Annual report 2010 - Dexia.com

Declaration of corporate governanceManagement reportConsolidatedfinancial statementsAdditional information Annual financial statementsResponsibilitiesThe Management Board is entrusted with the management ofthe company and of the Dexia Group, for which it managesand coordinates the different business lines, in the context ofthe strategic objectives and the general policy defined by theBoard of Directors. In addition, it ensures the execution of thedecisions taken by the Board of Directors.OperationSince the creation of Dexia SA in 1999, the ManagementBoard has had its own internal regulations (the “Regulations”),amended on several occasions, determining its responsibilitiesand its modes of operation. The collegial decision-makingprocess, the Board’s powers and certain rules governing thestatus of members are also subject to specific provisions inthe protocol on the prudential structure of the Dexia Groupsigned with the Belgian Banking, Finance and InsuranceCommission.In addition to rules governing the composition of theManagement Board (see above), the Regulations include thefollowing rules.• Rules relating to the responsibilities of theManagement Board in its dealings with the Boardof DirectorsThe Regulations first define the responsibilities of theManagement Board in its dealings with the Board of Directors.The Management Board must formulate a preliminary opinionregarding any proposals debated by the Board of Directors orthe Strategy Committee in terms of strategy or general policyof the Group. It may make recommendations to the Board ofDirectors through the Chief Executive Officer.If the Chief Executive Officer takes part in discussions by theBoard of Directors or its specialist committees, for which theManagement Board has an acknowledged right of opinion orinitiative, the Chief Executive Officer presents to and defendswith the Board of Directors the points of view previouslydebated by the Management Board.• Rules relating to decision-makingThe Management Board operates in a collegial mannerand its decisions result from a consensus of its members. Itassumes joint responsibility for such decisions. If applicable,the Chairman of the Management Board may, on his owninitiative or on request from two other members, submitthe issue under debate to a vote. Resolutions are adoptedby a majority vote of all members present or represented. Inthe event of a tie vote, the Chairman shall cast the decidingvote. In exceptional cases, decisions may be taken by theManagement Board in writing with the unanimous consentof its members.• Rules relating to meetingsManagement Board meetings are convened by its Chairman, inprinciple once a week. If necessary, meetings can be convenedat any time by the Chairman or if two or more members sodesire. Any member of the Management Board who is unableto attend may be represented by another member of theBoard, but a member may not represent more than one othermember. Each member of the Board may propose an item forthe agenda which is set by the Chairman. On the decision ofits Chairman, the Management Board may also meet in theform of a Group Executive Committee to deal with transversalsubjects of a certain importance.• Conflicts of interestIf a member of the Management Board directly or indirectlyhas a conflicting financial interest in a decision or operation tobe decided by the Board, he must inform the other membersof the Board before they deliberate. His declaration, includingthe reasons for his conflicting financial interest, must berecorded in the minutes of the Management Board meetingthat must make the decision. In addition, the member of theManagement Board must inform the company’s auditors. Hemay not participate in the deliberations of the ManagementBoard in relation to the transactions or decisions concerned,or vote on them.• Transactions between members of theManagement Board and Group companiesTransactions between companies of the Dexia Group andmembers of the Management Board must be concludedunder normal market conditions.• Transactions on Dexia financial instrumentsIn 2009, the internal rules of the Management Boardwere amended in order to update the rules relating to theprevention of insider trading in relation to Dexia financialinstruments.Compensation reportCompensation of the directors ofDexia SA for 2010Review of the principles appliedDexia SA’s 2006 Ordinary Shareholders’ Meeting decided topay an annual maximum global compensation amount ofEUR 1,300,000 to the directors for their services, effective1 January 2005.This meeting also authorised the Board to determine thepractical procedures of this compensation and its allocationwhich comprises a fixed amount and fees.At its meeting on 23 May 2002, the Board of Directorsdecided to grant each director a fixed annual compensation ofEUR 20,000 (or fixed amount of EUR 5,000 per quarter), anddirectors’ fees of EUR 2,000 per Board meeting or specialistcommittee meeting. Directors who have been in office forless than one full year shall earn a proportion of the fixedfee based on the number of quarters during which they haveeffectively been in office.For the Dexia transformation plan, the directors decided totemporary reduce the fixed amount of their compensationfor 2009. At its meeting on 29 January 2009, the Boardof Directors decided to grant each director a fixed annualamount of EUR 10,000 (or an amount of EUR 2,500 insteadof EUR 5,000 per quarter). This measure was maintained in2010.44 Dexia Annual report 2010