1. Recruitment and election of members of the Board of Directors
The Committee recommends that the Board of Directors ensures a formal, thorough and transparent process for selection and nomination of candidates with a view to ensuring a board composition that provides the competence needed to enable the Board of Directors to perform its tasks in the best possible manner.
As a way to achieve this, the Committee recommends that:
- the Board of Directors includes a description of the nominated candidates’ background in the notice convening the general meeting when the election of the members to the Board of Directors is on the agenda, and that such description includes information about other managerial positions and directorships held by the candidates in both Danish and foreign companies as well as demanding organisational tasks performed by the individual persons.
- the recruitment criteria established by the Board of Directors are stated, including the requirements for professional qualifications, international experience, etc., which, in the opinion of the Board of Directors, represent essential qualities with regard to the Board of Directors, and that the owners of the company are given an opportunity to discuss these criteria.
- every year, the Board of Directors publishes a profile of its composition and provides information about any special competence possessed by the individual members that is important for the performance of their duties.
2. Training and introduction for members of the Board of Directors
The Committee recommends that new members joining the Board of Directors are given an introduction to the company and that the chairman, in collaboration with each individual Board of Directors member, decides whether it is necessary to offer the member in question relevant supplementary training.
The Committee recommends that every year, the Board of Directors assesses whether the competence and expertise of the members need to be updated in some respect.
3. The number of members of the Board of Directors
The Commission recommends that the Board of Directors has only so many members as to allow a constructive debate and an effective decision-making process that enables all the members of the Board of Directors to play an active role and so that the size of the Board of Directors allows the competence and experience of members of the Board of Directors to match the requirements of the company.
The Commission recommends that at regular intervals, the Board of Directors considers whether the number of members of the Board of Directors is appropriate in relation to the requirements of the company.
4. The independence of the Board of Directors
In order for the members of the Board of Directors to act independently of special interests, the Committee recommends that at least half of the members of the Board of Directors elected by the general meeting are independent persons.
In this context, an independent member of the Board of Directors elected by the general meeting may not:
- be an employee of the company or have been employed by the company within the past five years.
- be or have been a member of the Executive Board of the company.
- be a professional consultant to the company or be employed by, or have a financial interest in, a company which is a professional consultant to the company.
- have some other essential strategic interest in the company other than that of a shareholder.
Furthermore, any person related, in terms of business or in any other way, to the company’s major shareholders, is not regarded as an independent person.
Family ties with persons not regarded as independent persons also imply a situation of non-independence.
The Committee recommends that at least once a year, the Board of Directors lists the names of the members of the Board of Directors who are not regarded as independent persons and also discloses whether new candidates for the Board of Directors are considered independent persons and states the grounds for such consideration.
The Committee recommends that the members of the Executive Board of the company are not members of the Board of Directors of the company.
The Committee recommends that the annual report contains the following information about members of the Board of Directors:
- occupation of the individual members of the Board of Directors.
- other managerial positions or directorships held by a member of the Board of Directors in Danish and foreign companies as well as demanding organizational tasks performed by that individual.
- number of shares, options and warrants held by a member of the Board of Directors in the company and group enterprises as well as changes in the member’s portfolio of the mentioned securities having taken place during the financial year.
5. Members of the Board of Directors elected by the employees
The Committee recommends that the company considers the need to explain the system of employee elected board members in the company’s annual report or on its website.
6. Meeting frequency
The Committee recommends that the Board of Directors meets at regular intervals according to a predetermined meeting and work schedule or when meetings are deemed necessary or appropriate as required by the company and that the annual meeting frequency is published in the annual report.
7. Time allocated to Board of Directors’ work and the number of directorships
The Committee recommends that a member of the Board of Directors who is also a member of the Executive Board of an active company holds no more than three ordinary directorships or one chairmanship and one ordinary directorship in companies not forming part of the group unless in exceptional circumstances.
8. Retirement age
The Committee recommends that the company agrees on a retirement age for members of the Board of Directors and that the annual report contains information about the age of the individual members of the Board of Directors.
9. Election period
The Committee recommends that members of the Board of Directors are up for re-election every year at the general meeting and that the Board of Directors in this connection makes special efforts to ensure the balance between replacement and continuity on the Board of Directors as regards the chairmanship and the deputy chairmanship.
The Committee recommends that the annual report states when the individual member of the Board of Directors joined the board, whether the member of the Board of Directors was re-elected and when the new election period expires.
10. Use of Board of Directors committees
The Committee recommends that the Board of Directors considers and decides whether to establish committees, including nomination, remuneration and audit committees.
If the Board of Directors appoints a committee, the Committee recommends that such appointment takes place only in connection with matters relating to specific issues for the purpose of preparing decisions to be made by all the members of the Board of Directors.
In the event of appointment of a Board of Directors committee, the Committee recommends that the Board of Directors draws up terms of reference for that committee setting out its responsibilities and powers.
The Committee recommends that the company’s annual report describes important issues included in the terms of reference of the individual Board of Directors committee and that the annual report lists the names of the members of the individual Board of Directors committee as well as the number of meetings of that committee held during the financial year.
11. Assessment of the Board of Directors’ work
The Committee recommends that the Board of Directors establishes an assessment procedure that regularly and systematically evaluates the work, results and composition of the Board of Directors as well as the work and results of the individual members, including the chairman, for the purpose of improving the Board of Directors’ work and that the criteria of assessment are clearly defined.
The Committee recommends that such assessment is made once a year, that the chairman of the Board of Directors is in charge of this process, drawing on external support, if necessary, that the outcome is discussed by the entire Board of Directors and that the Board of Directors provides details of its procedures of self-assessment in the company’s annual report.
The Committee recommends that the Board of Directors assesses the Executive Board’s work and results once a year according to previously established explicit criteria.
The Committee recommends that the Executive Board and the Board of Directors establish a procedure to assess the collaboration between the two boards at an annual meeting between the CEO and the chairman of the Board of Directors and that the outcome of such assessment is presented to the entire Board of Directors.