HUTECH INSTITUTE OF INTERNATIONAL EDUCATION

_____________________________________________________________________________

CORPORATE GOVERNANCE
ASSIGNMENT
JULY 2021
_____________________________________________________________________________

FULL NAME: PHAN THI NHU MY

CLASS: 18BOBA01

STUDENT ID: 181401017

EMAIL: nhumyy2410@gmail.com

LECTURER: TRAN HOANG VUONG

 TABLE OF CONTENTS
Abstract...........................................................................................................................................3
I. INTRODUCTION ABOUT BINH MINH JOINT-STOCK COMPANY.............................4
II. CHARACTERISTICS OF A PUBLIC LISTED COMPANY IN VIETNAM....................9
1. What is a public listed company ?.....................................................................................9
2. Characteristic of a public listed company in Vietnam..................................................10
a. Separation between business and owner.................................................................10
b. Shares are easily transferred....................................................................................11
c. The time of holding shares........................................................................................11
d. Limited responsibility................................................................................................11
e. Board of Director structure......................................................................................11
f. Transparency of reports............................................................................................12
g. Capital mobilization...................................................................................................12
h. Number of shareholders............................................................................................12
i. Register minimum capital..........................................................................................13
j. Corporate governance................................................................................................13
III. CONSISTENT CHARACTERISTICS OF BINH MINH PLASTIC JOIN-STOCK
COMPANY...................................................................................................................................13
1. Limited responsibility.......................................................................................................13
2. Board of Director structure.............................................................................................14
3. Transparency of reports...................................................................................................15
4. Capital mobilization..........................................................................................................15
5. Register minimum capital................................................................................................16
6. Corporate governance......................................................................................................17
IV. CORPORATE GOVERNANCE MATTERS THAT ARE ASSOCIATED WITH THE
BINH MINH PLASTIC JOIN- COMPANY.............................................................................20
V. CONCLUSION........................................................................................................................22
REFERENCES........................................................................................................23

2
Abstract

In the era of fierce competition between businesses in the economic environment, Governance
plays an extremely important role in the development of organizations. According to James
Stoner and Stephen Robbins: “Governance is the process of planning, organizing, leading, and
controlling the activities of the members of an organization and of using all other resources of
the organization to achieve its goals. stated goals”. Governance determines the existence and
development of an organization. Without administrative activities, everyone in the organization
will not know what to do, when to do it, thereby making work messy. By planning work,
directing everyone to work together for a common goal, management helps organizations operate
effectively and achieve their goals. Governance also helps organizations control and control the
implementation process, create systems and processes to coordinate reasonably, make good use
of resources to maintain operations and achieve goals with the lowest cost. Under the same
circumstances, but an organization with better and more scientific management, the ability to
achieve good results will be higher. And most clearly realize the role of corporate governance in
public companies and public listed companies. Because these are large-scale enterprises with
many shareholders contributing capital. Therefore, there is a strict requirement in the
management process to ensure fairness, openness and transparency in business activities of
enterprises. For example, Binh Minh Plastic Joint Stock Company is one of the leading
companies in the industry listed on the Ho Chi Minh City Stock Exchange. Learn about the
characteristics of public listed companies in general and Binh Minh Plastics in particular, thereby
uncovering existing problems in corporate governance of the company.

3
I. INTRODUCTION ABOUT BINH MINH JOINT-STOCK COMPANY

Binh Minh Plastic joint-stock company is a company specializing in manufacturing and

distributing plastic pipes such as PVC-U pipes and fittings, pipes used in plumbing systems,
pipes, and fittings of HDPE, PP pipes. -R, agricultural sprays, etc. The head office is located at
240 Hau Giang, Ward 9, District 6, HCMC. The contact phone is 02839690973. Website address
binhminh@binhminhplastic.com.vn

Image 1. Logo of Binh Minh Plastic joint stock company

(http://www.binhminhplastic.com.vn, 2021)

