Under the Finnish Limited Liability Companies Act, the Board of Directors is responsible for the administration of the company and the appropriate arrangement of its operations.

In addition, the Board of Directors is responsible for ensuring that supervision of the Company’s accounting and asset management is appropriately arranged. The duties of the Board of Directors also include deciding on the Company’s strategy, adopting action plans and budgets, and handling and approving the interim report, financial statements and annual report.

Election of members and terms of office

Election and the Term

In accordance with Taaleri’s Articles of Association and General Meeting resolutions, the Board of Directors is comprised of no fewer than three (3) and no more than eight (8) members. The Chairman of the Board of Directors and Vice Chairman of the Board of Directors are elected by the General Meeting.

The term of office of the members of the Board of Directors ends at the close of the first annual general meeting following the election.

At the Annual General Meeting held on 20 March 2019, seven members were elected to Taaleri’s Board of Directors for a term of office that ends at the close of the Annual General Meeting 2020.

Independence

The Board of Directors has assessed the independence of the nominees in accordance with the Corporate Governance Code issued by the Finnish Securities Market Association in 2015.

According to the evaluation carried out by the Board, all member nominees are independent of the Company’s significant shareholders.

In addition, according to the Board’s member-specific overall evaluation, all member nominees are independent of the company, including Peter Fagernäs, although he has been a member of the Board of Directors for over 10 consecutive years. Based on the Board’s overall evaluation, Peter Fagernäs’s independence is not compromised due to his long service history, and no other factors or circumstances have been identified that could impair his independence.

Rules of procedure

The Board of Directors controls and supervises the company’s executive management, appoints and dismisses the CEO, approves the company’s strategic objectives and risk management principles, and ensures the operation of the management system. The duty of the Board of Directors is to promote the interests of the company and all its shareholders. The members of the Board of Directors do not represent in the company parties that have proposed them as members.

The rules of procedure, the Limited Liability Companies Act and the Corporate Governance Code specify the functions and areas of responsibility belonging to the Board of Directors.

In order to make its work more efficient, the Board of Directors has established an Audit Committee and a Remuneration Committee.

The Board of Directors’ rules of procedure have been approved in the Board’s meeting on 26 April 2019.

Members of Taaleri’s Board of Directors

Name Born Title Board Member Since
Peter Fagernäs 1952 Chairman 2007
Juha Laaksonen 1952 Vice Chairman until 31 May 2019, Member of the Board as of 1 June 2019 2013
Juhani Elomaa 1960 Member of the Board until 31 May 2019, Vice Chairman as of 1 June 2019 2019
Elina Björklund 1970 Member of the Board 2019
Esa Kiiskinen 1963 Member of the Board until 20 March 2019 2014
Vesa Puttonen 1966 Member of the Board 2013
Hanna Maria Sievinen 1972 Member of the Board 2016
Tuomas Syrjänen 1976 Member of the Board 2017

Duties of the Board of Directors

Duties of the Board of Directors, among other things are:

Strategy

Approve:
a) Business plan;
b) Company strategy;
c) Vision, mission and values;
d) Annual budget; and
e) Company’s business and financial targets as well as the Group’s and business segments’ strategic plans.

Supervise the execution of the Group’s strategy.

Business development

Monitor regularly:
a) Development of the operational business of Group companies;
b) Changes in the operating environment; and 
c) Achievement of set targets.

Organisational structure

Approve the organisational structure of the Company and Group.

Governance

Approve principles and policies required by legislation and requiring Board approval.

Approve the Corporate Governance Statement.

Committees

Decide on the establishment of committees.

Decide on the size and composition of committees.

Rules of procedure

Assess the content, relevance and timeliness of its rules of procedure, annually.

Assess regularly the timeliness of rules of procedure of committees.

Approve the rules of procedure of the Board of Directors, committees and Executive Board.

Stock exchange releases

Approve stock exchange releases (excluding technical stock exchange releases).

Reorganisations, investments, business restructuring, permits

Decide on:
a) Issues related to the Company’s share and other financial instruments; 
b) Company law measures; 
c) The establishment, purchase and sale, revision or divestment of businesses; 
d) The establishment of subsidiaries or associated companies, on the acquisition of existing shares or shareholdings in companies, and on the divestment and cancellation of shares or interests; and 
e) The acquisition, revision, divestment or termination of official permits upon which business is based.

Approval authorisations

Approve limits for investments, divestments and financial commitments that may not be exceeded without Board permission.

Related-party transactions

Approve agreements, transactions and other arrangements between insiders of the Group and Group companies.

Decide on the publication of a stock exchange release about material related-party transactions.

Financial reporting

Process reporting on the Company’s financial situation, the Company’s and Group’s results, and development of sales and personnel, on a regular basis.

Approve internal income and expense allocations used within the Group.

Monitor financial statements and other financial reporting and the reliability of the reporting.

Financial result

Approve the Company’s financial statements and half-year reviews and the related financial results press releases.

Independence

Assess the independence and qualifications of the Board of Directors’ members, annually.

Monitor that the Board of Directors’ members meet the requirements of independence.

