Board of Directors
The general objective of the Board of Directors is to direct the Company’s business in a manner that secures a significant and sustained increase in the value of the Company for its shareholders. To this end the members of the Board offer their expertise and experience for the benefit of the Company.
The tasks and responsibilities of the Company’s Board of Directors are determined on the basis of the Finnish Companies Act as well as other applicable legislation. The Board has general authority to decide and act in all matters not reserved for other corporate governing bodies by law or under the provisions of the Company’s Articles of Association. The Board’s general task is to organize the Company’s management and operations. In all situations, the Board must act in accordance with the Company’s best interests.
The Board of Directors has established rules of procedure, which define its tasks and operating principles. The main duties of the Board of Directors are as follows:
With respect to directing the Company’s business and strategies:
• To decide on the Group’s basic strategies and monitor their implementation;
• To decide on annual authority frames for the Group’s capital expenditure, monitor their implementation, review such plans quarterly and decide on changes;
• To decide on individual investments or items of expenditure that are included in the authorized capital expenditure frames and have a value exceeding EUR 20 million, as well as on other major and strategically important investments;
• To decide on any individual business acquisitions and divestments within the current scope of business, having a value exceeding EUR 10 million;
• To decide on any financing arrangements by any Group company which either exceed EUR 150 million, are organized by way of public offerings, or which are otherwise out of the Group’s normal course of business; and
• To decide on any other commitments by any of the Group companies that are out of the ordinary either in terms of value or nature, taking into account the size, structure and field of operation of the Group.
With respect to organizing the Company’s management and operations:
• To nominate and dismiss the CEO and his deputy, and to decide on their terms of service, including incentive schemes, on the basis of a proposal made by the Board Nomination and Compensation Committee;
• To nominate and dismiss members of the Group Executive Committee, to define their areas of responsibility, and to decide on terms of service, including incentive schemes, on the basis of a proposal by the Board Nomination and Compensation Committee;
• To decide on the composition of boards of directors of certain key subsidiaries of the Group;
• To monitor the adequacy and allocation of the Group’s top management resources;
• To decide on any significant changes to the Group’s business organization;
• To define the Group’s ethical values and methods of working;
• To ensure that policies outlining the principles of corporate governance are in place;
• To ensure that policies outlining the principles of managing the Company’s insider issues are in use; and
• To ensure that the Company has other guidelines concerning matters which the Board deems necessary and fall within the scope of the Board’s duties and authority.
With respect to the preparation of matters to be resolved by General Meetings of Shareholders:
• To establish a dividend policy and issue a proposal on dividend distribution; and
• To make other proposals to General Meetings of Shareholders.
With respect to financial control and risk management:
• To discuss and approve interim reports and annual accounts;
• To monitor significant risks related to the Group’s operations and management of such risks; and
• To ensure that adequate procedures concerning risk management are in place.
The Board of Directors also assesses its own activities on a regular basis.
The Board of Directors is quorate when more than half of its members are present. A decision by the Board of Directors shall be the opinion supported by more than half the members present at a meeting. In the event of a tie, the Chairman shall have the casting vote.
The Annual General Meeting elects the chairman, the vice chairman and the other members of the Board of Directors for a term expiring at the close of the following Annual General Meeting. The entire Board is therefore elected at each Annual General Meeting. A Board member may be removed from office at any time by a resolution passed by a General Meeting of Shareholders. Proposals to the Annual General Meeting concerning the election of Board members which have been made known to the Board prior to the Annual General Meeting will be made public if a given proposal is supported by shareholders holding a minimum of 10% of all the Company’s shares and voting rights and if the person proposed has consented to such nomination.
Under the Articles of Association, the Board shall have a minimum of five and a maximum of twelve members. At the 2007 Annual General Meeting, eight members were elected to the Board of Directors. The current Board members are Jukka Härmälä (Chairman), Ole Johansson (Vice Chairman), Victoire de Margerie, Evert Henkes, Anna Nilsson-Ehle, Leo Oksanen, Leena Saarinen and Taisto Turunen. Th e CEO of Outokumpu is not a Board member. The Company’s largest shareholders have confirmed that they are in favor of a principle according to which members of the Company’s Board of Directors should, as a rule, be qualified experts from outside the Company. Seven of the Board’s eight members are independent of the Company (Evert Henkes, Jukka Härmälä, Ole Johansson, Victoire de Margerie, Anna Nilsson-Ehle, Leena Saarinen and Taisto Turunen) and six are independent of both the Company and its significant shareholders (Evert Henkes, Jukka Härmälä, Ole Johansson, Victoire de Margerie, Anna Nilsson-Ehle and Leena Saarinen).
The Board of Directors shall meet at least five times a year. In 2007, the Board met nine times. The average attendance rate of members at Board meetings was 96%.