Table of Contents
Page
1 INTRODUCTION ... 1
2 DEFINITIONS ... 1
3 BOARD OF DIRECTORS ... 1
3.1 POWERS AND RESPONSIBILITIES OF THE BOARD... 1
3.2 COMPOSITION OF THE BOARD... 3
3.3 FUNCTIONING OF THE BOARD ... 6
3.4 ACCESS TO ADVISORS ... 8
3.5 EVALUATION ... 8
3.6 CONDUCT OF THE DIRECTORS ... 9
4 EXECUTIVE MANAGEMENT ...11
4.1 CHIEF EXECUTIVE OFFICER ...11
4.2 MANAGEMENT COMMITTEE ...11
4.3 GROUP EXECUTIVE MANAGEMENT ... 12
5 BOARD COMMITTEES ... 12
5.1 GENERAL ... 12
5.2 ROLE AND COMPOSITION OF THE COMMITTEES ... 12
5.3 FUNCTIONING OF THE COMMITTEES ... 15
6 REMUNERATION POLICY ... 17
7 DIVIDEND POLICY ... 18
8 SHAREHOLDERS’ MEETING ... 18
8.2 SHAREHOLDERS’ MEETING NOTICES ... 19
8.3 ATTENDANCE FORMALITIES ... 19
8.4 PROXIES ... 20
8.5 REMOTE VOTING ... 20
8.6 QUESTIONS ... 20
8.7 QUORUM AND MAJORITY ... 20
8.8 MINUTES ... 20
9 BOARD OF AUDITORS ... 20
10 GOVERNMENT COMMISSIONER ... 21
11 BUSINESS CONDUCT AND ETHICS CODE ... 21
12 DEALING AND DISCLOSURE CODE ... 22
13 SHAREHOLDING STRUCTURE AND SHAREHOLDERS’ AGREEMENT ... 22
ANNEX 1 – BOARD COMPETENCY PROFILE ... 24
bpost CORPORATE GOVERNANCE CHARTER
1
INTRODUCTION
The board of directors (the “Board”) of bpost NV, naamloze vennootschap van publiek recht / bpost SA, société anonyme de droit public (“bpost”) has approved this Corporate Governance Charter on May 27, 2013, which lays down the principles on the basis of which the Board, its directors and its committees shall operate.
bpost is committed to high standards of corporate governance and has adopted the Belgian Code on Corporate Governance of March 12, 2009 (the “Corporate Governance Code”) as reference code. It strives to comply with the recommendations of the Corporate Governance Code and the OECD Guidelines on Corporate Governance of State-owned Enterprises laid down in the OECD Code, subject however to the legal framework applying to bpost and in particular the Law of March 21, 1991 on the reform of certain public-sector commercial undertakings (“betreffende de hervorming van sommige economische overheidsbedrijven” / “portant réforme de certaines entreprises publiques économiques”). The Board shall review this Corporate Governance Charter at regular intervals and adopt any changes deemed necessary and appropriate. The charter is made in the English, Dutch and French languages.
2
DEFINITIONS
Any term defined in Article 2 of the Articles of Association of the company shall have the same meaning for the purposes of this Corporate Governance Charter.
3
BOARD OF DIRECTORS
3.1 POWERS AND RESPONSIBILITIES OF THE BOARD
3.1.1 General
In accordance with Article 25, §1 of the Articles of Association, the Board is vested with the power to perform all acts that are necessary or useful for the realisation of the company’s purpose, except for those which the law or the Articles of Association reserve to another corporate body. In particular, the Board is responsible for:
(i) defining the general policy orientations of the company and its subsidiaries; (ii) deciding all major strategic, financial and operational matters of the
company;
(iii) overseeing the management by the Management Committee, the chief executive officer (CEO) and the Group Executive Management; and
3.1.2 Monitoring responsibilities
The Board shall in particular, among others:
• ensure that an internal control system and procedures are put in place, including an appropriate risk identification and management system and procedures to ensure legal compliance;
• monitor the functioning and adequacy of the internal control system and procedures, taking into account the review made by the audit committee; • take the necessary measures to ensure the integrity of the financial
statements;
• evaluate the performance of the senior management;
• monitor and review the effectiveness of the Board’s committees;
• monitor the activities of the statutory auditors and the internal audit department, taking into account the review made by the audit committee; • regularly review the business plan as prepared by the Management
Committee, among others by (i) developing an in-depth knowledge of the business being served, (ii) understanding and questioning the plan’s assumptions, and reaching an independent judgment as to the probability that the plan can be realized; and (iii) monitoring corporate performance against the strategic targets and business plan;
• review, approve and monitor the company’s financial objectives;
• decide on the appointment or removal of any member of the Management Committee or of the Group Executive Management;
• decide on the principles governing the remuneration of the chief executive officer and of the other members of the Management Committee and of the Group Executive Management, including any share-based or other incentives; and
• decide on any delegation of powers to the chief executive officer, or the members of the Management Committee or of the Group Executive Management.
3.1.3 Information to the Board
The Board will take the necessary measures in order to make sure it is informed on a regular basis on:
• the progress towards the implementation of the business plan, through, inter alia, quarterly management reporting regarding the business and regarding the financial aspects of the implementation; and
3.2 COMPOSITION OF THE BOARD
3.2.1 General
The Board consists of up to 12 directors, including the CEO, appointed and dismissed as described in Articles 19 and ff. of the Articles of Association.
Whenever the Board is expected to nominate a candidate for appointment or election, the Chairman of the Board must make sure that, before considering the candidate, the Board has sufficient information about the candidate, such as a curriculum vitae, an evaluation of the candidate based on a preliminary interview, a list of the positions that the candidate has held and holds and, when the candidate is nominated to be elected an independent director, any other information that is needed to assess the candidate's independence. The Board must also have received the advice of the remuneration and nomination committee.
The composition of the Board must warrant that the company complies with gender representation requirements set forth in article 18, §2bis of the law of March 21, 1991 and the Board must take these provisions into account when considering proposals for nomination or when expected to nominate a candidate for appointment or election.
The composition of the Board must warrant that decisions are taken in the interest of the company and that both the executive, non-executive and independent directors of the Board have the necessary competences, experience and expertise to fulfil their responsibilities. The Board competency profile is attached hereto as Annex 1
3.2.2 At least three directors elected by an electoral college consisting of all shareholders of the company other than the public institutions must meet the independence criteria, as set out in Article 526ter of the Companies Code. This means that a candidate for an independent Board Member’s seat must:
.