History

Binh Minh Plastic Factory was established on November 16, 1977, under the model of public-
private partnership on the basis of merging Vietnam Chemical Plastic Pipe Company (KEPIVI)
and Kieu Tinh Plastic Company. The factory specializes in manufacturing all kinds of civil
plastic products and some plastic pipe products with fittings. 1986, this year marked the
historical turning point of Binh Minh Plastics when it was selected by UNICEF as the first and
main supplier of PVC-U plastic pipes for the project "Rural clean water program", marking the
complete transformation of Binh Minh Plastic's product structure into the production of
industrial and technical plastic products, creating a premise for the development of Vietnam's
plastic pipe industry. In 1990, Officially registered for exclusive protection of trademark,
trademark, and logo of Binh Minh Plastic in Vietnam. After the equitization process, the
company officially operated under the name of Binh Minh Plastic Joint Stock Company ( is
abbreviated as BMPLASCO) on January 2, 2004. This is an extremely important milestone
marking a fundamental change in the Company's operating mechanism. In 2006, the Company's
shares were officially traded on the HOSE with the stock code BMP. In 2013, the Certificate of
conformity for products according to the regulations of the Ministry of Construction, increased

4
charter capital to VND 454,784,800,000. In 2017, the company increased its charter capital to
VND 818,609,830,000. In 2017, completing the conversion of the new eco-friendly additive
system and launching a new product line of PP-R spare parts. In 2018, became a member
company of SCG Thailand Group - a leading industrial group in Southeast Asia. Approaching a
large corporation with a lot of experience and modern management technology, Binh Minh
Plastics has very favorable conditions to exchange, cooperate, improve capacity and efficiency in
management, production, and business operations business in Vietnam. In 2020, the company
won the title of "50 best-listed companies in Vietnam 2020"; the title of "Top 50 Vietnamese
Brands 2020" by Forbes Vietnam; The title of "50 best-performing companies in Vietnam" by
Nhip Cau Dau Tu Magazine; The title of "Typical Enterprise of Ho Chi Minh City 2020"; Award
"Golden Brand Ho Chi Minh City 2020"; Certificate of "Typical industrial products and
supporting industries of Ho Chi Minh City 2020" awarded by Ho Chi Minh City. Currently, the
company has 4 production factories in Ho Chi Minh City. Ho Chi Minh City, Binh Duong, Long
An, and Hung Yen with a total capacity of 150,000 tons/year, meeting the demand for goods
supply for the national market, promoting research and development, diversifying types, and
sizes product.

Market size

Binh Minh Plastics accounts for about 43% of the market share of plastic pipes and fittings in the
South, about 5% of the market share of plastic pipes and accessories in the North, and about 28%
of the market share of plastic pipes in the whole country. Through the distribution network of
SCG, some products of Binh Minh Plastics have initially penetrated firmly into Southeast Asian
countries. Currently, the market capitalization of Binh Minh Plastic Company is over 818 billion
VND. The product distribution system has about 1900 stores in Vietnam.

Vision

Maintain its position as the leading enterprise in the plastic building materials industry in
Vietnam. proactively improve capacity and spirit to be ready to compete in the region and
internationally.

5
Mission

To supply products and services to meet the growing needs of the market. ensure the
harmonization of interests of customers, employees, shareholders, and society.

Core value

High consensus - respect for the past - strong present - confidence in the future 90 stores which
are widely distributed throughout the country of Vietnam.

Operational situation

n recent years, the business activities of Binh Minh Plastic Company have always been in growth
momentum. In the context of the Covid-19 epidemic that lasted for the whole year, the economic
growth of the whole country was significantly reduced, it can be assessed that the production and
business results achieved in 2020 are very good. This result is not only based on the traditional
advantages of the Company but also because the Company has promoted and taken advantage of
its newly built advantages to excellently operate the business towards the initiative and
efficiency in improving work, saving costs, motivating employees, satisfying customers.

