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  • I. Definition and Interpretation

1.1. Definition of Terms. Unless otherwise provided elsewhere in this Manual, the following terms shall mean as follows:

1.1.1. Ad Hoc Board Committees – Board Committees created to address particular issues, which may include operational matters. Ad Hoc Committees are temporary in nature and dissolved after they have served the purpose specified for their creation. Membership to any Ad Hoc Committee may include representatives of Management.

1.1.2. Affiliate – A corporation, of which fifty percent (50%) or less of the outstanding capital stock is owned by NORTHRAIL.

1.1.3. Attached Agency / Corporation – an agency with a lateral relationship with a national government department for the purpose of policy and program coordination. The coordination may be accomplished by having the Department represented in the governing board of the attached agency or corporation.

1.1.4. BCDA – The Bases Conversion and Development Authority – The holding company of NORTHRAIL

1.1.5. Board of Directors – The collegial body that exercises the corporate powers of NORTHRAIL, as specified in the Articles of Incorporation and Bylaws. It is charged with the functions of governing and conducting the business of NORTHRAIL and monitoring Management.

1.1.6. Corporate Charter – refers to NORTHRAIL’s Articles of Incorporation which includes the corporation’s purpose(s) for which the company was formed, the specific type of corporation, the names and addresses of the initial directors and incorporators, the business location, number and classes of share and duration of the corporation and the authority of the corporation for the initial issue of specific number of shares of stock and price of those shares.

1.1.7. Code of Corporate Governance or Code – Code of Corporate Governance for GOCCs promulgated by the Governance Commission for Government Owned or Controlled Corporations (GCG) under GCG Memoradum Circular No. 2012-07 and Approved by the President of the Philippines on 28 November 2012.

1.1.8. Corporate Governance – The framework of rules, systems and processes in the corporation that governs the performance by the Board of Directors and Management of their respective duties to the State and the stakeholders. It provides the structure through which the objectives of a corporation are set, and the means of achieving those objectives, and monitoring performance are determined.

1.1.9. DOTC – The Department of Transporation and Communications. It is the primary policy, planning, programming, coordinating, implementing and administrative entity of the executive branch of the government on the promotion, development, regulation of a dependable and coordinated network of transportation systems and services.

1.1.10. Executive Board Member – A Member of the Board who is at the same time appointed to head a group/department/unit within NORTHRAIL or performs any work related to its operation.

1.1.11. Non-executive Director or Board Member – a director who is not the head of a department or unit of the corporation nor performs work related to its operation.1

1.1.12. Independent Board Member – A Member of the Board who has no relationship with NORTHRAIL, its affiliates, partners in a joint venture, or subsidiaries that could interfere, or be reasonably perceived to interfere, with the exercise of his/her independent judgment in carrying out the responsibilities as a Member of the Board.

1.1.13. Internal Auditing – An independent, objective assurance and consulting activity designed to add value and improve NORTHRAIL's operations. It helps NORTHRAIL accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.

1.1.14. Internal Audit Department – a department or unit of the corporation and its consultants, if any, that provide independent and objective assurance services in order to add value to and improve the corporations operations. This department reports to the NORTHRAIL board.

1.1.15. Internal Auditor - the highest position in the corporation responsible for Internal audit activities. If internal audit activities are performed outside service providers, he is the person responsible for overseeing the service contract, the overall quality of these activities, and follow-up of engagement results.

1.1.16. Internal Control – The system established by the Board and Management for the accomplishment of NORTHRAIL’s objectives, the effective and efficient operation of its business, the reliability of financial reporting and faithful compliance with applicable laws, regulations, and internal policies.

1.1.17. Management – The body given the authority by the Board to implement the policies it has laid down.

1.1.18. Oversight Director(s) – A Board committee or a particular member of the Board tapped by the Board to oversee a specific project or function, providing consultancy-type advice and service, analyze information and recommend actions for Board approval.

1.1.19. Regular Board Committees – Permanent Board Committees that perform policy-making and governance functions of the Board that are delegated to them. Membership in Regular Committees shall be exclusively for Board Members.

1.1.20. Special Board Committees – Committees created to support the Board in the performance of its functions. Special Board committees should have written terms of reference that define their duties, authority, composition, reporting relationships and conduct of business.

1.1.21. Stakeholders – Beneficiaries of NORTHRAIL programs identified under its Articles of Incorporation and By-Laws, allied laws and executive issuances, and investors providing external capital to NORTHRAIL in the form of equity or credit.

1.1.22. Subsidiary – A corporation of which more than 50% of the voting stock is owned or controlled, directly or indirectly through one or more intermediaries, by NORTHRAIL.

1.2. Interpretation of Salient Provisions. All doubts or questions that may arise in the interpretation or application of this Manual shall be resolved in favor of promoting transparency, accountability and fairness to the State and stakeholders of NORTHRAIL.