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STRUCTURE AND ACTIVITIES OF THE SUPERVISORY BOARD (SB)

ASSESSMENT ON PERFORMANCE OF SUPERVISORY BOARD AND SUPERVISORS IN 2024

SB MEMBERS
No. SB member Position SB joining date Number of shares directly owned at the end of the period Share ownership rate at the end of the period
1 Ms. Phan Thi Cam Huong Head of SB 25/6/2020 200 0.000038%
2 Mr. Do Minh Duong Supervisor 27/4/2021 2,000 0.000378%
3 Mr. Le Canh Khanh Supervisor 12/6/2023 0 0%
OPERATIONS OF SUPERVISORY BOARD

The Supervisory Board carried out its activities in 2024 according to the plan approved by the General Meeting of Shareholders at the Annual General Meeting in 2024.

Inspection and supervisions is carried out regularly based on topics and projects at functional departments, affiliated units and subsidiaries of PVCFC. SB has performed its duties carefully, honestly and in compliance with the provisions of the law, the Company’s Charter and the SB operating regulations. The detailed inspection and supervision in 2024 were as follows:

  • Inspecting/supervising management of BOD and EB; inspecting and supervising compliance with regulations of the Law, the Company’s Charter, resolution of General Meeting of Shareholders, regulations and mechanism of the Company; inspecting/supervising of investment, financial situation, preservation and development of capital, implementation of business and production plan; Monitoring the implementation of contracts and transactions with related parties on a regular, continuous, and timely basis. This is carried out through the review and analysis of reports from functional departments, proposals, documents, regulations, and policies submitted for approval or endorsement by competent authorities, as well as reports from affiliated units and subsidiaries., attending BOD meetings, periodic meetings and other meetings of the Company.
  • Preparing the activity report for 2023 and the activity plan for 2024 of the Supervisory Board to be submitted to the General Meeting of Shareholders for approval., proposing selection of independent audit units to audit 2024 financial statements, Conducting the appraisal of the 2023 financial statements and the first, second, and third quarters of 2024; reviewing and evaluating effectiveness of internal control, internal audit, risk management and early-warning systems of PVCFC.
  • Inspecting the management, using and final settlement of scientific technology and development fund at Research & Development Center and Division of IT and Safety Technique; inspecting/supervising management and deployment of investment projects; inspecting/ supervising preservation and development of PVCFC’s capital at PPC – a subsidiary; and participating in some inspections/audits with the Company’s Internal Audit team.

Based on the regular, periodic, and specialized monitoring and inspection activities regardin the actual operational situation as mentioned above. Supervisory Board has carried out specific assessments on operational performance, timely detecting errors, limitation, frauds and potential risks to provide early warnings, contributing opinions, recommendations to BOD, General Director regarding operational and management of business and production activities. In 2024, the Company seriously implemented and complied with legal regulations, internal regulations, and resolutions of GMS and BOD, and has exceeded the production and business targets approved by the GMS. Given proactive inspection and supervision according to the Resolution of the General Meeting of Shareholders, the Supervisory Board in 2024 has excellently performed its operational plan approved by the General Meeting of Shareholders.

OPERATION OF EACH SB MEMBER

SB consists of 03 supervisors who perform their duties and responsibilities independently based on their specific scope of work as follows:

Ms. PHAN THI CAM HUONG

Head of Supervisory Board

  • In charge of overseeing the overall activities of the Supervisory Board.
  • Organizing, building inspection and supervision plans in 2024 submitted to the General Meeting of Shareholders and approved, chairing organization, implementation on schedule.
  • Supervising business, marketing activities, finance, accounting, statistics of the Company; chairing appraisal of quarterly, semi-annual and annual financial statements of the Company.
  • Supervising the implementation of business and production plans and the company’s planning process.
  • Reviewing, inspecting and evaluating effectiveness of internal control, internal audit, risk management and early-warning systems of PVCFC.
  • Considering, proposing selection of independent audit units to audit financial statements of the Company, discussing, exchanging existing issues and obstacles with independent audit units regarding review and audit of financial stateme
  • Submitting reports of Supervisory Board in 2024 to General Meeting of Shareholders, preparing reports in 2024 according to the Law on Enterprise, the Company’s charter and regulations of Supervisory Board
  • Fully attending BOD meetings, periodic meetings and other meetings of the Company.

