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. 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 Nasdaq Copenhagen.

1. Whitepaper on NORDEN’s corporate governance practice

Covering the financial year 2016:

Whitepaper 2016

pdf

Whitepaper 2016 

pdf

Covering the financial year 2015:

Whitepaper 2015

pdf

Whitepaper 2015 

pdf

Covering the financial year 2014:

Whitepaper 2014

pdf

Whitepaper 2014 

pdf

Covering the financial year 2013:

Whitepaper 2013

pdf

Whitepaper 2013 

pdf

Covering the financial year 2012:

Whitepaper 2012

pdf

Whitepaper 2012 

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 day-to-day management, organising and developing, for managing assets, liabilities and equity, accounting and reporting, and it also prepares and implements 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 executives in the stratey meetings when relevant.

NORDEN is managed based on the Company’s Corporate Soul Purpose and the values of Flexibility, Reliability, Empathy and Ambition. The management focus is long-term, and the goal is for the Company to develop for the benefit of its stakeholders 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.

Board meetings
During 2016, a total of 15 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 59% for the employee-elected board members. It should be noted that the employee-elected board members in 2016 were 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 3 meetings in 2016. 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 2016, 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 9 members – 6 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 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 of Directors 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 was 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, and this share was maintained in 2016. The Board of Directors has set a new target figure and aims at having 2 out of 5 shareholder-elected board members be women by 2020. The nomination committee has the target figure in mind when considering potential candidates for the Board of Directors.

3.4. Election

Board members elected by the annual general meeting are elected for one year at a time. Retiring members can be re-elected. At the annual general meeting on 5 April 2017, Erling Højsgaard retired by rotation and decided not to run for re-election as a consequence of the age limit stated in the articles of association. Tom Intrator and Hans Feringa were newly elected. By rotation, Arvid Grundekjøn retired and was re-elected.

After the annual general meeting 2017, the Board of Directors appointed Klaus Nyborg as Chairman and Johanne Riegels Østergård 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. 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 2016, the Board of Directors held 15 meetings.

For 2017, the Board of Directors has planned 11 meetings, 4 of which are teleconferences in connection with the annual and interim reports. To this should be added meetings in the committees. 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. In 2016, the Board of Directors reduced board remuneration by a further 21%. The change took effect from the middle of 2016, and total remuneration of the Board of Directors in 2016 amounted to USD 0.7 million. The Board of Directors proposes unchanged remuneration in 2017.

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

In 2016, 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.