Cooperative’s total member was 654 persons with total grant funds were 2,201,570.00 Baht.As of December, 2015, the Cooperative’s total member was 604 persons with total grant funds were 1,960,390.00 Baht. The total grant funds have been increasing every year as shown in the following table.

Grant-in-add Total member (Person) 2,472,950 Baht

2017

693 Person 2,201,570 Baht

2016

654 Person 1,960,390 Baht

2015

604 Person 0

500000

1000000

1500000

2000000

2500000


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Organization Stakeholder Analysis CHO confidents in the manufacturing of goods and services to the customers in acknowledging the business for all sectors, as from the learning of technology development in continuous and the driving of the development at local level to global level, which will bring to the growth in field of social, economy, and environment all together. All of these matters have been designated as CHO’s strategy in responding to CHO’s stakeholders both internal and external, with the cooperation of each sector as appropriately, and create the growth benefit with fairness and transparent, aware to the operation of business with responsibility to society and community.

Stakeholders Employees

CHO has its plan of model scheme for 10 years, with the review annually in building good relationship with suppliers, customers, entrepreneurs, government sector, and employees in the organization, CHO has surveyed in each year the satisfaction and the demand of customers. CHO also communicates and coordinates with every sector of the stakeholders, in bringing the information for the efficiency improvement in designing products and services as accurately, and also for the actual coordination. The issue about responsibility and communication procedure for each group of the stakeholders can be summarized as follows:

Communication procedure and participation

Responsibilities CHO lends the significant of the development of its employees’ knowledge, by focusing on those who earned less than bachelor’s degree in attending the course and have the further examination in part of skillful for much more effectiveness of operation. This leads to the project called bachelor’s degree of Cho Thavee affecting to the higher remuneration without having go back to school. It is the real onthe-job training as appropriately, it also building the binding to the organization on many activities often organized by CSR committee.

38

• The employees’ communication and getting in formation by the voice on the line for public relation, monthly making merit activity, Happy workplace from CSR and other activities. • CEO meets the employees at the meeting row • CHO’s information from the annual report and CSR report. • Sustainability of professional development by the project of personnel development CHO School and training. • Listen to the employees’ opinion from the survey. • Receipt of opinion and complaint box • A performance evaluation twice a year

Communication channel

Stakeholders’ expectation

CHO’s responding

• Communicating through • Developing good culture within • B eing a good operator by organizing the activity in the voice on the line and the organization other activities • Developing business way and order to built relationship among employees and • Communicating through building relationship • Managing personnel effectively encourage them the electronic media • Better benefits and compensa- • O r g a n i z i n g a t r a i n i n g program for employees tion, stability at technician level in CHO School • E qually treatment to the employees • C H O p r o v i d e d v a r i o u s benefits to its employees such as a fringe benefit for a disable employees, free on-site dinning’s, etc. • C H O a d d e d t o p r o v i d e funding for education to its employees’ children. • L i f e i n s u r a n c e f o r employees

39


SUSTAINABLE DEVELOPMENT REPORT 2017

Stakeholders

Cho Thavee Public Company Limited

Communication procedure and participation

Responsibilities

Communication channel

Stakeholders’ expectation

CHO’s responding

Community and Society

The reduction of pollution from CHO’s operation concerning the noise and smell, the investigation and coordination with community in responding to the subject requested, and provide the protecting system of pollutions, the development of CHO’s economic, the development of temple, school in annual, to support the local community’s activities for good health by playing sport, and sport family as increasing for each year.

• The community relation activity, to support in field of education, technology, sport, culture, religious, • The conference with local government sector, to join in the activity of community, government sector, private sector • Sport activity “Football CHO Thavee Junior Cup”, and Thai traditional activity • Survey activity relating to the community and society for the surrounding area twice a year • Receipt of complaint from the community

• P r o v i d i n g t h e • Sustainable developing for the • Organizing activities in order Company information community and society to help and reduce the comfrom the annual report • Better environment for the munity and society’s problem and CSR report surrounding area and reduc- • Building a green area by planting a tree around the Compa• FM radio, FACEBOOK ing the air pollution from a ny fence in order to reduce advertising, public spraying the air pollution from a sprayrelation through social ing to the surrounding area media, you tube channel

Customers/ Trading Partners

To perform as to the agreement of procedure, to develop the modern innovative design, the new related legal, to take good care for the safety of assets as systematically and orderly, fairly treatment to the trading partners concerning the purchasing and payment

• Organizing the meeting with entrepreneurs • Communicating through the electronic media and web page • Inviting the customer for the Company visit • Surveying on the satisfaction • The trading partner and the Company support the activity of CHO Thavee Junior Cup • Providing a receipt of complaint channel for the operation and production improvement • Providing a 24-hour call center for a domestic after sales service

• Survey for customer • Responding to the customer’s satisfaction needs • The Company’s informa- • The needed products and tion through the annual the quality of products and report and CSR report services • Through a social media • Maximizing the performance • E-mail, website and a of the repair and maintenance management assessment form • On time delivery

Creditors/ Debtors

To act as per the agreement • Providing the Company information condition, transparency in purchasthrough the annual report and CSR ing goods and payment to suppliers report with Good Corporate Governance • The financial report performing complied with laws and regulations and Good Corporate Governance building on good relationship, welcome for company visit, • the disclosure of important to related organization as accurately

40

• Researching and passing on knowledge of technology in developing products equivalent to global standard • Developing standard and modern products • Continuously developing the after sales service • Strictly follow the agreement and condition to the customers and trading partners

• C o n t a c t i n g t h r o u g h • Acting to the creditors and • Following the regulation, the the electronic media, debtor according to agreement loan contract and other agreetelephone, letter and condition complying by law ment with business transparwebsite ency • Organizing the company visit for the confidence of business operation

41


SUSTAINABLE DEVELOPMENT REPORT 2017

Stakeholders

Cho Thavee Public Company Limited

Communication procedure and participation

Responsibilities

Communication channel

Stakeholders’ expectation

CHO’s responding

Competitors/ Business Alliance

To perform as to rules of bidding • Organizing the meeting, to share the competition as accurately, complied experiences to the rules and regulations of bid- • Legal issues relating to business, ding, to provide useful information, company visit, and business cooperato share the knowledge tion in future

• Annual report and CSR • Transparent competition and • Transparency in business report fairly treatment on business operation • Memorandum Of Underoperation • Performing as to rules of • Gaining trust from alliance standing (MOU) bidding market competition • Meeting as accurately • letter E-Mail, company • Established a consortium visit, exchange of lecturer, with Scan Inter Company website Limited. It named “SCN-CHO collaboration group”

Shareholders/ Investors

The stable financial liquidity, good operation results from Good Corporate Governance, return on investment with process that can be examined, precise and transparency, the organization has positive development in continuous, the expansion of service providing in future

• Providing the annual report and CSR report to the shareholders and the investors • Annual shareholders’ meeting • The company visit • Road show in other province • Opportunity Day for listed company meet and greet the investors • Booth and exhibition for investment • Disclosing the Company information and business performance in each quarter through the Company’s website, Facebook and CHO News

• Contacting through the • Maximizing in retu rn in • Increasing more informaelectronic media, teleinvestment and growing of tion channel for shareholdphone, letter, website, the business operation ers and investors Facebook and CHO news • Transparency in management • U p d a t i n g c u r r e n t l y • Building the understanding in information and news the Company operation through the investor relation website

Mass Source of information with the • Annual report, CSR report Communication effectiveness, accuracy, and promptly • shareholders’ meeting and press tour

• Press conference, e-mail, • Receiving the completed and • Updating news of business website, Facebook, line, updated information with fairoperation telephone, advertisement ness through CHO YouTube • Receiving the updated news of channel business operation • Fairly treatment disclosing the information to the mass communication

The Company have contacted on • Company visit by the public sector procurement with the public sector • Quoting the procurement with the public from past until nowadays, also the sector company is monitored to comply • Following the regulations and condition with laws and regulations and Good of the public sector Corporate Governance by the public sector

• Letter from the public • The Company gain trust from • Transparency in following sector, contacting through the private sector as the transthe rules and regulations the electronic media, teleparency in business operation of business operation phone and website

Thank Press • occasionally meet the mass communication

Public Sector

42

43


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Developing Aspects and CHO’s Strategic Directions

Materiality Matrix More

Operational Framework

The Prioritization of the issues (Prioritization) The Company has reviewed the sequence of the major issues affecting the stakeholders and the operations of the Company. The priority was considered based on the relevant issues and the GRI G4 reporting standards. In 2017, the company has prioritized issues in 2 levels from the Materiality Matrix as the high-priority issues and low-priority issues.

