As VolkerWessels is not a listed company, there is no legal requirement to apply the Code. The Board of Management, the Supervisory Board and the General Meeting of Shareholders subscribe to the most important main points that underpin the Code. For that reason a large part of the Code is applied, on voluntary basis, to VolkerWessels. Of course, it follows from being unlisted that a number of principles and best practices of the Code do not apply, or that application does not contribute to the intended objectives of the Code. Within the context of the `apply or explain' principle, where the code is not followed or is not followed in full in the text below at a number of points, this is indicated.
The principles and best practices from the Code that is applied by VolkerWessels are apparent from the current annual report, the statutes and the regulations that apply to the Board of Management or to the Supervisory Board and or to the committees thereof. The most important governance-related documents are published on the website.
As an unlisted company, VolkerWessels does not have any separate regulations relating to private investments and share dealing in relation to insider trading. However, VolkerWessels does have a general code of conduct for all employees, aimed at ensuring they act with integrity. Additionally, in pursuance of the law, in combination with regulations that apply to them, it is that case that the members of the Board of Management and the members of the Supervisory Board are not permitted to use insider knowledge to deal in shares and or to deal in shares and must avoid all semblance of such. Members of the Board of Management have, together with approximately 150 executive board members from the group, a minority shareholding in the holding company Storm Investments BV, which indirectly holds all the shares in VolkerWessels. This shareholding has the character of a long-term investment.
Remuneration of Board of Management
The Supervisory Board following a proposal from the Remuneration, Selection- and Appointments Committee determines the remuneration of the members of the Board of Management. The remuneration policy for the members of the Board of Management is aimed at attracting and retaining qualified and expert directors and serves the interests of VolkerWessels in the medium and long term.
For the determination of the remuneration level of the members of the Board of Management, the remuneration level of members of the Board of Management of other Dutch and European construction firms and companies of similar scale in other sectors are used as a reference, whereby complexity, scope and risk profile are considered. When determining the remuneration level of the chairman and the other members of the Board of Management, their specific responsibilities are taken into account.
The remuneration policy of the members of the Board of Management was decided during the General Meeting of Shareholders held in May 2005. The Remuneration, Selection- and Appointments Committee reviews the remuneration level annually, in which - if necessary or desirable - use is made of external advice for weighting the relevant criteria and the general salary trend in the sector is also taken into account. The remuneration of the members of the Board of Management consists of the following components:
1 - Fixed basic salary
This relates to the fixed part of the income.
2 - Performance-related bonuses
The variable bonus enjoyed by the members of the Board of Management is set annually by the Supervisory Board and is related to a number of measurable, predefined, financial objectives (currently: improvement of operational working capital and EBITDA) and personal objectives that contribute to the realisation of the long-term strategy of VolkerWessels.
The Supervisory Board has the authority to maximise the variable bonuses.
3 - Pension scheme
The members of the Board of Management participate in a pension scheme. This pension scheme relates to a collective available-premium system with a pensionable age of 65 years and an accrual percentage of 2.25% per year of the pensionable salary on the basis of average salary.
The aim thereby is to achieve a level of financing such that retirement at the age of 62 is feasible. Individual board members can renounce accrual of pension entitlements.
4 - Expenses reimbursements and benefits in kind
The members of the Board of Management receive a general expenses allowance for costs that they have to incur on account of their job. Benefits in kind are a company car and participation in a collective health care insurance facility, both made available by the company.
5 - Severance pay
In all contracts that started as from 1 January 2009, the possible severance pay for the members of the Board of Management has been maximised at one times the fixed basic annual salary increased by half of the average realised short-term bonus in the three preceding years.
Committees of the Supervisory Board
The Supervisory Board has established two committees. These committees report their findings to the full Supervisory Board.
The Audit Committee has a (preparatory) supervisory role in respect of the integrity and quality of VolkerWessels' internal and external financial reports and the functioning of the internal risk management- and control systems. This committee also advises the full Supervisory Board on the appointment and dismissal of the external accountant and the contents and range of the audit task. The Audit Committee also monitors the independence of the external accountant and the nature and scope of the other activities that are performed by (the office of) the external accountant for VolkerWessels. For a more detailed overview of the tasks and working method of the Audit Committee, please see the Rules of Procedure that are published on our website.
The duties of the Remuneration-, Selection and Appointments Committee include advising the Board of Management on the size and composition and the functioning of the Board of Management and the remuneration of its individual members. The members of the Remuneration-, Selection and Appointments Committee must preferably have a broad administrative background with experience in the field of remuneration and governance issues in a 'corporate' environment. The Remuneration-, Selection and Appointments Committee consists as of 31 December 2011 of: R.L.J. van Rappard and D. Wessels.
Given the position of VolkerWessels as an unlisted company and the structure of our group, the main principles of the remuneration policy are published. For a more detailed overview of the tasks and working method of the Remuneration-, Selection and Appointments Committee, please see the Rules of Procedure that are published on our website.
The Supervisory Board and the Board of Management in consultation with the external accountant have taken the necessary measures to ensure the objectivity and the independence of the external accountant. The main measures are:
The external accountant's fee that is not related to the audit of the annual accounts amounts to approximately 21% of the audit costs in the reporting year.
The Supervisory Board, the Board of Management and the Audit Committee periodically reviews the implementation of the aforesaid measures. The external accountant submits a report to the Board of Management and the Supervisory Board about the measures that are and will be taken to continue to meet the professional and legal requirements regarding ensuring the independent position with respect to the group. This included the periodic replacement of the responsible accountants/partners.