Company management is guided by the principles of integrity, honesty, transparency, and accountability. To encourage every stakeholder in the Company to do the right thing and be accountable for his own actions, the Company adopts this Whistleblowing Policy. Directors, officers, employees, suppliers, and business partners are encouraged to come forward and raise serious concerns about a perceived wrongdoing, malpractice, or risk involving the Company.

(1) Policy and Coverage

This Policy articulates longstanding practice in the Company, which provides an avenue for directors, officers, suppliers, business partners, and other stakeholders to raise such concerns. This provides an assurance that a person who raises a concern (Whistleblower) will be protected from reprisals, harassment, disciplinary action, or victimization by reason of whistleblowing.

(2) Concerns Covered

Concerns that are covered by this Policy include the following:

Abuse of authority

• Unethical or illegal conduct
• Misuse or misappropriation of Company’s assets
• Violation of the Manual of Corporate Governance
• Conflict of interest situations
• Violation of the Company’s policy against insider trading
• Violation of the Securities Regulation Code
• Violation of Company policy against corrupt practices
• Any conduct that poses a serious risk to public safety, health, or the environment
• Any other conduct analogous to the foregoing.

(3) Protection from Retaliation

The Whistleblower will be protected from reprisals, harassment, disciplinary action, or victimization as a result of any report, disclosure, or raising of a concern (Report) where it is made in good faith, with reasonable belief that the Report is true and is not made maliciously or for personal gain.

Any harassment, retaliatory action, or reprisal resulting from whistleblowing shall be dealt with severely, i.e., with disciplinary or legal action, pursuant to relevant policies and procedures of the Company, and applicable laws.

4) Confidentiality

All Reports and, to the extent practicable, the identity of the Whistleblower, shall be confidential.

(5) Reporting Channels

The Whistleblower may send or communicate a Report through the following channels:

• Mail: 35th Floor Rufino Pacific Tower, Ayala Avenue, Makati City
• Telephone: (+632) 750 2000
• Fax: (+632) 751 0773

(6) Investigation

If a member of the board, a senior officer, or a manager is the subject of a Report, the Report shall be endorsed to the Senior Vice President of Administration who shall form a committee composed of himself, one (1) Independent Director and one (1) member from the Audit Related Party Transactions Committee. The committee shall determine if an investigation is warranted. If determined to be warranted, the Committee shall conduct a fact-finding investigation. Findings of the Committee shall be submitted to the board of directors for appropriate action.

If an employee is the subject of a Report, the Report shall be endorsed to the Senior Vice President of Administration who shall form a committee composed of two (2) Managers, with himself as chairperson of the committee. The committee shall determine if an investigation is warranted. If determined to be warranted, the Committee shall conduct a fact-finding investigation. Finding of the Committee shall be submitted to the relevant office concerned for appropriate action.

A Whistleblower or the person subject of a Report may not be a member of the investigation committee. In the event implementation of the foregoing results in this circumstance, in lieu of the Whistleblower or the person subject of a Report, a member of the board of directors shall form part of the committee.

(7) False Report

The Company will not tolerate false reports. Should it be determined by the Committee that a Whistleblower knowingly submitted a Report containing false statements or fabricated evidence, the Whistleblower shall be subject to disciplinary or legal action pursuant to the policies and procedures of the Company, and any applicable laws.

This Policy covers material related party transactions. Material related party transactions are any related party transactions, either individually or over a twelve-month period, amounting to ten percent (10%) or higher of a company’s current total assets based on its latest audited financial statement.

(1) Duties and Responsibilities of the Board of Directors

The Board of Directors shall have the overall responsibility in ensuring that Material RPTs are handled in a sound and prudent manner, with integrity, and in compliance with applicable laws and regulations to protect the interest of the Company’s shareholders and stakeholders. Towards this end, the Board of Directors shall have the duties to (a) institutionalize an overarching policy on management of Material RPTs to ensure effective compliance with existing laws, rules and regulations at all times and that Material RPTs are conducted on an arm’s length basis, and that no shareholder or stakeholder is unduly disadvantaged; (b) approve all Material RPTs, as endorsed by the Company’s Related Party Transactions Committee; (c) establish an effective audit, risk and compliance system to determine, identify ,and monitor related parties and Material RPTs.

(2) Duties and Responsibilities of Senior Management

Senior management shall implement appropriate controls to effectively manage and monitor Material RPTs on a per transaction and aggregate basis. Exposures to related parties should also be monitored on an ongoing basis to ensure compliance with the Company’s policies and with the pertinent rules of the SEC.

(3) Internal Audit

The internal audit function, through the Audit Committee, shall conduct a periodic review of the effectiveness of the Company’s system and internal controls governing Material RPTs to assess consistency with this Material RPT Policy and related policies and procedures. The resulting audit reports, including exceptions or breaches, shall be communicated directly to the Audit Committee.

(4) Whistle Blowing Mechanism

Consistent with the Company’s Whistle Blowing Policy, the Company shall encourage all its stakeholders to immediately communicate/report, confidentially and without the risk of reprisal, legitimate concerns about illegal, unethical or questionable Material RPTs, directly to the Audit Committee Chairman so that these will be investigated and addressed by an objective independent internal or external body.