(i) not be an executive member of the board, or exercise a function as a member of the Management Committee or of the Group Executive Management, or as a person responsible for the daily management of the company or an affiliate or related person (as defined in Article 11 of the Companies Code), and not having been in such a position for the previous five years prior to the appointment;
(ii) not have exercised more than three consecutive mandates as non-executive director in the board of directors, without the total term may have exceeded twelve years;
(iii) not be or have been a senior management employee (as defined in Article 19, 2° of the Law of September 20, 1948 on the organisation of industry (“houdende organisatie van het bedrijfsleven” / “portant organisation de l’économie”) of the company or an affiliate or related person (as defined in Article 11 of the Companies Code) during a period of three years prior to the appointment;
(v) (a) not hold 10% or more of the company’s share capital or of a specific category of shares of the company;
(b) if he/she holds shareholder rights representing less than 10%: (i) these shareholder rights, together with the other bpost shares held by companies that are controlled by the director in question, may not represent 10% or more of the company’s share capital or of a specific category of shares of the company; (ii) he/she must not have entered into any contract or have given unilateral undertakings concerning the sale of these shares or the exercise of the rights attaching to these shares;
(c) not be representing, in any circumstances, a shareholder fulfilling the conditions covered under this point (v).
(vi) not have or have had in the past financial year a significant business relationship with the company or an affiliate or related person (as defined in Article 11 of the Companies Code), either directly or as partner, shareholder, member of the board, member of senior management (as defined in Article 19, 2° of the Law of September 20, 1948 on the organisation of industry) of a company or person who maintains such a relationship;
(vii) not be or have been within the last three years, a partner or employee of the current or previous external auditor of the company or an affiliate or related person (as defined in Article 11 of the Companies Code);
(viii) not be an executive member of the board of another company in which an executive director of bpost has a seat as non-executive member of the board and not have other significant ties with executive directors of bpost through involvement in other companies or bodies;
(ix) not have close family members, i.e., spouse or partner that the candidate is officially registered as cohabiting with, or a second-degree family member, who are directors or members of the Management Committee or of the Group Executive Management or otherwise responsible for the daily management or members of the senior management (as defined in Article 19, 2° of the Law of September 20, 1948 on the organisation of industry) of the company or an affiliate or related person (as defined in Article 11 of the Companies Code) or who fall under the provisions of (i) to (viii) above.
3.2.3 Chairman
The Chairman of the Board is appointed and, as the case may be, removed from his/her chairmanship, in accordance with Article 23 of the Articles of Association. He/she can only be appointed or removed after consultations with the Strategic Partner so long as the Strategic Partner, directly or indirectly, owns at least 20% of the voting stock.
• coordinates the processes that govern the appointment or re-election of the members of the Board and the standing Board committees;
• plans the Board meetings. He/she draws up, in consultation with the CEO, the calendar and the agenda of Board and committee meetings. The Chairman is consulted reasonably in advance on all matters which the CEO wishes to submit to the Board;
• prepares, chairs and leads the Board meetings and ensures that the procedures relating to the preparation, the deliberations, the approval of resolutions and the implementation of decisions run smoothly. The Chairman ensures that the directors receive clear, timely, accurate information before the meetings to allow recipients enough time to review them and that all members of the Board receive the same information; • oversees and ensures the quality of continuous interaction and dialogue at
Board level;
• is responsible for providing the appropriate induction for newly appointed directors to ensure their swift contribution to the Board;
• chairs and leads the general meetings of shareholders and ensures that they are conducted efficiently;
• chairs the meetings of the Commission Paritaire/Paritair Comité;
• represents and safeguards, in consultation with the CEO, the interests of the company by maintaining contact with external constituencies and participating in external policy forums; and
• is consulted at an early stage on strategic initiatives of the CEO, the Management Committee and the Group Executive Management.
3.2.4 Company Secretary
The Company Secretary appointed by the Board advises the Board on all governance matters. He/she assists and advises the Chairman of the Board and the chairmen of the Board committees in exercising their general and specific roles and duties.
The core responsibilities of the Company Secretary include:
• ensuring that the corporate bodies comply with their requirements under the law, the Articles of Association and the Corporate Governance Charter, and reporting regularly to the Board on this matter;
• arranging for the implementation of the delegation of powers policy decided by the Board, monitoring the delegation of powers throughout the group and establishing appropriate procedures to ensure compliance with such policy;
• acting as secretary of the Board, the committees and the shareholders meetings (including preparing the minutes and maintaining the company books and records).
3.2.5 Other participants
In principle only Board members (and the Company Secretary) are authorised to attend and participate in Board meetings. The government commissioner is invited to all Board meetings with a view to fulfilling the role of the commissioner defined in the Law of March 21, 1991.
Other participants may be invited by the Chairman or the CEO to attend (without the right to vote) a particular Board meeting on specific items on the agenda if this is useful in view of his/her expertise in respect of such items on the agenda of the Board.
3.2.6 Other mandates and functions
Board members are allowed to serve on the boards of other companies, and to take up other mandates or functions provided that (i) the provisions of Article 20 of the Articles of Association are complied with, (ii) such mandates or functions do not interfere with the Board member’s ability to fulfil his or her duties as a Board member of bpost and (iii) they do not take on more than five directorships in listed companies (including their mandate as Board member).
Changes in other mandates or functions of Board members shall be reported to the Chairman if and when they occur.
Any director, including the CEO, who is appointed for a new external mandate must inform the Nomination and Remuneration Committee. Any new external mandate that the CEO wishes to fulfill is subject to prior approval of the Board acting upon recommendation of the Remuneration and Nomination Committee. The external mandates held by the CEO and any other director are disclosed annually in the Remuneration Report.
3.3 FUNCTIONING OF THE BOARD
3.3.1 Meetings
In principle the Board meets seven times a year, and in any event at least five times each year. Additional meetings may be called with appropriate notice at any time to address specific needs of the business. A Board meeting must in any event be convened if so requested by at least two directors.
The meetings are held at the day, hour and place mentioned in the convocation. In principle, the meetings are held at the registered office of bpost.