Material Aspects

8

Significant Impact to Stakeholder

CHO prioritizes and pays attention to the significant aspects of the business operation that help in sustainable growth in the future. Therefore, CHO decided to do the significant aspects assessment concerning to the sustainable development. The assessment was for the analysis whether there were some significant issues that might show some risks or opportunities in the economic, the social, or the environment sectors within its business function (Internal effects) as well as its stakeholders (Externalities). Once the assessment was completed, the results were presented to the executive committee for their approval and combined in this report. The report was assessed in accordance with the Global Reporting Initiative (GRI) as follows. The Key Issue Selection Principle (Materiality) In 2017, the company has selected the key issues from the management of the sustainable development. The selection shall help the company achieving in many aspects of the organization. The issues were selected from the employees’ survey and the sustainable development operation. They could reflect the risk or opportunity in terms of the economic, the social, and the environment. Which concerned in every unit of the organization and stakeholders and can impact both internal and external to the firm.

7

3

12

6

13

Less

4

14 2

9 15

11

More

Significant Impact to

The company will improve the significant aspect assessment procedure in the next time to ensure the quality of the assessment and the ability to show the result even more clearly. Scope of impact Stakeholders outside the organization

Within organization CHO

Community and Society

Customers/ Trade

Creditors/ Debtors

Competitors/ Business

Shareholders/ Investors

1. The Corporate Governance 2. The Innovation Researching and Development Economic 3. The Procurement aspect 4. The Supply Chain Management 5. The Risk Management 6. The Occupational Health and Safety 7. The Social and Community Responsibility Social aspect 8. The Human Rights 9. The Employees Relationship 10.The Anti-Corruption 11. The Air Quality Management 12. The Recycling Environment 13. The Water Management aspect 14. The Environmental Friendly Products and Services

15. The Biodiversity

44

10 1

5

45

Mass Communication

Public Sector


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

The Business Development Strategy in Long-term for the year 2023 CHO applies the policy of driving organizational sustainability with the long-term planning according to the model scheme for 10 years “CHO 2013 Strong, Brave and Differentiation” and being the “Learning Organization” through the important tool including Routine to Research (R2R), Knowledge Management (KM) and Continuous Quality Improvement (CQU) in creating the learning at all time. The employees are the most important tool as they are the connector and passing the development from inside organization to the outside and environment society which is called the “Sustainability”

Innovative Movement for Sustainable Development

CHO.CSR

“CHO 2013 Strong, Brave and Differentiation”

46

All the Time

The management of the organizational sustainability concerns the policy in defining vision and strategy. The managements have their significant duties in setting the goals and transmitting the vision and the management frame work to the authorized committees. The transmitting depends on the mechanism, and the operational procedure of various activitygroups in reaching the targets and the cooperation of the organization’s human resources. The significant strategic goal of the organization is to be a “Learning Organization”. The policy direction in managing the sustainability depends on the application of mechanism from each group in creating the learning at all time. The mechanisms are such as the technician school course called “Rohng Rian Chang Cho Thavee”, the employee development course (CHO program), and group of various activities. The significant driving of policy in leading the organization to be a learning organization is the driving and the developing of routine work systematically. CHO has implemented significant instrument called R2R (Routine to Research) by havingthe continuous quality implement (CQI) which is the supporting instrument for the development of routine work to research (R2R)

47


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Innovative Movement for sustainability SCA

In summary, the organization’s driving policy focused on knowledge as the basic to the development of learning to sustainability by having group of activity and CHO’s course as the basic and R2R instrument helping in developing the procedure of learning systematically

SPA ENV EPW

OJT

Rohng Rian Chang Cho Thavee Project Human resources development is conducting according to the sustainable policy and the trends of changing. Development approaches are classified in to 3 main categories, for all sections, Coaching/OJT-On the Job Training, Knowledge Sharing/CHO School, and Project Assignment/Mechatronics Project.

The Purpose of CHO’s Technical School for Sustainability The employees can learn new techniques to handling their jobs and quality improving the new product and issues. By the approaches, the strengthen organization, the secure growth with sustainable. The interpersonal relationship is by product and shown off the clearly teamwork.

Knowledge Sharing / CHO School

Project Assignment / Mechatronics Project

CHO School Training for Trainer Program The Courses of CHO Technical School was designed from many data assessing for the cores competency problem by the managers/supervisors. The courses will help employees developing their skills to be promptly prepare for their work and also be develop to be a teacher in “Rohng Rian Chang Cho Thavee” school. 100

80

New employees 60

Coaching / OJT

40

20

Employees 40.4 % 31.13 %

29.21 %

12.8 % 5.30 %

0

48

Short Term Training Courses Many Short Courses were set on the basis of Technical fundamental, specific techniques, etc. Each courses requires 5 weeks long. The employees were grouped for the basis of Technical fundamental training course at approximately 6-7 classes annually. The participants are as following:

2015

2016

3.93 %

2017

49

Note : the percentage was calculated from the total participants and the total employees


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

CHO Mechatronics Program The Mechatronics Course offers for engineers technicians and others employee. They will learn the basic of automatic control principles and its programming. Special project on Mechatronics will hands out to participants. They have done 10 project before finished the program. 200

168

168

Participants Contacted Hours : persons

150

120

120

100

50

6 0

8

Employees

7

Engineers

2016

8

Employees

Engineers

2017

Completed Implantation Projects of the year 2017 1. Transport Equipment A car control by microcontroller project Qualification of the work 1. It can transport parts from the warehouse department to the assembly department or to the concerning production departments. It helps reduce the transporting work by workers and save their time. 2. It can be loaded exceed not more than 1 ton. 3. It uses electric power from a battery as a starter power in order to reduce pollutions. 4. It adopts new technologies to apply and develop them into an advancement of technology.

50

• Catering truck Model by PLC _ CR0200 IFM.

Qualification of the work 1. To be used as teaching materials to customers and the Cho Thavee school’s students. 2. To add a channel in promoting the company’s products in terms of education to customers and visitors. They can learn and understand the working process of the catering cars. 3. The catering truck model works with the PLC controlling systems. The systems command the model via a touch screen and control its movement of the parts by DC motor, Gear Box, Ball Screw, and Sensor.

• Lighting Powered by Solar cell Panel During the year 2017, the Solar Cell Project Monitoring • 20 Solar cell panels were installed. Battery discharges on load for 12 hours and 2-3 hours completely recharges. • 20 Batteries were installed as energy storages, 28.73 hours for completely discharge, or 24 hours with no recharging. • DC/AC inverter is required with battery level detection for selectable between AC and DC voltage sources.

51


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Routine Job to Research Development (R2R) R2R Connect to learn, Connect to the sustainable success “The “RohngRian Chang Cho Thavee” school project is an output resulting from the R2R concepts. The project has used innovation and equipment in knowledge management for the company’s personnel. It works as a good basis knowledge in the future development of CHO’s employees and the organization. It will make the company as an always learning organization which will sustain the future of its businesses.” Mr. Suradech Thaweesaengsakulthai, Chief Executive Officer of Cho Thavee Public Company Limited.

“Innovation” The Policy which driven the organization to the sustainable business The R2R concept or the use of innovation and equipment in knowledge management that CHO has adapted the knowledge to be its good basis for the company’s foundation. It will root CHO as an always learning organization which is an important step in driven the company to be sustainable in the business.

