3 DSV Statutory Report on Corporate Governance 2018 MANAGEMENT STRUCTURE Together, the Board of Directors and the Executive Board constitute the governing body of DSV. The ultimate authority rests with the shareholders in general meeting. The Board of Directors supervises and outlines the overall visions, strategies and objectives for the development of the Group’s business activities. The Executive Board is responsible for the day-to-day management and the execution of the strategy, and furthermore contributes essential input to the work of the Board of Directors. The Board of Directors has established audit, nomination and remuneration committees to perform various preparatory tasks relating to key areas of the Board’s work. The allocation of responsibilities between the Board of Directors and the Executive Board is laid down in the relevant Rules of Procedure. The individual Division Managers are responsible for the day- to-day operations of the divisions supported by centralised Group functions. BOARD OF DIRECTORS COMPOSITION The Board of Directors of DSV currently has six members. According to the Company’s Articles of Association, the Board of Directors must comprise at least five and not more than nine Directors. Directors are elected for a term of one year at a time, and new Directors are elected according to the applicable rules of the Danish Companies Act. COMPETENCIES OF THE BOARD The composition of the Board of Directors is intended to ensure diversity of the Board’s competency profile and that the Board is able to perform its duties effectively. Overboarding is also taken into consideration when considering the Board composition. Current competencies required of and possessed by the Board are knowledge of the transport sector, international commercial experience and experience in strategy, M&A, risk management, IT, human resources and accounting. In instances where specialised knowledge or insight is required in supporting the work of the Board, services may be obtained from external advisors or specialists. See page 37 in Annual Report 2018 for a description of the individual Directors’ skills and experience. BOARD OF DIRECTORS SELFEVALUATION Once a year, the Board of Directors performs an overall self-evaluation, focusing on the results, composition and competencies of the Board. In this regard, diversity, overboarding, internal management cooperation, succession planning and focus areas for the coming year are also considered. The Chairman of the Board is in charge of the self-evaluation process. When completed, the self-evaluation report is presented to and discussed by the Board. The result of the self-evaluation conducted in 2018 did not give rise to any significant considerations and supports the current composition of the Board. On this basis, the Board is considered to have the right competencies supporting the long-term value creation for our shareholders. INDEPENDENCE OF BOARD MEMBERS According to the Danish Recommendations on Corporate Governance, four of the six members of the Board of Directors are regarded as independent. Kurt K. Larsen (Chairman) and Jørgen Møller were members of the Executive Board and Division Management, respectively, until joining the Board of Directors and are therefore not regarded as independent Board members as defined in the Recommendations. BOARD MEETINGS The Board of Directors held eight ordinary and three extraordinary board meetings in 2018. The content of the meetings is determined by the annual cycle of the Board, thus ensuring that all important policies are reviewed. Besides the work laid down in the annual cycle, in 2018 the Board also focused on other adhoc tasks such as merger and acquisition proposals and updated Recommendations on Corporate Governance. BOARD COMMITTEES AUDIT COMMITTEE The Audit Committee consists of three members, with expertise and experience in financial accounting. The overall tasks of the Audit Committee are: • to monitor and report on the statutory audit and financial reporting processes; • to monitor compliance with applicable legislation, standards and regulations; • to monitor internal controls and risk management systems; • to monitor auditor independence, including the level of non-audit
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