Home› Investors› Corporate Governance Suomeksi In English About us ▾ Products ▾ Investors ▾ Sustainability ▾ Careers ▾ Media ▾ Contacts Corporate Governance Corporate Governance Suominen’s governing bodies General Meetings of Shareholders Shareholder's Nomination Board Board of Directors Management Internal control Risk management Internal audit Insider management Auditing Principles for related party transactions Remuneration Articles of association Disclosure policy Suominen Corporation (“Suominen” or the “Company”) complies with the Finnish Corporate Governance Code 2020 (the “Code”) issued by the Securities Market Association. The Code is available on the internet at www.cgfinland.fi. This Corporate Governance Statement (the “Statement”) is published separately from the report of Board of Directors. This Statement has been published simultaneously with the Financial Statements and Report by the Board of Directors as a Stock Exchange Release, and it is available also on Suominen’s website, www.suominen.fi. The Audit Committee and the Board of Directors of Suominen Corporation have reviewed the Statement. The Statement will not be updated during the financial year, but up-to-date information on its various topics is available on Suominen’s website. Recent Corporate Governance Statements Corporate Governance Statement 2020 (pdf) Corporate Governance Statement 2019 (pdf) Corporate Governance Statement 2018 (pdf) Corporate Governance Statement 2017 (pdf) Corporate Governance Statement 2016 (pdf) Corporate Governance Statement 2015 (pdf) Corporate Governance Statement 2014 (pdf) Corporate Governance Statement 2013 (pdf) Corporate Governance Statement 2012 (pdf) Corporate Governance Statement 2011 (pdf) Suominen’s governing bodies Responsibility for the Company’s operations is held by the constitutional bodies required by the applicable laws and regulations. Suominen’s decision-making bodies are the General Meeting of Shareholders, the Board of Directors with its two Committees, and the President & CEO, supported by the Executive Team. General Meetings of Shareholders Suominen’s supreme decision-making body is the General Meeting of Shareholders, where shareholders exercise their decision-making power. The Annual General Meeting is held once per year before the end of April on a date determined by the Board of Directors. It decides on the matters stipulated in the Finnish Companies Act and Suominen’s Articles of Association. Such matters include: Adoption of the financial statements Use of the profit shown on the balance sheet Election of the Chair and members of the Board of Directors and the decision on their remuneration Discharging the members of the Board of Directors and the President & CEO from liability, and Election of the Auditor and the decision on the Auditor’s compensation. Suominen publishes a notice of the Annual General Meeting of Shareholders on the Company’s website no earlier than two months and no later than three weeks prior to the meeting, however, at least nine (9) days prior to the record date of the meeting. In order to participate in the Annual General Meeting, a shareholder must inform the Company of the participation at the latest on the date mentioned in the invitation. The date may not be earlier than ten (10) days before the meeting. Annual General Meeting in 2021 The Annual General Meeting (AGM) of Suominen Corporation was held on March 25, 2021 in Helsinki, Finland. In order to prevent the spread of the COVID-19 pandemic, the AGM was held without shareholders' and their proxy representatives' presence at the venue of the meeting. The shareholders of the company participated in the meeting and exercised their shareholder rights by voting in advance. The AGM adopted the Financial Statements for 2020 and discharged the members of the Board of Directors and the President and CEO from liability for the 2020 financial year. The AGM approved the Remuneration Report 2020 for the governing bodies and the Board of Directors' proposals concerning forfeiture of the shares entered in a joint book-entry account and of the rights attached to such shares, the authorization for the Board to decide on repurchasing of the company's shares as well as issuance of shares and granting of options and other special rights entitling to shares. Meeting documents are available on the Annual General Meeting 2021 page. Advance information Shareholders shall be invited to General Meetings through a notice published on the company's website. The notice shall give at least the following information: the time and place the proposed agenda for the General Meeting a description of the procedures that shareholders must comply with in order to be able to attend and cast their vote at the General Meeting the date on which a shareholder entered in the shareholder register has the right to attend and cast his or her vote at the General Meeting (so-called record date) the place where the documents and proposals for resolutions of the General Meeting are available the address of the company website In addition, the company may, if so decided by the Board of Directors, announce the time and place of the General Meeting of Shareholders as well as the address of the company website in one newspaper in the company's domicile. The following information shall be available on the company website at www.suominen.fi at least 21 days before the General Meeting: the notice of the General Meeting the total number of shares and voting rights