Annual Report 2012 - Investor Relations

40Corporate GovernanceCompensation and Nomination CommitteeThe Compensation and Nomination Committee establishes theprinciples for compensation of the Board of Directors, the Delegateof the Board and members of the Executive Committee. Italso establishes the guidelines for the selection of candidates formembership on the Board of Directors and the Executive Committee.The main tasks of the Compensation and Nomination Committeeare:• Establishing the compensation principles for the Board of Directors,the Delegate of the Board and the Executive Committeemembers• Establishing the financial compensation for the Board of Directors,the Delegate of the Board and the Executive Committeemembers• Evaluating the performance of the Delegate of the Board• Evaluating the performance of the Board of Directors• Establishing the principles for the selection of candidates forelection to the Board of Directors and selecting candidates• Establishing the principles for the selection of the successor tothe Delegate of the Board, Executive Committee members andselecting candidates• Reviewing the status of the pension fund of Cham Paper GroupHolding AG and its subsidiariesThe Compensation and Nomination Committee has no decisionmakingauthority, but it rather assesses the aforementioned mattersand prepares them for approval by the Board of Directors. TheCompensation and Nomination Committee meets at least onceevery six months, and more frequently as may prove necessary.The Compensation and Nomination Committee consists of HansSchaller (Chairman), Philipp Buhofer and Urs Ziegler. In FY 2012,three meetings were held, each lasting about half a day.3.4.3 Functioning of the Board of Directors and itscommitteesThe Board of Directors meets at the invitation of the Chairman asoften as the conduct of business demands, however at least onceevery quarter. In addition, extraordinary meetings or decisions byway of circular also take place as required. The Board of Directorsmeets once a year for a strategy seminar. Decisions are made bythe entire Board of Directors. The Chairman generally chairs theBoard of Directors meetings and casts the tie-breaking vote in theevent of ties. He also plans and runs these meetings. Meetings ofthe Board of Directors and their agendas are prepared by the Chairmanin consultation with the Delegate of the Board. Each memberof the Board of Directors may convene a meeting or request thatan item be placed on the agenda. The members of the Board of Directorsare sent the agendas and documentation in advance of themeetings. Apart from the Board of Directors members, meetingsare also attended by the Head of Finance and Controlling and, dependingon the agenda, by other Executive Committee members.Depending on the matter being discussed, the Board of Directorsmay also invite other third parties to be present at meetings. Whendealing with matters that relate only to Cham Paper Group HoldingAG or that are of a particularly confidential nature, only Board ofDirectors members are in attendance. Minutes are taken of thedeliberations and decisions of the meetings. In 2012 the Board ofDirectors held eight meetings, of which five were half-day meetingsand three were full-day meetings. One of these meetings wasconvened as extraordinary meeting.The Board of Directors has established two permanent committeesfrom among its members, the Audit Committee and the Compensationand Nomination Committee, to deal with clearly definedsubject areas. These two committees primarily have an advisoryand monitoring function and they report to the Board of Directorsso as to enable it to prepare its decisions or exercise its supervisoryfunction. The members of both committees are appointed bythe Board of Directors.The Board of Directors is a constituent body; it elects the Chairmanand Vice Chairman from among its members. The Vice Chairman'srole is to represent the Chairman if he is unable to attend or isotherwise engaged.3.4.4 Delegation of Authority within the Board of Directorsand the Executive CommitteeThe Board of Directors of Cham Paper Group Holding AG delegatesoperational management completely to the Delegate of theBoard. By the same token, the Delegate of the Board is responsiblefor operational management. He is assisted in carrying out thistask by members of the Executive Committee who report directlyto him. The authorities and responsibilities of the Executive Committeeare determined in particular by the budget approved by theBoard of Directors, the Organisational Regulations and the establishedstrategy. The Organisational Regulations can be consultedon the website, under Investor Relations/Corporate Governance 2 .3.4.5 Information and control instrumentsThe Board of Directors exercises its ultimate supervision of theExecutive Committee by way of a structured reporting system aswell as management accounting and budgeting processes. Generally,the memebers of the Executive Committee also attend themeetings of the Board of Directors. At meetings they present andcomment on day-to-day business, provide a detailed view of finances,and inform the Board of Directors about current operativeissues in the core businesses. They also report on developmentsin key markets and projects and draw the Board of Directors’ attentionto existing and imminent risks. Apart from materials on thecourse of business, financial results, market developments andother significant events in the Group, the Board of Directors alsoreceives the following comprehensive written reports on a periodicalbasis, these items being provided to the Board in a timelymanner prior to its meetings:2 http://ir.champaper.ch/cgi-bin/show.ssp?id=770&companyName=champaper&language=English