Rules of procedures for the Board of Directors

Rules of procedure for the Board of Directors of Beijer Electronics Group AB (publ)

Adopted  by the Board of Directors on April 26, 2018. 

Contents

  1. Composition
  2. Assignment, Responsibilities and Duties
  3. Chairman of the Board
  4. Meetings
  5. Minutes
  6. Decision-making
  7. Disqualification
  8. Confidentiality and Communication
  9. Committees
  10. Annual General Meeting

 

1. Composition

Members, Deputies and the Chairman are appointed annually at the Annual General Meeting for the period until the next Annual General Meeting has been held. The composition of the Board of Directors is stated in the Articles of Association, and shall have such composition that it satisfies the requirements of members’ non-affiliation in accordance with the Swedish Code of Corporate Governance.

2. Assignment, Responsibilities and Duties

Board members shall dedicate the time and care, and acquire the knowledge, necessary to protect the company’s and its owners’ interests. Board members should independently judge the matters the Board of Directors is to consider and seek the information that the Board member considers necessary for the Board of Directors to be able to reach well-founded decisions. The Board member shall acquire the knowledge of the company’s operations, organization, markets etc. required for the assignment.

The Board of Directors is responsible for the company’s organization and administration of the company’s affairs, in the Company’s and all shareholders’ interests.

The Board of Directors shall ensure that the company’s organization is structured so that accounting, the management of funds and the company’s other financial circumstances are controlled satisfactorily. The Board of Directors is liable for judging the company’s and the Beijer Electronics Group group’s financial situation continuously.

The Board of Directors shall appoint a Chief Executive Officer.

The Board of Directors shall present Annual Accounts.

The Board of Directors’ responsibilities include:

  1. adopting overall strategy and business orientation and the overall goals for the operation
  2. adopting a budget for the Beijer Electronics Group group
  3. updating budgets
  4. following up on overall goals and action-plans
  5. appointing, appraising, and where necessary, dismissing, the Chief Executive Officer, with an appraisal on an ongoing basis, with the Board of Directors dealing with this matter on a dedicated footing at least once per year
  6. ensuring that the company has satisfactory internal controls and formalized processes that ensure compliance with established principles for financial reporting and internal controls,
  7. ensuring that there are effective systems for monitoring and controlling the company’s operations
  8. ensuring that the company’s financial reporting has been proposed consistent with laws, applicable accounting policies and other standards applying to listed companies
  9. ensuring that there are satisfactory controls of the company’s compliance with laws and other ordnances that apply to the company’s business
  10. to ensure that the required ethical guidelines are set for the company’s conduct
  11. ensuring that the company’s communication features openness, and is accurate, relevant and reliable
  12. that the Beijer Electronics group’s organization, processes and internal instructions are regularly reviewed by the company’s auditors

The Board of Directors is also responsible for:

  1. adopting the Rules of Procedure for the work of the Board of Directors each year
  2. adopting instructions for the Chief Executive Officer each year
  3. adopting instructions for obtaining and reporting information as guidance for the Board of Directors’ assessment of the company’s and the Beijer Electronics Group group’s financial position (such instructions may be included in the Rules of Procedure for the Chief Executive Officer)
  4. meeting the company’s auditors semiannually
  5. appointing a Remuneration Committee consisting of the Chairman and two Board members each year
  6. appointing an Audit Committee consisting of at least three board members each year
  7. appraising the work of the Board of Directors through a systematic and structured process with the aim of developing the Board of Directors’ working methods and effectiveness, reporting on relevant sections of this appraisal to the Nomination Committee
  8. deciding on the Chief Executive Officer’s terms of employment
  9. ensuring that the company’s semi-annual and nine-month interim report is subject to summary review by the company’s auditor
  10. where applicable, considering whether the Chief Executive Officer should be permitted to take on significant assignments outside the company
  11. reviewing the company’s systems for internal controls in the Corporate Governance Report and evaluating the need for a dedicated internal audit function each year, and explaining its standpoint on the above review of internal controls
  12. the above in structure shall also be revised as required, for example due to changes to legislation or equivalent   

3. Chairman of the Board

The Chairman of the Board should ensure that the work of the Board of Directors is well organized, conducted effectively, and that the Board of Directors performs its duties.

