Corporate governance report 2012 - Nobel Biocare Corporate

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68 Nobel Biocare Annual Report 2011 — Corporate Governance needed under the Organizational Regulations. The CEO attends the meetings of the Nomination and Compensation Committee, with the exception of meetings that deal with his own compensation or “Board only topics”. From 1 January 2011 to 31 December 2011, the NCC met five times. All members participated in all meetings. Michel Orsinger attended two meetings after 3 July 2011 as a guest. Audit Committee (AC) The Committee is composed of at least three non-executive members of the Board of Directors, at least one of which should be a financial expert. The Committee meets at least four times per year and its primary objective is to support the Board of Directors in the performance of its supervisory duties. The Head of Internal Audit, Compliance and Risk Management served as the Committee’s secretary throughout 2011. The CFO and the Group General Counsel participated in the Committee’s meetings on a regular basis, whereas the Chairman of the Board and the CEO participated on relevant agenda topics. The Audit Committee focuses on the following major responsibilities and duties: –review of financial reporting; –supervision of external audit; –supervision of internal audit; –supervision of risk management; –supervision of internal controls; –supervision of compliance with organizational regulations and corporate governance; –supervision of fraud prevention. The Chairman of the AC presents a report on the outcome of the discussions and findings of the AC meetings to the Board of Directors in the subsequent Board meeting. The report also includes recommendations to the Board and decisions made by the AC where the authority has been delegated by the Board to the AC. From 1 January 2011 to 31 December 2011, the Audit Committee met nine times, thereof four times via telephone conference. All members participated in all meetings. There is a standard agenda for all AC meetings, added by special topics, based on the annual agenda and upcoming priorities. In all meetings, the CFO, the Group General Counsel and the Head Internal Audit, Compliance and Risk Management give an update on their activities. Furthermore, at the end of each meeting, there is a private session of the AC. At the AC meetings, the following key topics are presented and discussed on a regular basis: special accounting and reporting topics, cash status and forecast, key financing decisions, tax, status of litigation cases, compliance status and issues, audit reports and project updates. Additionally, financial statements, media releases and the Annual Report are presented, reviewed and approved. The treasury manual and the charters of the AC and the Internal Audit function are reviewed once a year. The risk management process and the Internal Controls System (ICS) status are reviewed at least annually. The compliance roadmap is reviewed periodically. On a regular basis Nobel Biocare’s auditor, KPMG AG, is invited for an audit update. Once per year, KPMG AG’s performance is assessed, the audit scope defined and their budget approved. Upon request, the AC also approves key finance, risk and compliance standards. The AC also approves the annual work program of the Internal Audit function and assesses its performance. The AC respectively defined members of the AC meet the CFO, the Group General Counsel and the Head Internal Audit, Compliance and Risk Management for private sessions. The Chairman of the AC also runs meetings with KPMG AG without management attendance. Innovation and Technology Committee (ITC, formerly Strategy and Technology Committee) The Committee is composed of at least three and maximum four members of the Board of Directors and members of Management, one of them being the CEO. The Board establishes the ITC. The ITC nominates a Member of Management to serve as a Secretary. In 2011, the Head of Mergers and Acquisitions served in that role. The Committee has the following authority, responsibilities and scope of work: –discussion and review of all relevant matters regarding innovation, products, solutions and key technologies within all fields of the corporate strategy; –review of major launch plans; –review of innovation and technology roadmaps for relevant functions; –discussion of options for portfolio enlargement; –review of the key product development process; –review of patent strategy.
Corporate Governance report 69 The ITC will through its Chairman report back to the Board and submit for and request Board approval should this be needed under the Organizational Regulations. From 1 January 2011 to 31 December 2011 the committee met five times. Apart from Stig Eriksson and Daniela Bosshardt-Hengartner, who did not participate in the meeting of 15 February 2011, all members attended all meetings. Michel Orsinger attended three meetings after 3 July 2011 as a guest. Board members and attendances 2011 Name Full Board AC NCC ITC Number of meetings in 2011 11 9 5 5 Rolf Watter 1 11 9 3 3 Raymund Breu 2 11 5 5 Daniela Bosshardt-Hengartner 11 4 4 Stig G. Eriksson 11 4 Edgar Fluri 10 9 Robert Lilja 11 9 Oern Stuge 11 5 Heino von Prondzynski 3 4 2 2 2 Antoine Firmenich 4 1 1 Michel Orsinger (guest) 6 2 3 1 Vice-Chairman and member of the Board until 3 July 2011, Chairman ad interim and member of the Board after 3 July 2011 2 Vice-Chairman and member of the Board after 3 July 2011 3 Chairman and member of the Board until 3 July 2011 4 Member of the Board until 30 March 2011 3.5 Definition of areas of responsibility The Board of Directors is entrusted with the ultimate direction of the Company as well as the supervision of management. The Board decides on all matters that have not been reserved for or conferred upon another governing body of the Company by law, by the Articles of Incorporation, or by the Company’s organizational regulations. The Board’s duties and responsibilities, inter alia, are to: –select, appoint, dismiss, supervise, rate the performance of and approve the remuneration of (i) the CEO (upon proposal by the NCC) and (ii) the other members of the EC (upon proposal by the CEO and motion of the NCC); –appropriately instruct and diligently supervise the CEO; –nominate the officers representing Nobel Biocare and determine their signatory power for registration in the commercial registry; –take appropriate actions and pass resolutions on all matters to be submitted to, or required for the preparation of the shareholders’ meeting, pursuant to the Articles of Incorporation, such as (i) annual reports to the shareholders, (ii) payment of dividends, (iii) election or reelection of board members and the statutory auditors of Nobel Biocare and of the Group and (iv) amendments of the Articles; –review and approve the overall strategy, the business strategies, basic organization and the relevant Group policies and general guidelines; –approve the annual Group budget, the Group’s consolidated quarterly and annual financial statements, Nobel Biocare’s annual financial statements and the annual report to the shareholders; –approve and regularly review the implementation of the Group’s overall accounting principles, its financial control and planning procedures, and its compliance program; –assess the risks associated with conducting the Group’s business, based on reports provided by the management; –approve the Group’s overall guidelines on lending and borrowing limits, and on new investments; –ensure and review the design, implementation and operation of a system of internal controls (“IC”) by management in line with legal obligations and industry practices; –review the Group information systems (“IS”) strategy; –review and approve acquisitions, divestitures, liquidations and other transactions that are financially or strategically material to the business activities of the entire Group, the materiality being defined as exceeding a value of CHF 1’000’000; –designate a Secretary to the Board of Directors. The Board of Directors assumes the ultimate responsibility for the Company’s and Group’s business and affairs. Within the framework of the legal requirements of the company, the Board delegates the overall business, affairs and day-to-day management to the CEO and the EC, with the exception of any Board or Shareholders’ meeting duties and authorities that cannot be delegated. The Chairman of the Board In addition to his legal and statutory duties, the Chairman carries out those tasks delegated to him by the Board. The Chairman, specifically, has the authority, respectively the duty, to: –ensure supervision of the CEO; –maintain close cooperation with the CEO and the EC; –inform the board on important matters; –represent the board vis-à-vis the CEO and the EC; –represent Nobel Biocare vis-à-vis shareholders and, in special cases, maintain relations with shareholders and investors, complementing the regular activities of the CEO and the EC;
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Corporate governance report 2012 - Nobel Biocare Corporate

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