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| Investor Information | Corporate Governance |
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Etteplan Oyj is a Finnish public limited company that in its decision-making and governance complies with the Finnish Companies Act, other legislation concerning publicly listed companies, and the Articles of Association of Etteplan Oyj.
Etteplan is a publicly listed company that abides by the regulations of NASDAQ OMX Helsinki Ltd. The company is committed to compliance with the corporate governance code for listed Finnish companies, published by the Securities Market Association on 22 October 2008, except with reference to the committees of the Board of Directors, because the company does not have such administrative bodies. The Board of Directors handles all matters within the scope of its duties in full assembly.
The company’s highest decision-making body is the general meeting of shareholders, where shareholders exercise their right to monitor and control the company's operations. The company must hold one Annual General Meeting for shareholders during each financial year, by the end of June. If necessary, an extraordinary meeting of shareholders is held.
The shareholders exercise their right to speak and vote at the shareholder meeting. The matters to be considered at the Annual General Meeting (AGM) are specified in section 8 of Etteplan’s Articles of Association and in Chapter 5, Section 3 of the Companies Act.
Decisions by the AGM are published without delay after the meeting by means of a stock exchange release and on the company’s Web site.
Providing shareholders with information from shareholder meetings
The Board of Directors convenes an Annual General Meeting or an extraordinary meeting with a summons to be published in one Finnish-language national daily newspaper, determined by the Board of Directors. The summons must list the agenda for the meeting. The summons to a meeting and the Board’s proposals for the meeting are also published as a stock exchange release and made available for viewing on the company’s Web site.
Participation in an Annual General Meeting
To be able to participate in an Annual General Meeting, a shareholder must be registered in the list of Etteplan Oyj's shareholders, maintained by Euroclear Finland Ltd. A nominee-registered shareholder who intends to take part in an AGM must report such intentions to the book-entry register authority in good time before the meeting and comply with the instructions received from the bank. Shareholders must register for an AGM in advance, within the time prescribed in the summons. A shareholder may participate in an Annual General Meeting personally or through a duly authorized proxy. The proxy must present a power-of-attorney form for such authorization. Upon registration for an Annual General Meeting, the shareholder must report to the company any powers of attorney issued. The shareholder and proxy may have an assistant present at the meeting.
Participation in shareholder meetings by Board members, the CEO, and the auditor
The CEO, the chairman of the Board, and a sufficient number of Board members must be present at a general meeting of shareholders. Furthermore, the auditor must be present at the Annual General Meeting.
General meeting participation of a Board candidate
A person who is for the first time a candidate for the Board of Directors must participate in the meeting that decides on the election, unless there are weighty grounds for absence.
Date for the Shareholders Meeting
The Board of Directors is responsible for the company’s management and for the due organization of the company’s operations in accordance with the relevant legislation and the company’s Articles of Association. The Board of Directors controls and monitors the company’s operations and management; appoints and dismisses the CEO; and approves the major decisions affecting the company’s strategy, capital expenditures, organization, remuneration and bonus systems covering the management, and finances. The Board of Directors is responsible for the due organization of the company’s management and operations as well as for ensuring that the supervision of the company’s accounting and treasury management is appropriately arranged.
Charter of the Board of Directors
As part of the company’s corporate governance, the Etteplan Oyj Board of Directors has approved written charter to control Board work. The Board's charter complements the stipulations of the Finnish Companies Act and the Articles of Association of the company. The shareholders can assess the activities of the Board on the basis of the charter.
Board meetings and assessment of activities
The Etteplan Board of Directors met 14 times in 2008. In addition to the members of the Board, the company's CEO attended Board meetings. The average attendance percentage at the meetings was 94.3%. The Board meets as often as appropriate fulfillment of its obligations requires.
On an annual basis, the Board of Directors assesses its activities and work practices. The Board specifies the criteria to be used in the assessment, which is carried out as internal self-evaluation. The results of these activities are handled by the Board.
Composition of the Board of Directors
The Board of Directors prepares a list of proposed members of the Board of Directors for consideration by the Annual General Meeting. The Board-proposed candidates are reported upon in the summons to the meeting and on the company’s Web site.