Mr. DO MINH DUONG

Supervisor

  • Monitoring the implementation, progress, and effectiveness of investment projects.
  • Setting up appraisal reports, quarterly semi-annual and annual financial statements.
  • Setting up appraisal report on salary fund implemented.
  • Setting up reports of Supervisory Board according to regulations of Enterprise Law and the Company’s charter.
  • Participating in inspection of Divisions/Departments/Units under the plan of the Supervisory Board or coordinating with Internal Audit Division, related divisions; collecting opinions of members at inspections, setting up minutes of inspection under scope of work assigned in accordance.
  • Participating in supervision of year-end inventory count.
  • Supervising implementation of recommendations of inspection groups on the basis of scope of work assigned.

Mr. LE CANH KHANH

Supervisor

  • Inspecting science and technology fund and implementing R & D.
  • Supervising and joining in the process of inspection of financial situation, preservation and development of capital of a subsidiary in Bac Lieu (PPC).
  • Participating in inspection of year-end inventory count

Comment:

Based on the 2024 operational plan approved by the General Meeting of Shareholders, Members of Supervisory Board have made efforts and proactively implemented their responsibilities, tasks, timely proposing suggestions and recommendations within the scope of assigned tasks, excellently performing assigned tasks, complying with provisions of the Law on Enterprise, the Company’s charter and operational regulations of Supervisory Board.

MEETINGS OF SUPERVISORY BOARD

In 2024, Supervisory Board organized four (04) meetings to approve some issues such as: approval of reports submitted to General Meeting of Shareholders; appraisal of financial statements, evaluation of business and production situation; construction and implementation of operational plan of Supervisory Board; inspection plan at branches, affiliated units and approval of inspection results.

MEETINGS OF SUPERVISORY BOARD
No. Members Position Attending meetings Ratio
1 Ms. Phan Thi Cam Huong Head of SB 4/4 100%
2 Mr. Do Minh Duong Supervisor 4/4 100%
3 Mr. Le Canh Khanh Supervisor 4/4 100%
MEETING RESULTS
No. Date Content Conclusion/evaluation Attendance rate Voting rate
1 29/3/2024 Appraising business and production situation and financial statement in 2023. In 2023, The Company has successfully achieved the production and business targets approved by the 2023 Annual General Meeting of Shareholders; financial situation was healthy, preserving and developing capital. 3/3 3/3
Appraising salary fund implemented in 2023. Agreeing and approving contents of draft report submitted to annual General. Meeting of Shareholders and independent audit unit to audit 2024 financial statement. 3/3 3/3
Approving draft report of Supervisory Board and submitted to annual General Meeting of Shareholders; proposing selection of audit unit of 2024 financial statement. Agreeing and approving contents of draft report submitted to annual General. Meeting of Shareholders and independent audit unit to audit 2024 financial statement. 3/3 3/3
Evaluating independence and efficiency of independent auditors. Unanimously approve the evaluation that Deloitte Vietnam Limited Company conducted the audit of the 2023 financial statements with “Independence” and “Effectiveness” according to the “Procedures for Organizing the General Meeting of Shareholders.” 3/3 3/3
Implementing operational plan of Supervisory Board in 2024. Based on the detailed operational plan for 2024, the members of the Supervisory Board will continue to strengthen the implementation of inspection and supervision activities for 2024. 3/3 3/3
2 12/6/2024 Appraising business and production situation and financial statement in Q.1 2024 In Q.1 2024, financial situation was healthy, ensuring payment ability, preserving and developing capital. 3/3 3/3
Implementing inspection/ supervision plan of Supervisory Board in the last 6 months of 2024. Agreeing on operational contents of Supervisory Board in the last 6 months of 2024. 3/3 3/3
Implementing inspection/ supervision plan at affiliated units. Agreeing with a detailed inspection/ supervision plan of affiliated units. 3/3 3/3
3 30/8/2024 Appraising business and production situation and audited 2024 mid-year financial statement. In the first 6 months of 2024, financial situation was healthy, ensuring payment ability, preserving and developing capital. 3/3 3/3
Approve the plan for inspecting/supervising the research and development activities,
as well as the use and settlement of the science and technology fund.		 Agreeing to approve the inspection plan of the Research and Development Center and the Department of
Safety, Engineering, and Information Technology.		 3/3 3/3
4 20/11/2024 Appraisal of business and production situation and financial statement in Q.3 2024. In Q.3 2024, financial situation was healthy, ensuring payment ability, preserving and developing capital. 3/3 3/3
Assign the tasks to the members of the Control Board to carry out/cooperate in the inspection of the PPC member units and KVF Agreeing to assign Mr. Le Canh Khanh – a supervisor as the Deputy Head of PPC inspection team and assigning Mr. Do Minh Duong – a supervisor to
participate in the Company’s internal inspection/audit team to review activities at KVF.		 3/3 3/3
Detailed inspection, supervision plan of Supervisory Board in 2025. Agreeing with the implementation of detailed inspection and supervision content and plans of Supervisory Board in 2025 and submit to General
Meeting of Shareholders for approval at the Annual General Meeting of Shareholders 2025. 		3/3 3/3
Review report No. 361/BC-PCTT on the implementation of consulting services for “Integrating Sustainable
Development Risks into the Enterprise Risk Management Framework” for PVCFC.		 Agreeing to approve. 3/3 3/3