Number
Content Unit 2020 2019 2018
s
1 Revenue Billion VND 4,700 4,343 4,130
2 Output Ton 110,574 105,021 94,500
3 Profit before tax Billion VND 627 529 530
4 Profit after tax Billion VND 523 423 428

Table 1. Operational situation of Binh Minh Plastic company in 3 years

6
Board of director

Number Name Position Born Qualification

Master of
Chairman of the
Mr. SAKCHAI Business
1 Board of 1967
PATIPARNPREECHAVUD Administration
Directors

Mechanical
Vice-Chairman of
Engineer,
Mr. NGUYEN HOANG NGAN the Board of
2 1962 Master of
Directors
Administration
General Director

Member of the
Board of Director
Mr. WISIT
Deputy General Master of
3 RECHAIPICHITGOOL 1961
Director of Science
Finance and
Administration
The member of
Mr. PORAMATE Master of
4 the Board of 1963
JARNROONGRO Industry
Directors
Independent
Mechanical
member of the
5 Mr. PHAN KHUC LONG 1961 Engineer
Board of
Directors

Table 2. Board of Director of Binh Minh Plastic company

Executive Board

7
 Number Name Position Born Qualification
Mechanical
Engineer, Master
Mr. NGUYEN HOANG
1 General Director 1962 of
NGAN
Administration

Mechanical
Engineer, Master
Deputy General
2 Mr. NGUYEN THANH HAI 1971 of Business
Director of Sales
Administration

Chemical

Deputy General Engineer, Master

Mr. NGUYEN THANH
3 Director of 1968 of Business
QUAN
Engineering Administration

Deputy General
Master of
Mr. WISIT Director of
4 1961 Science
RECHAIPICHITGOO Finance -
Administration

Table 3. Executive Board of Binh Minh Plastic company

Shareholder structure

Shareholders Holding shares Percentages (%)

8
 State shareholders 19,983 0.024
Board 618,550 0.756
Control committee 14,040 0.017
Domestic individual 12,928,024 15.793
Domestic organization 1,397,841 1.708
Foreign individual 918,604 1.122
Foreign individual 65,963,896 80.580

Table 4. Shareholder structure of Binh Minh Plastic company

II. CHARACTERISTICS OF A PUBLIC LISTED COMPANY IN VIETNAM

1. What is a public listed company ?

The Securities Law 2006, in Clause 1, Article 25, stipulates that a public company is a joint-
stock company of one of the following three types:

“First, the Company made a public offering of shares

Second, the Company has shares listed at the stock exchange or securities trading center

Third, the Company has shares owned by at least one hundred investors, excluding professional
securities investors, and has contributed charter capital of VND 10 billion or more."

If a joint-stock company can meet one of the three conditions above, it is considered a public
company. However, it can be seen that there is an overlap in the regulation of 3 cases used to
identify public companies because it is not necessary.

Binh Minh Plastic Company has all 3 characteristics as above. Binh Minh Plastic Company has
offered to sell shares to the public. The company was listed on the Ho Chi Minh City Stock
Exchange in 2006 with a maximum stock of BMP. With a very large number of shares
circulating on the market, of course, the number of shareholders investing in the company is very
large.

9
A public listed company means a company that is permitted by the Securities Commission to
include securities in the list of qualified securities for trading on the centralized trading market
(the Stock Exchange). Listed companies must comply with the strict discipline of the stock
exchange market, and the law on securities, especially the information disclosure regime when
registering for listing, periodically and irregularly disclosing information for all investors and
shareholders in the company. In a listed company, shareholders are provided with more tools to
protect their interests, such as shareholders easily conduct securities sales transactions to transfer
ownership of shares, access to more information. In addition, there is an institution of the
Securities and Exchange Commission that works for the purpose of protecting investors.

