Annual report 2010 - Dexia.com

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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
Declaration of corporate governanceDirectors and persons who are closely associated with themare obliged to notify the CBFA of transactions on Dexiafinancial instruments carried out on their own account.Transactions notified are automatically published by the CBFAon its internet site.Directors must declare to the Group Chief ComplianceOfficer:• at the time of their entry into office, all the Dexia financialinstruments they hold;• at the end of each year, an update of the list of Dexiafinancial instruments they hold.The rules and restrictions relating to transactions on Dexiafinancial instruments described above are applicable todirectors and to persons closely associated with them. Theyalso apply to observers as defined in the articles of associationof Dexia SA.Operation and activities of the Board of Directorsof Dexia SA during the 2010 financial yearAttendance by Board membersThe Board of Directors met on eleven occasions in 2010. Thedirectors’ attendance rate at Board meetings was 92%.ATTENDANCE RATE OF EACH DIRECTOR ATMEETINGS OF THE BOARD OF DIRECTORSJean-Luc Dehaene 10 of 11Pierre Mariani 11 of 11Gilles Benoist 9 of 11Isabelle Bouillot 8 of 11Olivier Bourges 11 of 11Brigitte Chanoine 11 of 11Stefaan Decraene 11 of 11Robert de Metz 11 of 11Augustin de Romanet de Beaune 7 of 11Christian Giacomotto 11 of 11Antoine Gosset-Grainville 6 of 7Catherine Kopp 11 of 11Serge Kubla 9 of 11Francine Swiggers 11 of 11Bernard Thiry 10 of 11Marc Tinant 10 of 11Koen Van Loo 11 of 11Francis Vermeiren 11 of 11Activities of the Board of DirectorsIn addition to matters falling within the normal competenceof the Board of Directors (result monitoring, budgetapproval, appointment and compensation of membersof the Management Board, convocation to Ordinary andExtraordinary Shareholders’ Meetings, minutes of meetings ofspecialist committees), the Board also dealt with the followingfiles:• decision by the European Commission within the context ofexamining assistance granted to Dexia by the French, Belgianand Luxembourg governments;• approval of the 2009 financial statements;• allocation of the 2009 result and proposal to issue bonusshares in favour of shareholders;• monitoring implementation of the Group transformationplan;• progress made in social negotiations;• Dexia Group Compensation policy, and the compensationof Group executives and market professionals;• sale of Assured Guaranty shares acquired by Dexia on thedisposal of FSA;• Dexia Group budget for 2009, 2010 and 2011;• Dexia strategy in Turkey;• Dexia’s risk appetite policy;• creation of a new analytical division called Legacy PortfolioManagement Division alongside the Core Division;• stress tests on the solvency of European banking institutionsand publication of exposures to Member States of the eurozone;• strategic review of the Group and its different businesslines;• monitoring the litigation between Dexia banka Slovenskoand Ritro;• monitoring the Lernout & Hauspie litigation;• the Group’s liquidity situation and deleveraging;• exposure to sovereign debt;• disposal of Dexia banka Slovensko;• impact of Basel III on Dexia;• new IFRS9 rules;• Investor Day;• Dexia Group Memorandum of Governance, intended forthe Banking, Finance and Insurance Commission;• credit risk on Financial Products portfolio.Conflicts of interest in 2010As indicated above, if a director directly or indirectly has aconflicting financial interest in a decision or operation to bedecided by the Board of Directors, he must inform the othermembers of the Board before they deliberate. In addition, hisdeclaration, including the reasons for his conflicting financialinterest, must be recorded in the minutes of the Boardmeeting that must make the decision.At the meeting on 31 March 2010, the Board dealt withsetting the compensation of members of the ManagementBoard. As Pierre Mariani and Stefaan Decraene are respectivelyChairman and Member of the Management Board, theyabstained (in accordance with Article 523 of the CompanyCode) from participating in the deliberations and vote by theBoard of Directors on their compensation. The extract fromthe minutes relating to the points concerning Pierre Marianion the one hand and Stefaan Decraene on the other arereproduced below.Extract from the minutes of the meeting of the Boardof Directors of Dexia SA held on 31 March 2010J-L DEHAENE presents the report of the Appointments andCompensation Committee dated 18 March 2010, the minutesof which are included in the file for the Board and the meetingof the Appointments and Compensation Committee held on31 March prior to the meeting of the Board.These meetings were dedicated essentially to the compensationof members of the Dexia Executive Committee and topmanagement (cf. Point 2.1. and 2.2. infra).(…)Management reportConsolidatedfinancial statementsAdditional information Annual financial statementsAnnual report 2010 Dexia37
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Photographs: page 8: C. LEBEDINSKY/
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Annual report 2010 - Dexia.com

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