Corporate Governance
Hf. Eimskipafélag Íslands in its efforts to strive for the highest standards of corporate governance has adopted the following corporate governance guidelines. When making the guidelines the Company has considered specially the corporate governance guidelines introduced by The Chamber of Commerce, the Confederation of Icelandic Employers and the Iceland Stock Exchange.
THE BOARD OF DIRECTORS OF THE COMPANY
The Annual General Meeting of the shareholders elects the members of the Board of Directors of the Company in accordance with our Articles of Association and the Company Act no. 2/1995. The Board members shall be maximum 5 and minimum 3. When a new Board is elected, it determines whether an elected Director is “independent” as that term is defined in the Guidelines. If a majority of the elected Directors are not independent, the finding will be stated in the annual report, together with an explanation.
The Board is responsible for protecting the interests of all shareholders, with due consideration for all other stakeholders, and it performs a supervisory role. The Board undertake the Company’s affairs and shall see to it that the Company’s organization and activities be at all times in correct and proper order. The Board, together with the Managers handles the management of the Company’s business.
The current Board of Directors consists of four people:
Chairman
Mr. Sindri Sindrason
Directors
Mr. Eggert Magnusson
Mr. Gunnar Bjorgvinsson
Mr. Þór Kristjánsson
RESPONSIBILITIES OF THE BOARD OF DIRECTORS
The Board is responsible for the business affairs of the Company in accordance with Icelandic law and the Articles of Association by performing i.e. the following tasks:
·The Board represents the company externally, for instance in courts of law and vis-a-vis government authorities
·The Board hires the CEO’s of the Company and decides his/her’s salaries and benefits.
·The Board monitors the work of the Management and has the power to resign Managers.
·The Board monitors the operations of the Company and shall acquire such information it deems necessary to perform its tasks.
·The Board monitors that the operational and financial plans are followed and makes decisions regarding reports on the Company’s credit, major undertakings, important guarantees, finance, cash flow and special risk factors and other matters that are not a part of the day-to-day management of the Company.
·The Board determines how often the Management submits interim accounts.
·The Board is responsible for compliance with provisions of law and regulations in respect of annual accounts and book-keeping. It ensures that the necessary basis for audit exists and is responsible for the annual accounts, signed by Board members and the auditor, being completed no later than one week before the Company’s Annual General Meeting of the shareholders.
·The annual accounts for each year shall include a report from the Board, containing information on important factors which do not appear in the balance sheet or profit and loss account or the notes but that are nonetheless material in assessing the Company’s financial status and performance during the financial year, The report contains the Board’s proposals for the distribution of dividends if any or the adjustment to the equity position in case of loss as a result of the operation during the previous financial year. It reports the number of shareholders at the beginning and end of the financial year, including the percentage holdings of those shareholders who own at least 10% or more of the shares of the Company.
·The Board’s report also discusses important events which have taken place after the end of the financial year, the Company’s future prospects, and research and development work.
·The Board shall have access to all of the Company’s books and documents.
·The Chairman of the Board ensures that an annual evaluation of the Board’s performance and work is performed. The Chairman may engage an outside party to carry out the performance evaluation.
TASKS OF THE CEO's
The Board defines the tasks of the CEO. This should include at least the items stated below:
·The CEO shall deal with the day-to-day operation of the company, and shall in these matters follow the Board’s policy and instructions.
·The CEO cannot make decisions on extraordinary or major matters without the approval of the Board of Directors, unless this it is necessary to avoid losses for the Company and a meeting of the Board of Directors cannot be called to make the decision. All such decisions made by the CEO must be reported to the Board of Directors.
·The CEO shall ensure that the Company’s accounts are kept in accord with law and customary practice, and that the Company’s assets are handled in a secure manner.
·The CEO shall ensure that the Company’s interests are suitably insured.
·The CEO shall submit to the auditor the information and documents which are significant to the audit, and shall provide the auditor with such information, documents, facilities and assistance as the auditor deems necessary for his/her work.
·The CEO shall sign the annual accounts, together with the Board.
ANNUAL GENERAL MEETING OF THE SHAREHOLDERS
The Annual General Meeting of the shareholders of the Company is held once a year before end of May each year. All shareholders are invited to attend. The meeting shall be called upon in accordance with the company’s Articles of Association.
The management structure of the Company is the Board of Directors and the CEOs.
REMUNERATION OF BOARD AND MANAGEMENT
The remuneration of the Board of Directors is decided by the Annual General Meeting of the shareholders. The remuneration of the CEO’s is decided by the Board of Directors. A Remuneration Policy, including Compensation policy and option plan for CEO and executives, is decided by the Annual General Meeting of the shareholders.
AUDITING AND COMPLIANCE
Audit
An independent auditor is appointed annually by the Annual General Meeting.
Further information on Hf. Eimskipafélag Íslands’ corporate governance can be found at the company’s website: www.eimskip.com.