The Shareholders’ Nomination Board shall prepare a proposal concerning the composition of the Board to be presented to the General Meeting. The General Meeting elects the Board members for the term of office expiring at the close of the General Meeting following the election. The Articles of Association of the Company do not contain any provisions on a special order of appointment of the Board members but the General Meeting elects all Board members based on the proposal of the Shareholders’ Nomination Board. Any shareholder of the Company may also make a proposal directly to the General Meeting in accordance with the Finnish Companies Act.
When preparing its proposal concerning the composition of the Board, the Shareholders’ Nomination Board shall take into account the independence requirements under the Finnish Corporate Governance Code adopted by the Securities Market Association, the results of the annual performance assessment of the Board conducted in accordance with the Corporate Governance Code, the principles on diversity of the Board and other applicable rules and regulations. The Shareholders’ Nomination Board may also consult an external expert at a cost approved by the Company in order to find and assess suitable candidates.
The Shareholders’ Nomination Board is entitled to receive from the Company and from its member candidates for the Board the results of the annual performance assessment of the Board, information relevant to the evaluation of the candidates' independence, and other information reasonably required by the Shareholders’ Nomination Board in preparing its proposals.
The AGM 2020 elected the following seven individuals to the Board:
Mr. Pekka Ala-Pietilä, Chairman
Ms. Kerttu Tuomas, Vice-Chairman
Mr. Doug Baillie
Mr. William R. Barker
Ms. Anja Korhonen
Ms. Sandra Turner
Mr. Ralf K. Wunderlich.
The principles on diversity of the Board have been defined in the Charter of the Shareholders’ Nomination Board. The Company’s Board must have sufficient expertise, competence and experience related to the Company’s line of business. The composition of the Company’s Board shall reflect the requirements set by the Company’s operations and development stage. The Board must specifically have sufficient collective knowledge and competence in:
- matters pertaining to the Company’s line of business and its business operations;
- management of an internationally operating public limited company of corresponding size;
- group and financial management
- strategy as well as mergers and acquisitions;
- internal control and risk management; and
- corporate governance.
The selection of the members of the Board is based on candidates' background and competence to understand Huhtamaki's current and future markets, strategy, employees and customers, including a sound understanding of financials and business dynamic. The Board must as a whole have combined experience in different markets, geographies and important topics like digitalization and sustainability. The most important nomination criteria for the candidates of the Board are competency, knowledge, personal qualities and integrity. Both genders shall be represented on the Board.
The objectives concerning the diversity of the Board have been achieved well. According to the Nomination Committee of the Board that was operational until April 29, 2020, the composition of the Board comprises qualifications defined in the principles on diversity in a balanced way. As regards diversity in terms of gender, both genders are represented in the Board in a well-balanced manner and both genders have been represented in the Board for a long time. Since 2009, two to three Board members have been female thus representing 25–43% of all Board members. At the AGM in 2020 seven members representing four different nationalities were elected to the Board. The age structure of the Board members is 53–70 years and three Board members are female and four male. The Board members have international experience in different roles in global companies operating in the different businesses and geographical market areas that are important for the Group. Board members hold or have held management positions and positions of trust in both listed and unlisted companies. All Board members have a university level degree, mainly in technology or finance More information on the educational and professional background of the Board members is available on Group's website in section Board of Directors.
In the view of the Nomination Committee of the Board that was operational until April 29, 2020, the current composition of the Board ensures well both comprehensive knowledge of the Company and new insights. The Board strives to ensure that experienced Board members with longer history in the Company’s Board and with wide knowledge of the Company’s various stages transfer their Company specific knowledge and expertise to the new members thereby ensuring that the knowledge stays in the Board also in the future.
Diversity of the Board*
All members of the Board are non-executive. The Board considers all members of the Board independent of the Company. It was noted in the consideration that despite William R. Barker has served as director for more than 10 consecutive years, the Board has determined no reasons justifying him to be considered dependent on the Company. The evaluation has been made based on the actual circumstances from both the perspective of the Company and the director in question. The Board also considers all members independent of the significant shareholders of the Company.
|William R. Barker||-|
|Ralf K. Wunderlich||16,350|
The shareholdings include the Company’s shares owned by the Board members and by any potential corporations over which a Board member exercises control. Board members do not own any shares in any other Group companies than the Company.
Information on the remuneration of the Board members is available in section Remuneration and in Remuneration Statement issued and published in connection with the Director’s Report.
Up-to-date information of the shares owned by the Board members can be found here.
In addition to the powers vested in the Board by the Companies Act and the Articles of Association, the essential duties and working principles of the Board are defined in the Company’s Charter of the Board of Directors.
The responsibilities and duties of the Board include, among other things,
- organizing the Company’s management and operations including e.g.
- appointing and dismissing the President and CEO and approving the proposals by the President and CEO for GET members’ appointments and dismissals
- deciding on the compensation of the President and CEO within the framework of the Remuneration Policy and of other GET members and annually reviewing the performance of the President and CEO and other GET members
- defining the Group’s ethical values and methods of working including e.g. the approval of the Company’s Code of Conduct
- deciding on related party transactions that are not part of the ordinary course of business of the Company or are not implemented under arms-length terms
- directing the Company’s business and strategy including e.g.
