What are regulations on wages, salaries, and other benefit packages granted to the Chairperson and members of the Board of Directors and Director General of SCIC of Vietnam?

What are regulations on wages, salaries, and other benefit packages granted to the Chairperson and members of the Board of Directors and Director General of SCIC of Vietnam?

Pursuant to Article 37 of the organizational and operational charter of state capital investment corporation issued together with the Decree 148/2017/NĐ-CP stipulating wages, salaries, and other benefit packages granted to the Chairperson and members of the Board of Directors and Director General of SCIC of Vietnam as follows:

1. The Chairperson, members of the Board of Directors, Director General of SCIC shall be entitled to wages, salaries, compensation packages, bonuses and other benefits, depending on their performance and business outcomes of SCIC, in accordance with laws and regulations of the Government on operational functions, duties and regimes of SCIC.

2. The Ministry of Finance shall grant approval of pay, compensation, bonus and other benefit packages applied to the Chairperson, members of the Board of Directors and Director General of SCIC under law. Compensation and other benefit packages paid to the Chairperson, members of the Board of Directors and Director General of SCIC shall be accounted for as SCIC’s management expenses under law, and must be recorded into separate accounts shown in SCIC's annual financial statements.

What are obligations and responsibilities of the Chairperson, members of the Board of Directors and Director General of SCIC for management and governance of SCIC of VIetnam?

Pursuant to Article 38 of the organizational and operational charter of state capital investment corporation issued together with the Decree 148/2017/NĐ-CP stipulating obligations and responsibilities of the Chairperson, members of the Board of Directors and Director General of SCIC for management and governance of SCIC of VIetnam as follows:

1. The Chairperson, any member of the Board of Directors or Director General of SCIC shall assume the following obligations:

a) Comply with laws, organizational and operational Charter of SCIC or decisions of the state owner’s representative agencies for implementation of assigned rights and duties;

b) Carry out assigned rights and obligations in an honest, discreet and due manner in the best legal interests of SCIC and SCIC’s state owner’s representative;

c) Commit to acting in the best interests of SCIC and state owner’s representative to SCIC. Prohibit using business information, trade secrets and opportunities of SCIC and abusing positions and rights of management and use of capital and assets of SCIC to gain personal interests and serve the interests of other organizations and individuals. Prohibit giving SCIC’s property to any person without permission; revealing SCIC's secrets during the period of performing his/her duties assigned to a member of the Board of Directors or Director General of SCIC and within the maximum duration of 03 years after removal from the post of member of the Board of Directors or the Director General of SCIC, unless otherwise approved by SCIC’s Board of Directors;

d) If SCIC fails to pay all debts and other asset-related obligations due, SCIC‘s Director General shall be obliged to report to SCIC‘s Board of Directors to seek remedies for its financial difficulty and inform on SCIC’s financial status to all of its creditors. To such extent, the Chairperson, members of the Board of Directors and Director General of SCIC shall not be allowed to make decision to increase wages, salaries, set aside its profits to pay bonuses to the management and staff of SCIC;

dd) To the extent that SCIC fails to pay all debts and other asset-related obligations due and no action stated in point d of this clause is taken, several liability for any loss inflicted on creditors must be held;

e) In cases where the Chairperson, any member of the Board of Directors or Director General of SCIC is in breach of this Charter, makes decision ultra vires, abuses his/her position or authority to inflict any loss on SCIC and the State, compensations stipulated by law and this Charter must be paid;

g) He/she shall prevent his/her spouse, natural parent, child or sibling from holding the position of SCIC’s Chief Account or Cashier;

h) Report to the Ministry of Finance and SCIC on ownership of shares, portions of contributed capital and make public disclosure of interests associated with SCIC's related enterprises; SCIC’s related enterprises which he/she and his/her spouse, natural parent, child or sibling jointly and severally own shares or portions of contributed capital accounting for more than 35% of each enterprise’s charter capital.

2. Members of SCIC’s Board of Directors shall be jointly responsible to the Prime Minister, the Ministry of Finance and laws for decisions of SCIC‘s Board of Members, business results and efficiency of SCIC.

3. SCIC’s Director General shall be accountable to SCIC’s Board of Directors and laws for management of SCIC’s daily activities and implementation of delegated rights and assigned duties.

4. If he/she commits one of the following violations which have not yet resulted in his/her facing criminal prosecution, he/she shall not be paid bonuses, shall not be entitled to any pay rise and shall be subject to disciplinary actions depending on the degree of his/her violation:

a) SCIC's losses are inflicted through his/her fault;

b) Any loss of state capital is inflicted through his/her fault;

c) He/she decides to execute investment projects that are not effective, do not recover investment capital and fail to repay debts;

d) SCIC staff's wages, salaries and other benefit packages prescribed in laws on employment are not insured;

dd) Violations arising from management of capital, assets and against accounting, auditing and other regulations promulgated by the State are attributable to his/her fault.

5. If any violation specified in clause 4 of this Article is attributable to the Chairperson’s lack of his/her responsibilities or failure to fulfill his/her assigned roles, duties and powers, he/she shall be dismissed from his/her post, depending on the extent of his/her violation and consequences of such violation that lead to the compensation requirement set out by law.

6. In case where SCIC goes into bankruptcy and SCIC’s Director General has not yet filed for such bankruptcy, he/she shall be dismissed from his/her post and shall be held responsible to laws; if SCIC's Director General fails to do so and SCIC's Board of Directors does not order him/her to file for bankruptcy, the Chairperson and members of the Board of Directors shall be dismissed.

7. If SCIC subject to the regulatory requirement for reorganization, dissolution or ownership transition does not carry out procedures for doing so, SCIC’s Chairperson, members of the Board of Directors and Director General shall be dismissed.

8. SCIC’s Chairperson, members of the Board of Directors and Director General shall be responsible for sending full, accurate, authentic and timely reports on matters required by the state owner's representative agency to serve the purposes of performing tasks of inspection, supervision and assessment by competent regulatory authorities within the duties assigned by the state owner's representative agency.

9. SCIC’s Chairperson, members of the Board of Directors and Director General shall be responsible for sending timely reports to the state owner’s representative agency on the fact that it is running at a loss, is incapable of making payments, fails to fulfill objectives and tasks assigned by the state owner's representative agency or commits other violations.

What are regulations on coordination between the Board of Director and Director General in management and governance of SCIC of Vietnam?

Pursuant to Article 39 of the organizational and operational charter of state capital investment corporation issued together with the Decree 148/2017/NĐ-CP stipulating coordination between the Board of Director and Director General in management and governance of SCIC of Vietnam as follows:

1. In the course of implementing resolutions and decisions of the Board of Directors, on seeing that SCIC's interests are likely to be adversely affected, the Director General must inform on this to the Board of Directors to seek its consent to any amendment to such resolutions and decisions. In cases where the Board of Directors fails to make necessary amendments, the Director General must observe them and then report to the Ministry of Finance to seek its decision on possible actions to be taken under its delegated authority.

2. The Director General shall be responsible for periodically reporting to the Board of Directors on business conditions of SCIC. Where necessary, the Board’s Chairperson may request the Director General to directly report to the Board of Directors or send a representative of the Board of Directors to SCIC’s meetings.

3. The Board of Directors must authorize the Director General to act on behalf of SCIC to perform its duties and shall be responsible for such authorization. The Director General shall be responsible to the Board of Directors and laws for duties that he/she perform on behalf of SCIC.

4. The Director General may take necessary actions in case of emergency as per law, and must concurrently submit immediate reports to the Board of Directors and other competent regulatory authorities.

Best regards!