The meetings of the Board are presided by the Chairman. If the Chairman is prevented from attending a meeting, the Board is presided by the eldest of the directors present, as provided for in Article 26, §2 of the Articles of Association. Management presentations to the Board are generally made by the CEO, who can be assisted by other members of the Management Committee or of the Group Executive Management or other senior officers, if necessary and at the discretion of the CEO. The Board can also require the Chief financial officer (CFO) or other members of the Management Committee or of the Group Executive Management to be heard.
A director can be represented at the meeting by another director by means of a power of attorney made in writing (letter, courier, fax) or through any other means of communication that leaves a trace (such as email). A director cannot hold more than two powers of attorney.
Directors represented at a meeting by another director will not be granted any attendance fee.
3.3.2 Convocations
Board meetings are convened by the Chairman or the CEO or at the request of at least two directors.
Convocations are made in writing (letter, courier, fax) or through any other means of communication leaving a material trace (such as email) at least two business days prior to the Board meeting. The convocation period can be shortened in case of urgency but should not be less than 24 hours prior to the Board meeting, save in cases of extreme urgency where the corporate interest justifies a shorter notice. The urgency must be justified in the convocation or in the minutes of the meeting. Each director may waive convocation. In any event, directors who are present or represented at a meeting are considered to have been validly convened for the meeting or to have waived the convocation requirement.
The convocations contain the agenda of the meeting in sufficient detail. In principle, available (draft) documents that are placed on the agenda and accompanying documents and advice will be sent to the Board members simultaneously with the convocation.
The convocations must contain a complete Board file, including proposed Board resolutions.
3.3.3 Quorum and majority requirements
The quorum and majority requirements in respect of the Board meetings are provided in Articles 28 and 29 (and Articles 55/1 and 55/2) of the Articles of Association.
consultations, the Chairman may call for a decision and the proposal shall carry if adopted by a majority of the votes cast.
The second paragraph of this section 3.3.3 will not apply if and so long as the transitional provisions set forth in Title VII of the Articles of Association are in effect.
3.3.4 Minutes
Minutes are taken at every Board meeting. They contain a summary of the deliberations, specify the decisions that are taken and mention any abstaining or reservation of any director.
The minutes of a meeting are prepared and circulated to the Board members within fifteen calendar days of the date of the meeting. If a Board member wishes to have certain changes made to the minutes, he/she can request so within ten calendar days following receipt of the draft minutes.
The minutes will be finally approved at the subsequent Board meeting.
The minutes are signed by the Chairman, the Company Secretary and any directors who request to do so.
In order to facilitate the drafting of the minutes, Board meetings may be recorded provided that any recordings or tapes will be destroyed under the responsibility of the Company Secretary upon approval of the minutes of such meetings.
3.3.5 Unanimous written resolutions
In exceptional circumstances, where the urgency of the matter and the interests of the company so require, the Board resolutions may be approved by unanimous written consent of all directors, whereby directors’ signatures should be placed either on one single document or on more than one original of such document. This written procedure may not be used for the approval of the annual accounts or the use of the authorised capital or the renewal or the amendment of the management contract between the Belgian state and the company.
3.4 ACCESS TO ADVISORS
The Board, its Chairman and its committees may call on external independent advisers, experts, consultants and other Board members, at the company’s expense, if required for the performance of their tasks. The Chairman, assisted by the Company Secretary, is entrusted with the coordination thereof with a view to ensuring cost efficiency and avoiding duplication of efforts.
3.5 EVALUATION
Under the lead of the Chairman, the Board shall regularly (on an annual basis) evaluate its scope, composition, performance and that of its committees, as well as the interaction with the executive management.
3.6 CONDUCT OF THE DIRECTORS
3.6.1 Independence
Each Board member is required:
• to be guided exclusively by the overall goal of the Board of bpost which is to pursue the long term success of the company and to ensure that all decisions are taken in the corporate interest of bpost;
• to maintain in all circumstances his independence of judgment, decision and action.
3.6.2 Conflicts of interest
(i) All Board members are expected to avoid any action, position or interest that conflicts or appears to conflict with an interest of bpost or any of its subsidiaries.
Before accepting their appointment to the Board, prospective directors should satisfy themselves that they and their respective relatives (including spouse or other life companion, relatives by blood or marriage up to the second degree and foster children) do not have any personal, professional or financial interest in the company that puts them in a position of continuous or recurring conflict of interest with bpost. If such a situation arises after the appointment, the Board will evaluate the matter and may recommend to the shareholder or shareholders who appointed or proposed the relevant director that they proceed to his or her replacement.
A prospective director is not considered to have a conflict of interest within the meaning of this section 3.6.2 merely on the basis of a mandate as director or any other function held by him or her with one of the shareholders of bpost or a company affiliated with a shareholder of bpost. Each Board member should arrange his or her personal and business affairs in such a way as to avoid any conflict of interest of a personal, professional or financial nature with bpost, directly or through relatives (as defined above).
(iii) Transactions and/or business relationships between directors and bpost or one or more of its affiliated companies, which do not strictly fall under the application of Article 523 of the Companies Code, should always take place at the normal market conditions. The director concerned should inform the Chairman in advance of such transactions
(iv) The procedures set forth in Article 524 of the Companies Code shall be observed (by law or voluntarily) for any decisions regarding the management contract or other agreements with the Belgian state or other public institutions (other than those within the scope of Article 524, §1, last sub-paragraph).
3.6.3 Transactions in shares of the company
The directors shall fully comply with the bpost Dealing and Disclosure Code.
3.6.4 Service arrangements
Non-executive Board members are not permitted to enter, either directly or indirectly, into supply agreements with bpost or any of its subsidiaries for the provision of paid services or goods, unless explicitly authorised by the Board. Any service offered by bpost or any of its subsidiaries to Board members is exclusively rendered under commercial conditions in conformity with the prevailing market conditions.
3.6.5 Interaction with management
Board members may contact managers of bpost subject to the following guidelines. On the initiative of the Chairman or the CEO, Board members can be asked to give their advice on specific business-management issues and to contact the manager(s) concerned.
The Chairman is responsible for ensuring that the directors receive accurate, timely and clear information. Management has an obligation to provide such information but directors should seek clarification or amplification where necessary.
Board members are asked to consult the CEO prior to contacts with management and to use their judgment to ensure that these contacts do not detract the members of the management from business operations and management responsibilities.