The composition of the Board of Directors
The Board of Directors appoints the Chief Executive Officer (CEO) and terminates this employment, as well as monitors the CEO’s activities. The parent company’s CEO furthermore acts as the Group’s Chief Executive Officer. The CEO is responsible for managing the Group’s day-to-day operations in accordance with the rules and instructions issued by the Board of Directors. The CEO may take measures that are unusual and far-reaching with regard to the scope and nature of the company’s operations only with authorization from the Board of Directors. The CEO is responsible for ensuring that the company’s accounting complies with the applicable legislation and that its treasury management is arranged in a reliable manner.
Matti Hyytiäinen has been the company’s President and CEO since the beginning of 2008. He is not a member of the Board of Directors, but he attends Board meetings. The CEO’s personal information, shareholdings, essential work experience, and most significant simultaneous positions of trust are presented on the company’s Web site.
A written CEO agreement has been drawn up for the Chief Executive Officer.
The CEO appoints members to the Management Group who are appropriate from the standpoint of line operations. The Management Group assists the CEO and also develops and monitors all matters entrusted to the company’s management, including those connected with the Group and business unit strategies, acquisitions and major capital expenditures, divestments, the company’s image, monthly reporting, interim reports, investor relations, and the main principles of the human resource policy. The Board of Directors approves the appointment of the Management Group members.
As of 1 January 2009, the members of the Management Group are Matti Hyytiäinen, President and CEO; Tom Andersson, Vice President; Pia Björk, Vice President, Operations Development and M&A; Per-Anders Gådin, Chief Financial Officer; Risto Koivunen, Vice President; Outi-Maria Liedes, Vice President, HR and Communications; and Juha Näkki, Vice President. The personal information, shareholdings, essential work experience, and most significant simultaneous positions of trust of the members of the Management Group are presented on the company’s Web site.
Jukka Rausti, the company’s executive vice-president, will retire in 2009. From 1 January 2009 he became Senior Executive adviser of the Board of Directors and reports to the Chairman of the Board.
Contact Information for the President and CEO and Management Group
Board of Directors
According to the resolution passed by the Annual General Meeting of 2009, the monthly remuneration for each ordinary member of the Board of Directors is EUR 1 300 and EUR 2 600 for the Chairman of the Board. The meeting remuneration for each ordinary member of the Board is EUR 600 per meeting and for the chairman of the Board of Directors EUR 1,200 per meeting.
Compensation and other benefits of the President and CEO
The President and CEO’s compensation consists of a basic salary and a yearly bonus decided annually by the Board on the basis of the Corporation’s financial result and other key targets. The yearly bonus may not exceed 100 percent of the recipient’s annual salary. In 2008, President and CEO Matti Hyytiäinen’s basic salary was EUR 215,950. He has also car and phone benefits, which in 2008 totaled to EUR 15,751. In addition, his bonus accrued for 2008 totaled EUR 100,858. Matti Hyytiäinen belongs to the target group of a share-based incentive plan for the key employees of Etteplan Group. In 2008 the President and CEO did not receive any shares or share based rights. The bonus accrued from 2008 and paid in April 2009 was 4 451 Etteplan Oyj shares together with an estimated cash bonus to cover taxes and similar charges arising from the receipt of shares. The company has taken out and maintains an additional accrual basis pension insurance policy for the President and CEO. In 2008 EUR 9 500 was paid for the additional accrual basis pension insurance policy. In the event of dismissal, the President and CEO is entitled to receive compensation equivalent to 18 months’ salary which includes the salary for a six-month term of notice.
Management Group
The system of compensation for the members of the Management Group includes a base salary and a profit-related bonus that is based on the company's profit and the result within the member's area of responsibility. Members of the Management Group are entitled to participate in the share-based incentive plan for the company’s key personnel, whose first earnings period ended in 2008.
Internal control
The objective of Etteplan Oyj’s internal control and risk management is to ensure that the company’s operations are efficient and profitable, its information is reliable, and it complies with appropriate regulations and operating principles. The objectives also include identification, assessment, and monitoring of risks related to business operations.