SALARY, COMPENSATION – RELATED OPERATING EXPENSES AND OTHER BENEFITS OF SUPERVISORY BOARD AND SUPERVISORS

Salary, remuneration and operating expenses of each member of Supervisory Board are paid in compliance with the Company’s regulations and approved by General Meeting of Shareholders. Total income of Supervisory Board in 2024 was 3,102.09 billion VND.

ASSESSMENT ON THE COMPANY’S 2024 PERFORMANCE

In 2024, PVCFC fully performed the tasks approved by the 2024 Annual GMS in Resolution No. 1724/ NQ-PVCFC dated June 11, 2024 with the results of operations, production, business, and financial investment as follows

PRODUCTION AND BUSINESS

In 2024, the Company implemented production and business solutions, in a specific and effective manner, promoting investment, focusing on governance and making efforts to successfully complete the production and business plan, investment targets and pay dividends as follows:

Key production and business indicators

  • Total converted Urea production output: 956.4 thousand tons, re aching 101% of the plan.
  • Total converted NPK output: 207.5 thousand tons, reaching 110% of the plan.
  • Urea consumption output: 804.7 thousand tons, reaching 101% of the plan.
  • NPK consumption output: 175.8 thousand tons, reaching 114% of t he plan.
  • Self-trading fertilizer: 254.4 thousand tons, reaching 103% of the plan.
  • Total revenue and income: 14,037 billion VND, reaching 103% of the plan.
  • Profit before tax: 1,522 billion VND, reaching 125% of the plan.
  • Profit after tax: 1,428 billion VND, reaching 125% of the plan.

Dividend payment: PVCFC has made 20% of dividend payment in 2023 (equivalent of 2,000 VND share).

Total investment value in 2024 was VND 1.173,20 billion, reaching 97.5% of the adjusted annual plan.

Top Focusing on corporate governance in line with good practices has helped enhance the Company’s operational efficiency. During the year, the Company has received awards of Top 10 Best corporate governance enterprises, Enterprises with Corporate governance beyond compliance, and Enterprises with Most Reliable Sustainability Report

In addition, the Company has completed three-line model to help the internal control, internal audit and risk management systems operate effectively and promote the efficiency of the system.

REGARDING THE FINANCIAL INVESTMENT

As of December 31, 2024, PVCFC has contributed capital in two (02) subsidiaries :

PetroVietnam Packaging Joint Stock Company (PPC), with PVCFC’s contributed capital of VND 20.83 billion, accounting for 51.03% of charter capital: In 2024, PPC completed the production and business plan targets when profit after tax reached VND 8.14 billion, completing 112.28% of the plan and after-tax profit margin on charter capital reached 16.96% (profit after tax/equity of 11.84%).