according to classes of shares at the date of the notice the documents to be submitted to the General Meeting a proposal for a resolution by the Board of Directors or another competent body an item on the agenda of the General Meeting with no proposal for a resolution The Board of Directors' proposals to a General Meeting and the invitation shall also be announced in a stock exchange release. Minutes of the General Meeting The minutes of a General Meeting are available to shareholders on the company website within two weeks from the General Meeting. Appendixes of the minutes are available only to the extent they describe the actual content of the decision. General Meetings AGM 2021 » AGM 2020 » AGM 2019 » AGM 2018 » AGM 2017 » AGM 2016 » AGM 2015 » AGM 2014 » EGM 2014 » AGM 2013 » AGM 2012 » EGM 2011 » AGM 2011 » EGM 2010 » AGM 2010 » AGM 2009 » AGM 2008 » Shareholder's Nomination Board Suominen has a permanent Shareholders’ Nomination Board established by the 2013 Annual General Meeting. The task of the Nomination Board is to prepare and present to the Annual General Meeting and, if necessary, to an Extraordinary General Meeting, a proposal on the remuneration of the members of the Board of Directors, a proposal on the number of members of the Board of Directors and a proposal on the members and the Chair of the Board of Directors. In addition, the task of the Nomination Board is to seek potential successors for the board members. The Nomination Board consists of four (4) members, three of which are appointed by the Company’s three largest shareholders who appoint one member each. The largest shareholders shall be determined on the basis of the registered holdings in the Company’s shareholders’ register held by Euroclear Finland Ltd as of the first working day in September. The Chair of the Company’s Board of Directors serves as the fourth member. The Nomination Board is established to exist and serve until the General Meeting of the Company decides otherwise. The members are nominated annually, and their term of office ends when new members are nominated to replace them. The members of the Nomination Board shall be independent of the Company, and a person belonging to the Company’s operative management cannot be a member of the Nomination Board. Nomination Board in 2021 Shareholders’ representatives on the Nomination Board in 2021 are Lasse Heinonen, representing Ahlstrom Capital B.V., Mikael Etola representing Oy Etra Invest Ab and Jukka Perttula representing Nordea Nordic Small Cap Fund. Jaakko Eskola, Chair of the Board of Directors will act as the fourth member of the Nomination Board. Board of Directors Composition of the Board of Directors The 2021 Annual General Meeting elected six members to Suominen's Board of Directors. The term of office of the members of the Board of Directors ends at the close of the Annual General Meeting 2022. Jaakko Eskola, b. 1958 M.Sc. (Eng.) Member of the Board since 2021 Chair of the Board since 2021 Independent member More info » Andreas Ahlström, b. 1976 M.Sc. (Economics and Business Administration) Member of the Board since 2015 Deputy Chair of the Board since 2020 Non-independent member More info » Björn Borgman, b. 1975 M.Sc. (Industrial Engineering) Member of the Board since 2020 Independent member More info » Nina Linander, b. 1959 B.Sc. (Economics) and MBA Member of the Board since 2020 Independent member More info » Sari Pajari-Sederholm, b. 1968 M.Sc. (Technology) Member of the Board since 2019 Independent member More info » Laura Raitio, b. 1962 Licentiate of Technology (Forest Products Technology) Member of the Board since 2015 Independent member More info » In accordance with the Market Abuse Regulation (MAR), effective as of July 3, 2016, the shareholdings of company management are not updated anymore. The shareholding data below is available as per July 2, 2016. Board of Directors The main duty of the Board of Directors of Suominen is to direct Suominen’s strategy in a way that it, in the long run, enables the delivery of the financial targets set for Suominen and maximizes shareholder value while simultaneously taking into account the expectations of the key stakeholders. The Board of Directors is responsible for the administration and the proper organization of Suominen’s operations. The Board is responsible for making decisions on matters that are likely to have a major impact on the Company. The Board convenes according to an annual meeting plan. The members of the Board of Directors are elected by the General Meeting of Shareholders. Pursuant to the Articles of Association of the Company, the Board shall have at least three and no more than seven members. The main duties The duties of the Board are defined in the Finnish laws and regulations, Suominen’s Articles of Association, the Finnish Corporate Governance Code and the Board’s Charter. The main duties are the following: to approve the Company’s strategy and oversee its implementation to approve the Company’s long-term targets and monitor their implementation to approve the annual business plan to approve major business acquisitions, divestments, investments or expenditures to approve major external funding (both debt and equity), capitalization of subsidiaries, and guarantees and mortgages to decide on the appointment and dismissal of the CEO and other members of the Executive Team and to decide on their terms of employment and remuneration to approve the Company’s organizational structure to monitor and supervise