Risk management
Management and mitigation of the impact of risks is one of the Group’s main principles of operation. The Board of Directors and the Management Group monitor the development of risks and concentrations of risk. The Group’s financial administration operations monitor and assess operational and financial risks and take measures to avert them in cooperation with the Board of Directors, the Management Group, and the management personnel responsible for corporate planning.
Risks related to Etteplan Group’s business operations are divided into external and internal risks, and the risks are monitored according to this classification.
External risks
External risks include risks concerning general economic development on the whole and unpredictable changes in customers’ order books, which are classified as the greatest risk in the company’s business operations.
Internal risks
Internal risks include strategic and operating risks, as well as financing risks.
Etteplan’s most significant strategic risks relate to development of business operations and acquisitions. The company aims to manage these risks by following its acquisitions policy and applying procedures and models that have been prepared on the basis of this policy. In addition to acquisitions, organic growth is an important element of the growth objectives for Etteplan’s business.
Etteplan’s greatest operating risks are related to commissions and personnel. The company’s commissions involve risk of services or performances including a professional error, omissions, or other negligence that could cause significant financial or other damage. In order to contain operating risks, the company applies the following procedures: application of quality management systems, codes of practice, and acceptance procedures; coupled with training of personnel; and compliance with instructions on management of quotes and contracts, particularly in delimitation of contractual liability. The company has a liability insurance coverage that encompasses the entire Group. However, the insurance does not cover all liability risks. The company’s business is based on professional personnel. Availability of competent professionals is an important factor in ensuring profitable growth and continued business operations. Reviews concerning financing risks are presented in the notes to the financial statements.
Internal auditing
Internal audit within Etteplan Group is an administrative function reporting directly to the CEO and forms part of the Group’s financial administration. Internal auditing is supported by the quality management system. The Group’s internal control is organized among others according to a system that includes monthly reporting, comparing actual performance to the budgeted plan and actual performance in the preceding year. The operating income statement is reconciled with regular bookkeeping and interim reports.
INSIDER ADMINISTRATION
The Etteplan Oyj Board of Directors has approved insider regulations for the company. The regulations are based on the Finnish Securities Markets Act, and they comply with the standards of Financial Supervision and the Guidelines issued by the OMX Nordic Exchange Helsinki Ltd, which took effect on 2 June 2008.
The primary duty of statutory audit is to verify that the financial statements give correct and sufficient information about the Group’s profit and financial situation for the financial year. Etteplan Oyj’s financial year is the calendar year. The auditor is responsible for auditing the company’s accounts and the correctness of its financial statements during the financial year, and for issuing an auditor’s report to the Annual General Meeting.
A summary of the Group’s audit report is compiled for the Board of Directors. Also, the auditors of all Group companies report separately to the management of each company within the Group. The auditors attend at least one meeting of the Board of Directors in the relevant financial year.
The Annual General Meeting elects one regular auditor to audit corporate governance and accounts. The auditor must be a firm of independent public accountants authorized by the Central Chamber of Commerce. In 2009, the Annual General Meeting elected PricewaterhouseCoopers Oy, a firm of authorized public accountants, with Mika Kaarisalo, APA, acting as chief auditor. The auditor’s term ends at the conclusion of the first Annual General Meeting after the election.
Audit fees and services not related to auditing
The audit fees paid in 2008 totaled EUR 95,285 (in 2007: EUR 96,145). In addition, EUR 47,253 was paid to the firm for services not related to auditing (in 2007: EUR 4,797).
It is Etteplan Oyj’s principle to be open, truthful, and quick in all communications. The primary objective of the company's investor information is to provide the market with information about the Group's operations and financial standing. The goal is to give all stakeholder groups correct and uniform information in a regular and balanced manner.
Silent period
Etteplan Oyj follows a so-called silent period before publication of interim reports and financial statement bulletins. The duration of the silent period is two weeks.
Distribution of investor information
Etteplan publishes all of its investor information on the company’s Web site at www.etteplan.com. Financial bulletins are made available for viewing and printing immediately after publication. They are published in Finnish and English. |