Korea-Vietnam Fertilizer Company Limited (KVF), with PVCFC’s contributed capital of VND 611.76 billion, owning 100%. From January 1, 2024 to December 31, 2024, total revenue reached VND 1,052.25 billion and loss was VND 26.35 billion, a decrease by VND 120.20 billion compared to the same period (loss of VND 146.55 billion). PVCFC has taken over KVF since April 1, 2024 when this subsidiary had a loss of VND 31.47 in the first quarter of 2024. In the last 9 months of 2024, KVF gained a profit of 5.13 billio n VND.

APPRAISING FINANCIAL STATEMENTS

The Supervisory Board has conducted an appraisal of quarterly financial statements, semiannual financial statements and 2024 financial statements to ensure prudence, accuracy and transparency. The appraisal results are as follows:

  • The financial reports fully and honestly reflected the financial situation of the Company as of December 31, 2024, as well as the results of business operations in 2024.
  • Opening and recording accounting books, classifying economic contents are appropriate with accounting standards and current accounting regimes.
  • Good financial indicators show that PVCFC’s financial situation is healthy, ensuring ability of debt payment, preserving and developing owner’s equity, specifically: Current payment ratio reaches 2.76 times; Quick payment ratio reaches 2.13 times; Debt/Total assets ratio reaches 0.35 times; Debt/Equity ratio reaches 0.55 times; Consolidated profit after tax on average equity (ROE) reaches 14.18%; Consolidated profit after tax on average total assets (ROA) reaches 9.22%; Capital preservation ratio as of December 31, 2024 reaches 1.02 times (Consolidated equity as of December 31, 2024 is VND 10,117.18 billion/Consolidated equity as of December 31, 2023 is VND 9,963.38 billion).

EVALUATING THE ROLE, RESPONSIBILITIES AND INDEPENDENCE OF THE INDEPENDENT AUDIT

Based on Audit Report, Management Letter, Audit Summary Report, the Supervisory Board will collect information and evaluate independence and efficiency of independent auditors according to criteria stipulated at form BM01/DHDCD.03.02 and form BM02/ DHDCD.03.02 under rule of procedures for General Meeting of Shareholders issued in accordance with Decision No. 399/QDPVCFC dated March 3, 2023 and reporting at the General Meeting of Shareholders. The results are as follow:

Deloitte Vietnam Audit Co. Ltd, was selected to audit PVCFC’s 2024 Financial Report. Deloitte has conducted and audited the PVCFC’s Financial Report carefully, independently and objectively. The audit unit has complied with professional ethical standards and regulations during the audit process. The Financial Report audit results fully, honestly and reasonably reflect the Company’s financial situation as well as the results of production and business activities in 2024.

EVALUATING THE PERFORMANCE AND RESULTS OF THE BOARD OF DIRECTORS, GENERAL DIRECTOR AND OTHER EXECUTIVES

The BOD consists of 07 members (02 independent directors) and 03 affiliated Committees: Audit and Risk Management Committee, Human Capital - Remuneration Committee, and ESG Committee. In 2024, BOD issued 146 Resolutions/Decisions on all aspects of activities in accordance with order, authority stipulated at Law on Enterprise and the company’s Charter. BOD has played its role and responsibility carefully and cautiously. BOD has issued policies and regimes; directing and monitoring implementation of policies, regimes, strategic orientations, business and production plans approved by the General Meeting of Shareholders, creating favorable conditions for the General Director to implement.

BOD always focuses on improving the capacity of good governance practices. BOD members (including independent Directors) fully attend meetings and work with a high sense of responsibility as well as excellently performing their missions.

PBOD has strictly implemented the internal regulations already issued and complied with the provisions of the Law and the Company’s Charter.

BOD has strictly implemented the internal regulations already issued and complied with the provisions of the Law and the Company’s Charter. BOD has worked with consulting unit to assess the current status of corporate governance to improve governance capacity according to ASEAN Corporate Governance Scorecard (ACGS) and issued sustainable development orientation based on ESG. 2024 is the first year PVCFC prepared Sustainability Report and was honored to receive the trusted Sustainability Report Enterprise Award by VLCA.

Affiliated committees under BOD have upheld their roles, implementing their functions and missions to ensure common interests of PVCFC and shareholders.