R2R is learning process for rapid and continuously improving their routine jobs. The learning will use innovation of every employees to develop their skills to comply with standards for researching. In every step of the project, there are judges who were judged and advocated whether the works can be used in real life working. At the same time, the project helps improving the employees’ knowledge not limited to only their routine job skills. The results are the works from the R2R project that approved by the judges and were usable will receive a prize from the company. This will inspire its employees to create a new innovation.

Mr. Suradech Thaweesaengsakulthai, President and Chief Executive Officer of Cho Thavee Public Company Limited.

Routine Job to Research Development (R2R) Safety Morale

Motivation

KM. & INNOVATION

Quality

Cost Saving

The result of operation for the R2R project for year 2014-2017 1

15

18

6

2014 The approved and usable project

52

R2R

and

5 The expectation from doing R2R • Goods delivery and premium services continuously improving for the satisfaction of customers • Core competency and efficiency of CHO increasing Totally • Learning achieving : Personnel and The Organization

Cost

1

8 8

10 9

2015

2016 The in-progress project

53

6 2017 The rejected project

2


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

The usable prototype from the R2R project from the year 2017

The operation of Four CHO- CSR Groups CSR COMMITTEE ALL DEPARTMENTS CHARITY

Lifting machine for catering trucks’ cylinder leg

Jig for hydraulic tank welding

Created by :

the employees in the Hydraulic 1 department

Created by :

the employees in the Hydraulic 1 department

Benefits:

Saves approximately 30% of working hour and uses approximately 50% less of labor in the progress. Inconvenient to use in anon-spacious area

Benefits:

Saves approximately 50% of working hour and uses approximately 50% less of labor in the progress. Have to use more space than the previous one for the installation.

Cons:

Cons:

Automatic Pipe Cleaning Machine

Air-Bleed Trolley Jaw Cylinder cart

Created by :

the employees in the Hydraulic 1 department

Created by :

the employees in the Hydraulic 1 department

Benefits:

Saves approximately 30% of working hour and uses approximately 50% less of labor in the progress. the machine is in a large size which makes it inconvenient to move from place to place.

Benefits:

Saves approximately 30% of working hour, uses approximately 50% less of labor in the progress, and provides more safety than usual. the cart is in a large size.

Cons:

Cons:

Learning Process and Development

CSR Social and community Activity -Disabilities - Anti-Corruption - Human Rights - Internal and External Communities

CSR Special Activity -Other Special Activities within the Company **External activities supporter**

CSR HAPPY WORK PLACE Activity -Happiness in 8 field of Happy Workplace

CSR Environment Activity - Internal Environment - External Environment - Environmental Innovation Development

CHO’s New year party and entertaining activities In 2017, there was the cooperation between the 4 groups of CSR teams to organize the new year party and entertaining activities for the employees in order to building the unity between them and relaxing them after their devotion to work for the whole year.

Cushion Wearing Helper With Roller

Equipment Box For Hydraulic Equipment

Created by :

the employees in the Hydraulic 1 department

Created by :

the employees in the Hydraulic 1 department

Benefits:

Saves approximately 60% of working hour and uses approximately 20% less of labor in the progress. a glove is needed when using the machine for the better efficiency.

Benefits:

More convenient to find and use equipment.

Cons:

It needs more space than the usual hydraulic installation.

Cons:

54

55


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Society and community Activity (SCA)

Social and community Activity’s committee achievement in 2017

The SCA. Committees and working staff are responsible for the work of anti-corruption, human rights and related social functions are performed within the community and outside the board and staff have discussed the situation at the meeting all. Monthly For the pursuit of activities suitable action plan has been set up and approved by the Executive Committee.

The implementation of Labors and human rights the company. The Company has been allowing the disable person to be an employee to promote the crimination and improve their equality and quality of life. In the year 2017, there are 6 disable were employed equivalent to 1% of all workers. In addition of salary payment, social welfare is topped up for all disables. The company treats the better life; work place and suitable work condition to reduce any risk from the disability.

The Scholarships for the employees’ children project

100% supporting to disability employees

CHO Thavee Football Junior Cup (CJC)

The operation of Society and community Activity (SCA) committee

Anti-Corruption

CHO has given the scholarships for its employees’ children project for 2 consecutive years (From year 2016-2017).The scholarships were given through the CSR’s social and community activity committee project. They were given to the employees’ children who are studying in the level of Pathomsuksa 1 (Grades 1) to Musthaomsuksa 6 (Grades 10) who earn a good grade in schools in order to encourage them to study and be good kids. In addition, if the students received the scholarships 3 consecutive years, the company will grant scholarships for their education in another 3 consecutive years. The project received good feedback from the employees. In this regard, CHO is considered to take the personnel issue as an importance aspects in terms of locally development.

Scholarships for the employees’ children

Leads To

Sustainable Development

56

57

Planting opportunity by “Giving” The sustainable development is framing based on the Triple Bottom Line or the balancing between 3 aspects; which are the Economic, the Society, and the Environment. Especially for the Society aspect, we see the important of the education. Learning is the fundamental for developing every aspect in the future. As for the reason, the company has planted and expanded the idea to set up a project named “The Giving Scholarships to the employees’ children project” As part of building our achievement, if our fundamental needed of the company’s employees are still lacking, how can we through roughly understand the heart of trying to giving the social returns? Hence, the scholarships project has established in order to serve the main purpose in creating the employees engagement with the organization. In addition, the employees have benefits from decreasing the expenses in their family. Most importantly, the scholarships help supporting their family and resulting in the better work performance as well as creating happy workplace in CHO community.


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Cho Thavee Football Junior Cup Games CHO has always seen an importance of improving the football skills of the young generations. Then, the company has been the organizer of Cho Thavee Junior Cup games since 2011. The project was meant to instill disciplineinthe children through playing football when they still young. The football games are encouraging many children age between 12 to 14 years old to play sports. The games were competing between the teams within the province and targeting to improve their skills both on playing football and running at the same time.

“CHO” plants “Taproot of Thought” For youth with sports dimensions Youth Age not over 12 and 14 years old

CHO THAVEE Junior cup

Some statistics of football teams participations Number of Team Age 12 years old Number of Team Age 14 years old

Total 39 Teams

Total 45 Teams

2011

Total 64 Total 64 Total 64 Total 60 Teams Total 53 Teams Teams Teams Teams 32 32 32

28

27

26

23 16

Football, Athletics

19 2012

26

2013

32

32

32

32

2014

2015

2016

2017

7th “Cho Thavee Junior Cup” Games: Creating the new generations of Thai football players Playing football helps us having cleverness, practicing faster movement.Football has its own rules which every player has to follow. The rules can be adapted to use both inside and outside of the field. More importantly, football is one of the most famous sports whether in Thailand or around the world. For this reason, CHO Thavee Public Company Limited has organized youth football games called “7th CHO Football Junior Cup” for the year 2017. The games are supporting and giving the opportunity to the youth in Khon Kaen province and others province in playing football.They can learn and play football as it is a way to exercise themselves regularly. It helps improving the quality of life for the children in terms of being healthy both their body and mentality. The children has gained their experience and skills in playing football.

58

Benefits to CHO

Benefits to the society and the youth

• Building up harmonization between CHO’s employees by participating in the activities • Brand CTV/CHO be recognized in society • Building up a great reputation for CHO • Building up a fellowship with the trading partners by cooperating to organize the activities

• Self-discipline cultivated for youth • It is the first competition field for the chance to process to the bigger competition filed in the future. • Skill development for youth • To allow the youth paying attention to sports, staying away from drugs and reducing social problems • To allow the youth regularly exercising which helps developing a healthy quality of life, good health and without sickness

Besides the winning of the fames, the most important idea of organizing the games is helping the children understand the “Disciplines and Sportsmanship”. We created a player card for each of them. They cannot swop or change the other players for their position in order to win the games. The player card help the children learn to be “Discipline”, honest, and responsible in their duty as a player in the games. Not only for the player, the judges have to respect the rules and be honest when judging the games. The outcome is to create the most fair game which is the key to develop our country in long term. For the “Sportsmanship”, the games taught the kids to learn and accept the result of the game with smiles. They learned to give and help the others both inside and outside the field. This experiences will be the fundamental to create the good virtue and morality within our future generations.

