Investor

Corporate Governance in NORDEN

Table of content

  1. Whitepaper on NORDEN’s corporate governance practice
  2. A two-tier management structure
  3. The Board of Directors
    1. Role
    2. The work of the Board of Directors
    3. Board composition
    4. Election
    5. Continuity
    6. Order of business
  4. Board remuneration
  5. Recommendations from the Danish Corporate Governance Committee/Nasdaq Copenhagen on best corporate practice

NORDEN continuously works on corporate governance issues and seeks to provide its shareholders and other stakeholders in due time with precise and relevant information about the Company’s strategy, operations, results and expectations.

The Board of Directors and the Executive Management closely follow the debate on corporate governance matters. The Board of Directors assesses that NORDEN complies with the vast majority of the corporate governance guidelines issued by the Nasdaq Copenhagen.

1. Whitepaper on NORDEN’s corporate governance practice

Covering the financial year 2015:

Whitepaper

pdf

Whitepaper

pdf

 

 


Covering the financial year 2014:

Whitepaper pdf
Whitepaper pdf

 

 

 

Covering the financial year 2013:

Whitepaper pdf
Whitepaper pdf

 

 

 

Covering the financial year 2012:

Whitepaper pdf
Whitepaper pdf

 

 

Covering the financial year 2011: 

Whitepaper - updated 1 March 2012 pdf
Whitepaper - updated 1 March 2012 pdf
Whitepaper previous pdf
Whitepaper previous pdf


Covering the financial year 2010:

Whitepaper pdf
Whitepaper pdf


 

Covering the financial year 2009:

Whitepaper pdf
Whitepaper pdf  


   

2. A two-tier management structure

As customary in Denmark, NORDEN has a two-tier management structure consisting of a Board of Directors and an Executive Management. There is not duality between the two bodies. The majority of the Board of Directors are elected by the shareholders at the general meeting, the rest is elected by the employees. The general meeting is the supreme authority, and resolutions are adopted by simple majority of votes, unless otherwise provided by legislation or by NORDEN’s articles of association

The Board of Directors appoints the Executive Management and sets out its responsibilities and conditions. The members of the Executive Management are responsible for the daily management, organisation and development of NORDEN, for managing assets, liabilities and equity, accounting and reporting, and also prepare and implement the strategies. The ongoing contact between the Board of Directors and the Executive management is primarily handled by the Chairman and the CEO. The Executive Management participates in the board meetings and is supplemented by other selected executives in the stratey meetings when relevant.

NORDEN’s vision, mission and values are the cornerstones of the Company’s management. The management focus is long term, and the goal is for the Company to develop for the benefit of its stakeholders - also in fluctuating markets - to achieve reasonable and fairly predictable earnings within the risk framework set out by the Board of Directors. See also Risk Management and Strategy.

3. The Board of Directors

3.1. Role

The Board of Directors determines strategies,policies, goals and budgets. In addition, it sets out the risk management framework and supervises the work, procedures, etc. carried out by the daily management.

See Articles of Association §4.2-4.4 for the Board of Directors' authorisations.  

3.2. The work of the Board of Directors

The Board of Directors sets out a work schedule to ensure that all relevant issues are discussed during the year and that important policies, rules of procedure, internal rules, etc. are discussed at least once a year. The strategy and budget process is initiated at a seminar in October/November, while final adoption takes place at a meeting in December.

Board meetings
During 2015, a total of 12 board meetings have been held, of which 5 were teleconferences, hereof 4 in connection with financial reporting. Attendance was 98% for the shareholder-elected board members and 57% for the employee-elected board members. To this should be added that the employee-elected board members are composed of seafaring staff, who might be otherwise occupied at sea and therefore cannot attend.

Remuneration committee
The Board of Directors has a remuneration committee responsible for supervising the implementation of NORDEN’s remuneration policy. The committee held two meetings in 2015. More details about remuneration committee (terms of reference).