Currently, at the Stock Exchanges, there are regulations and conditions for listing, including
criteria on the number of shareholders and the size of the actually contributed charter capital.
Specifically, the Ho Chi Minh City Stock Exchange stipulates that the company must have a
minimum capital of 120 billion VND and have more than 300 shareholders. The company must
have a minimum capital of 30 billion VND and more than 100 shareholders (except in the case
of state-owned enterprises - State-owned enterprises conducting equitization).

More simply, we can understand that a public company is a company that widely mobilizes
capital from the public through the issuance of securities (shares or bonds) listed at stock
exchanges securities or securities that are not listed but are traded through securities brokerage
institutions. And the characteristic of publicly listed companies is the involvement of external
capital with many investors, so it places stricter requirements on corporate governance.

2. Characteristic of a public listed company in Vietnam

a. Separation between business and owner

Because a publicly listed company is a joint stock company, it has all the characteristics of a
joint stock company in terms of charter capital, shareholders, property liability, share transfer,
capital mobilization or investment. legal way. Therefore, a publicly listed company has the first
feature that is a separate legal entity, that is, an enterprise operates as an entity, it can own assets,
use assets and is not dependent on Owner. This means that even if the members of the board of
directors change, ownership continues to be given to someone else and the business continues to
operate and survive, until the business is liquidated or closed. .

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b. Shares are easily transferred

This means that shareholders of publicly listed companies can easily transfer their shares to
others. There is no restriction on the transfer of shares, offering for sale of shares and
subscription to buy shares between owners.

c. The time of holding shares

About the time of holding shares of the members of the company's board of directors, The Stock
Exchanges require the management of a publicly listed company to hold 100% of the company's
shares in the first 6 months and 50% for the next 6 months from the date of listing.

d. Limited responsibility

The liability of the owners is limited to the number of shares they own. Shareholders are not
personally liable in the event the company suffers losses or incurs debts.

e. Board of Director structure

Article 276 of Decree 155/2020/ND-CP-stipulates the composition of the Board of Directors in a

public company as follows:

The number of members of the Board of Directors of a public company is at least 03 and at most
11 people.

The structure of the Board of Directors of a public company must ensure that at least one-third
(1/3) of the total number of members of the Board of Directors are non-executive members.

In case an unlisted public company operates under the model specified at Point b, Clause 1,
Article 137 of the Law on Enterprises, the composition of the Board of Directors of the company
must ensure that at least one-fifth (1/5 of) ) the total number of members of the Board of
Directors who are independent members. In case the number of members of the Board of
Directors of an unlisted public company operating under the above model is less than 5, the
company must ensure that there is 1 member of the Board of Directors who is an independent
member.

The number of independent members of the Board of Directors of a listed company must ensure
the following provisions:

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 Having at least 1 independent member in case the company has between 3 and 5 members of
the Board of Directors;

 Having at least 2 independent members in case the company has from 6 to 8 members of the
Board of Directors;

 There are at least 3 independent members in case the company has from 9 to 11 members of
the Board of Directors.

f. Transparency of reports

A publicly listed company has many shareholders, and a number of shares are traded on a daily
basis. Therefore, the company must provide enough information in the form of public reports so
that shareholders can rely on it to consider investing in the business.

The information disclosure statement of a public listed company includes summary information
on the organizational structure, business activities, management apparatus, shareholder structure,
assets, financial situation, and other relevant information. other information. The latest year's
financial statements of the joint-stock company are audited by an independent auditing
organization. In case the company increases its charter capital after the end of the latest
accounting year, the company must supplement the most recent audited financial statement.

g. Capital mobilization

The highlight of a publicly listed company is that it can borrow from many different sources. A
public company can issue Debts (secured or unsecured) and raise capital. It can issue shares
(equity or preference) to the public. Even banks and other financial institutions provide loans and
financial support to the company.

h. Number of shareholders

A public company requires shares owned by at least 100 investors, excluding professional
investors who are financial institutions, and a listed public company requires an additional
condition that 100 shareholders must hold at least 20% of voting shares.

i. Register minimum capital

12
Joint-stock companies have contributed charter capital at the time of registration for a listing of
VND 30 billion or more based on the most recent audited financial statement, and at the same
time, a capitalization value of at least VND 30 billion calculated according to the latest financial
statements the weighted average settlement price of shares in the most recent public offering.