59


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Special Activity (SPA)

Making Wood Flowers To Be Placed on the Royal Cremation Ceremony for the

Special Activity is responsible for supporting and contributing to society in various forms. The Company has offers a policy on CSR to the form of the truly sustainable development. So, the SPA was set up by developing mind thought from general supporters to be a public sponsor who support and enhance in the company charities.

The Performance of the Special Activity (SPA) of 2017

To help for the funeral ceremony of the employee

late King Bhumibol Adulyadej The CHO’s employees participated in making flowers to place on the royal cremation ceremony on October 26th, 2017.

The Donation Activities To Support Education The company has financially supported groups of students from the Rajamangala University of Technology of Technology Khon Kaen Campus and from the engineering department at Khon Kaen University to compete in designing and developing the automotive engineering in the TSAE Auto Challenge Student Formula. In the same manner, the company has financially supported the other educational projects, too.

Blood Donation. Blood donation

To support for the sport fair to educational institutes

Special Activity To donate money to various organizations

To support the research and development of students

This CSR activity aimed yearly base to enhance awareness of sacrificed and pool up the blood bank for hospitals to use with their patients. CHO’s employees coordinated with Central Hospital of KhonKaen province to donate blood to the hospital through CHO’s SPA every year. In addition, SPA held activities which help the community every year, too. In the year 2017, the donation was implemented for 3 times with the total blood donated at 97,000 ccs. In this regards, the CHO species (the employees) was joined and greatly contributed to the activities that the company held for the sake of the community and the society.

The total blood donation statistic

Target 120000

106,000 CC. 97,000 CC.

100000

The employees, communities, society and stakeholders have been helped, supported, and developed from Special Activity

8000

74,300 CC.

6000 4000

Leading to

2000 0

Sustainable development

60

61

2015

2016

2017


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Happy Family

HAPPY WORK PLACE Activity

This event is to encourage employees to realize and recognize the importance of family. The Happy Work place committee organized the festival as of the year 2017. The activity included pouring water on the hands of the company’s executives and seniors employees and asking for blessings. The activity was meant to show their love and gratitude to those they love, and been blessed by the company’s executives and seniors employees.

Happy Work Place committee is creating happy within the workplace for employees in all 8 factors. The 8 factors happen from each of the activity that happened in accordance with the agreement in the Happy Work Place committee. The activities were planned and held by the allocated budgets for the important activities in the company. The CSR-SPA committee will consider appropriate activity and support the budget. Any suggestions or problems will handle by the CSR-SPA committee. For the year 2017, the Committee has stressed to create happiness and being supportive to the employees through the activities. The company has held the main activities as following:-

The Performance of Happy Work Place in 2017 The Casts Liabilities to Employees (Happy Money)

Annually Travelling Experience

The Company realized to the mental health of employees such as stress, anxiety, and worrying in debts. The integration on those problems is to help them release debt and strengthening financial discipline. The Casts liabilities to employees

Happy Family

Moral principle training

Engagement

Fitness Promoting

Management Money training

Employees Happy & Sustainable Organization Organization Culture

Good Food, Economic price, Free Rice

Participations

National Mother day and Father day

Receiving money

Records in the monthly income statement

Merit Making and offer food to monk (Happy Soul) In each month, CSR-SPA committee provides a birthday celebration for employees who were born in the month. To make them all high merit, inherit the Buddhist culture, encourage them to do good virtue and morality, and perform their work happily among the employees, faithful in religious and morally living.

Employees’ Birthday Anniversary Life Insurance for employees

62

Consultant appointment

63


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Promoting Exercising and Being Recreation (Happy Relax) In 2017, the company has held annual traveling Healthy (Happy Body) experience activities for employees. The activity is The company held annually Sports day every year purposing to create unity and help the employees during April. The event is encouraging employees to relax from their work. to exercise after work and at lunch time. Sports help them being strong and healthy both inside and outside. On the event day, there are prizes for the winner in these 3 sports; 1) Kicking rattan ball, 2) Table tennis, and 3) Thai Chess.

Learning and All-time Approving Good Food, Economic Price, and Themselves (Happy Brain) Free Rice (Happy Money) The company is pushing all employee to bean Canteen with nutrition food and free of stream rice were set for all employees. The Happy Work Place committee had start this project since 2015 which could help employees reducing cost of living.

expert or skilled worker in each position, the CSRSPA encourages them learn to be professional, got progress in career path regularly, and more discipline in their work. In accordance with the company’s policy for the year 2017, the Happy Generosity to Others (Happy Heart) Workplace committee has held the enhancing The HAPPY WORK PLACE committee realized the their ability activity and committee building event importance of the employees’ birthday anniversary to create harmony among the employees. which considered as one of the important days for everyone. The committee has prepared presents and to the employees on their birthday’s anniversary with the best wishes at their working stations. This activity shows the support for generosity within the community and makes the day is more important for each of everyone.

64

Environment Activity Environment committee is a responsible for handle all operational of environment both inside and outside the organization. In addition, to creating innovative environment which consistent to the core competencies of organizations.

The CSR-Environment objectives of Environment in accordance with “To Goal CHO 2023” 1. Provide an appropriate environmental management system. Monitoring and evaluating the implementation of all projects regularly. As well as learn issues on the environmental movement such as global warming, pollutions, ecology, etc. 2. Selecting new technology for production processes that governs to environmental standards with friendly to environment, pollution reducing, and the pollution treatment before being released into nature. 3. Using resources efficiently, Energy consumption efficiently, reuse or recycle in resources 4. Develop new products and services with friendly to the environment and safe to use. 5. Create Safety and Healthy environment for employees and the surrounding community. 6. Compliance with environmental laws and regulations. 7. Support customers on the caution of the environmental precautions that result from using the product and services from Cho Thavee group. 8. Promoting knowledge and training toward employees and people in surrounding community in the issue of environment, safety and health care. 9. Setup an emergency plan to dealing with the environmental issues that may arise. Setup a real time reporting system to regulators when such events occur. 10. Promote environmental preservation to community and support to surrounding community for those activities. 11. Improved the working environment in the painting process. The company changed the processing to set the closed paintingroomfor spray painting where it has water curtains to reduce the scent and dust from the painting process. Apart from what mentioned, the company also has the closed paintingroomfor power coat painting as well.

The Performances of CSR-Environment in 2017 Community Engagement activity The company and its subsidiaries have participated with the Ministry of Industry of Thailand for the water management project and installing good environmental governance project. The surrounded community within the area has also participated in doing the projects. During the activity, the community has been informed about the impacts from the company’s business to the community as well as the solutions which the company has continually solving the environmental impacts. The activities for the projects are for examples; Freeing fishes to the public water resource in the area surrounding the company’s location together with the people in the community.

5s activity • Forming 5s committee by having each of the department representative as part of the team. • Auditing 5s practices every month. • Following the 5s practices and putting up the 5s information on the internal announcement board to promoting the practices.

65


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Environment Operation Environmental policy 1. The company has engrossed in advocating the operation based on the environmental regulation and laws as well as the continually developing and adjusting the operation related to the environmental. 2. The company has engrossed in preventing and reducing accidents in the workplace in accordance with the occupational safety, health, and environment act of Thailand. 3. The company promptly operates businesses in accordance with the national environmental regulations and laws in terms of the waste management (waste sorting) and encouraging to the best effective energy usage. Which we try to reduce and prevent emissions into the atmosphere from our business practices. 4. The company promptly promotes and applies the environmental policy to our employees and our stakeholders as well as promoting it to the public which in line with the national laws and regulations. 5. The company has processed to review, adjust, and evaluate our operation in line with the above policy regularly. By doing so, we has updated our environmental policy as needed but still in line with the national regulations and laws. The policy shall publish and promote to our employees and our stakeholders.