3.6.6 Interaction with third parties
Directors may, at the request of the Chairman or the CEO or in consultation with them, participate in communication activities undertaken by bpost. In particular, Board members are expected to support, in the private and public spheres, the position of the Board with regard to the strategy, policies and actions of bpost.
3.6.7 Confidentiality
4
EXECUTIVE MANAGEMENT
4.1 CHIEF EXECUTIVE OFFICERThe King appoints the CEO by a Royal Decree debated within the Council of Ministers, upon proposal of the Board and after having received the advice of the Remuneration and Nomination Committee. The CEO is appointed for a renewable six-year term. The CEO and the chairman of the Board belong to a different language group.
The CEO is removed in the manner provided in Article 148bis/3, §2 of the Law of March 21, 1991.
The CEO is vested with the day-to-day management of the company and the execution of the resolutions of the Board. In addition, he exercises the special and limited powers assigned to him by the Board.
The CEO reports regularly to the Board.
Within the limits of the powers granted to him by or pursuant to the Articles of Association, the CEO may delegate special and limited powers to any person. He may allow sub-delegation of these powers. The CEO informs the Board of the powers which are delegated by him.
4.2 MANAGEMENT COMMITTEE
As required by the Law of March 21, 1991, the Board establishes a management committee (“Management Committee”). This Management Committee is composed of the CEO, who chairs the Management Committee, and of maximum six other members. With regard to the Belgian members, the Management Committee is composed of an equal number of Dutch-speaking and French-speaking members, as the case may be with the exception of the CEO.
Upon proposal of the CEO and after having received the advice of the Remuneration and Nomination Committee, the Board shall appoint and remove the members of the Management Committee, other than the CEO. The Board determines the term and the specific conditions of the mandate of afore-mentioned members after having received the advice of the Remuneration and Nomination Committee.
The Management Committee acts as a collegial body and convenes at the invitation of the CEO. The Management Committee decides with a simple majority of the votes cast. In the event of a tie of the votes within the Management Committee, the CEO has the casting vote.
The Management Committee exercises the duties assigned to it by the Articles of Association or by the Board.
Within the limits of the powers assigned to it by the Articles of Association or by the Board, the Management Committee may assign to one or more members of staff of the company special and limited powers, without assigning them the power to perform acts which entail expenses in excess of 6,200,000 EUR or revenues in excess of 25,000,000 EUR. The Management Committee may allow sub-delegation of these powers.
In accordance with Article 4, §2, of the Law of March 21, 1991, the Management Committee represents the company, as a collegial body, in the negotiation of every renewal or amendment to the management contract between the Belgian state and the company, it being understood that the Board decides on its approval.
4.3 GROUP EXECUTIVE MANAGEMENT
The operational management of the Company is ensured by the Group Executive Management under the leadership of the CEO. The Group Executive Management consists of the members of the Management Committee and maximum four other members, which are appointed (for the duration the Board determines) and removed by the Board, upon proposal of the CEO and after having received the advice of the Remuneration and Nomination Committee.
The Group Executive Management convenes regularly at the invitation of the CEO. The Group Executive Management is assisted by the Company Secretary.
The individual members of the Group Executive Management exercise the special powers delegated to them by the Board or the CEO, as the case may be. Within the limits of the powers assigned to them, the members of the Group Executive Management may assign to one or more members of staff of the company special and limited powers, without assigning them the power to perform acts which entail expenses in excess of 6,200,000 EUR or revenues in excess of 25,000,000 EUR. The members of the Group Executive Management may allow sub-delegation of these powers.
5
BOARD COMMITTEES
5.1 GENERAL
The Board is assisted by three committees, i.e. the Strategic Committee, the Audit Committee and the Remuneration and Nomination Committee.
The terms of reference of these committees are set out hereinafter. Each committee should regularly (at least every two or three years) review its terms of reference and its own effectiveness and recommend any necessary changes to the Board.
The appointment of committee members is based on (i) their specific competences and experience, in addition to the general competence requirements for Board members and (ii) the requirement that each committee possesses the competencies and experience to perform its tasks. The duration of the appointment of a committee member may not exceed the duration of its directorship.
5.2 ROLE AND COMPOSITION OF THE COMMITTEES
5.2.1 Strategic Committee
(i) Role and responsibilities
• review from time to time industry developments, the objectives and strategies of bpost and its subsidiaries and recommended corrective actions;
• review the draft of the business plan submitted each year by the Management Committee;
• review strategic transactions proposed by the Management Committee, the CEO or the Group Executive Management, including strategic acquisitions and divestitures, the formation and termination of strategic alliances or longer-term cooperation agreements, the launching of a new product segment and the entry into a new product or geographical market or the withdrawal from any such product segment or geographical market; and
• monitor the implementation of such strategic projects and of the business plan.
The Strategic Committee will meet sufficiently in advance of the Board meetings so as to allow the members of the committee to make sound recommendations to the Board. It will meet at least every three months. (ii) Composition
The Strategic Committee consists of (i) the chief executive officer, who chairs the Committee, (ii) three directors appointed in accordance with Article 21, §1 of the Articles of Association (provided that, upon the termination of office of the first of such three directors who were designated members of the Committee as of the closing of the initial public offering of the company, due to expiration of its term or otherwise, such director shall be replaced, within the Committee, by a director appointed in accordance with Article 21, §2 or §4, of the Articles of Association) and (iii) one director appointed in accordance with Article 21, §3 of the Articles of Association if there is any such director and, otherwise, a director appointed in accordance with Article 21, §2 or §4 of the Articles of Association.
5.2.2 Audit Committee
(i) Role and responsibilities
In accordance with Article 25, §4 of the Articles of Association, the Board has set up an audit committee (hereinafter the “Audit Committee”).
The Audit Committee advises the Board on accounting, audit and internal control matters, and shall in particular:
• review accounting policies and conventions;
• review the draft annual accounts and examine whether the proposed distribution of earnings and profits is consistent with the business plan and observance of applicable solvency and debt coverage ratios;
• review the quality of financial information furnished to the shareholders and the market;
• monitor and oversee the internal audit process, internal control and risk management, including for the company and its subsidiaries as a whole;
• propose candidates for the two statutory auditors (“commissaires”/”commissarissen”) to be appointed by the shareholders’ meeting;
• monitor the statutory audit (“wettelijke controle”/”contrôle legal”) of the annual and consolidated accounts, including any follow-up on any questions and recommendations made by the external auditors; and
• review and monitor the independence of the external auditors, in particular regarding the provision of additional services to the company.