Specifically, the condition for the charter capital to list on the Ho Chi Minh City Stock Exchange
(HOSE) is over VND 120 billion, the Hanoi Stock Exchange (HNX) is over VND 30 billion, and
the Stock Exchange (SGD) is 80 billion VND, etc.

j. Corporate governance

In terms of corporate governance, public companies, in addition to complying with the

provisions of the Enterprise Law 2014, must also comply with the Securities Law and other
relevant regulations in order to create internal supervision as well as to create control over the
company convenient control from the government. Since a public company is a joint-stock
company, however, unlike a joint-stock company in the Law on Enterprises, a public company is
provided with a separate chapter for public companies and specified in relevant documents other
authority.

III. CONSISTENT CHARACTERISTICS OF BINH MINH PLASTIC JOIN-STOCK

COMPANY

1. Limited responsibility

For businesses with legal status such as limited liability companies and joint-stock companies,
one of the most important characteristics is the separation of liability with the company's assets
from the liability with the assets of the company members or shareholders, as members and
shareholders have limited liability for the financial obligations of the business. With enterprises
operating in the form of joint-stock companies, the enterprises will have legal status and are
solely responsible for the assets of the enterprise for the financial obligations of the enterprise.

The company's assets are formed from two main sources: borrowed capital and capital
contributed by members and shareholders to the company. Basically, in addition to the assets
contributed or committed to contributing to the company, shareholders in a joint-stock company
are not personally liable for their own assets for the financial obligations of the company. It can

13
be seen that the financial obligations of a company with legal status and the financial obligations
of members and shareholders in that enterprise are separate.

In Binh Minh Plastic Joint Stock Company, the current legal representative is Mr. Nguyen
Hoang Ngan Vice Chairman cum General Director. He is only the person who operates the
company on behalf of the company, and the company is still a separate entity. When there is a
problem such as a loss, the company is only responsible for the registered capital of VND 818
billion, and the shareholders who are the owners of the business are only responsible for the
percentage of shares that their initial agreement. All property liability is unrelated to the owner's
personal property.

2. Board of Director structure

According to regulations on the composition of the Board of Directors in a public company, the
number of members of the Board of Directors of a public company ranges from 3 to 11
members. At the same time, the structure of the Board of Directors of a public company must
have one-third of the members being non-executive members.

Based on the above regulations, the Board of Directors structure of Binh Minh Plastics
Company, because:(see Tables 2 and 3, part I)

There are 5 members on the board of directors, Mr. SAKCHAI PATIPARNPREECHAVUD,

Mr. NGUYEN HOANG NGAN, Mr. WISIT RECHAIPICHITGOOL, Mr. PORAMATE
JARNROONGRO, Mr. PHAN KHUC LONG

There are 3 members who are non-executive members: Mr. SAKCHAI

PATIPARNPREECHAVUD, Mr. PORAMATE JARNROONGRO, Mr. PHAN KHUC LONG

The Board of Directors has 1 member who is an independent member, Mr. PHAN KHUC LONG

3. Transparency of reports

In the operating charter of Binh Minh Plastic Company, Article 48 clearly states that the
company must prepare annual financial statements in accordance with the law as well as the
provisions of the State Securities Book and the State Securities Book must be checked according
to regulations. Within 120 days from the end of each fiscal year, the Company must submit the
financial statements for that year notified by the General Meeting of Shareholders to the

14
competent tax authority, the State Certificate, the Securities and Exchange Commission
securities, and the business registration agency.

The annual financial statements must include: The report on the results of production and
business activities, which honestly reflects the company's profit and loss in the fiscal year; The
statement of financial position honestly and accurately reflects the performance of the Company
up to the time of making the report; Remittance statements and notes to financial statements.