Particularly, the Chairman should;

  1. organize and lead the work of the Board of Directors to create the best possible prospects for the work of the Board of Directors
  2. ensure that scheduled Board meetings are held in accordance with these Rules of Procedure and additional meetings are held as required
  3. lead Board meetings
  4. ensure that new Board members undergo the necessary introductory training and other training that the Chairman and Board members consider appropriate collectively
  5. ensure that the Board of Directors updates and deepens its knowledge of the company continuously
  6. be responsible for contacts with shareholders on ownership issues and convey the views of the owners to the Board of Directors
  7. ensure that the Board of Directors receives satisfactory information and supporting data for its work including monitoring the company’s operations and ensuring that Board members also receive information on the company’s operations and significant events between Board meetings
  8. after consulting with the Chief Executive Officer, adopt a proposed agenda for Board meetings
  9. ensure that Board decisions are executed
  10. ensure that the work of the Board is evaluated each year
  11. in the absence of the Chairman, the oldest Board member shall perform the Chairman’s duties. If the Chairman leaves his position during his term of office, the Board of Directors shall elect a Chairman internally for the period until the next Annual General Meeting
  12. if, in addition to Chairmanship, the Chairman of the Board secures consulting assignments on behalf of the Beijer Electronics Group group, then, if necessary with consideration to the content of the assignment, the Chairman shall approve the potential division of responsibility with the Chief Executive Officer

4. Board Meetings

Location of Meetings
The Board of Directors normally meets in Malmö, Sweden. However, the Board may decide to hold meetings in another location in Sweden, or a foreign location.

Scheduled Board Meetings
The Board of Directors shall hold at least four scheduled meetings each year. Of these meetings, one meeting shall consider strategy issues.

Board Meeting Following Election
The newly elected Board of Directors shall hold its Board meeting following election after the Annual General Meeting. The following matters shall be considered at this meeting:

  1. appointing the chairman of the board
  2. appointing  authorized signatories
  3. adopting the rules of procedure for the Board of Directors
  4. adopting instructions for the Chief Executive Officer

    
Additional Board Meetings
When a Board member or the Chief Executive Officer requires, the Board shall be convened for additional Board meetings.

If the company’s auditor issues a reminder to the Board, this matter shall be considered at a Board meeting within four weeks of the reminder being presented.

Per Capsulam Meetings, etc.
The Chairman of the Board may permit additional Board meetings to be held per capsulam.

The Chairman of the Board may also permit a member to participate by telephone in special circumstances.

All Board members shall be requested for, and approve, decisions taken per capsulam.

Material for Board Meetings
Each Board member will be provided with documentation for each Board meeting. Such documentation shall normally be sent at least one week prior to the relevant meeting. An agenda and copy of the previous minutes shall be attached to the documentation.

Business of Board Meetings
The following matters shall be considered at scheduled Board meetings (not strategy meetings).

  1. financial reporting for the group and
  2. business reporting for the group.

Written supporting documentation shall be sent prior to meetings for financial reporting. Reporting shall be in accordance with the instructions for the Chief Executive Officer.

5. Minutes

Minutes shall be taken at Board meetings. Minutes are taken and signed by the Board Secretary and shall be verified  by one Board member in addition to the Chairman. However, minutes taken at meetings held per capsulam shall be verified by all Board members.

The minutes should clearly state which matters have been considered, which documentation has been used for each matter and the import of the decisions taken. If due to disqualification, a specific Board member has not participated in proceedings, this matter shall be noted in the minutes. The minutes shall be sent to Board members as soon as possible after the Board meeting.

Minutes shall be taken in numerical order, and stored in a satisfactory manner with the agenda through the agency of the Secretary.