Performance assessment of the Board of Directors and the CEO

Self-assess their performance annually at the end of the term of office, including also the committee performance evaluation.

Assess and provide feedback to the CEO on his performance, annually.

Appointments

Appoint the CEO and Deputy CEO and decide on their dismissal.

Appoint members of the Group's Executive Board, who report to the CEO, at the proposal of the CEO.

Be heard prior to the dismissal of a senior executive.

Service contracts

Approve senior executive service contracts and their terms.

Remuneration: Remuneration policy, principles of remuneration schemes and remuneration schemes

Approve and propose to the General Meeting the remuneration policy.

Approve the principles of the remuneration schemes.

Approve the remuneration schemes used within the Group.

Remuneration: Reporting

Approve the Remuneration Statement.

Approve and present to the General Meeting the remuneration report.

Internal control and risk and capital adequacy management

Monitor and supervise the efficiency, effectiveness and procedures of internal control and risk and capital adequacy management.

Approve the operating principles of internal control and risk and capital adequacy management.

Monitor that the Group is observing applicable laws and regulatory requirements.

Monitor the appropriateness of the CEO’s actions.

Process reports on risk management, compliance activities and realised risks.

Internal Audit

Approve Internal Audit’s audit plan.

Process Internal Audit reports.

Litigation and administrative processes

Approve initiated and threatening legal and administrative processes that may have a material impact on the Company’s financial position.

The Board of Directors’ Committees and the Shareholders’ Nomination Committee and their rules of procedure

Taaleri Plc’s Board of Directors has two committees that assist the Board in preparing matters for the Board. The duties and operating principles of the committees are specified in the committees’ rules of procedure. The key content of the rules of procedure are described below.

Audit Committee

The main function of the Audit Committee is to monitor the Company’s processes of financial reporting, bookkeeping, auditing, internal control, as well as internal auditing and risk management.

The Audit Committee has three (3) members. The Board of Directors elects the Audit Committee’s members and Chairman.

Committee members are elected for a term of office of one (1) year at the Board of Directors’ organisational meeting after the Annual General Meeting.

The Audit Committee convenes, as a rule, four times per year.

The duties of the Audit Committee include, among others:

Governance

Process and transmit to the Board the principles and policies required by legislation and requiring Board approval.

Process and transmit to the Board the Company’s Corporate Governance Statement.

Rules of procedure

Assess the content, relevance and timeliness of its rules of procedure annually and propose modifications it considers necessary for approval by the Board.

Financial reporting

Monitor and supervise the financial statements and other financial reporting and the reliability of reporting.

Financial result

Process and transmit to the Board of Directors the Company’s financial statements and half-year reviews as well as proposals regarding the related financial results press releases.

Audit

Undertake the tendering of audit services at regular intervals.

Ensure that the auditor and chief auditor are replaced at minimum in accordance with regulatory requirements.

Prepare and present to the General Meeting a proposal on the auditor’s remuneration and election or re-election. 

Assess the qualifications, performance and independence of the auditor.

Assess the experience, qualifications and performance of the senior members of the external audit team.

Approve fees to be paid to the auditor under the guidance given by the Annual General Meeting.

Monitor and supervise the statutory audit of the financial statements and the consolidated financial statements.

Assess the annual audit plan.

Assess the services related and unrelated to auditing provided to the Company by the auditor.

Remuneration: Remuneration policy, principles of remuneration schemes and remuneration schemes

Process and transmit to the Board of Directors a proposal on the principles of remuneration schemes.

Process and transmit to the Board of Directors a proposal on the remuneration policy.

Process the Group compliance officer’s report on remuneration schemes’ regulatory conformance prior to making proposal on remuneration schemes to Board of Directors.

Process and transmit to the Board of Directors a proposal on remuneration schemes used within the Group.

Remuneration: Targets in accordance with the remuneration scheme

Decide on targets in accordance with the remuneration schemes of individuals working in oversight functions.

Remuneration: Oversight

Oversee the accuracy of payments made on the basis of the remuneration schemes.

Oversee conformity of the Group’s upcoming and existing remuneration schemes and remuneration with requirements and the correctness of the payments made.

Process internal audit’s annual report for compliance with the remuneration schemes.

Remuneration: Reporting

Process and transmit to the Board of Directors a proposal on the Remuneration Statement.

Process and transmit to the Board of Directors a proposal on the remuneration report.

Internal control and risk and capital adequacy management

Monitor and oversee efficiency, effectiveness and procedures of internal control and risk and capital adequacy management.

Process and transmit to the Board of Directors the operating principles of internal control and risk and capital adequacy management.

Oversee regulatory compliance systems and supervise its effectiveness and the prevention of abuse.

Assess the compliance and risk management organisation, tasks and human resources, at regular intervals.

Oversee compliance with executive management share ownership recommendations.

Process and transmit to the Board of Directors a report on risk management, compliance activities and realised risks.

Approve underlying assumptions of stress tests and scenario analyses.

Internal Audit

Assess and monitor at regular intervals the effectiveness, procedures, organisation, duties and human resources of the Company’s Internal Audit function.

