Corporate Governance Report
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CORPORATE GOVERNANCE REPORT CORPORATE GOVERNANCE REPORT This report describes corporate governance, management and administration, as well as the manner in which the Board of Directors ensures the quality of the financial statements and its cooperation with the company’s independent auditors. The report for the 2015/2016 financial year includes the Board’s report on internal controls for financial reporting and operational governance. corPoratE goVErnancE at nobina preceding year. Representatives of the Board of Directors, the Nobina’s corporate governance focuses on how to govern, executive management and the auditors are normally present manage and control operations with the aim of creating value to answer such questions at the AGM. for the company’s shareholders and other stakeholders. Corpo- rate governance aims to create the preconditions for active, Annual General Meeting 2015 responsible corporate bodies, to clarify the allocation of roles At the AGM on 27 May, 2015, 50.08 per cent of the shares and and responsibilities and to ensure accurate reporting and infor- the voting rights were represented. Representatives of Nobina’s mation. Both external and internal regulations form the basis Board of Directors and Group management, and the auditor of Nobina’s corporate governance. were present. The following resolutions were passed: EXTERNAL REGULATIONS: INTERNAL REGULATIONS: The meeting resolved that the Board should comprise six • Swedish Companies Act • Articles of Association Board members with no deputies and that the company • Swedish Annual Accounts Act • The Board’s Rules of Procedure should have one auditor with no deputy. John Allkins, Birgitta • Other relevant laws • The Board’s instructions Kantola, Graham Oldroyd, Gunnar Reitan, Ragnar Norbäck for the CEO • Swedish Corporate and Jan Sjöqvist were re-elected as Board members, and Jan Governance Code • Policies and guidelines Sjöqvist was also re-elected as Chairman of the Board. All of the above were elected for the period until the next AGM. Since 1 July, 2008, all companies whose shares are listed on PricewaterhouseCoopers AB was elected as the company’s Nasdaq Stockholm or NGM Equity are required to apply the auditors. A fee of SEK 900,000 was approved for the Chair- Swedish Corporate Governance Code (the Code), regardless of man of the Board and a fee of SEK 450,000 for each of the their market capitalisation. Nobina is subject to the rules of the other Board members, SEK 2,700,000 in total. No fees are Code and has followed them since becoming listed on 18 June, paid to Board members employed by the company or by any of 2015. its subsidiaries. Fees to the auditors are paid against invoices approved by the Board. Articles of Association The Parent Company’s income statement and balance sheet The Articles of Association contain no separate provisions per- and the consolidated income statement and balance sheet were taining to the appointment or removal of Board members or adopted for the 2014/2015 fiscal year and the Board members the amendment of the Articles of Association. The Articles are and CEO were discharged from liability. available in their entirety on Nobina’s website at www.nobina. In accordance with the proposal by the Board and the com. CEO, it was resolved that the profit for the year of SEK 108,197,506, disposable earnings from previous years totalling Annual General Meeting and shareholders SEK 1,764,270,693 and the share premium reserve of SEK The Annual General Meeting (AGM) is the company’s highest 612,407,930 would be appropriated, such that SEK governing body. Shareholders exercise their decision-making 2,484,876,129 is carried forward. The meeting resolved that no rights at the AGM on such matters as the composition of the dividend would be paid for the preceding fiscal year. Board of Directors and the election of auditors. The Nomina- Furthermore, the principles for appointing a Nomination tion Committee proposes candidates for selection as Board Committee and the guidelines on remuneration of senior members, Chairman of the Board and auditors. Resolutions at executives were decided in accordance with the submitted the AGM are normally passed with a simple majority. In cer- proposal. tain cases, however, the Swedish Companies Act stipulates a The Board was authorised to take decisions on new share certain level of attendance to reach a quorum or a special vot- issues and, in that connection, to disapply shareholders’ ing majority. Shareholders have the opportunity at the AGM pre-emption rights, with the aim of offering shares to investors to pose questions about the company and its results for the in conjunction with raising capital and/or spreading owner- 32 NOBINA ANNUAL REPORT 2015/2016 CORPORATE GOVERNANCE REPORT ORGANISATION CHART, NOBINA CORPORATE GOVERNANCE Shareholders Annual General Nomination