MANUAL ON CORPORATE GOVERNANCE OF THE NATIONAL HOUSING AUTHORITY (Subject to the Approval of the Govemance Commission for GOCCs) Pursuant to GCG Memorandum Circulars Nos. 2012-05, 2012-06 and 2012-07, National Housing Authority, (NHA) hereby ADOPTS, PROMULGATES and IMPLEMENTS this Manual of Corporate Govemance for NHA, as set forth below DEFINITION OF TERMS Section 1. Definition of Terms - As used in this Manual, the following terms shall have the following meanings: + NHA Charter - refers to Presidential Decree No. 757, promulgated on 31 July 1975. * National Housing Authority (NHA) - the sole govemment corporation engaged in direct shelter production and provision of housing assistance to the lowest 20% of urban income earners through slum upgrading, squatter relocation, development of sites and services and construction of core-housing units.’ + Board of Directors (Board) - refers to the collegial body that exercises the corporate powers, conducts all business and controls or holds all properties of NHA. * Coordinating Council - refers to the Housing and Urban Development Coordinating Council (HUDCO), which is charged with the main function of coordinating the activities of the government housing agencies to ensure the accomplishment of the National Shelter Program.” + General Manager - appointed by the President of the Philippines and acts as the Chief Executive Officer of NHA. He shall serve on a fulltime basis, possess managerial ability and must be a recognized authority on housing and/or related fields. + Management - refers to the body given the authority to implement the policies determined by the Board of Directors in directing the course of NHA.* + Officers - refer to Board Officers and Executive Officers of the National Housing Authority.” + GOCC Act - refers to Republic Act No. 10149, otherwise known as the “GOCC Governance Act of 2011 + GCG - refers to the Governance Commission for GOCCs® « Supervising Agency - refers to the HUDCC to which NHA is attached to for purposes of policy and program coordination and for general supervision, + Public Officials or Public Officers - refer to elective and appointive officials and employees, whether classified as permanent or temporary status, whether in the career or non-career service, whether or not they receive compensation, regardless of amount, who are in the National Government or in other instrumentalities, agencies or branches of the Republic of the Philippines, including NHA and other government-owned or controlled corporations, and their subsidiaries.” * Section 1 (a), Executive Order No, 90, 17 December 1986) *Section 3, £.0. No. 90 * Section 7, par.2, P.D. No. 757 * Section 1, GCG-MC No, 2012-07 rid © GCG-MC No. 2012-07 ” Section 1, id ‘ia+ Reimbursable Representation Expenses (RRE) - refer to reimbursable representation expenses incurred for official business by the Chairman and Members of the Board which are supported by official receipts/invoices and a certification that the expenses were incurred for official business in their capacity as Chairman and Members of the Board of NHA.” ‘+ Housing Program - a comprehensive and integrated program consisting of housing development and resettlement, sources and schemes of financing and delineation of government and private sector participation + Fit and Proper Rule - refers to a set of standards for determining whether a member of the Board of Directors or the General Manager is fit and proper to hold a position in NHA which shall include, but not be limited to, standards on integrity, experience, education, training and competence, as such standards set by the GG." ‘+ Extraordinary Diligence - refers to the measure of care and diligence that must be exercised by the Directors and Officers in discharging their functions, in conducting business and dealing with the properties and monies of NHA, which is deemed met when Directors and Officers act using the utmost diligence of a very cautious person taking into serious consideration all the prevailing circumstances and Material Facts, giving due regard to the legitimate interests of affected Stakeholders. '° + Material Information - refers to the information which a reasonable investor, stakeholder or Supervising Agency would consider important in determining whether: (1) to buy, sell or otherwise transact, with NHA; or (2) to. exercise with reasonable prudence “voting exercise related to” corporate acts, contracts and transactions which would adversely affect the operations of NHA."