The company must set up quarterly and monthly control reports in accordance with the
regulations of the State Securities Commission, the Stock Exchange and submit them to the
Collection Agency and the Business Registration Authority in accordance with the provisions of
the Law Enterprise.

Organizations and individuals interested in the business activities of Binh Minh Plastics Joint
Stock Company are entitled to inspect or backup and take pictures of the audited financial
statements. These financial statements are publicly posted on the company's website at
https://www.binhminhplastic.com.vn/.

4. Capital mobilization

The company usually has two ways to increase business capital, first, by raising equity by calling
for capital contributions from members, and secondly, by borrowing. For a joint-stock company,
in addition to the traditional forms of mobilization, a joint-stock company also issues securities,
which is characterized by the issuance of shares and bonds to the public to attract idle money in
society. These are two methods of raising capital that reflect the characteristics of the capital
structure of a joint-stock company and at the same time demonstrate the strength of the capital
raising ability of a joint-stock company compared to other types of businesses. The advantages
of capital mobilization in the stock market: mobilize a large source of capital due to the
expansion of the mobilized audience; reducing the cost of raising capital due to direct access to
investors; Securities is an attractive form of investment because there are many rich and diverse
types suitable for different investment needs.

According to the provisions of the Enterprise Law, a joint-stock company can create a flexible
loan structure with loans of different legal nature by issuing ordinary bonds, convertible bonds,
and other types of bonds. Small par value shares combined with liquidity and transferability have

15
encouraged all classes of people to invest. The par value of shares is uniformly set at 10,000
VND (Clause 2, Article 13 of the Law on Securities 2019). In principle, a person who owns one
or more shares can become a shareholder of the company. With such a small denomination, the
shareholding company has encouraged all strata of society to contribute capital to invest. Stock
liquidity refers to a stock's ability to easily convert to cash. Thanks to the ability to freely
transfer, shareholders can withdraw their capital at any time by selling shares on the stock
market. For some reason, shareholders may not want to continue their investment in the
company. They then have the right to freely transfer their shares to others.

In 2017, Binh Minh Plastics Joint Stock Company increased its charter capital through the
issuance of shares to increase share capital from the equity that was approved in the Resolution
of the Annual General Meeting of Shareholders in 2017. 2017. The distribution method is to
distribute to existing shareholders with the ratio of 10:8, a shareholder owning 10 shares on the
closing date of the entitlement list will receive an additional 8 newly issued shares from the
source equity. Accordingly, the number of additional shares to be issued is expected to be nearly
36.4 million shares. Issuers are existing shareholders. After the issuance, the charter capital of
Binh Minh Plastics will increase from 455 billion VND to about 819 billion VND.

5. Register minimum capital

Currently, the conditions for registration of charter capital to list shares on the Ho Chi Minh City
Stock Exchange (HOSE) is a joint-stock company with charter capital contributed at the time of
registration for listing from VND 120 billion or more calculated according to the value recorded
in the accounting books.

On January 2, 2004, Binh Minh Plastic Joint Stock Company officially registered its business
and went into operation in the form of a Joint Stock Company. The company is listed on the Ho
Chi Minh City Stock Exchange. Ho Chi Minh City on 11/07/2006. By November 2006, the
Company increased its charter capital from VND 107,180,000,000 to VND 139,334,000,000.
Business registration certificate 2nd change dated 01/08/2008, increasing charter capital to
175,989,560,000 VND. Business registration certificate 3rd change dated 06/02/2010, increasing
charter capital to 349,835 .520,000 VND. June 19, 2013: Charter capital increased to
454,784,800,000 VND. And now, Binh Minh Plastic Joint Stock Company has a charter capital
of VND 818,609,830,000

16
6. Corporate governance

Currently, the Enterprise Law 2014 designates two models of the organizational structure of a
JSC so that shareholders when establishing this company have the right to choose:

The first model includes the General Meeting of Shareholders, the Board of Directors, the
Supervisory Board, and the Director/General Director (According to the provisions of Point a,
Clause 1, Article 134 of the Enterprise Law 2014). In this case, a JSC with less than 11
shareholders and institutional shareholders holding less than 50% of the total shares of the
company is not required to have a Supervisory Board. In fact, this model is also the
organizational model of a JSC as stipulated in Article 95 of the 2005 Enterprise Law.