the Company’s performance and to ensure the effectiveness of its management to decide on the Company’s share-based long term incentive schemes to approve the Company’s financial reports, including annual accounts, interim reports, report by the Board of Directors and financial statement releases to ensure that the Company has adequate planning, information and control systems and resources for monitoring results and managing risks to convene General Meetings to establish a dividend policy and make a proposal on distribution of dividend to make a proposal concerning the election of the auditor and the auditing fees, and to make other proposals to General Meetings. Independence of the Board members The Board of Directors has evaluated the independence of its members. All members are independent of the Company. All members are also independent of its significant shareholders, with the exception of Andreas Ahlström, who acts as Investment Director at Ahlström Capital Oy. The largest shareholder of Suominen, Ahlstrom Capital B.V., is a group Company of Ahlström Capital. Meeting practice The Board of Directors convenes under the direction of the Chair or, if the Chair is unable to attend, the Deputy Chair. Principally, the matters are presented by the President & CEO. In 2020, the Board of Directors convened 11 times, of which three times per capsulam. The attendance rate at the meetings was 100%. The participation of each individual member is presented in the table below. Name Participation Jan Johansson Chair 11/11 Andreas Ahlström Deputy Chair 11/11 Björn Borgman Member 10/10 Nina Linander Member 10/10 Sari Pajari-Sederholm Member 11/11 Laura Raitio Member 11/11 Until March 19, 2020 Risto Anttonen Deputy Chair 1/1 Hannu Kasurinen Member 1/1 Self-evaluation In 2020, after most of its meetings, the Board assessed the preparations of the meeting, the course of the meeting, and its own operations, in line with the principle of continuous development. The Board of Directors conducted an annual evaluation of its operation and working methods during financial year 2020. The assessment was conducted internally. The results of the assessment were discussed confidentially also with the Nomination Board members to whom the report was provided. Diversity principles of the Board of Directors At Suominen, diversity has been recognized as an essential success factor in the long term. When considering the Board’s composition, diversity is assessed through a number of viewpoints. Diversity in the Board’s competencies, experience and opinions promotes openness to new ideas and helps the Board support and challenge the Company’s management. Furthermore, diversity promotes open discussion, integrity in decision making, good corporate governance, and effective supervision of both the Board and the management, and it also supports succession planning. The Nomination Board of Suominen’s shareholders evaluates the number of members on the Board, its composition and the competence requirements of the Board in the light of the present and future needs of the Company. When assessing the composition of the Board, the Nomination Board considers, among other things, whether the Board possesses a broad range of business knowledge and members representing both genders and various ages. It is Suominen’s objective to have both men and women on its Board. It is fundamental that the Nomination Board’s final proposal to the Annual General Meeting is based on the qualifications and competencies of each candidate. In addition, candidates must also have the possibility to devote a sufficient amount of time to the Board work. Board Committees The Board of Directors has two permanent committees: the Audit Committee and the Personnel and Remuneration Committee. The Board of Directors elects the members of the committees among its members at its annual organizing meeting. Both Committees report to the Board on their activities after each Committee meeting. Audit Committee The Audit Committee assists the Board in supervising the Company’s governance, accounting and financial reporting, internal control systems and monitoring the activities of the external audit. The Audit Committee prepares for the Board matters that fall under its areas of responsibility, but it does not have autonomous decision-making powers unless the Board resolves otherwise on certain matters. The Chair and members of the Audit Committee are elected annually by the Board from among its members. The Audit Committee comprises at least three members. The members of the Audit Committee must be independent of the Company, and at least one member must also be independent of the Company’s significant shareholders. Audit Committee in 2021 In its organizing meeting, the Board of Directors of Suominen elected the members of the Audit Committee and Personnel and Remuneration Committee from among its members. Members of the Audit Committee are Nina Linander (Chair), Andreas Ahlström and Laura Raitio. Audit Committee in 2020 The Audit Committee consisted of Nina Linander (Chair as of March 19, 2020), Hannu Kasurinen (Chair until March 19, 2020), Andreas Ahlström and Laura Raitio. In 2020, the Audit Committee convened 4 times.The attendance rate at the meetings was 100%. The participation of each individual member is presented in the table below. Name Participation Nina Linander Chair 3/3 Andreas Ahlström Member 4/4 Laura Raitio Member 4/4 Until March 19, 2020 Hannu Kasurinen Chair 1/1 Personnel and Remuneration