* sICRS — - refers to the Integrated Corporate Reporting System, the extensive database and comprehensive information on NHA developed by the National Government through the GCG. * * Intemal Audit Service (IAS) refers to an independent unit in NHA which is responsible for reviewing and evaluating the effectiveness of the risk management, control and governance processes of the organization and making recommendations for improvement to help achieve organizational objectives. It is also tasked with the evaluation of management controls and operations performance and the determination of the degree of compliance with laws, regulations, managerial policies, accountability measures, ethical standards and contractual obligations. The unit is likewise responsible for the appraisal of the plan of organization and all the coordinated methods and measures, in order to recommend courses of action on matters relating to operations and management control and to assist Management in achieving organizational objectives in an effective, efficient, economical and ethical manner." + Performance Evaluation System (PES) - refers to the process of appraising the accomplishment of NHA and in a given fiscal year based on set performance criteria. * Performance Scorecard - refers to @ govemance and management tool forming part of the performance evaluation system which consists of a set of measures, targets and initiatives that facilitate the achievement of breakthrough results and performance through effective and efficient monitoring and coordination of the strategic objectives of NHA."" * Stakeholder - refers to any individual or entity for whose benefit NHA has been constituted, or whose life, occupation, business or well-being are directly affected, whether favorably or adversely, by the regular transactions, operations, or pursuit of the business or social enterprise for which NHA has been constituted, and which would include its beneficiaries, employees, management, investment partners, the general public, suppliers and service providers, or the community in which NHA operates.” Board Resolution No. 3570, 23 October 1996 ® Section 1,P.0. No. 757 ™ Section 1, GCG M.C. No. 2012-07 ® Section 1, GCG M.C. No. 2012-07 id * Section 44, id ° Philippine Government Internal Audit Manual * Section 1, GCG M.C. No. 2012-07 Pig “id* Civil Society Organizations (CSOs) - include non-government organizations (NGOs), peoples organizations, cooperatives, trade unions, professional associations, faith-based organizations, media groups, indigenous peoples movements, foundations, and other citizen groups formed primarily for social and economic development, which monitor government projects, engage in policy discussions, and actively participate in collaborative activities with Government. * Strategy Map _- refers to an integrated set of strategic choices or objectives drawn by the Board, the successful execution of which results in the achievement of the NHA vision, in relation to its mission and purpose." NATIONAL HOUSING AUTHORITY Section 2. Mission and Charter Statement - To provide decent, adequate, and affordable housing to low-income families, ensure the provision of community facilites, utilities, and access to social services and economic opportunities, Section 3. Vision - By 2019, NHA would have provided 50% of the housing needs to homeless low- income families (based on the 2011 census) primarily those living in waterways, danger areas, and government infrastructure project sites in Metro Manila and all regions nationwide.”* Section 4. Objectives” -NHA shall have the following purposes and objectives: a) To provide and maintain adequate housing for the greatest possible number of people and belonging to the low-income sector of society; and b) To hamess and promote private participation in housing ventures in terms of capital expenditures, land, expertise, financing and other facilities for the sustained growth of the housing industry. Section 5. Powers and Functions of NHA” - NHA shall have the following powers and functions to be exercised by the Board: a) Develop and implement the comprehensive and integrated housing development and resettlement; b) Formulate and enforce general and specific policies for housing development and resettlement; ©) Prescribe guidelines and standards for the reservation, conservation and utilization of public lands identified for housing and resettlement; d) Exercise the right of eminent domain or acquire by purchase privately owned lands for purposes of housing development, resettlement and related services and facilities; e) Develop and undertake housing development and/or settlement projects through joint ventures or other arrangements with public and private entities; ) Issue bonds or contract loans, credits, indebtedness, including suppliers credit or any deferred Payment arrangements with any person or entity, domestic or foreign, for the implementation of its housing programs; 9) Discharge all responsibilities of the government as may arise from treaties, agreements, on other commitments on housing and resettlement to which it is a signatory, including the determination of forms of assistance for housing development to be extended through multilateral or bilateral assistance programs; h) Promote housing development by providing technical assistance; i) Sue and be sued; j) Adopt and use a seal which shall be judicially noticed; k)_ Enter into contracts whenever necessary under such terms and conditions as it may deem proper and reasonable; |) Acquire property rights and interests, and encumber or otherwise dispose the same as it may deem appropriate; m) Invest its funds, as it may deem proper, in bonds and securities issued and guaranteed by the government or by the Central Bank of the Philippines; ma ® Section 3, P.D. No. 757 New Mission and Vision GCG-Approved id id * Section 6, P.D. No. 757