The Audit Committee will meet sufficiently in advance of the Board meetings so as to allow the members of the committee to make sound recommendations to the Board. It will meet at least four to five times a year. At least twice a year, the audit committee will meet the external and internal auditors to discuss matters relating to its terms of reference and any issues arising from the audit process, and in particular any material weaknesses in the internal control.
(ii) Composition
The Audit Committee consists of five members: (i) three independent directors appointed in accordance with Article 21, §2 of the Articles of Association, (ii) a director appointed in accordance with Article 21, §1 of the Articles of Association, and (iii) one director appointed in accordance with Article 21, §3 of the Articles of Association (so long as the Strategic Partner owns at least 15% of the voting stock), or, otherwise, a second director appointed in accordance with Article 21, §1 of the Articles of Association. The chairman of the Audit Committee is designated by the Board.
5.2.3 Remuneration and Nomination Committee (i) Role and responsibilities
In accordance with Article 25, §4 of the Articles of Association, the Board has set up a remuneration and nomination committee (hereinafter the “Remuneration and Nomination Committee”).
The Remuneration and Nomination Committee advises the Board principally on matters regarding the appointment and remuneration of directors and senior management, and shall in particular:
To this effect, the Remuneration and Nomination Committee should consider proposals made by relevant parties, including shareholders; • advise on proposals for appointment originating from shareholders; • advise the Board on its proposal to the government for the
appointment of the chief executive officer and on the chief executive officer’s proposals for the appointment of other members of the Management Committee and of the Group Executive Management; • advise the Board on the remuneration of the chief executive officer
and the other members of the Management Committee and of the Group Executive Management and arrangements on early termination;
• review any share-based or other incentive scheme for the directors, members of the Management Committee, members of the Group Executive Management and employees;
• establish performance targets and conduct performance reviews for the chief executive officer and other members of the Management Committee and of the Group Executive Management; advise the Board on the remuneration of the directors; and
• submit a remuneration report to the Board.
The Remuneration and Nomination Committee will meet sufficiently in advance of the Board meetings so as to allow the members of the committee to make sound recommendations to the Board. It will meet at least twice a year.
(ii) Composition
The Remuneration and Nomination Committee consists of five members: (i) three independent directors appointed in accordance with Article 21, §2 of the Articles of Association, (ii) one director appointed in accordance with Article 21, §1 of the Articles of Association of the Company (who shall chair the committee), and (iii) one director appointed in accordance with Article 21, §3 of the Articles of Association (so long as the Strategic Partner owns at least 15% of the voting stock), or, otherwise, a second director appointed in accordance with Article 21, §1 of the Articles of Association.
5.3 FUNCTIONING OF THE COMMITTEES
5.3.1 Meetings
Meetings may be called with appropriate notice at any time when a recommendation is to be made to the committee that falls within the competence of the committee.
Meetings are held at the place and on the day and time indicated in the convocation notice. In principle, the meetings are held at the registered office of bpost.
members can attend a meeting by phone conference or other means of communication.
Management presentations to the committee are generally made by the CEO, who can be assisted by other members of the Management Committee and of the Group Executive Management or other senior officers, if necessary and at the discretion of the CEO.
A member can be represented at the meeting by another committee member by means of a power of attorney made in writing (letter, courier, fax) or through any other means of communication that leaves a trace (such as email). A member cannot hold more than one power of attorney.
The chairman of the committee is responsible for ensuring that its committee functions effectively and in line with the Articles of Association and the Corporate Governance Charter.
The chairman prepares, chairs and leads the committee meetings and ensures that they are conducted efficiently. The chairman ensures that written materials are distributed well in advance to allow recipients enough time to review them.
The chairman ensures that all members of the committee receive the same information.
The Company Secretary assists in the organization of the committee meetings. He/she acts as secretary of the committees and prepares the report and minutes on the findings and recommendations of the meeting.
In principle only the committee members (and the Company Secretary) are authorized to attend and participate in committee meetings.
It is standard practice that the chairman of the committee invites the CEO to attend committee meetings. Other non-committee members may be invited by the chairman to attend (without the right to vote) a particular committee meeting on specific items on the agenda if this is useful in view of his/her expertise in respect of such items on the agenda of the committee.
5.3.2 Convocations
Committee meetings are convened by the chairman of the committee or the CEO or at the request of the chairman of the committee and another member.
Convocations are made in writing (letter, courier, fax) or through any other means of communication that leaves a trace (such as email) at least seven calendar days prior to the meeting, save in case of urgency warranting a shorter notice period (whereby such urgency must be justified in the convocation).
Members may waive the benefit of the convocations. In any event, members who are present or represented at a meeting are considered to have been validly convened for the meeting and to have waived the convocation requirement.
The convocations must contain a complete committee file.
5.3.3 Quorum
For a committee meeting to be valid, at least half of the members must be physically present.
This special quorum requirement shall however not apply when an unforeseen emergency arises that makes it necessary for the committee to take action that would otherwise become time-barred by law or in order to avoid imminent harm to bpost.
5.3.4 Majority requirement
All recommendations of the committee are adopted by a majority of the votes cast.
5.3.5 Minutes
Minutes are taken at every committee meeting. They contain a summary of the deliberations, specify the decisions that are taken (i.e. the recommendations to the Board) and mention any abstaining or reservation of any committee member. The minutes of a meeting are prepared and circulated to the committee members within fifteen calendar days of the date of the meeting. If a committee member wishes to have certain changes made to the minutes, he/she can request so within ten calendar days following receipt of the draft minutes. In exceptional, duly motivated circumstances, the timing can be extended with maximum two days. In the absence of any comments by any committee member within this period of ten, or, as the case may be, twelve calendar days the minutes will be deemed approved by all committee members.
In case of comments, the amended minutes will be re-circulated for approval within three calendar days of the date on which the comments were received.
The minutes are signed by the chairman of the committee, the Company Secretary and any committee members who request to do so.
In order to facilitate the drafting of the minutes, committee meetings may be recorded provided that any recordings or tapes will be destroyed under the responsibility of the Company Secretary upon approval of the minutes of such meetings.