Committee The Personnel and Remuneration Committee assists the Board by preparing remuneration and appointment matters concerning the company’s CEO and other members of the Executive Team. The Committee prepares for the Board matters that fall under its areas of responsibility, but it does not have independent decision-making powers unless the Board resolves otherwise on individual matters. The Chair and members of the Committee are elected annually by the Board from among its members. The Committee comprises at least three members. The members of the Committee must be independent of the Company. Personnel and Remuneration Committee in 2021 In its organizing meeting, the Board of Directors of Suominen elected the members of the Audit Committee and Personnel and Remuneration Committee from among its members. Members of the Personnel and Remuneration Committee are Jaakko Eskola (Chair), Björn Borgman and Sari Pajari-Sederholm. Personnel and Remuneration Committee in 2020 The Personnel and Remuneration Committee consisted of Jan Johansson (Chair), Björn Borgman and Sari Pajari-Sederholm. In 2020, the Personnel and Remuneration Committee convened twice. The attendance rate at the meetings was 100%. The participation of each individual member is presented in the table below. Name Participation Jan Johansson Chair 2/2 Björn Borgman Member 2/2 Sari Pajari-Sederholm Member 2/2 Management President & CEO The President & CEO (Managing Director) of Suominen is appointed by the Board of Directors. The President & CEO is responsible for day-to-day operations in accordance with the Companies Act and guidelines and instructions provided by the Board of Directors. The President & CEO is in charge of the day-to-day management of Suominen Group and is responsible for ensuring that the Company’s accounting practices comply with the law and that its assets are reliably managed pursuant to the Companies Act. The President & CEO acts as the Chair of the Executive Team as the immediate supervisor of the team’s members. Petri Helsky, born 1966, serves as the President & CEO of Suominen. Mr. Helsky holds Master of Science degrees both in Engineering and Economics. Executive Team The President & CEO is supported by the Executive Team. The Executive Team consists of: Petri Helsky, b. 1966 M.Sc. (Economics), M.Sc. (Technology) President & CEO Joined Suominen in 2019 More info » Toni Tamminen, b. 1978 D.Sc. (Technology), M.Sc. (Economics) CFO Joined Suominen in 2019 More info » Lynda A. Kelly, b. 1964 B.Sc. (Business Administration/Marketing) SVP, Americas business area & Business Development Joined Suominen in 2014 More info » Markku Koivisto, b. 1971 M.Sc. (Technology) SVP, Europe business area & R&D Joined Suominen in 2017 More info » Klaus Korhonen, b. 1974 LL.M. SVP, HR & Legal Joined Suominen in 2019 More info » Mimoun Saïm, b. 1964 ENSI Engineering SVP, Global Operations Joined Suominen in 2011 More info » Ernesto Levy acted as SVP, Americas until April 6, 2020. Suominen’s operative organization Suominen’s operative organization consists of two business areas, Europe and Americas, and seven global functions supporting the business: Operations, Finance, Sourcing, R&D, HR & Legal, Business Development and Communications & IR. The Company only has one operating segment. Internal control Control environment Control operations are embedded in the activities of Suominen’s organization. Controlling is executed in connection with the steering of business processes, supported by comprehensive reporting. Suominen’s control environment is based on instructions, the business culture and the way of working adopted by the Company’s managers and employees. In cascading the principles in the organization, honesty, transparency and working in teams are integral elements of establishing high ethical standards throughout the Company. The foundation of the internal control process is based on the Company’s Code of Conduct, values, policies and other directives and instructions. The responsibility structure of the Company is based on authority inherent in the positions and work descriptions, segregation of duties and the “four-eyes” and “one-over” decision-making principles. Effective internal control requires that duties are properly allocated to employees and potential conflicts of interests are identified and eliminated. A satisfactory control environment is ensured through internal analyses and evaluations of key processes. Nominated Process Owners are responsible for ensuring than efficient internal process controls are defined and implemented across the organization. The ICT function ensures that the security checks of ICT systems throughout the Group are functioning and conducted at a sufficient level. Control activities Internal control activities are in place to, among other things, verify that the Company’s financial reports provide a true and fair view of the Company’s financial position. It is the duty of the Board of Directors and the President & CEO to organize the internal control activities. Each member of the Board of Directors receives a monthly report on the Company’s result and financial position. In practice, control activities are conducted in the meetings of the Board of Directors and the management teams, where the results of the activities are reviewed. The Company’s Finance function and the Group’s controller network support and coordinate the financial management and control of the activities of the entire Group. Internal control at