Message from the Chairman and the President

Mr. Ekniti Nitithanprapas Chairman 8 AR 2018 THAI 9 Message from the Chairman and the President Thai Airways International PCL (THAI) strives to become the National Premium Airline by leveraging essential strategies of 1. Aggressive Profit (proactive marketing at competitive costs) 2. Business Portfolio (capacity upgrading and pursuit of business opportunities through the likes of aircraft maintenance, cargo terminal handling, and catering) 3. Customer Experience 4. Digital Technology 5. Effective Human Capital Management Properly executed, these strategies are bound to forge sustainable growth. To achieve this goal, this year we remained committed to constantly improving our execution and services, particularly in our core air transport business, so that customers of each target group may feel the outstanding, exquisite flying experience blended with a touch of Thai under the Service from the Heart policy; so that our services may be filled with quality and convenience throughout our flights; and so that our competitiveness may grow and generate more profits. Concerning the management of business units and other business tasks, our policy is to add value, grow business opportunities, and seek profits for cargo terminal handling service, aircraft maintenance, and catering. These tasks were undertaken by either THAI or its joint ventures with public and private agencies here and abroad. Thanks to the commitment of our workforce, this year THAI garnered acclaim from Skytrax, based on a survey of some 20.63 million travelers worldwide who used the world’s 335 airlines. We take exceptional pride in being named the World’s Best Economy Class airline (second straight year), the World’s Best Airline Lounge Spa (fourth straight year), and the Best Economy Class Onboard Catering (second straight year). Above all, we were ranked among the top 10 World’s Best Airlines 2018. These accolades speak volumes for our endeavor to become the National Premium Airline. 8 AR 2018 THAI 9 Mr. Sumeth Damrongchaitham President 10 AR 2018 THAI 11 We are convinced that good governance and ethics are pivotal to THAI’s efforts to strengthen from the inside out and lead the corporation to sustainable growth. On behalf of the Board of Directors, management, and staff, may we assure you that each and every action we take will be with good governance, transparency, and integrity. We have assigned the Corporate Governance and Social Responsibility Committee to develop a Code of Conduct Manual, enforced from September this year onward, representing a compilation of applicable codes and policies together with corporate governance best practices for the workforce to master and apply to their jobs. The CG Day 2018 activities promoted efforts for the Board, the management, senior executives, and the rank and file to manage THAI under strict compliance with corporate governance codes together with ethics and the code of conduct, while joining hands in anti-fraud efforts. To this end, the Board assigned the Corporate Governance and Social Responsibility Committee to investigate the implementation approach of the Moral Organization Project so that THAI may successfully become a moral organization or “Moral THAI” by 2019-2020. And thanks to our joint promotional efforts for the culture of good governance in THAI, this year our excellence was recognized by the Thai Institute of Directors under the Corporate Governance Report of Thai Listed Companies 2018 assessment program, earned a five-star award from the National Corporate Governance Committee, which reiterated management practices that valued the display of responsibility to all stakeholders for sustainable growth. Each of us is prepared to do our best to once again turn THAI toward security and sustainability. (Mr. Ekniti Nitithanprapas) (Mr. Sumeth Damrongchaitham) Chairman President 10 AR 2018 THAI 11 Summary of the 2018 Annual Activities of the Audit Committee The Audit Committee of Thai Airways International Public Company Limited consists of three independent directors, qualified and experienced in areas of Law, human resource management, risk management, information technology, finance and reviewing the reliability of financial statements. At present, the Audit Committee consists of Mr. Distat Hotrakitya as Chairman, Mr. Somkiat Sirichatchai and Mr. Rathapol Bhakdibhumi as committee members. Mr. Somnerk Thumrongthammavong, Vice President, Office of the Internal Audit, serves as secretary to the Committee. During the year 2018, 10 meetings (9 meetings with a regular agenda and 1 meeting for special agenda) were organized between the Audit Committee, external auditors, internal auditors and the company’s executive management. The Audit Committee has performed their duties independently and adhered to the Charter of Audit Committee which are consistent with the Ministry of Finance’s regulations for Audit Committee and Internal Audit Unit of state enterprises AD 2012, the Audit Committee’s Good Governance Practices, and the Stock Exchange of Thailand’s regulations. The Audit Committee’s meeting attendance records during 2018 can be referred to in the Good Corporate Governance section. To this, the Audit Committee has reported important issues and the committee’s opinions to the Board of Directors as deemed appropriate. Significant audit committee activities during the year 2018 are summarized herein as follows: 1. Financial Statement Audit : The Audit Committee, together with the finance and accounting executives, and external auditors have jointly reviewed company’s quarterly and annual financial statements, consolidated financial statements, connected transaction including the reviews of financial reports, financial statement disclosure, accounting policy and significant accounting projections, as well as observations from the examination and review of external auditors and the supporting explanations and analysis of the company’s financial status and performance (MD&A). The Audit Committee has asked the external auditors’ opinion about the accuracy and completeness of financial statements, adequacy and suitability of the account recording methods and information disclosure including adjustment entries materially affecting the statements to ensure that the financial statements were accurate and completed to Thai Financial Reporting Standards. In addition, an exclusive session between the Audit Committee and external auditors was organized without presence of company executive management to discuss the independency of activities and views of external auditors. Moreover, the committee discussed key audit matters which were of most concern in the audit of the financial statements for the period in question, including continuous followed up with senior managements’ response to questions by the external auditor. 2. The Audit of Adequacies and Effectiveness of Internal Control and Risk Management Systems : The Audit Committee has reviewed and monitored through overseeing the Office of the Internal Audit’s audit reports and results of the internal control self-assessment in accordance with the Regulations of Ministry of Finance on Internal Control Standard and Guidelines for Government Agency AD 2018 with reference to the Committee of Sponsoring Organization of The Treadway Commission : COSO 2013. In addition, one meeting was organized between the Audit Committee and the executive management of the company to discuss over the appropriate agenda in relation to company performance and significant audit findings. Moreover, the Vice President of the Risk Management Department has also participated in the Audit Committee meeting to report on the company’s significant risks and providing instructions on how to mitigate and manage those risks on a regular basis every year. 3. Monitoring of Internal Audit Activities : The Audit Committee has provided guidance on the preparation of the audit plan and has approved it. These include the committee approving individual development plans which have been evaluated, and improved the knowledge and capabilities of the internal auditor (Competency Framework) and also encouraging continuous development to gain further knowledge and efficiency when performing audit activities. The Audit Committee has also acknowledged the performance and any issues from Office of the Internal Audit on a quarterly basis. 12 AR 2018 THAI 13 The Audit Committee has given suggestions for the Audit Report’s significant points, so that the management concerned with those points will improve their operations to ensure sufficient internal control, and also reported those points to the Board of Directors for acknowledgement. Furthermore, the Audit Committee reviewed the annual budget of Office of the Internal Audit, the Office’s adequacy and suitability of resource consumption, KPIs, and the annual merit consideration for the Vice President of Office of the Internal Audit. This included acknowledging the results of the external assessment which concluded that the vast majority of the internal audit of Office of the Internal audit is in the line with IIA Standards (International Standards for the Professional Practice of Internal Auditing), and encouraging Office of the Internal Audit to increase its role as an advisor to various department, such as being the working group of preparation to join Thailand’s Private Sector Collective Action Coalition against Corruption (CAC) and the working group of self-evaluation for anti-corruption measures. 4. Legal and Regulatory Compliance Audit : The Audit Committee has

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