Water Management The Company is focusing the efficient of water consumption. A few water consumption in the production is bringing zero problems in the water management and the water consumption. The water treatment system from the production and offices are efficiency. Grease Trap, Septic Tank and Anaerobic Filter were installed prior to get the better quality then drained to the public sanitary sewer.

Monitoring & Measurement

Monitoring The Quality of Environment in Company and Its Subsidiaries The company and Its Subsidiaries use main source of Electricity, in order to reduce the air pollutants from the production lines. For the air pollution in painting process is operate accord to the requirement of the legal provision, More than 80% of processes, The company chooses a color material which is composed of 2K with the Low Emission Product in addition with closed painting coloring booth which is equipped the modern Air Filter Systems to reduce pollutant particles, also the mean of particulate from all processes is meet the national regulations. Moreover, the air quality in the plant and vicinities regularly was monitoring by a private inspector company which has been certified. The noise pollution of The company and Its Subsidiaries is inspected within the factory and vicinities each year. The data reported that the noise pollution is meet requirements of the National Regulations.

66

Waste Management The company and Its Subsidiaries have arranged the appropriate managements which is applying for disposal from the Factory by meet to the National Standards and Regulations. In the year 2015, there are approximately 900 metric tons of the non-hazard waste. In the year 2016, there are 478 metric tons of the waste. And In the year 2017, there are 155 metric tons of the waste which decreased from the year 2015. The non-hazard waste were classified and sorting for energy saving and resources preserving. Basically, 3Rs project was introduced for waste management, i.e. Reduce, Reuse and Recycle. It can reduced the disposal cost. The left over from recycling waste, our waste management contractor has organized toput them in the landfill under the proper method which creates no impact to the factory and vicinities. In addition, the simply techniques of environmental preserve and energy preserve were introduced to employees, the Youth, and vicinities via 3Rs projects.

Sustainable Energy & Green Innovation

The mission of The company and Its Subsidiaries is creating products with regarding to the energy preservation, friendly to environment, sustainably, safety, multi functions which is a basic concept of the energy preservation. Also the strictly implement in accordance with standards and regulations is applied in order to reduce the energy consumption in production lines, in addition, the production processes are improving to reduce the energy consummation and take the least effect to environment. The following activities concern to energy and environment preservations are presented.

Energy Preservation, Investment for Environment CHO is focusing to reduce its energy consumption including the use of renewable energy to reduce the country’s natural resources burden and to apply Mechatronics Engineering knowledge which our staffs have gained from the training. Led by the solar panels study and development by using solar energy for lighting the area around the company which results in the reduction of power purchasing and save more energy. The project was started in 2015 until present. The former Sport light needed the electrical energy of 43.2 kWh then we changed to the solar cell LED light which needed the electrical energy of 8.16 kWh and can be used to power lighting around the company’s fences for at least 12 hours per day. Reducing electricity cost up to 63,072 baht per year. The Company and its subsidiaries were developed the sustainable product for preserving energy. With the composite materials are used to be the main part of a new lighter container which is enhances the efficient of carrier to be greater but lighter. The fuel consumption, the interesting statistics is reduced by 9%. We are working under leading of the professional in product designer to create new product with the world standards. By the year 2014, the project of commercial Electric Trucks and Electric Catering vehicles were established with 100% electrical driven to reduce pollutions and the cause of the global warming.

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Working Environment

The quality of working life is very importance in our Company. Therefore, the company and its Subsidiaries has taken the working environment into their consideration and managing to promote the good practices through many projects. So, the working environment were managed and balanced through appropriate activities. The hygienic safety, happiness, and stabilized, are the most criteria to tuned up good attitude and create happy workplace environment. In the end, it will help the organization gain in productivity whether by individual or the organization as a whole. Thus, the end result will create good effects to and motivate the workers.

Training in Environment

New guys participated to the courses

Percentage 100

80

60

40

20

0

2015

2016

2017

Unit

The company has organized the environment training for new employees before starting their job which the program started since October 2015. There are 100% of the employees attended the training. The training course contents are definitions of environment, working environment, i.e. dust or particle, noise pollution, temperature, light intensity, national standard and regulation for the occupational safety, health, and environment as well as guiding them to use the safety equipment.

Reducing the environmental impacts on the community.

CHO has the protection, controlling, and treatment of odors and dusts from the business. The company has been compliance with the limitation of the pollutions to not over than the environmental standards according to the laws concerning to the national environmental quality act and the other regulations and laws that might be related. There is an inspection from the external organization every year. According to the risk management, the above mentioned is still not enough to control the pollutions which created by the production process of the company. Refer to the environmental and health impact to the surrounded communities survey, the majority of the respondents agreed that dusts from the business production have impacts on the community in the few level and the medium level of impacts at 28 percent and in the very much level of impacts at 16 percent. The people in Moo Baan Thaworn was impact from the odors and noises more than the people in Moo Baan NoonTun where located further than Moo Baan Thaworn. The majority of the people suggested the company to fix the odors and noises issues which were releasing from the plant. The second largest group of the people suggested the company to fix the noises which created during the lunch or breaks of the company’s employees. The company’s production has the risk factors for the occupational health and the environmental risks which created by the coloring process.

68

The coloring process

Electrical energy cleaning sand

cleaning process

labor use Puttying

noise, waste, dusts

bad odors, dusts

noise, bad odors, dusts

Wind energy Polishing putty Using man-power in sandering Polishing until it is smooth color, water, electricity, papers

The real color spraying in the closed spraying booth

In the year 2017, the company has adjusted the coloring room to reduce its impact on the local community at the increased rate of 90%. According to the survey, we can see that there are still dusts and odors from the coloring process which may impact the surrounded communities. CHO has adjusted the coloring room from the dry system to be the water curtain system which can reduce the dust. In addition, the company has planted the ironwood along the fences, the asides, and behind the factory. The ironwoods were growing as a natural fence which can help protecting the scatter of the odors and the dust from spray paint. The natural fence prevented the impacts to the livelihood of the community around the factory. In addition, They can be a natural fence because the ironwood is a perennial tree. Its benefits are not just what mentioned earlier, they also give shadows, releasing ozone into the atmosphere, and improving the environment of the company’s area as well as prevents the impacts from the community. The company has improved the prevention efficiency of the spread of odors and spray paint by installed slants and water curtains around the spray booth which may affect the surrounding community with 2 meters high and 130 meters length around the spray booth. After the installation, the company had asked residents in the surrounding community and found that the smell of paint and the spray paint which spread into the community were reduced by 80%. In addition, the company has planted the ironwood along the side and the back walls of the factory to create a natural fence which can filter the painted smell and dust from the company’s products manufacturing process.

The processing in the prevention of the air pollution

bad odors, dusts, wastewater

paper with color stained, Capturing the wastewater, dusts, color, by the water curtain in the spraying booth.

1.Planting pine trees around the factory’s walls and fences.

2.Installed slants on the wall.

3. Installed water curtains

4.Inspected from the external organization every month

The result To prevent the bad odors and dusts spreading to the communities at 80%

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

The Result Of Air Quality Measuring In The Surrounded Community Location

Parameter Total Suspended Particulate (TSP)

Time

24 hrs

Result*

0.18 mg/m3

Standard*

Passed 24 hrs

0.06 mg/m3

Units

2015

2016

2017

Electrical Power : Buying

kW

6,480.00

6,096.00

6,597.00

The solar power usage

kW

N/A

3,212.00

4,233.60

Total of Fresh water

Liter

9,126,000.00

9,894,000.00

10,637,148.00

Waste Water treated

Liter

0

0

0

Treated water reused

Liter

0

0

0

​Landfill

Ton

0

0

0

recycle

Ton

0

0

0

​sale

Ton

900

478

155

​other

Ton

0

0

0

Leakage of Chemical substance

Time

0

0

0

Energy

Water

0.33 mg/m3

Moo Ban Thavorn village PM-10

Comparing result

Environment

0.12 mg/m3

Notes * = the Notification of the National Environment Board, No.24, B.E.2547 (2004), regarding to regulate the standard of the air quality in the atmosphere (which was published in the Royal Government Gazette Vol.121 Part 104D, dated September 22, B.E.2547 (2004).) mg/m3 = milligram per cubic meter

Waste Management

Green Industry project (Green System)

In the year 2017, the company and its subsidiaries have participated the Green Industry project by the Water Technology and Industrial Pollution Management Bureau under the Department of Industrial Works of Thailand. The project aims to create the greener industry in Thailand. CHO has been considered and received the 2nd level of the environmental friendly establishment.