Board of
supervisors

Diagram 1. Model 1 of organizational structure

The second model includes the General Meeting of Shareholders, the Board of Directors
(including independent members and the Internal Audit Committee); Director/General Director
(Specifically, according to the provisions of Point b, Clause 1, Article 134 of the Enterprise Law
2014). In which, the Board of Directors must have two different types of members: members
who are responsible for managing all activities of the company (executive members); and
independent members. In addition, in this model, there is also the participation of the Internal
Audit Committee, which is a subordinate agency of the Board of Directors.

17
 Executive
director

Independent
directors

Diagram 2. Model 2 of organizational structure

Binh Minh Plastic Joint Stock Company belongs to the first model, in the company's governance
structure, there is the existence of the Supervisory Board. This is the body responsible for
regularly monitoring all activities of the Board of Directors and other leadership positions of the
JSC. In principle, "The Supervisory Board is an agency elected by the General Meeting of
Shareholders with the number of 03 to 05 members, of which at least one member is an
accountant or auditor". The Supervisory Board has the main task of performing tasks related to
supervising the activities of the Board of Directors, the Director/General Director in the
management and administration of the JSC. Therefore, the Supervisory Board must have the
right to access all information related to the activities of the above subjects. On the other hand,
after reviewing and appraising information that is mainly related to the financial activities of the
company, the Supervisory Board must be responsible for making appraisal reports and
submitting them to the General Meeting of Shareholders. In addition, “The Supervisory Board
also plays an important role in proposing remedial and improvement measures and solutions to
achieve the highest efficiency in the management and administration of the company. For a joint-
stock company with a large number of shareholders, the Supervisory Board is essential to ensure
that all governance activities are carried out properly.

18
 Subcommittees
under Board of
Director

Diagram 3. Management model at Binh Minh Plastic joint-stock

According to the operating charter of Binh Minh Plastic Joint Stock Company, the Board of
Directors establishes states under the Board of Directors to be in charge of development strategy,
personnel policy, salary and bonus, internal audit shareholder relations. This number of members
is decided by the Board of Directors, at least 3 including members of the Board of Directors and
external members, with priority given to independent members or non-executive members of the
Association. board of directors. Of course, all activities of these subcommittees must comply
with the regulations of the board of directors.

The Supervisory Board has the following members:

Number Member Position Note

1 Nguyen Thanh Thuan Chief of department Independent
2 Nguyen Luu Thuy Minh Member Employee

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 3 Praween Wirotpan Member From SCG

Table 5. List of Supervisory Board of Binh Minh Plastic company

The task of the Supervisory Board in Binh Minh Plastic Company is to promote activities in
monitoring, checking compliance and transparency in production and business activities of the
Company, specifically: Monitoring compliance Charter and resolutions of the General Meeting
of Shareholders and the Board of Directors; Supervising the management and administration
activities of the Board of Directors and the Board of Management; Verify the truthfulness and
transparency of the Company's quarterly and annual financial statements; review and comment
on internal processes/regulations; Consulting the Board of Directors, the Executive Board with
professional opinions to further improve business performance.