Audit committee
The Board of Directors has an audit committee responsible for supervising financial reporting, transactions with closely related parties, control and risk management systems, auditing etc. During 2015, the committee held 4 meetings. More details about audit committee (terms of reference)
 Explanation of control and risk management in connection with the financial reporting is available here

Nomination committee
In 2014, the Board of Directors established a nomination committee. More details about nomination committee (terms of reference).

3.3. Board composition

Four to six members of the Board are elected by the shareholders by the shareholders in general meeting and the additional number of members are elected by the employees according to Danish legislation.

The Board of Directors currently has 8 members – 5 elected by the shareholders and 3 elected by the employees in NORDEN. None of the members elected by the shareholders have previously been employed with the Company. Although Klaus Nyborg has acted as interim CEO in the period 26 June 2014 to 30 April 2015. See board members here

In order for the Board of Directors to be able to both perform its managerial and strategic tasks and at the same time act as a good sounding board to the Executive Management, the following skills are deemed particularly relevant: insight into shipping (specifically dry cargo and tankers), general management, strategic development, risk management, investment, finance/accounting as well as international experience. The Board of Directors is considered to possess these skills. See board members' skills here

In 2013, the Board of Directors set target figures for the share of the underrepresented gender on the Board and formulated a policy to increase the share of the underrepresented gender on the other management levels. The target for the share of shareholder-elected women on the Board of Directors is to retain representation of at least 16% (1 out of 6) and aim at increasing this share to 33% before 2017. In 2015, the share of women in the Board of Directors increased to 20% (1 out of 5) as a
result of a reduction in shareholder-elected members. The nomination committee has the target figure in mind when considering potential candidates for the Board of Directors.

3.4. Election

At each annual general meeting, two of the longest serving members elected by the general meeting retire. At the annual general meeting on 2 April 2016, Alison J. F. Riegels retired by rotation. After 31 years as member of the Board of Directors, Alison J. F. Riegels had at her own request decided not to run for re-election. Johanne Riegels Østergård was newly elected. By rotation, Karsten Knudsen retired and was re-elected.

After the annual general meeting 2016, the Board of Directors appointed Klaus Nyborg as Chairman and Erling Højsgaard as Vice Chairman.

The age limit for board members is 72.

The members elected by the employees are elected for a 3-year term.

3.5. Continuity

The seniority of the board members is high, and the Board of Directors has managed NORDEN in periods of high growth as well as during economic downturns. This experience and insight is considered a great asset.

3.6. Order of business

The Board’s work is set out in an order of business, which is revised annually. In addition, the Company is governed by the principles that regulate the interaction between its management and its stakeholders, e.g. the Danish Companies Act; the Danish Financial Statements Act; the rules of  Nasdaq Copenhagen and NORDEN's articles of association, policies and directives.

The Board of Directors has an audit committee. More details about audit committee

In 2015, the Board of Directors held 12 meetings.

For 2016, the Board of Directors has planned 12 meetings, 4 of which are teleconferences in connection with the annual and interim reports. To this should be added 4 chairmanship meetings as well as meetings in the committees. As previously, the Board of Directors will discuss strategy and budget at 2 meetings at the end of 2016. A fixed annual calendar ensures that all relevant issues are taken up and discussed during the year.

4. Board remuneration

Each member receives a base fee, and the Chairman and Vice Chairman also receive a supplement fee. 

The fee structure was changed in 2015 for it to better reflect efforts made in connection with committee work. In addition, the Chairman and Vice Chairman receive a supplement fee. Total remuneration of the Board of Directors fell as a result of the change and due to a reduction in the number of board members from 9 to 8 from USD 0.8 million to USD 0.7 million. The Board of Directors proposes unchanged remuneration in 2016.

5. Recommendations from the Danish Corporate Governance Committee/Nasdaq Copenhagen on best corporate practice

In 2015, the Board of Directors has discussed the updated recommendations from the Danish Committee on Corporate Governance.

In the top section above a systematic summary can be found of the 47 recommendations, which NORDEN follows by and large.

A systematic examination (whitepaper) of NORDEN’s corporate governance practice as compared with the Danish Corporate Governance Committee/Nasdaq Copenhagen is available in the top section above.