The particulate measure The air quality measuring in the surrounded community area of the company, Moo Ban Thavorn village, has been measured by C.E.M. technology (Thailand) company limited on April 28-29th, 2017. The results show that the density of Total Suspended Particulate (TSP) and PM-10 are within the standard by the Notification of the National Environment Board, No.24, B.E.2547 (2004), regarding to regulate the standard of the air quality in the atmosphere.

70

71


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Occupation Health and Safety Every Employees in all positions who work for Cho Thavee Company are all significantly important. Every one of them is part of the organization’s achievement. The performances were operated under the revised policies as of the year 2017: 1. The company has been engrossed in operating its businesses in accordance with the occupational safety, health and environment Act of Thailand. 2. The first responsibility of employee’s in work place is the “safety first.” 3. The company shall support for the improving of working conditions and environmental conditions for more safety. 4. The company shall support for the safety activities that promote to employees for stimulating the employee’s awareness such as: the training, the motivation, public relation, the competition campaign of safety. 5. The company, employees, and business partners must cooperate for all safety activities that take them to the ultimate safety, or shortly “accident must be zero.” 6. All of the supervisors must take action of a role model, leader, trainer, coacher, and motivator for all employees with safety strategies. 7. The employee must recall himself/herself safety, co-workers, and throughout the company’s assets at all times. 8. The employees must care of the cleanliness and the orderliness over the working area. 9. Employees must cooperate for all safety projects and healthy project and has a right to raise up a suggestion for improving their working environment and their safety procedures. 10. The company has reconsidered, adjusted, and procured the evaluation on the result of the policies implementation regularly.

The Chart of Safety

Safety Management Representations

President and Chief Executive Officer

Safety Committees

Safety Unit

Safety staff

Safety officer. Professional. 2 persons

Safety officer. Management 13 persons

Safety officer. Supervisor 55 persons

Field Risk Assessment: Accidental Reduction

Pause! Think before Operation

Look around ! hazard?

Carefully Continue

The Company realizes that every employee is a valuable resources and recognizes the priority over any properties and equipments. The occupational health, safety, and environmental handbook is purposing to give the right understanding and information in operating the businesses. It is concerning to all members of the Company, out sourcing contactors, and every one who involve in the company’s businesses. Everyone has to study throughtout this handbook. Any conflict to this handbook, the specific procedure shall be replaces.

72

Risk control to protect endangered Upcoming

Risk assessment of hazard potential.

73


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

CHO has received an honorable mention award from the Role model in operating the business with occupational safety, health, and environment institution program for the year 2017.

An Exercise ; Emergency Case of Chemical Leakage In order to prevent the Chemical disasters that can spread over the vicinity. The Company has an emergency plan in the case of Chemical Leakage either risk reduction or safety reasons. Then, the Rescue Emergency exercise in case of a chemical leakage was performed once a year under the target of unity, teamwork, good experience in communication and systematical approach on operational rescue.

Safety Providing the environment and health in the workplace, CHO is concerning the safety in each operation. Therefore, CHO has providing the environment and health in the workplace. The personal safety equipment was provided and employees were trained to use for general and particular works to adapt the working environment, in order to establish the effective production system, and improving their quality of life in the working area. The most important, whereas they are working, employee must be aware and concentrate in all operation, never negligent, and highly self-care. The accident can happened anywhere whether in or outside the plant.

The risk to an accident occurrence

Fire Prevention in work place

The company has established the fire safety in the workplace according to the regulation of the Ministry of Interior identifying in the management and processing standards in the safety, occupational health, and the working environment aspects in the year 2012. The regulation mentioned that the company shall conduct a firefighting and fire evacuation training to its employees. This will guarantee that the attendants have the knowledge and understanding about the basic firefighting and be able to use the fire extinguishers, fire host, and fire sprinkler properly. A number of participants of the basic firefighting exercise must be at least 40% of all employees. In addition, all the operation staffs need to do the fire fighting and evacuating exercise at least once a year.

74

The Company and its affiliates realize either safety or healthy of workers and its partners. In addition, it shall be a cause to employees and its partners’ morale and spiritual. By the year 2017, there were 13 incidents which had 1 incident less than the year 2016. Most of them were careless and missed performing. Then, the company has prevented the accident by training its employees to use the equipment properly. Accidental case was usually found in hot work and assembly the products. So, both of the parts production Unit and repairing service Unit are the risky working areas and have to implement all relevant preventing and control.

The summary of cases caused by the operation. Safety Remark

Unit

2015

2016

2017

Absence due to any accident (employees)

Cases

2

4

6

Absence due to any accident (contractors)

Cases

0

0

0

The event nearly caused an accident

Cases

0

0

0

Number injured (employees)

Cases

17

14

13

Number injured (contractors) Total of Dead

Cases Case

0 0

3 0

0 0

75


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Record of Injury in the Company and its subsidiaries during 2013-2017 80

713

70 60 50

615

673

693

Total employees Number of injured

506

40 30 20 10

10

10

17

14

13

2013

2014

2015

2016

2017

• The results of the sound level test in the operation areas (Leg. 8 Hrs.) has performed by C.E.M. technology (Thailand) company limited on April 28th -29th, 2017 in 6 areas. The results have been compared with the standard of “Ministerial Regulation on the Prescribing of Standard for Administration and Management of Occupational Safety, Health and Environment in Relation to Heat, Light, and Noise B.E. 2549 (A.D.2006)”. The sound level standard during the work for 8 hrs. per day and continually being heard not over 90 dB (A), the results of the sound level (Leg. 8 Hrs.) were passed the standard in all 6 areas of operation.

The Records of Sound Level Density in 2017

Healthy

The Company has provided physical healthy • Providing courses for new guys on physical health, occupation health, for good checks and occupational health services for communication employees and has annual assessment on physical environments, i.e. dust, noise, etc., and • The Sound level within the plant was inchemical environments were monitored. The spected to prevent the sound effects to the assessment report leads to establish an approenvironment. The inspection performed by priate preventive plans to specific working area the Centre for Environmental Management, and/or leads to modify or reorganize the workFaculty of Engineering, Khon Kaen Univering area avoiding any unexpected outcome. sity. The result of the inspection met to the standards of the Ministry of Interior iden• Physical healthy check according to the Natifying in the management and processing tional Regulation “Medical Check. B.E. 2547” standards in the safety, occupational health, once a year. These covered the pre-works and the working environment aspects about checking and test for drugs. the heat, light, and sound in the year 2006.

No.

Location

Testing result/ dB (A)

Standard / dB (A)

Comparing result

Leq.

*

ACGIH

*

1

The 1993 Building

81.1

90

85

Passed

2

Contractors area 1993

81.5

90

85

Passed

3

Hydraulic assembling department and air brake# 2 area

81.7

90

85

Passed

4

Assembling department area

81.9

90

85

Passed

5

Parts producing department area

81.8

90

85

Passed

6

Repair service department area

82.5

90

85

Passed

Note “*” is the “Ministerial Regulation on the Prescribing of Standard for Administration and Management of Occupational Safety, Health and Environment in Relation to Heat, Light, and Noise B.E. 2549 (A.D.2006)”.

76

77


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Awards and Recognition of the year • Outstanding Sustainability Awards 2017 CHO has won the Outstanding Sustainability Awards 2017 on Wednesday, 8th November 2017 from the SET Sustainability Awards 2017. The awards held by the Stock Exchange of Thailand. The award is to honor and praise CHO as the business that has the sustainable business practices and being the model for the other registered companies.