(5) Investigation

All investigations about allegations of illegal, unethical, abusive or questionable Material RPTs, whether via whistleblowing channels or as uncovered during audits and/or supervisory examinations, shall be handled by the Company’s Audit Committee or by an independent external firm as may be decided by the Board of Directors. Interested or involved persons shall inhibit from being involved in such investigations.

(6) Administrative Sanctions

The following are considered breaches/violations of this Material RPT Policy:

• directors and officers who deliberately fail to declare or conceal any and all material facts as well as their direct or indirect interest in the Company’s Material RPTs;
• heads and managers who deliberately fail/refuse to report/disclose or have been remiss in their duties in handling their units’ Material RPTs, if any;
• Abusive Material RPTs or those that were not entered at arms’ length terms and unduly favoring a related party.

After administrative hearings/due investigation is made, the imposition of the appropriate administrative sanction/s shall be decided by the board of directors for directors and officers or the president, for all other persons.

(7) Identification and Initial Review of Material RPTs

The Company’s managers, officers, and directors shall identify Material RPTs either individually, or in aggregate over a 12-month period with the same party, amounting to 10% or higher of the Company’s Total Assets based on its latest audited financial statements.

Each Material RPT shall be subject to prior review by the Audit and Related Party Transaction Committee to determine whether the same is on arm’s length terms and it is in the best interest of the Company, considering the relevant factors and circumstances.

To ensure that Material RPTs are entered into at terms that promote the best interest of the Company, its shareholder and other stakeholders, effective price discovery mechanism may be resorted to, such as but not limited to opening the transaction to a bidding process or publication of a property available for sale. The Company shall appoint an external valuation expert or expert independent party, i.e., auditing/accounting firms and third-party consultants and appraisers, to evaluate the fairness of the terms of the material related party transaction prior to the execution of such transaction.

(8) Review and Approval of Material RPTs

In reviewing Material RPTs, the following procedures shall be observed.

Evaluation and Endorsement. The Related Party Transactions Committee shall evaluate and endorse for the approval of the Board of Directors all Material RPTs.

Final Approval. Before any Material RPT may be executed, the Board of Directors shall appoint an external independent party to evaluate the fairness of its terms prior to the execution of such transaction. This external independent party may either be an auditing/accounting firm or third-party consultant or appraiser.

All individual Material RPTs shall be approved by at least two-thirds vote of the Board of Directors, with at least majority of the independent directors voting to approve the Material RPT, subject to confirmation of the stockholders during the annual stockholders meeting together with all other Material RPTs that crossed the materiality thresholds. Alternatively, the Material RPT may be ratified by the vote of the stockholders representing at least two-thirds of the Company’s outstanding capital stock in a Special Stockholders’ Meeting called for the purpose. The rule similarly applies for aggregate RPT transactions within a 12-month period that breaches the materiality threshold of 10% of the Company’s Total Assets.

Independence and Inhibition of Directors and Officers Involved in Material RPTs. To prevent potential or actual conflict of interest situations which may arise out of or in connection with Material RPTs, directors and officers with personal interest in the transaction shall abstain from the discussion, approval and management of such transaction. In the event of refusal to abstain, their attendance shall not be counted for purposes of assessing the quorum and their votes shall not be counted for purposes of determining if the required approval is secured.

Self-Declaration and Disclosure. Directors, substantial shareholders and officers shall disclose to the board of directors any and all material facts related to the Material RPTs as well as their direct and indirect financial interest in any transaction or matter that may affect or is affecting the Company. Disclosure shall be made at the board of directors meeting where the Material RPT will be presented for approval and before the completion or execution of the Material RPT.

(9) Disclosure and Regulatory Reporting

The Company shall submit the following to the Securities and Exchange Commission a Summary of Material RPTs entered into during the reporting year shall be disclosed in the Company’s Integrated Annual Corporate Governance Report (I-ACGR), and an Advisement Report in accordance with the SEC-prescribed format shall be filed within 3 calendar days after the execution date of the transaction.

Both disclosures shall include the following information:

• complete name of the related party;
• relationship of the parties
• execution date of the Material RPT
• financial or non-financial interest of the related parties
• type and nature of transaction as well as a description of the assets involved
• total assets
• amount or contract price
• percentage of the contract price to the Company’s Total Assets based on its latest Audited Financial Statement
• carrying amount of collateral, if any
• terms and conditions
• rationale for entering into the transaction
• approval obtained (directors present, names of directors who approved the Material RPT, and the corresponding voting percentage obtained)

(10) Policy Review and Updating

This Policy shall be reviewed by Compliance Officer as soon as necessary to ensure its effectiveness and to incorporate therein any relevant changes in SEC’s pertinent requirements as well as changes in the Company’s internal policies and procedures. Any changes and updates to this policy shall be subject to the review and endorsement of the Related Party Transactions Committee for approval by the board of directors

This Policy was approved by the Board of Directors of Philippine Infradev Holdings Inc. on 02 July 2020 and is signed by the Chairman of the Board and the Compliance Officer of the company in compliance with SEC Memo Circular No. 10, Series of 2019.