Suominen has been decentralized across global functions, who monitor compliance with the operating guidelines approved by the Board concerning their areas of responsibility. In addition to the Group-level guidance, control measures are also taken at the business area and plant level. Control measures include both general and more detailed control procedures aimed at preventing, revealing and correcting errors and deviations. In day-to-day business operations, several control activities are exercised to prevent potential errors and deviations in financial reporting. Moreover, control activities are in place to help reveal and correct the identified errors. Suominen categorizes its control activities into three categories. Documented instructions help the organization to standardize the monitoring of tasks. Continuous and regular reporting conveying feedback on the performance of global functions and each Group company ensures that instructions and defined processes are followed. In critical processes, specific authorizations are needed in the work flow, either for security or for verification needs. The need for separate evaluations, as well as their scope and frequency, is defined by assessing risks and the effectiveness of ongoing monitoring procedures. Information security and related control activities play a key role when the features of ICT systems are being defined and applied. Information and communication The Company’s Financial Manual, policies approved by the Board and other directives and instructions relating to financial reporting are updated and communicated on a regular basis by the management to all affected employees and are also available in the Company’s intranet. In addition, a standard reporting package is used by the business areas and the subsidiaries. Group management and business area management conduct monthly reviews that include an analysis of performance metrics and indicators assisting management to better understand the underlying business performance. Follow-up Ongoing responsibility for follow-up rests with the business area management and controller functions. Regular inspections by quality auditors or customer audit personnel cover also the internal controls of supply chain processes. The Company’s Finance function monitors the operations and processes of the subsidiaries and the accuracy of external and internal financial reporting. Risk management Risk management is considered an integral part of running the business of Suominen, and the identification and assessment of risks is an essential element of internal control. The aim is to focus on the material risks that are significant from a business perspective. Risks are categorized into strategic, operational, financial and hazard risks. Operational risks are considered to potentially have a material value in transactions with external parties. However, the Company’s policies, instructions, process check-ups, allocation of tasks and standards set up by total quality operating systems help to establish a prudent environment in which exposure to material risks can be mitigated. Risks relating to financial reporting are evaluated and monitored by the Board, aiming to ensure that the financial reporting of the Company is reliable, supports decision-making and serves the needs of external stakeholders. The valuation of assets, liabilities and contingent liabilities based on various evaluation assumptions and criteria may constitute a risk. Future estimates and assumptions on the reporting date involving a significant risk of causing material changes in the carrying amounts of assets and liabilities are continuously evaluated. Complex and evolving factors having an impact on business circumstances may add uncertainty to the assessment of the carrying amounts of assets. To avoid errors in stating the fair values of assets or liabilities, regular check-ups are made, e.g. by comparing material flows, values, and quantitative and qualitative data with the information in accounting. The risk of errors due to irregularities and discontinuities in information is reduced by using established and automated system-based audit trails. Internal audit Suominen does not have a separate internal audit organization. The Company’s auditor presents annually the external audit plan to the Audit Committee. The Audit Committee considers annually whether there is a need to perform extended audit procedures. If the Audit Committee finds it necessary, it agrees separately with the Company’s auditor or other suitable parties on extended audit procedures. Findings related to extended audit procedures are reported to the Audit Committee, the President & CEO and the relevant management. Insider management Suominen complies with the EU Market Abuse Regulation (“MAR”), the Finnish Securities Markets Act, the decisions, regulations, guidelines and standards issued by the Finnish Ministry of Finance and the Financial Supervisory Authority, the rules of Nasdaq Helsinki Ltd as well as the Guidelines for Insiders issued by Helsinki Exchange in force at any given time. In addition, the Board of Directors of the Company has approved an Insider Policy to inform the governing bodies and employees of Suominen and its affiliated companies of the regulations in force pertaining to insider trading. Directors required to submit notifications Based on the MAR, Suominen no longer maintains a public insider register. Instead, Suominen maintains a list of the Company’s directors and