• Thailand Sustainability Investment (THSI) 2017 CHO has continually won the Thailand Sustainability Investment 2017 for 3 consecutive years. The award is a sustainability award which awarded by the Stock Exchange of Thailand in the SET Sustainability Awards 2017. CHO has been awarded on Wednesday, 8th November 2017. The sustainability award is rewarded to the registered companies that meet the assessment standards according to the environmental, social, and governance index or ESG. Thus, the awarded companies will be interested and wellknown among investors and the public. The award is to honor and praise the companies as they have applied the sustainable practices in their businesses. And, they are the good examples of being sustainable for the other listed companies.

• “Starred Labour” project of the Department of Skill Development under the Ministry of Labour of Thailand

The Ministry of Labour of Thailand has given six-pointed star marks to CHO’s skilled technicians who passed the standard test from the program. The technicians have received the stars on June 6th, 2017 to guarantee that the employees are meeting the standards. The program helps the company drives its employees’ competency enhancement policy and coping the company’s future under the “Thailand 4.0” program.

About this Report The Reporting Guidelines :

CHO has continuously prepared it sustainability report which this is the fourth report so far. This report is purposing to disclose the result of its performances for the period from 1st January 2017 to 31st December 2017. The information provided are concerning the economic, the environment, and the social sectors to disclose these information to all its stakeholders and gain the trustworthy in the performances of CHO. The company’s stakeholders are consist of its shareholders, employees, business partners, customers, communities, and society.Furthermore, this report is reporting accordingly to the Global Reporting Initiatives (GRI-G4) index.

The Content Selection for Reporting :

The content selection for this report is selected the important aspects of the company’s performances in building sustainable business. CHO stresses to improve the competency of its personnel, enhancement of products, creating happy workplace in its community,and the responsibility to the society.

Scope of this Report :

This report presents throughoutall activities including the business operation, economic, environmental and social sustainability of the Company and Cho Thavee Thermotech Co. LTD. (the subsidiary company)by not including its relevant company.

The Certification of This Report :

The report was not certified from any external organization who has the expertise in this area. Nonetheless, it was annuallyverified of the correction by the company’s board of directors, the executive committee, and the CSR committee. This report was verified of the correction on February 23rd, 2018. The economic aspect of this report has reported according to the financial and accounting progress and has the same details with the company’s Annual Report for the year 2017. The information was audited by the authorized auditors in order to provide the transparent and trustworthy of the information. The company has not planned to send out its sustainability report to External organization for certification, yet. This report publishes in Thai and English version by printed, CD and electronic media on the company’s website, This report can be downloaded at: http://cho.listedcompany.com/sd_report.html For any enquiry or suggestion, please contact: CSR committees and Investor Relationship Cho Thavee Public Company Limited 265 Moo 4, Klangmuang Road, Muangkao Muangkhonkaen, KhonKaen 40000 Tel.: 043-043880-90 extension 1120 Facsimile: 043-043899 Email address: info@cho.co.th or ir@cho.co.th

78

The employees who received the stars are 14 (Continue with details on page 14)

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SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

GENERAL STANDARD DISCLOSURES Standard Disclosure

Disclosure Requirements

Page SR

G4-12

STRATEGY AND ANALYSIS

G4-1

G4-2

AR

Standard Disclosure

Provide a statement from the most senior decision-maker of the organization (such as CEO, chair, or equivalent senior position) about the relevance of sustainability to the organization and the organization’s strategy for addressing sustainability. Provide a description of key impacts, risks, and opportunities.

G4-13 2 G4-16 22-26

3

Report the name of the organization.

G4-4

Report the primary brands, products, and services.

G4-5

Report the location of the organization’s headquarters.

3

G4-6

Report the number of countries where the organization operates, and names of countries where either the organization has significant operations or that are specifically relevant to the sustainability topics covered in the report.

8

G4-7

Report the nature of ownership and legal form.

3

G4-8

Report the markets served (including geographic breakdown, sectors served, and types of customers and beneficiaries).

8,16

G4-9

Report the scale of the organization.

8-11

G4-10

a. Report the total number of employees by employment contract and gender. b. Report the total number of permanent employees by employment type and gender. c. Report the total workforce by employees and supervised workers and by gender. d. Report the total workforce by region and gender. e. Report whether a substantial portion of the organization’s work is performed by workers who are legally recognized as self-employed, or by individuals other than employees or supervised workers, including employees and supervised employees of contractors. f. Report any significant variations in employment numbers (such as seasonal variations in employment in the tourism or agricultural industries).

80

G4-17

5-7,18-21 G4-18 G4-19 G4-20 G4-21

Report any significant changes during the reporting period regarding the organization’s size, structure, ownership, or its supply chain. List memberships of associations (such as industry associations) and national or international advocacy organizations.

AR

15 6-7 28-29

28-29

a. List all entities included in the organization’s consolidated financial statements or equivalent documents. b. Report whether any entity included in the organization’s consolidated financial statements or equivalent documents is not covered by the report. a. Explain the process for defining the report content and the Aspect Boundaries. b. Explain how the organization has implemented the Reporting Principles for Defining Report Content. List all the material Aspects identified in the process for defining report content. For each material Aspect, report the Aspect Boundary within the organization. For each material Aspect, report the Aspect Boundary outside the organization.

3-7

76-82

44-45,79 44-45 44-45 44-45

STAKEHOLDER ENGAGEMENT G4-24 G4-25

G4-26

9-11

Describe the organization’s supply chain.

SR

IDENTIFIED MATERIAL ASPECTS AND BOUNDARIES

ORGANIZATIONAL PROFILE G4-3

Disclosure Requirements

Page

Provide a list of stakeholder groups engaged by the organization. Report the basis for identification and selection of stakeholders with whom to engage. Report the organization’s approach to stakeholder engagement, including frequency of engagement by type and by stakeholder group, and an indication of whether any of the engagement was undertaken specifically as part of the report preparation process.

38-43 38-43

38-43

REPORT PROFILE G4-28

Reporting period (such as fiscal or calendar year) for information provided.

79

G4-29

Date of most recent previous report (if any).

79

G4-30

Reporting cycle (such as annual, biennial).

79

81


SUSTAINABLE DEVELOPMENT REPORT 2017 Standard Disclosure G4-31

G4-32

G4-33

Cho Thavee Public Company Limited

Disclosure Requirements Provide the contact point for questions regarding the report or its contents. a. Report the ‘in accordance’ option the organization has chosen. b. Report the GRI Content Index for the chosen option. c. Report the reference to the External Assurance Report, if the report has been externally assured. GRI recommends the use of external assurance but it is not a requirement to be ‘in accordance’ with the Guidelines. a. Report the organization’s policy and current practice with regard to seeking external assurance for the report. b. If not included in the assurance report accompanying the sustainability report, report the scope and basis of any external assurance provided. c. Report the relationship between the organization and the assurance providers. d. Report whether the highest governance body or senior executives are involved in seeking assurance for the organization’s sustainability report.

Page SR

AR

79

G4-40

80-88

G4-41

G4-42

G4-43

79

GOVERNANCE G4-34

G4-35

G4-36

G4-37

G4-38 G4-39

Report the governance structure of the organization, including committees of the highest governance body. Identify any committees responsible for decision-making on economic, environmental and social impacts. Report the process for delegating authority for economic, environmental and social topics from the highest governance body to senior executives and other employees. Report whether the organization has appointed an executive-level position or positions with responsibility for economic, environmental and social topics, and whether post holders report directly to the highest governance body. Report processes for consultation between stakeholders and the highest governance body on economic, environmental and social topics. If consultation is delegated, describe to whom and any feedback processes to the highest governance body. Report the composition of the highest governance body and its committees. Report whether the Chair of the highest governance body is also an executive officer (and, if so, his or her function within the organization’s management and the reasons for this arrangement).