Auditor Meeting Committee Remuneration Audit Committee Board of Directors Committee CEO and President Group management ship. In line with the Board’s proposal, it was then resolved to Principles governing appointment of the Nomination Committee conduct a new issue of a maximum of 645,396 shares to the The 2015 AGM passed resolutions on the following principles company’s CEO and President at a subscription price deter- governing the Nomination Committee until the end of next mined in accordance with the applicable agreements. The AGM: Nobina will have a Nomination Committee compris- deadline for subscription to and cash payment for the new ing one representative for each of the three largest shareholders shares was set as 30 June, 2015. The reason for deviating from in terms of votes and the Chairman of the Board. The names of the shareholders’ pre-emption rights was because the company the members of the Nomination Committee and the share- has committed to issuing new shares under an incentive pro- holders they represent is to be published not later than six gramme agreement. months prior to the AGM and be based on shareholding statis- Finally, to arrive at an appropriate number of shares, it was tics provided by Euroclear Sweden AB as of the last banking resolved to perform a 1:10 reverse split to consolidate the com- day in September 2015. Unless the members of the Nomina- pany’s shares. To enable this consolidation, it was also resolved tion Committee agree otherwise, the member representing the to amend the Articles of Association such that the number of largest shareholder, in terms of votes, will be appointed Chair- shares should be not less than 60,000,000 and not more than man of the Committee. In the event that a shareholder who 240,000,000. has appointed a member is no longer one of the three largest shareholders, in terms of votes, the appointed member is to Annual General Meeting 2016 resign and be replaced by a new member in accordance with The 2016 AGM will be held on 31 May, 2016. See page 100. the above procedure. Nomination Committee Nobina’s Nomination Committee ahead of the 2016 AGM The Nomination Committee is tasked with the preparation and submission of proposals for: the Chairman of the AGM, Member Representing Shareholding/votes members of the Board, the Chairman of the Board, directors’ Jan Sjöqvist Chairman of the Board 0.2% fees to the Chairman and each of the members of the Board, as Ralph Herrgott Sothic Capital 11.8% well as any remuneration for Committee work, fees to the Nuno Caetano Invesco 5.8% company’s auditor and, where applicable, proposals regarding Fourth Swedish National the election of auditors. Furthermore, the Nomination Com- Tomas Ehlin Pension Fund (AP4) 5.6% mittee prepares and submits proposals to the AGM regarding principles governing the composition of the Nomination The members of the Committee were appointed based on the Committee. ownership structure as of 30 September 2015. The sharehold- ings are reported as of the same date. The Chairman of the Nomination Committee is Ralph Herrgott, who also repre- sents the largest owner. NOBINA ANNUAL REPORT 2015/2016 33 CORPORATE GOVERNANCE REPORT Member elected Year Remuneration, Number of Attendance at Attendance at by the AGM elected Born SEK shares/votes Independent1 Board meetings committees Jan Sjöqvist 2005 1948 900,000 193,737 Yes 13 of 13 2 of 2 Graham Oldroyd 2014 1961 450,000 34,375 Yes 13 of 13 2 of 2 Birgitta Kantola 2009 1948 450,000 14,578 Yes 13 of 13 3 of 3 Ragnar Norbäck 2014 1955 – 722,444 No 13 of 13 Gunnar Reitan 2012 1954 450,000 16,500 Yes 12 of 13 2 of 3 John Allkins 2013 1949 450,000 54,963 Yes 13 of 13 3 of 3 Summa 2,700,000 1) According to the Code, the member is independent of the Company, its management and major shareholders of the company (i.e. shareholdings that exceed 10 per cent). Board meetings during the financial year: nobina’s board of dirEctors The Board’s responsibility Date Type Items addressed The Board’s work is governed by the Swedish Companies Act, 3 March Scheduled Operations, Budget and IPO the Articles of Association, the Code and the Rules of Proce- 23 April Extraordinary AGM, Policies and Instruc- dure established by the Board annually. Nobina’s Board is tions, and Committees responsible for the organisation and administration of the 23 April Scheduled Operations, Annual Report, company’s affairs. Neither during his time on the Board, nor Multi-Year Plan, Financial Targets and IPO previously, has the CEO participated in meetings where his remuneration was discussed. One of the Board’s most impor- 10 May By letter IPO tant assignments is to secure a long-term strategy, governance, 19–24 May Extraordinary IPO follow-up and control of Nobina’s daily operations with the 2 June Extraordinary by telephone IPO aim of creating value for shareholders, customers, employees 14 June Extraordinary Interim Report and IPO and other stakeholders.