Hydro Annual Report 2011b

Topic Comments References
13 Information and communication Hydro has established guidelines for the company's reporting of financial
and other information based on transparency and with regard to the
requirement of equal treatment of all parties in the securities market. This
also pertains to contact with shareholders outside of the general meeting.
A financial calendar is available in this report and at www.hydro.com Page 120
Shareholder information is available at www.hydro.com
The Financial Statements and Annual Report are sent free of charge to
shareholders on request. Notice of a general meeting of shareholders is
sent directly to shareholders unless they have consented to receive
these documents electronically.
14 Takeovers The board of directors will handle takeover bids in accordance with
Norwegian law and the Norwegian Code of Practice for Corporate
Governance. No mechanisms to prevent takeover bids are contained in
our Articles of Association or underlying steering documents, nor have
we implemented any measures limiting opportunities to buy shares in the
company. See also item 5.
Despite the restrictions described in item 5 to which Vale is subject, Vale
may sell its shares in Hydro to a third party on the following conditions:
The third party must make an unconditional offer for all the Hydro shares
or the offer must be recommended by Hydro's board of directors, and the
third party must own or become the owner of 50 percent of Hydro's
shares during the bidding period before Vale may sell its shares to a third
party.
Deviation: The board of directors has chosen not to prepare explicitly
formulated general principles for handling takeover bids. The reason for
this is that the Norwegian state, represented by the Ministry of Trade and
Industry, owns 34.3 percent of the Hydro shares issuedd (as of
31.12.2011) and has clearly expressed a long-term ownership
perspective in the company for the purpose of retaining its head office
and research activities in Norway. Reference is given to e.g. the Active
Ownership Report (Report to the Storting no. 13, 2010-2011).
15 Auditor Every year the external auditor presents to the audit committee the main
features of the plan for the audit of the company.
CORPORATE GOVERNANCE
Further on the Norwegian code of practice for corporate governance 137
The external auditor participates in considering relevant matters at all
meetings of the Audit Committee. The minutes from these meetings are
distributed to all member of the board of directors. This practice is in line
with the EU Audit Directive.
The external auditor expresses its opinion on internal control procedures
in an annual management letter.
The external auditor participates in board of directors' meetings where
the company's financial statements are discussed. At these meetings the
auditor will review material changes in the company's accounting policies,
assess material accounting estimates and any other material matters on
which the exteranl auditor and executive management may disagree, and
identify weaknesses in and suggest improvements to the company's
internal controls.
Both the board of directors and the audit committee hold meetings with
the external auditor without members of the corporate management
present. The audit committee holds meetings with the management of
Internal audit at least once a year without members of the executive
management present.
Hydro places importance on independence and has clear guidelines
regarding the use of services from external auditors. All use of services
from an external auditor, including non-audit services, are subject to prior
approval as defined by the audit committee.
Remuneration of the external auditor is stated in the annual report and
approved the general meeting of shareholders
In 2010 the general meeting of shareholders chose KPMG as the new
group external auditor with effect from reporting period 2010.
See also page 115 and 125
Read more about the Hydro share at
www.hydro.com/no/investor
See also page 72 and F77
See also page 125
Note 43