After each committee meeting, the Board shall receive a report from the committee on its findings and recommendations.
6
REMUNERATION POLICY
The remuneration of the members of the Board was decided by the Shareholders’ Meeting of April 25, 2000. In 2012, the gross annual remuneration was:
• €38,211.44 for the Chairman; and
• €19,105.72 for each other director, with the exception of the CEO.
meeting effective March 1, 2012) for attendance at one of the committees established by the Board.
The Board of Directors determines the remuneration of the CEO and of the other members of the Group Executive Management.
The remuneration of the members of the Group Executive Management ensures a competitive package in order to recruit, retain and motivate qualified and expert professionals. The package comprises (i) a fixed part, (ii) a variable part based on corporate and individual performance established in accordance with, and subject to, the Company’s remuneration policies as adopted and amended by the Board from time to time and (iii) executive-level benefits (in the form of pensions, insurance coverage and other fringe benefits, including allowances) commensurate with the respective positions of the members of the Group Executive Management.
The Company’s Annual Report includes a separate Remuneration Report which provides full details with respect to (i) the procedure for determining the executive remuneration policy, (ii) the executive remuneration principles and (iii) the components and amount of the remuneration and other benefits granted to the members of the Group Executive Management during the reporting year. The main contractual terms of hiring and termination arrangements with members of the Group Executive Management will also be disclosed in the Annual Report.
7
DIVIDEND POLICY
Subject to the availability of distributable reserves, bpost intends to declare and distribute an annual dividend of no less than 85% of its Belgian GAAP annual net profit on an unconsolidated basis. The amount of any annual dividend and the determination of whether to pay dividends in any year may be affected by a number of factors, including bpost’s business prospects, cash requirements and financial performance, the condition of the market and the general economic climate and other factors, including tax and other regulatory considerations.
8
SHAREHOLDERS’ MEETING
bpost encourages its shareholders to participate at Shareholders’ Meetings. In order to facilitate this, procedures are set forth in the Articles of Association to enable proxy voting and remote voting. Agendas, proxy forms, voting forms and all other relevant information are available on bpost’s website prior to Shareholders’ Meetings.
The below sections provide brief information on the Shareholders’ Meetings, notices, attendance formalities, proxy voting and remote voting. More detailed information is set forth in the Articles of Association.
8.1 ANNUAL AND OTHER SHAREHOLDERS’ MEETINGS
the previous fiscal year and any other matter properly presented to the Shareholders Meeting.
The Board and the Board of Auditors may convene a Special or Extraordinary Shareholders’ Meeting at any time bpost’s interests so require, which is typically in connection with necessary or appropriate changes to the Articles of Association of bpost. In accordance with the Belgian Companies Code, shareholders representing one-fifth of bpost’s total issued share capital may also convene a Special or Extraordinary Shareholders’ Meeting.
Normally, Shareholders’ Meetings are chaired by the Chairman of the Board. 8.2 SHAREHOLDERS’ MEETING NOTICES
Notices of all Shareholders’ Meetings contain the agenda of the meeting and the Board’s proposed decisions on the matters to be voted upon. The Board provides explanations of agenda items and proposals made by the Board, where appropriate through the reports and other formalities required by the Belgian Companies Code.
In accordance with the Belgian Companies Code, shareholders representing 3% of bpost’s total issued share capital may move for an item of business to be included in the agenda for the meeting and submit resolution proposals in relation to existing agenda items or new items to be added to the agenda for the meeting. Such right shall not be available in relation to a second extraordinary Shareholders’ Meeting that is convened for lack of a quorum at the first extraordinary Shareholders’ Meeting.
The new agenda items and/or resolution proposals should be received by bpost sufficiently far in advance to be included in the notices convening the meeting and, in any case, not later than the 22nd calendar day preceding the date of the Shareholders’ Meeting and a revised agenda shall be published at the latest on the 15th calendar day preceding the date of the Shareholders’ Meeting.
8.3 ATTENDANCE FORMALITIES
To attend a Shareholders’ Meeting, shareholders must:
(i) have the ownership of their shares recorded in their name, as at midnight Central European Time on the 14th calendar day preceding the date of the Shareholders’ Meeting (the “record date”):
− through registration in the share register of the registered shares, for holders of registered shares; or
− through book-entry in the accounts of an authorised account holder or clearing organisation, for holders of dematerialised shares.
(ii) notify bpost at the latest on the 6th calendar day preceding the date of the Shareholders’ Meeting of their intention to attend.
8.4 PROXIES
Any shareholder may attend Shareholders’ Meetings in person or be represented by a proxy (using the proxy form prepared by bpost), which proxy need not be a shareholder. A shareholder may designate, for a given Shareholders’ Meeting, only one person as proxy holder, except in circumstances where Belgian law allows the designation of multiple proxy holders.
8.5 REMOTE VOTING
Any shareholder may vote remotely before a given Shareholders’ Meeting through a form made available by bpost.
8.6 QUESTIONS
The Chairman of the Shareholders’ Meeting shall lead the meeting in such a manner that there will be sufficient time to answer questions shareholders may have relating to the Annual Report, special reports and/or the items on the agenda.
8.7 QUORUM AND MAJORITY
The quorum and majority requirements applying in respect of the Shareholders’ Meetings are provided in Article 44 and 45 (and Article 56/1) of the Articles of Association.
8.8 MINUTES
Minutes of the meeting are drafted by the secretary to the meeting (who is, normally, the Company Secretary). The minutes (including the results of the votes) are posted on bpost’s website as soon as possible after the meeting.
9
BOARD OF AUDITORS
The audit of the financial situation of the company and the non-consolidated financial statements of the company is entrusted to a Board of Auditors composed of four members, two of which are appointed by the Shareholders’ Meeting and the two others by the Court of Audit, the Belgian institution responsible for the verification of public accounts (Cour des Comptes/Rekenhof). The members of the Board of Auditors are appointed for renewable terms of three years. The Shareholders’ Meeting determines the remuneration of the members of the Board of Auditors.
