Bangkok, The Association of Investment Management Companies has resolved to place Energy Absolute Public Company Limited (EA) on the Restricted List, limiting transactions and prohibiting additional investment, confident in taking care of the best interests of unitholders along with sustainable investment. Ms. Chawinda Hanratanakul, President of the Association of Investment Management Companies (AIMC) as a representative of investment management companies in Thailand, disclosed the resolution of the meeting, which consisted of the AIMC Committee and the ESG Policy and Collective Action Subcommittee for the Thai Sustainable Mutual Fund (ThaiESG) and the Thai Corporate Governance Mutual Fund (ThaiCG). She is confident that all asset management companies (AMCs) are ready to manage the problems of Energy Absolute Public Company Limited (EA) and resolved to place EA's securities on the Restricted List, limiting transactions and prohibiting additional investment until there is clarity on the company's operating guidelines. The company's progress will be closely monitored, believing that EA's business operations can continue. 'For the EA case, currently, the holding of EA stocks and debt instruments by all types of mutual funds is a small proportion compared to the assets under management. In the past, investment managers have gradually reduced the proportion of investment in both EA stocks and debt instruments, especially when there are signs of abnormal prices. For EA bonds, due to the liquidity limitations of the instruments, reducing the proportion of investment may take time. In this regard, for the maximum benefit of investors, the fund management company has implemented Liquidity Management Tools (LMTs), which are guidelines for managing the liquidity of mutual funds in accordance with international guidelines, such as limiting the amount of investment units (Redemption Gate) to limit the maximum amount of investment units redemption per day to delay the redemption of assets invested by the fund, and separati ng EA bonds from the main assets of the mutual fund (Side Pocket) for separate management. This part of the EA bonds will not be included in the calculation of the NAV. Unitholders can still trade the main fund as usual. When the assets that have been side pocketed are sold in the future, the management company will return the money to unitholders. Both of these methods will help the fund not to rush to sell EA bonds at inappropriate prices or lower than they should be. These operations are carried out based on the principles of honesty, integrity and caution. Focus on protecting the interests and providing fairness to unitholders. In the past, it is believed that fund managers have made reasonable decisions in investing in EA securities. In the ThaiESG section, which invests in sustainable stocks, SET ESG Ratings currently has 196 stocks and EA has been ranked in SET ESG Ratings. In practice, fund managers do not need to invest in every stock. It depends on the selection and investment distribution. I belie ve that all fund managers perform their duties professionally in analyzing, selecting, and monitoring investments. The EA problem that has occurred, especially in terms of governance, which is one of the main factors of ESG, does not only occur in the Thai capital market, but can occur worldwide. All organizations involved in the capital market must therefore actively cooperate to develop truly sustainable investments. There must be effective support, inspection, and monitoring processes, including regulatory agencies, central organizations, independent agencies that certify and verify information, rating companies, auditors, fund managers, and appointed sales representatives, etc., so that the various processes are developed efficiently, in line with current events, can protect investors' interests, and truly achieve sustainability goals,' said Ms. Chawinda. Source: Thai News Agency
Sunday, September 08, 2024