Annual report 2010 - Dexia.com

Declaration of corporate governanceThe agenda lists the items to be discussed and specifies ifthey are listed for information purposes, for discussion, or fora vote.The minutes report discussions and record the decisionsmade, specifying reservations issued by some directors, ifapplicable.Transactions between a company of the DexiaGroup and Board membersThe internal rules of the Board of Directors provide thattransactions between a company of the Dexia Group andthe directors must be concluded under normal marketconditions.Management reportConsolidatedfinancial statementsAdditional information Annual financial statementsObligation of confidentialityThe information provided to the directors in the performanceof their duties, during Board meetings, meetings of thespecialist committees, or during private interviews, is providedintuitu personæ; they shall ensure that the confidentiality ofsuch information is strictly maintained.The knowledge of privileged information leads to theprohibition against executing, on his own behalf or on behalfof third parties, transactions on the securities of the companiesin question and a ban on disclosing this information to thirdparties.Training of Board membersIn order to acquire a solid understanding of the Dexia Group,the new members of the Board of Directors are invited, whenthey take office, to one or two days of contacts and visitswithin the Group.The Board members who sit on the specialist committees arechosen on the basis of their specific skills. They are assistedby outside experts as needed. The tasks of these specialistcommittees are clearly defined in the internal rules of theBoard of Directors, and in the specific internal rules of theAccounts Committee and the Internal Control, Risks andCompliance Committee.Conflicts of interestDirectors make sure that their participation in the Boardof Directors is not a source of direct or indirect conflict ofinterest, either personally or because of the professionalinterests they represent.They must ensure that their participation in the Board reflectscomplete independence from interests outside the companyitself. In particular, cross-exchanges of directors are to beavoided.Directors submit their mandate to the Board if there is asignificant change in their duties and the Board decideswhether to accept their resignation in such cases, after anopinion from the Appointment and Compensation Committee.They must resign if a change in their situation creates anincompatibility with their office as a Dexia director.If a director directly or indirectly has a conflicting financialinterest in a decision or operation to be decided by the Boardof Directors, he must inform the other members of the Boardbefore they deliberate. His declaration, including the reasonsfor his conflicting financial interest, must be recorded in theminutes of the Board meeting that must make the decision.In addition, he must inform the company’s auditors. He maynot participate in the deliberations of the Board of Directorsin relation to the transactions or decisions concerned, or voteon them.For publication in the annual management report, the Boardof Directors describes in the minutes the type of decisionor operation in question and the reasons for the decisionmade and the financial consequences for the company. Themanagement report contains copy of the minutes describedabove.Transactions on Dexia financial instrumentsIn order to promote the transparency of transactions in theDexia financial instruments, the internal rules, amended bythe Board of Directors at its meeting on 26 August 2009,stipulate that all the directors of Dexia SA have the status of“permanent insider” in view of their regular access to insideinformation on Dexia. Executive directors, as well as somenon-executive directors who, have access to the estimatedconsolidated results of Dexia, are thus entered in the list of“estimated consolidated results insiders”. Moreover, within thecontext of certain specific projects, directors may have accessto inside information on Dexia in relation to its projects, andthey are entered in the list of “occasional insiders”.In view of their “permanent insider” status, directors:• will refrain from carrying out any transaction on Dexiafinancial instruments during the period of one month priorto the announcement of the quarterly, half-yearly or annualresults;• must obtain prior authorisation from the Group ChiefCompliance Officer before any transaction on Dexia financialinstruments.Directors with the status of “estimated consolidated resultsinsiders” are subject for a statutory restriction period associatedwith estimated results and will refrain from carrying out anytransaction on Dexia financial instruments during a negativeintervention period beginning on D-15 of the account closingdate and ending on the date of publication of the results.They must moreover obtain authorisation from the GroupChief Compliance Officer before any transaction in view oftheir status of “permanent insider”.Directors entered in the list of “occasional insiders” may not,during the time they are in the list, carry out any transactionon Dexia financial instruments.As for stock options, and having regard to their terms, itis possible to uncouple the initiation of the order from itsexecution. Applying this principle, a director may give aninstruction in relation to the exercise of stock options duringa positive intervention period with a view to their executionif necessary during a negative period. This uncoupling is onlypossible if the order given is irrevocable and has a floor pricelimit.36 Dexia Annual report 2010