IV. CORPORATE GOVERNANCE MATTERS THAT ARE ASSOCIATED WITH THE

BINH MINH PLASTIC JOIN- COMPANY

Currently, Binh Minh Plastics is one of the few "enterprises" with a maximum foreign investor
ownership rate of 49%. The Company's BMP stock is also among the top stocks with the largest
market value on Vietnam's stock market. A high percentage of foreign investment leads to
difficulties in governance. After Nawaplastic completed raising its ownership in Binh Minh
Plastics in 2018, currently both Binh Minh Plastics and TPC Vina are owned by Thailand's SCG
group. TPC Vina provides 50% of PVC materials to help Binh Plastics Minh does not have to
stockpile production materials like other businesses that depend entirely on imports such as Tien
Phong Plastic or Dong A Plastic. However, according to FPTS, the fact that TPC Vina is the
main supplier of raw materials also has many potential risks. In the period from the second
quarter of 2018, when the price of plastic materials tended to decrease, the gross profit margin of
Binh Minh Plastic also decreased instead of improving like rival Tien Phong Plastic. It shows
that, although becoming a subsidiary of Thai group SCG helps Binh Minh Plastics actively excel
in raw materials compared to competitors, it also pushes Binh Minh Plastic company into a
situation of being due to conflict of interest is Binh Minh Plastics benefits in price, TPC Vina has
to suffer and vice versa. This development shows that when one person benefits, the other

20
suffers, but if they cooperate to share the benefits and risks equally, the results achieved by both
are only modest. In the case of Binh Minh Plastics, who benefits and who loses depends entirely
on Thai corporation SCG. Or from an investment perspective, shareholders of Binh Minh
Plastics' profit or loss depends entirely on the Thai people. The above evidence shows that
foreign corporations are partly interfering in the business strategy of Binh Minh Plastic
Company. It is impossible to accept that a foreign corporation is leading the company to develop
market share, support the supply of input and output materials, but at the same time increase the
dependence of the business on foreign organizations, leading to a lack of companies. Take the
initiative in implementing business plans and contingency plans.

Production strength is not enough to serve business activities. Specifically, Nhu Binh Minh
Company is in the state the company's products currently do not meet the market demand. Binh
Minh Plastic considers that to be the company's challenge. More and more businesses are
jumping into the plastic industry because of the attractive profit margins. Counterfeit goods also
affect consumers as well as the reputation of the Company. Therefore, Binh Minh Plastics
company needs to have solutions for input materials to ensure enough production for the market.

On the basis that the Government directs the epidemic control very well, businesses themselves
have learned to surf on Covid-19 after 4 times the disease is likely to break out in Vietnam. Mr.
Nguyen Hoang Ngan, Vice Chairman of the Board of Directors, General Director of Binh Minh
Plastic Joint Stock Company said that from the management level to each employee in the
Company, going on a business trip or on leave must also be approved by the leader on
registration of travel schedules and declarations. That leads to changes in the allocation of task
forces and the need to adapt to changes during the epidemic. The Epidemic Prevention
Department of Binh Minh Plastic Company has activated the response mode to unexpected
situations, ready to apply the process of working from home, disinfecting when the epidemic
may affect the factories.

V. CONCLUSION

Through research, it can be seen that Vietnam clearly stipulates the conditions to become a
publicly listed company on the stock exchange. State regulations such as separation of assets and
owners, conditions for registration of charter capital, the structure of the board of directors,
number of shareholders, a form of capital contribution, a form of enterprise capital increase,

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calculation transparency in reports. As for Binh Minh Plastic Company, it also meets these
conditions to become a public listed company in Vietnam. Since public enterprises are organized
on a large scale, there are of course many governance problems. Binh Minh Plastic Company is
the same because the company owns foreign investment capital at a high rate, so there is the
intervention of foreign organizations in the management and business strategies. Besides, the
company also faced the problem of insufficient supply and demand because the production
strategy was not enough to support the needs of the business. The company is still facing
problems with management and human resource allocation during the epidemic.

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Lịch sử hình thành & phát triển. (2021). Retrieved 25 June 2021, from
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TÌM HIỂU CÔNG TY ĐẠI CHÚNG LÀ GÌ?. (2021). Retrieved 29 June 2021, from
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