The Executive Board shall seriously implement the Resolutions, Decisions, and Directives of the BOD and the GMS.

Thanks to the right orientation, close supervision and timely direction of BOD in corporate governance as well as the flexible response and proactive management of EB in production and business, in 2024, the Company has successfully completed the plan targets with impressive achievements, safely operating production to ensure continuous business without any interruption caused by incidents, effectively practicing corporate social responsibilities (safety - health - environment - community responsibility), bringing stable income and improving the lives of employees, ensuring benefits of stakeholders, and strictly complying with current legal regulations and the Company’s regulations. These achievements have been recognized through the notable awards that the Company has achieved during the year.

ASSESSMENT ON OPERATING COORDINATION AMONG SB AND BOD, EB AND SHAREHOLDERS

Coordination between Supervisory Board and BOD, EB is based on principles of transparency, accuracy, compliance with regulations of the Law and of PVCFC to ensure the highest legitimate interests of PVCFC and shareholders.

The Supervisory Board has closely coordinated with BOD, EB in inspection and supervision activities to work out prompt measures and solutions to deal with noncompliance issues, fraud and other hidden risks to ensure full compliance with current regulations of the State and of PVCFC

The BOD and the EB closely coordinated and created favorable conditions for the Supervisory Board to carry out inspection and monitoring tasks; provided full and related information and documents, invited full participation in meetings, and implemented recommendations from the Supervisory Board.

The Supervisory Board fully fulfills its reporting obligations to the shareholders in accordance with the provisions of the Enterprise Law and the Company’s Charter.

ASSESSMENT ON TRANSACTIONS WITH RELATED PARTIES

In 2024, there was no transaction carried out between the Company, its subsidiaries, other companies controlled by the Company with over 50% of charter capital and up with BOD members, General Director and related persons of these members; transactions between the Company with companies in which BOD members are founding members or business managers during at least 3 years before time of transactions carried out at PVCFC.

BOD has approved the contracts/transactions with related parties, including organizations that are major shareholders and their subsidiaries. For these approval decisions, BOD members who are representatives of major shareholders do not attend voting. Resolutions on approving the contracts/transactions with related parties are disclosed by PVCFC in accordance with current regulations.

In 2024, the Company fully complied with the provisions of law on transactions between the Company and related parties.

RECOMMENDATIONS

In 2025, the country’s economy still faces countless difficulties and challenges. To ensure completing the production and business plan approved by GMS, the SB has given some recommendations as follows:

  • Continuing to improve productivity, save energy, and enhance cost efficiency.
  • Continuing to implement governance works, including risk management, volatility management, and value chain management.
  • Diversifying fertilizer products and expanding export markets to neighboring countries and regions.
  • Continuing to promote investment, reviewing investment portfolio, and carefully evaluating the feasibility and effectiveness of projects before implementation.
  • Focusing on human resource training and development.

OPERATING PLAN OF SB IN 2025

In 2025, Supervisory Board will implement their rights and responsibilities in accordance with the Law on Enterprise, the Company’s Charter and tasks of annual General Meeting of Shareholders, Supervisory Board focuses on inspecting and supervising the following contents:

  • Inspecting/supervising implementation and compliance with the Law on Enterprise, regulations of the State, inspecting implementation and compliance with resolution of General Meeting of Shareholders, regulations, decisions and directives of the Company.
  • Inspecting/supervising, evaluating financial health, capital balance and cash flow management, operational efficiency and debt payment ability, capital use and management, capital preservation and development, management of contributed capital in other enterprises.
  • Inspecting/supervising implementation of business and production plan, R & D, management and implementation of investment projects and other activities at the Company.
  • Reviewing, inspecting and evaluating efficacy and efficiency of internal control system, internal audit system, risk management and early warning system.
  • Reviewing/suggesting contracts and transactions with stakeholders under approval authority of BOD or General Meeting of Shareholders, information disclosure on related people and transaction with related people.
  • Conducting appraisal of semi-annual and annual financial statements.
  • Preparing reports submitted to the General Meeting of Shareholders and implementing other tasks in accordance with current regulations of the Law on Enterprise and the Company’s Charter.