82

Standard Disclosure

G4-44 27-28

27-30

27-28

41-49

G4-45

G4-46 27-28

9-22

G4-47

Disclosure Requirements Report the nomination and selection processes for the highest governance body and its committees, and the criteria used for nominating and selecting highest governance body members. Report processes for the highest governance body to ensure conflicts of interest are avoided and managed. Report whether conflicts of interest are disclosed to stakeholders. Report the highest governance body’s and senior executives’ roles in the development, approval, and updating of the organization’s purpose, value or mission statements, strategies, policies, and goals related to economic, environmental and social impacts. Report the measures taken to develop and enhance the highest governance body’s collective knowledge of economic, environmental and social topics. a. Report the processes for evaluation of the highest governance body’s performance with respect to governance of economic, environmental and social topics. Report whether such evaluation is independent or not, and its frequency. Report whether such evaluation is a self-assessment. b. Report actions taken in response to evaluation of the highest governance body’s performance with respect to governance of economic, environmental and social topics, including, as a minimum, changes in membership and organizational practice. a. Report the highest governance body’s role in the identification and management of economic, environmental and social impacts, risks, and opportunities. Include the highest governance body’s role in the implementation of due diligence processes. b. Report whether stakeholder consultation is used to support the highest governance body’s identification and management of economic, environmental and social impacts, risks, and opportunities. Report the highest governance body’s role in reviewing the effectiveness of the organization’s risk management processes for economic, environmental and social topics. Report the frequency of the highest governance body’s review of economic, environmental and social impacts, risks, and opportunities.

47-48

83

Page SR

AR 50-54

50

27

50

59-64

59-64

2

23-25

26


SUSTAINABLE DEVELOPMENT REPORT 2017

Standard Disclosure G4-48

G4-51

G4-52

G4-53

Cho Thavee Public Company Limited

Disclosure Requirements Report the highest committee or position that formally reviews and approves the organization’s sustainability report and ensures that all material Aspects are covered. a. Report the remuneration policies for the highest governance body and senior executives. b. Report how performance criteria in the remuneration policy relate to the highest governance body’s and senior executives’ economic, environmental and social objectives. Report the process for determining remuneration. Report whether remuneration consultants are involved in determining remuneration and whether they are independent of management. Report any other relationships which the remuneration consultants have with the organization. Report how stakeholders’ views are sought and taken into account regarding remuneration, including the results of votes on remuneration policies and proposals, if applicable.

SR 79

G4-56

G4-57

G4-58

AR

Standard Disclosure

Standard Disclosure Title

40

Page SR

AR

36-37

32-33

CATEGORY: ECONOMIC ASPECT: ECONOMIC PERFORMANCE

29-30

G4-DMA

Generic Disclosures on Management Approach

G4-EC1

Direct economic value generated and distributed

G4-EC3

Coverage of the organization’s defined benefit plan obligations

12

ASPECT: PROCUREMENT PRACTICES 12,57

G4-DMA G4-EC9

Generic Disclosures on Management Approach Proportion of spending on local suppliers at significant locations of operation

16

CATEGORY: ENVIRONMENTAL

57 ASPECT: ENERGY

ETHICS AND INTEGRITY Describe the organization’s values, principles, standards and norms of behavior such as codes of conduct and codes of ethics. Report the internal and external mechanisms for seeking advice on ethical and lawful behavior, and matters related to organizational integrity, such as helplines or advice lines. Report the internal and external mechanisms for reporting concerns about unethical or unlawful behavior, and matters related to organizational integrity, such as escalation through line management, whistleblowing mechanisms or hotlines.

SPECIFIC STANDARD DISCLOSURES

Page

30-34

27-34

32-34

G4-DMA

Generic Disclosures on Management Approach

G4-EN3

Energy consumption within the organization

G4-EN4

Energy consumption outside of the organization

G4-EN5

Energy intensity

G4-EN6

Reduction of energy consumption

51,67,71 71 51,67,71 51,67

ASPECT: WATER G4-DMA

Generic Disclosures on Management Approach

G4-EN8

Total water withdrawal by source

71

G4-EN9

Water sources significantly affected by withdrawal of water

65

ASPECT: BIODIVERSITY

84

G4-DMA

Generic Disclosures on Management Approach

G4-EN11

Operational sites owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas

85

65


SUSTAINABLE DEVELOPMENT REPORT 2017

Cho Thavee Public Company Limited

Standard Disclosure

Standard Disclosure Title

G4-EN14

Total number of IUCN Red List species and national conservation list species with habitats in areas affected by operations, by level of extinction risk

Page SR

AR

68-69

Standard Disclosure G4-LA6

ASPECT: EMISSIONS

G4-LA7

G4-DMA

Generic Disclosures on Management Approach

G4-EN15

Direct greenhouse gas (GHG) emissions (Scope 1)

67

G4-EN19

Reduction of greenhouse gas (GHG) emissions

67

G4-DMA

G4-EN20

Emissions of ozone-depleting substances (ODS)

67

G4-LA9

G4-LA8

G4-LA10

Generic Disclosures on Management Approach

G4-EN23

Total weight of waste by type and disposal method

71

G4-EN24

Total number and volume of significant spills

75

G4-LA11

G4-EN27 G4-EN28

Generic Disclosures on Management Approach Extent of impact mitigation of environmental impacts of products and services Percentage of products sold and their packaging materials that are reclaimed by category

ASPECT: EMPLOYMENT

G4-DMA

Generic Disclosures on Management Approach

G4-LA5

Percentage of total workforce represented in formal joint management-worker health and safety committees that help monitor and advise on occupational health and saftey programs

86

75 72-77

13 14,47-51 14

Generic Disclosures on Management Approach

G4-LA12

Composition of governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity

27-28

SUB-CATEGORY: HUMAN RIGHTS

G4-DMA

Generic Disclosures on Management Approach

G4-HR3

Total number of incidents of discrimination and corrective actions taken

34

ASPECT: INDIGENOUS RIGHTS

Generic Disclosures on Management Approach

Total number and rates of new employee hires and employee turnover by age group, gender and region ASPECT: OCCUPATIONAL HEALTH AND SAFETY

75

ASPECT: NON-DISCRIMINATION

SUB-CATEGORY: LABOR PRACTICES AND DECENT WORK

G4-LA1

Average hours of training per year per employee by gender, and by employee category Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings Percentage of employees receiving regular performance and career development reviews, by gender and by employee category

150-152

CATEGORY: SOCIAL

G4-DMA

9-11

AR

Generic Disclosures on Management Approach

G4-DMA

17 8,18-21

SR

ASPECT: DIVERSITY AND EQUAL OPPORTUNITY

ASPECT: PRODUCTS AND SERVICES G4-DMA

Type of injury and rates of injury, occupational diseases, lost days, and absenteeism, and total number of work-related fatalities, by region and by gender Workers with high incidence or high risk of diseases related to their occupation Health and safety topics covered in formal agreements with trade unions

Page

ASPECT: TRAINING AND EDUCATION

ASPECT: EFFLUENTS AND WASTE G4-DMA

Standard Disclosure Title

31

G4-DMA

Generic Disclosures on Management Approach

G4-HR8

Total number of incidents of violations involving rights of indigenous peoples and actions taken

34

ASPECT: HUMAN RIGHTS GRIEVANCE MECHANISMS G4-DMA

Generic Disclosures on Management Approach

G4-HR12

Number of grievances about human rights impacts filed, addressed, and resolved through formal grievance mechanisms

73

87

34

33


SUSTAINABLE DEVELOPMENT REPORT 2017 Standard Disclosure

Standard Disclosure Title

Page SR

SUB-CATEGORY: SOCIETY ASPECT: LOCAL COMMUNITIES G4-DMA

Generic Disclosures on Management Approach

G4-SO2

Operations with significant actual and potential negative impacts on local communities

68-69

ASPECT: ANTI-CORRUPTION G4-DMA

Generic Disclosures on Management Approach

G4-SO4

Communication and training on anti-corruption policies and procedures

G4-SO5

Confirmed incidents of corruption and actions taken

32 32-33

ASPECT: GRIEVANCE MECHANISMS FOR IMPACTS ON SOCIETY G4-DMA

Generic Disclosures on Management Approach

G4-SO11

Number of grievances about impacts on society filed, addressed, and resolved through formal grievance mechanisms

88

34

AR


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