persons closely associated with them. Persons on that list have an obligation to notify Suominen and the Finnish Financial Supervisory Authority of all transactions made with Suominen’s financial instruments by them or on behalf of them. Suominen will disclose the notifications it has received as stock exchange releases as soon as possible. At Suominen Corporation, the members of the Board of Directors, the President & CEO and other members of the Executive Team have been defined as subject to the requirement to report their transactions. Disclosed stock exchange releases on the transaction notifications of directors and persons closely associated with them can be viewed at www.suominen.fi (> Investors > Share and shareholdings > Management transactions). Closed period Suominen’s defined directors are subject to comply with the so-called closed period. The closed period applies prior to the disclosure of financial reports and lasts 30 calendar days, including the date of disclosure of a financial report. During the closed period, Suominen’s defined directors may not trade with the share or another financial instrument of the Company. Core persons preparing financial reports, among others, are also subject to a similar 30-day closed period. The times of the closed periods are disclosed through a stock exchange release and in the event calendar available on the Company’s website. During a closed period, trading with Suominen’s financial instruments by defined directors and core persons is possible only in certain very exceptional situations. An example of such an exceptional situation is a transaction conducted by a director or core person to participate in a share-saving scheme for Suominen employees which is a prerequisite of a director’s or a core person’s position. Any exceptions to the 30-day-long closed period requires the Company’s approval of the transaction in question. The exception cannot be applied if a director or a core person has inside information. Trading by directors and core persons Directors and core persons must, in addition to abiding by the closed period and other trade restrictions, time their trading so that it does not weaken the general trust in the securities market. Suominen recommends that directors and core persons make long-term investments in the Company’s shares and other financial instruments. Further, it is also recommendable to time the trading to a point in time when the market has as complete knowledge of the factors affecting the value of the share or the financial instrument as possible. Monitoring and control The Insider Officer of Suominen is the Company’s Chief Financial Officer. The Insider Officer is generally responsible for the administration of the Company’s insider matters. Without limiting the obligations arising from MAR, the Securities Markets Act or other applicable regulations, the Company’s insider administration assumes responsibility for internal communications concerning insider issues, training in insider issues within the Company, preparing and maintaining lists of directors and their closely associated persons, receiving notifications concerning the transactions of directors and their closely associated persons, going through the notifications and forwarding them to the Financial Supervisory Authority (if the director/closely associated person has authorized the Company to do so) and publishing the related stock exchange release, preparing and maintaining project-specific insider lists, preparing lists of personnel who are defined as core persons, monitoring insider issues, and administering the information to be published on the internet, if needed. Auditing The Annual General Meeting held on March 25, 2021 re-elected Ernst & Young Oy, Authorized Public Accountant firm, as auditor of the Company. Ernst & Young Oy appointed Toni Halonen, Authorized Public Accountant, as the principally responsible auditor of the Company. The auditors and the Audit Committee of Suominen agree annually on an audit plan. Audit fees in 2020 Auditor's fees and services EUR thousand Auditing 519 Non-audit related fees (tax and other consulting fees) 5 Total 524 Principles for related party transactions The Company complies with legislation regarding related party transactions and ensures, in accordance with the legislation and the Finnish Corporate Governance Code, that the requirements set for the monitoring, assessment, decision-making and reporting of related party transactions are complied with. The Board of Directors has approved Suominen’s Related Party Policy defining the principles for monitoring and assessing related party transactions. Suominen has defined the parties that are related to the Company and Suominen’s Finance function maintains a list of such persons and entities. The Company can carry out transactions with its related parties provided that such transactions are made within the Company’s ordinary course of business and on customary, arm’s-length terms. The Board of Directors decides on related party transactions that are made either outside the Company’s ordinary course of business or on other than customary, arm’s-length terms. Related party transactions are monitored regularly by the Company’s Finance function as part of the Company’s normal reporting and monitoring procedures. Members of the Board of Directors and the Executive Team are also obligated to report any planned related party transactions or ones they have become aware of to the CFO without undue delay