Minutes or extracts from minutes may not be copied or disclosed to any party other than Board members and the company’s auditor without the approval of the Chairman or the Board member appointed by the Chairman. However, disclosure is committed to the extent it is required by law or other statute, or regulatory decision.

6. Decision-making

The Board of Directors is quorate if more than half of the members are present. When judging if the Board of Directors is quorate, Board members that are disqualified should not be considered present.

Decisions may not be taken on a matter unless, as far as possible, all Board mem bers have firstly been able to participate in considering the matter, and secondly, received sufficient documentation to decide the matter.

For a Board decision, that opinion represented by over half of those attending present vote for at the meeting, or if voting is equal, the opini on that the Chairman represents. However, if the board is not complete, those members voting in favor of the decision must be more than one-third of the full number of Board members.

If votes are equal in the election of the Chairman, the election will be decided by drawing lots.

7. Disqualification

A Board member may not consider a matter if

  1. there is an agreement between the Board member and Beijer Electronics Group AB
  2. there is an agreement between Beijer Electronics Group AB and a third party if the Board member in question has a significant interest that may conflict with the company’s, or
  3. there is an agreement between Beijer Electronics Group AB and a legal entity that the Board member alone, or together with another party, may represent. However, this prohibition does not apply if the company’s counterparty is a company in the Beijer Electronics Group group.

Agreement also means legal proceedings or other lawsuit.

Stipulations on disqualification mean that a disqualified Board member may not participate all be present either at the Board of Directors’ consideration or its decision.

The onus is on Board members to inform the Board of Directors of circumstances that may imply the member being considered as disqualified.

8. Confidentiality and Communication

Board members are reminded of their obligation to treat those matters for the Board of Directors’ consideration confidentially, which particularly, shall apply to such information that may be provided regarding the company’s commercial relations.

All information on the company for the press shall the submitted by the company’s Chief Executive Officer and/or Chairman. In addition, all such information shall be provided to Board members before public disclosure. The Board of Directors may assign another party to submit such information.

9. Committees

Remuneration Committee
The Board of Directors shall establish a Remuneration Committee consisting of the Chairman and two Board members who are non-affiliated to the company or its management.

The Remuneration Committee shall be responsible for consultation on matters of remuneration and other employment terms for management, and particularly, perform the following duties; propose principles for remunerating the Chief Executive Officer and other senior managers to the Board of Directors for the Annual General Meeting.

No right to make decisions has been delegated to the Committee.

At least once yearly, and on written demand from a Board member, the Committee shall present a report to the Board of Directors, in which the Committee reports on its work. The Committee shall take minutes of its meetings and these minutes shall be presented to the Board of Directors.

Audit Committee
The Board of Directors shall establish an Audit Committee, which shall consist of at least three Board members. The majority of the Committee’s members shall be non-affiliated to the company and management, and at least one member of the Committee shall be non-affiliated to the company’s major shareholders. Board members that are members of management may not be members of the Committee.

The Audit Committee shall:

  1. be responsible for consultation on the work of the Board of Directors on quality-assuring the company’s financial reporting; whereby the Committee shall obtain a view of the company’s risk situation and the structure of the company’s internal controls
  2. regularly meet the company’s auditor to be informed on the orientation and scope of the audit and discuss coordination between external and internal audits, complex auditing issues and the view of the company’s risks,
  3. adopt guidelines for which other services other than auditing the company may purchase from the company’s auditor,
  4. evaluate audit eff orts and inform the company’s Nomination Committee, or where applicable, dedicated Nomination Committee, on the results of the evaluation, and support the Nomination Committee when preparing proposals for auditors and remuneration for audit work.

No right to take decisions has been delegated to the Committee.

At least semiannually, and on express demand from a Board member, the Committee shall present a report to the Board of Directors, in which the Committee reports on its work. The Committee shall take minutes of its meetings and these minutes shall be presented to the Board of Directors.

10. Annual General Meeting

The Board of Directors convenes the Annual General Meeting in accordance with an invitation approved by the Chairman of the Board.

The Chairman of the Board shall open the Annual General Meeting.