The Board of Auditors is currently composed of:
• Ernst & Young Bedrijfsrevisoren BCVBA (“Ernst & Young”), represented by Mr. Eric Golenvaux (member of the Institut de Réviseurs d’Entreprises/Instituut der Bedrijfsrevisoren), De Kleetlaan 2, 1831 Diegem;
• PVMD Bedrijfsrevisoren BCVBA (“PVMD”), represented by Mr. Lieven Delva (member of the Institut de Réviseurs d’Entreprises/Instituut der Bedrijfsrevisoren), Pagodelaan 258, 1020 Brussels;
• Mr. Philippe Roland, Member of the Court of Audit (Rekenhof/Cour des Comptes) and First President of the Court of Audit, Rue de la Régence 2, 1000 Brussels; and • Mr. Josef Beckers, Member of the Court of Audit (Rekenhof/Cour des Comptes),
Ernst & Young and PVMD are responsible for the audit of the consolidated financial statements of the company.
10
GOVERNMENT COMMISSIONER
The company is subject to the administrative supervision of the Belgian minister responsible for public sector enterprises, who exercises such control through a government commissioner. The role of the government commissioner is to ensure compliance with the requirements of Belgian law, the Articles of Association and the management contract with the Belgian state. In addition, the government commissioner reports to the Minister of the Budget on all decisions of the company having an impact on the Belgian state’s budget.
The government commissioner is entitled to attend all meetings of the Board and of the Management Committee. He or she is entitled to examine all records, correspondence, minutes and documents and may request further information and/or explanations from the chief executive officer, the directors or other officers and employees of the company. If the government commissioner considers that any decision of the Board, the chief executive officer or the Management Committee is contrary to Belgian law, the Articles of Association or the management contract, he or she may, within four days, lodge an appeal against such decision with the Belgian minister responsible for public-sector enterprises.
The minister has eight days in which to review the appeal during which time the implementation of the decision concerned is suspended. If the minister decides to uphold the appeal he/she may annul the decision. If the minister does not decide to uphold the appeal within the eight-day period, the decision shall become definitive. In addition, if the matter has an impact on the Belgian state’s budget, the Belgian minister responsible for public sector enterprises must obtain the approval of the Minister of the Budget. If this approval is not obtained, both ministers have a period of 30 days in which to agree.
The Belgian minister responsible for public sector enterprises and the government commissioner may also call a meeting of the Board or Management Committee to discuss any matters determined by them if compliance with requirements of Belgian law, the Articles of Association and the management contract so require.
11
BUSINESS CONDUCT AND ETHICS CODE
bpost’s Code of Business Conduct and Ethics summarises the values, principles and business practices that guide bpost’s business conduct. The Code of Business Conduct and Ethics sets out a set of basic principles regarding the minimum requirements with which each of bpost employees, officers, members of senior management, directors, advisers and consultants are expected to become familiar and to apply as guiding principles in the daily performance of their job responsibilities.
The Code of Business Conduct and Ethics encourages the reporting of any possible unethical or illegal conduct and sets forth specific compliance procedures. These include the opportunity for all complaints to be brought anonymously.
The Code of Business Conduct and Ethics is intended to supplement our other policies including bpost’s Dealing and Disclosure Code (see section 12 below), and bpost’s general commitment to comply with applicable laws, and is not intended to replace those laws.
12
DEALING AND DISCLOSURE CODE
bpost’s Dealing and Disclosure Code applies to all bpost employees, officers, members of senior management and directors, and the government commissioner (and his substitute), as well as to the other persons and entities indicated therein.
The Dealing and Disclosure Code is not intended to replace the applicable laws prohibiting insider dealing and disclosure of price-sensitive information.
The purpose of the Dealing and Disclosure Code is to ensure that such persons and entities do not abuse, nor place themselves under suspicion of abusing, and maintain the confidentiality of price sensitive information that they may have or may be thought to have, especially in periods leading up to an announcement of financial results or of price-sensitive events or decisions.
To this end, the Dealing and Disclosure Code sets out minimum standards to be followed. In particular, subject to special clearance that can only be granted in very limited circumstances, covered persons may not deal in bpost shares during a closed period or a prohibited period. A closed period is defined substantially as the period starting 30 days before publication of the annual, semi-annual or any IFRS 34 quarterly results or any quarterly trading update for the company and ending on the close of the trading day for the company’s ordinary shares on Euronext Brussels following the day of publication. A prohibited period is a period that bpost’s General Counsel or the Board has determined is a sensitive period.
The following persons covered by the Dealing and Disclosure Code must, before dealing in bpost shares, obtain clearance: the directors, the members of the Group Executive Management, and certain other senior employees (and some other persons and entities indicated therein).
The Dealing and Disclosure Code provides that directors and members of the Group Executive Management (and some other persons and entities indicated therein) are required to notify any transaction cleared under the Dealing and Disclosure Code to the FSMA in accordance with applicable Belgian regulations.
13
SHAREHOLDING STRUCTURE AND SHAREHOLDERS’ AGREEMENT
The controlling shareholder is the Belgian state, together with the Société Fédérale de Participations et d’Investissement SA/Federale Participatie– en Investeringsmaatschappij NV (“SFPI/FPIM”) owning a 50% stake plus one share in the company.
This Shareholders’ Agreement defines the special quorum and majority requirements that will apply for certain Board and shareholders’ resolutions, as set out in Articles 55 and 56 of the Articles of Association.
ANNEX 1 – BOARD COMPETENCY PROFILE
• Appointments to the Board shall be made on merit and on the basis of objective criteria. Directors should attain high standards of professional ability and judgment and should be committed, in conjunction with the other directors, to serving the long-term interests of the company.
• Each director individually should have skills and experience that are complementary to the needs of the company, and should bring to the Board an inquisitive and objective perspective which gives him/her the ability, if needed, to challenge management. In addition, directors should update their skills and improve their knowledge of the company to fulfil their role both on the Board and on Board committees.
• Directors should be willing to devote sufficient time to carrying out their duties and responsibilities effectively, and should be in a position to serve on the Board for a material period of time. Each director shall adhere to the applicable company policies relating to integrity, ethics and business conduct as will be laid down in a code of conduct and compliance policy, established by the Board, as well as in similar company documents. • Taken as a whole, the Board should be composed of persons to a certain extent
complementing each other, and representing various areas of skill and expertise. Moreover the Board's composition should reflect a reasonable diversity in gender and be in full compliance with the rules of the Articles of Association on linguistic parity and on incompatibilities.
• Each director must have strong language skills, including also an excellent oral and written command of business English, which is the working language in the Board and Board committees.