Prepare and transmit to the Board of Directors a proposal on Internal Audit’s audit plan.

Process Internal Audit’s reports.

Whistle blowing

Process complaints and notifications transmitted to the Company anonymously or in some other way.

Litigation and administrative processes

Approve initiated and threatening legal and administrative processes that may have a material impact on the Company’s financial position.

Other duties

Perform tasks occasionally delegated to the committee by the Board of Directors.

 

Remuneration Committee

The functions and responsibilities of the Remuneration Committee concern the remuneration and successor planning of the CEO, Deputy CEO and the Group’s Executive Board, and the preparation of Taaleri Group’s remuneration schemes.

The Remuneration Committee has three (3) members. The Board of Directors elects the Remuneration Committee’s members and Chairman.

Committee members are elected for a term of office of one (1) year at the Board of Directors’ organisational meeting after the Annual General Meeting.

The duties of the Remuneration Committee include, among others:

Rules of procedure

Assess the content, relevance and timeliness of its rules of procedure annually and propose modifications it considers necessary for approval by the Board.

Service contracts

Prepare for the Board of Directors senior executive service contracts and their terms.

Successor planning

Carry out continuous management successor planning.

Remuneration: Remuneration policy, principles of remuneration schemes and remuneration schemes

Assess the functionality of the existing remuneration scheme and remuneration with respect to its purpose.

Process the results of the risk adaptation process required by the remuneration regulation.

Process and transmit to the Audit Committee a proposal on the principles of remuneration schemes.

Process and transmit to the Audit Committee a proposal on the remuneration schemes used within the Group.

Remuneration: Reporting

Process and transmit to the Audit Committee a proposal on the Remuneration Statement.

Process and transmit to the Audit Committee a proposal on the remuneration report.

Other duties

Perform tasks occasionally delegated to the committee by the Board of Directors.

 

Shareholders’ Nomination Committee

The General Meeting 2019 resolved to establish a permanent Shareholders’ Nomination Committee, whose main duty is to prepare and present proposals to the Annual General Meeting, or to the Extraordinary General Meeting if needed, for election and remuneration of the members of the Board of Directors as well as identify successors for existing members of the Board.

The Nomination Committee consists of three members that represent the company’s biggest shareholders. Nomination right belongs to the three shareholders who hold the largest number of votes calculated of all shares in the company on the basis of the registered holdings in the company’s shareholders’ register held by Euroclear Finland Ltd or based on information represented by the nominee registered shareholders as of the last weekday in August in the year preceding the next Annual General Meeting. Should a shareholder not wish to use his/her nomination right, the right is transferred to the next largest shareholder who would otherwise not have a nomination right. In case two shareholders have an equal number of votes and the representatives of both such shareholders cannot be appointed to the Nomination Committee, the decision between them shall be made by drawing lots.

The Chairman of the Board of Directors shall request each of the three largest shareholders to appoint one member to the Nomination Committee.

The Chairman of the Board of Directors shall convene the first meeting of the Nomination Committee and act as the chairman of the Nomination Committee until the Nomination Committee has elected a chairman from among its members who shall be responsible for convening subsequent meetings. The Chairman of the Board of Directors can act as the Nomination Committee’s expert member upon request of the Nomination Committee.

The Nomination Committee shall serve until further notice unless otherwise decided by the General Meeting. The Nomination Committee’s members shall be elected annually and their term of office shall end when new members are elected to replace them. 

Composition of Taaleri’s Shareholders’ Nomination Board

The composition of Taaleri Plc’s Shareholders’ Nomination Board is:

  • Pertti Laine, Veikko Laine Oy’s Chairman of the Board of Directors, nominated by Veikko Laine Oy
  • Peter Fagernäs, Oy Hermitage Ab’s Chairman of the Board of Directors, nominated by Oy Hermitage Ab
  • Juhani Elomaa, Taaleri Plc’s Vice Chairman of the Board of Directors, nominated by Juhani Elomaa

At its meeting on 17 September 2019, the Shareholders’ Nomination Board elected Peter Fagernäs as its Chairman.

The duties of the Nomination Committee include, among other things:

Rules of procedure

Review the rules of procedure annually and propose possible amendments to the next General Meeting for adoption.

Board composition

Prepare and present to the General Meeting a proposal on the number of the members of the Board of Directors.

Prepare and present to the General Meeting a proposal on the members of the Board of Directors.

Prepare and present to the General Meeting a proposal on the chairman and vice chairman of the Board of Directors.

Independence

Take into consideration the independence requirements in the preparation of the proposal on the Board composition.

Performance assessment of Board and CEO

Take into consideration the results of the annual performance assessment of the Board of Directors in the preparation of the proposal on the Board composition.

Successor planning

Identify successors for existing members of the Board.

Remuneration: Remuneration scheme-based performances

Prepare and present to the General Meeting a proposal on the remuneration of the members of the Board of Directors for their Board and Board committee work.

The rules of procedure of the Audit Committee and the Remuneration Committee have been approved at the Board’s meeting on 26 April 2019, and the rules of procedure of the Shareholders’ Nomination Committee have been approved at the Annual General Meeting on 20 March 2019.