Profile for the size and composition of the Supervisory Board
Following consultation with the Executive Board and the Works Council, Heijmans N.V.’s Supervisory Board prepared a Heijmans N.V. Supervisory Board Profile on 26 March 1998. It was agreed at the time that this profile would be reviewed from time to time in the context of business developments and strategic changes at Heijmans N.V. and, if necessary, would be modified after consultation with the Executive Board and the Works Council.
On 9 December 2003, the Corporate Governance Committee presented the Netherlands Corporate Governance Code, which applies to all listed companies. The Code contains both principles, as well as best practice provisions that persons involved in a company (including Executive Board and Supervisory Board members) and other parties should adhere to in relation to one another.
On 1 October 2004, the new Two-Tier Entity Act (Structuurwet) came into effect, which stipulates that every Supervisory Board of a two-tier entity is required to prepare a profile of its size and composition. There must be at least three supervisory directors. In preparing the profile, due consideration must be given to the nature of the company, the activities of the company and the desired expertise and background of the supervisory directors. The profile and changes to the profile must be discussed in the General Meeting of Shareholders and with the Works Council (both have the right to be consulted). The transitional arrangements of the Two-Tier Entity Act specified that within 6 months following the effective date of the legislative proposal (i.e. before 1 April 2005), the profile was to be prepared and that consultations on the profile were to be carried out no later than in the first General Meeting of Shareholders held after the expiry of this six-month period.
In the context of the provisions of the new Two-Tier Entity Act, the Works Council has a strengthened right of recommendation for one-third of the number of supervisory directors. This one-third is rounded down in case the number of directors is not evenly divisible by three. Furthermore, a transitional rule applies to this provision: for every second vacancy on the Supervisory Board that arises after the Act comes into effect, the Works Council’s strengthened right of recommendation will apply until one-third of the Board’s members consists of members appointed on the recommendation of the Works Council. The Supervisory Board can only reject a proposed nomination if it raises an objection based on the recommended person’s unsuitability or if the composition of the Board would then be contrary to its required makeup. The profile plays a major role in relation to this last point.
The above provided the incentive for preparing a somewhat modified profile for the Heijmans N.V. Supervisory Board that has now been submitted to the Heijmans N.V. Central Works Council (COR) for consultation.
Consultation concerning the modified profile took place in the Heijmans N.V. General Meeting of Shareholders held on 27 April 2005, following which the profile was adopted.
The profile aims to provide a guideline for the composition of the Supervisory Board and the nomination of its members.
The Supervisory Board will, within the limits of its powers, do its best to ensure that the composition of the Supervisory Board is at all times such that:
- The members can operate independently and be critical of one another, the Executive Board and any other particular interest whatsoever.
- Every supervisory director has the competence required to assess the main points of overall policy.
- Every supervisory director possesses the specific expertise required to fulfil his/her task within his/her role in the context of this profile.
- The Supervisory Board as a whole is composed in line with this profile and that the composition of the Supervisory Board is such that it is able to carry out its tasks properly.
- At least one supervisory director is a financial expert, which means that this person must have acquired the relevant knowledge and experience in a financial administration/accounting environment with a listed company or with other large legal entities.
- All directors, with the exception of at most one person, are independent as defined in Article 1.4 of the Heijmans N.V. Supervisory Board Regulations.
- Any agreements made between the Supervisory Board and the Heijmans N.V. Central Works Council concerning the composition of the Supervisory Board will be respected.
- The members of the Supervisory Board adhere to the limitations set out in relation to the nature and the number of other functions in which they are involved, as defined in Article 22.1 of the Heijmans N.V. Supervisory Board Regulations.
- The Supervisory Board is composed in such a way as to promote sound relationships based on mutual trust, so that the Supervisory Board can act as a team.
- The Supervisory Board is composed in such a way as to make it possible to form an Audit Committee, a Remuneration Committee and a Selection and Appointment Committee from among its members.
- The interests of the Central Works Council have been taken into account in the formulation of this profile – in conformance with the current Two-Tier Entity Act, the Central Works Council is entitled to a strengthened right of recommendation.
- The Supervisory Board has a good sense of the international, social, economic, financial, political and business developments that are relevant to Heijmans N.V.
- The Supervisory Board shall consist of at least three members.
Every member of the Supervisory Board to be appointed or reappointed must possess the following qualities:
- Social experience with a well-developed understanding of the business sector, such that he/she can function in practical terms as a member of the Supervisory Board.
- Be capable of fulfilling the legal and statutory tasks of the Supervisory Board.
- Be capable, also in terms of having the required time, of reviewing and stimulating the direction of the Executive Board’s policy and the general state of affairs within the company in a timely and proper manner and assisting, whether requested to do so or otherwise, the Executive Board by providing advice with regard to the formulation and execution of policy.
- Be capable of taking measures in case of the absence or inability to act on the part of the Executive Board in order to provide leadership to the company.
In order for the Supervisory Board to fulfil its tasks, attempts will be made to ensure that – spread over the various members of the Board – certain expertise and experience is present, such as:
- Executive management expertise and familiarity with organizational processes, preferably business processes.
- Financial and economic knowledge and experience.
- Knowledge and experience related to business economics, legal and tax matters, information technology, personnel policy, marketing, relationships within society and investor relations.
- National and international corporate experience, preferably with listed companies.
- Experience acquired on the basis of management positions involving relations between the business community and various government agencies.
- Knowledge and experience related to the construction industry and related industries in the broadest sense, in order to be able to make a contribution to issues dealing with the development of the markets in which Heijmans N.V. operates.
- Experience with labour issues and consultations with social partners and employee organizations.
- Broad, general understanding of entrepreneurship, including the connection between economic, social and financial developments, in order to be able to contribute to expanding management’s field of vision, as well as to stimulate activities that are important to the continuity and profitability of the enterprise.
When a nomination for the appointment or reappointment of a member of the Supervisory Board is submitted, the Supervisory Board compares the nomination to the overall composition of the Board and the general and specific qualities identified in this profile, and this in the context of the composition of the Supervisory Board at that point in time.
The profile of the Heijmans N.V. Supervisory Board will be reviewed every two years and, if necessary, updated.
This profile was established on 27 April 2005 on the basis of, and in due consideration of, the provisions of Article 26.1 of the Heijmans N.V. Articles of Association and of Article 1.1 of the Heijmans N.V. Supervisory Board Regulations.
Chairman of the Supervisory Board Chairman of the Executive Board
J.L. Brentjens G.H. Hoefsloot