• The Remuneration and Nomination Committee shall be responsible for reviewing with the Board, on a periodical basis, the requisite skills and characteristics of individual directors, as well as the composition of the Board as a whole, and for making appropriate recommendations to the Board.
ANNEX 2 - Policy on application of Article 524 Companies Code procedure
This policy on article 524 of the Companies Code (“BCC”) is to be read in addition to other applicable policies, such as the policy on the delegation of powers, as approved from time to time by the Board of Directors.
In setting out this policy, the Board has taken into account the rationale of the shareholder conflict of interest rules of article 524 BCC, which is to subject to increased attention and disclosure Board decisions where a controlling shareholder could use its influence to obtain advantages at the detriment of a listed company, to the benefit of the controlling shareholder but not the minority shareholders of the listed company.
In summary, article 524 BCC subjects certain decisions of the Board of Directors of a listed company to a prior non-binding reasoned opinion of an ad hoc Board committee consisting of at least three independent directors. The committee is assisted by an independent financial and/or legal expert selected by the committee, and the company’s auditor validates the financial data used. The procedure then requires the Board to substantiate its decision and the auditor to validate the financial data used by the Board. The opinion and Board resolution are published in the company’s annual report.
The Board has approved the following policy in its meeting of 7 November 2013. It will be annexed to the Corporate Governance Charter and also subject to annual review on the basis of precedents.
I.
F
RAMEWORK BASED ON LEGAL REGIME1. Article 524 BCC is as such not applicable to the relationship between bpost and the State as it only concerns the relationship of a listed company with its affiliated companies, while the State is not a company. It was nevertheless foreseen under Clause 3.6.2 (iv) of the Corporate Governance Charter that:
“The procedures set forth in Article 524 of the Companies Code shall be observed (by law or voluntarily) for any decisions regarding the management contract or other agreements with the State or other Public Institutions (other than those within the scope of Article 524, §1, last subparagraph)”1
2. The procedure of article 524 BCC, by virtue of Clause 3.6.2 (iv) of the Corporate Governance Charter, must be complied with prior to any decision or any transaction by the Board of Directors of bpost if such decision or transaction is in connection with:
;
i. relationships between bpost and the State or other Public Institutions; or
ii. relationships between a subsidiary of bpost and the State or other Public Institutions.
Are excluded from scope:
i. decisions and transactions concerning the relationship between a subsidiary of bpost and its own subsidiaries;
ii. decisions and transactions concerning the relationship between two subsidiaries of bpost (so called sister companies).
3. The procedure only applies to decisions or transactions which fall within the competence of the Board of Directors as a matter of law. In addition, the procedure applies when decisions or transactions are delegated – on an ad hoc or systematic basis – to another (corporate) body, such as the Management Committee, the Group Executive Management or the CEO. The procedure does not apply to decisions (such as approvals of Board reports) or opinions expressed by the Board in preparation of a decision that is ultimately the prerogative of the shareholders.
The procedure will apply when the Board of Directors is to take actual decision to enter into a contract, is to decide on (material) amendments relating to such contract, or is to decide in an earlier stage (e.g. of a selection or negotiation process) resulting in a binding (irrevocable/unconditional) commitment on the terms and conditions of a (potential) contract (e.g. approval of the submission of a tender proposal including a target price).
4. The term “Public Institutions” refers to all Belgian public institutions or entities within the meaning of article 42 of the 1991 Law, which encompasses the Belgian State and affiliated public entities, including SFPI/FPIM. However, in light of the intention of the drafters of the Corporate Governance Charter, “Public Institutions” shall not include autonomous public enterprises that are state-owned or controlled, but function on the basis of commercial constraints (such as, e.g., Belgacom and NMBS/SNCB). The term does not, for the avoidance of doubt, include independent regulators.
5. As set forth in article 524, §1, last subparagraph BCC, the procedure is not applicable to: - the usual decisions and transactions that take place under the conditions and with the
guarantees that usually apply in the market to similar transactions. This exception can only be used for transactions that are customary for bpost; for example, the procedure will in principle not be applied when bpost delivers standard services to the State or any Public Institution on the basis of commercial terms or policies generally applicable within bpost, and that are part of the applicable existing commercial framework or policies and/or regulated delegations.
- decisions and transactions representing less than one per cent of the net assets of bpost, as they appear from the (last approved) consolidated annual accounts. For determining whether or not the threshold is crossed, the value of a transaction is to be calculated in its entirety, on the basis of the total (i.e. not annual) (expected) revenues (VAT excluded).
more appropriate (e.g. disclosure in the annual brochure on another basis mentioned in article 96 BCC, or immediate disclosure as price sensitive information).
II.
A
DDITIONALP
OLICYP
RINCIPLES ADOPTED IN LIGHT OF APPLICABLEL
EGALR
EGIMEConsidering that bpost and the State have a number of recurring relations, this policy sets forth certain additional policy principles and guidance in respect of the application (or not) of article 524 BCC to such recurring relations:
7. bpost will apply article 524 BCC when the Board is requested to approve the management contract with the State. When further special agreements are to be entered into with the State or Public Institutions in execution of the management contract, the procedure will only be reapplied to such agreements to the extent that the material contractual conditions of such agreement are not pre-determined by the management agreement.
8. The procedure will in principle not be applied (i) when a contract with the State or a Public Institution is presented to the Board of Directors of bpost for final approval and such contract has been awarded to bpost as a result of an open, transparent and competitive process, or (ii) when the Board has reasons to believe that such contract will be awarded (whether to bpost or to a competitor) as a result of an open, transparent and competitive process. The Board considers that, in this case, the (justified expectation) of effective competition among all candidates will ensure reasonable market compliancy of the conditions proposed by bpost: if there is a risk of pressure on bpost, it will not come from the granting authority, but from the competition among all interested candidates, and thus remain within the boundaries of a normal functioning of a competitive market. Any decision to approve substantive changes to a contract with the State or a Public Institution previously awarded to bpost will only in principle trigger the application of the procedure of article 524 BCC to the extent that changes to the substance of the contract can be considered as material.
Similarly, any extension or renewal of a contract with the State or a Public Institution previously awarded to bpost will in principle trigger the application of the procedure of article 524 BCC to the extent that such extension or renewal was not provided as an option (in clear, precise and unequivocal terms) in the initial contract terms or in case such decision is not to be considered as material.