- establishing strategic and financial targets as well as dividend policy and approving the strategic plans and budget as well as monitoring their implementation
- approving acquisitions and divestments as well as capital expenditure proposals exceeding EUR 10 million or proposals which are otherwise of material importance to the Group
- discussing and approving of financial statements, Directors’ Report, interim reports, Corporate Governance Statement, Remuneration Policy for the Governing Bodies, Remuneration Report and Sustainability Report
- financial communication and outlook
- internal control and risk management and
- preparation of matters to be resolved by the AGM
The Board also conducts an annual evaluation of its own performance and working methods. The evaluation may be conducted as an internal self-evaluation or by using an external evaluator. In 2019, the evaluation was done as an internal self-evaluation without an external evaluator.
In order to discharge its duties, the Board requires sufficient information on the structure, business operations and markets of the Group. Each Board member is provided with a monthly report on the financial situation and markets of the Group. In addition, if necessary, the Board is informed of all material events in the Group. New Board members are properly introduced to the operations of the Company with induction presentations and materials as well as visits to selected manufacturing units.
The meetings of the Board are held at the Company’s headquarters in Espoo or in other Group locations or in other places as decided by the Board. The Board may also hold its meetings by video or telephone and make decisions without convening a meeting. According to the Charter of the Board of Directors, it shall hold at least six regular meetings each year. In 2019, the Board held ten (10) meetings, three of which were video or telephone meetings and two were held without convening. The average attendance of the members at the Board meetings was 96%.
The President and CEO is usually attending all Board meetings. Other GET members are also invited to participate Board meetings depending on the matters to be deliberated in the respective meeting. The Auditor is participating annually in the meeting deliberating the financial statements. The Group General Counsel of the Company acts as the secretary of the Board.
Board members' attendance at the Board meetings in 2019
|Attendance (%)||Number of meetings attended|
|Pekka Ala-Pietilä (Chairman)||100||10/10|
|Kerttu Tuomas (Vice-Chairman)||90||9/10|
|William R. Barker||90||9/10|
|Ralf K. Wunderlich||100||10/10|
In order to focus on certain responsibilities, the Board may appoint Committees consisting of three to five Board members each. The Board also appoints the Chairman of each Committee. Each Committee member shall have the qualifications required by the duties of the Committee.
The Board currently has two Committees: the Human Resources Committee and the Audit Committee. The duties and responsibilities of the Committees are described in the charter for each Committee approved by the Board. The Committees assist the Board by preparing matters belonging to the competence of the Board. Each Committee regularly reports on its work to the Board. The Committees have no autonomous decision-making power and, thus, the Board passes its resolutions collectively. The entire Board remains responsible for the duties assigned to the Committees.
The duties and responsibilities of the Human Resources Committee
- To prepare, review and discuss development and implementation of people and organization strategy, talent management as well as other human resources matters and relating policies to be further deliberated by the Board of Directors
- To prepare the Remuneration Policy for the Governing Bodies and Remuneration Report
- To prepare the appointment of the President and CEO and other GET members, including the terms and conditions as well as remuneration
- To review and assess the remuneration of the President and CEO and other GET members
- To review succession and contingency planning for the CEO and other GET members including training
The Human Resources Committee shall meet at least twice a year. The following individuals were elected as members of the Human Resources Committee on the date of the AGM in 2020: Pekka Ala-Pietilä (Chairman), Doug Baillie, William R. Barker and Ralf K. Wunderlich. In 2019, the Human Resources Committee held five meetings. The average attendance of the members at the Human Resources Committee meetings was 95%.
Member's attendance at the Human Resources Committee meetings in 2019
|Attendance (%)||Number of meetings attended|
|Pekka Ala-Pietilä (Chairman)||100||5/5|
|William R. Barker||80||4/5|
|Ralf K. Wunderlich*||100||5/5|
The duties and responsibilities of the Audit Committee
- To monitor and assess Company’s financial reporting system
- To monitor and assess the effectiveness and efficiency of the Company’s internal control, internal audit and risk management systems
- To monitor and assess how agreements and other legal acts between the Company and its related parties meet the requirements of the ordinary course of business and arm’s length terms
- To monitor and evaluate the independence of the statutory auditor, and in particular the provision of non-audit services
- To monitor the Company's auditing
- To prepare and make the recommendation to the Board for the election of the statutory auditor at the AGM
- To review the financial statements, Directors’ Report, interim reports, Corporate Governance Statement and Sutainability Report
The Audit Committee members shall have sufficient expertise and experience with respect to the committee’s area of responsibility and the mandatory tasks relating to auditing. At least one member shall have competence in accounting and/or auditing. The Audit Committee members shall not be involved in the day-to-day management of the Group. The majority of the members shall be independent of the Company and at least one member shall be independent of the Company’s significant shareholders. In addition to the Audit Committee members, the CFO of the Company and when considered necessary also other members of the Company’s management participate in the Committee’s meetings. The Auditor usually participates in the meetings.
The Audit Committee shall meet in accordance with the schedule determined by the Committee but at least four times a year. The following individuals were elected as members of the Audit Committee on the date of the AGM in 2020: Anja Korhonen (Chairman), Kerttu Tuomas and Sandra Turner. In 2019, the Audit Committee held six meetings. The average attendance of the members at the Audit Committee meetings was 96%.
Members' attendance at the Audit Committee meetings in 2019
|Attendance (%)||Number of meetings attended|
|Anja Korhonen (Chairman)||100||6/6|