once the transaction has been brought to their attention. Remuneration Remuneration Policy for the governing bodies 2020–2023 As of 2020 the remuneration principles and decision-making processes for the remuneration of Suominen’s Board of Directors and President & CEO are described in the company’s Remuneration Policy for the governing bodies. The Policy is based on the amendment of the EU’s Shareholders’ Rights Directive (SHRD II), the provisions of the Finnish Securities Market Act and Limited Liability Companies Act, and the Recommendations of the Finnish Corporate Governance Code 2020. Suominen’s Remuneration Policy 2020-2023 was presented to the Annual General Meeting held on March 19, 2020. No voting was held on the Policy. Remuneration policy (pdf) Remuneration Report of Suominen Corporation As of 2021, the Remuneration Report describes Suominen Corporation’s remuneration for our Governing Bodies as required by the Finnish Securities Market Act, the Finnish Limited Liability Companies Act and the Finnish Corporate Governance Code 2020 issued by the Securities Markets Association. The Code is available on the Securities Market Association’s website at www.cgfinland.fi. Remuneration Report 2020 was presented and approved in the Annual General Meeting held on March 25, 2021. Remuneration Report 2020 (pdf) The remuneration paid to other members of the Executive Team in 2020 can be found under the section Remuneration of the other Executive Team members. Previous remuneration statements Remuneration Statement 2019 (pdf) Remuneration Statement 2018 (pdf) Remuneration Statement 2017 (pdf) Remuneration Statement 2016 (pdf) Remuneration Statement 2015 (pdf) Remuneration Statement 2014 (pdf) Salary and remuneration report 2013 (pdf) Salary and remuneration report 2012 (pdf) Salary and remuneration report 2011 (pdf) Remuneration of the Board of Directors The AGM held on March 25, 2021 confirmed that the remuneration of the Board of Directors remains unchanged. The Chair will be paid an annual fee of EUR 66,000 and the Deputy Chair and other Board members an annual fee of EUR 31,000. Chair of the Audit Committee will be paid an additional fee of EUR 10,000. Further, the members of the Board will receive a fee for each Board and Committee meeting as follows: EUR 500 for each meeting held in the home country of the respective member, EUR 1,000 for each meeting held elsewhere than in the home country of the respective member and EUR 500 for each meeting held as telephone conference. 60% of the annual fee is paid in cash and 40% in Suominen Corporation’s shares. The number of shares to be transferred will be determined based on the share value in the stock exchange trading maintained by Nasdaq Helsinki Ltd, calculated as the trade volume weighted average quotation of the share during the one-month period immediately following the date on which the interim report of January-March 2021 of the company is published. The shares will be transferred out of the own shares held by the company by the decision of the Board of Directors by May 31, 2021 at the latest. Compensation for expenses is paid in accordance with the company's valid travel policy. Remuneration of the President & CEO The current remuneration of the President & CEO consists of a fixed base salary and benefits, performance-based bonus (short-term remuneration), share-based incentive plans (long-term remuneration) and a supplementary pension plan. Base salary and benefits By the decision of the Board of Directors on Feb 3, 2021 the President & CEO received a 2,5% increase to his base salary effective from February 1, 2021. Current monthly base salary after the increase is EUR 34,850 and monthly value of benefits currently at EUR 1,130. These include typical benefits such as a company car and a telephone. Additionally, he has a health insurance, of which the costs to the company are 4,028.39 EUR during 2021. Short-term remuneration Suominen applies an annual bonus scheme based on the principles approved by the Board of Directors in advance for one year at a time. For the financial year 2021, the President & CEO’s potential reward from the period is based on Group EBITDA (weight 50%), Group Contribution Margin (CM, weight 20%) and certain personal targets (weight 30%), and it may not exceed 60% of the annual base salary. Long-term remuneration Performance Share Plan The President & CEO is a participant in the Company's Performance Share Plan which currently includes three 3-year Performance Periods, calendar years 2019-2021, 2020-2022 and 2021-2023. The potential reward of the Plan from all three Performance Periods is based on the Relative Total Shareholder Return (TSR). The potential rewards for the President & CEO to be paid correspond to the value of an approximate maximum total of 151,500 shares from Performance Period 2019-2021, 224,500 shares from Performance Period 2020-2022 and 128,500 shares from Performance Period 2021-2023. Maximum total of shares includes also the proportion to be paid in cash. The Plan includes a share price cap mechanism, which cuts the reward if the limits set by the Board of Directors for the share price are reached. The potential rewards from the Performance Periods 2019-2021, 2020-2022 and 2021-2023 will be paid partly in the Company’s shares and partly in cash in 2022, 2023 and 2024, respectively. The cash proportion is intended to cover taxes and tax-related costs arising from the reward to the participant. As a rule, no reward will be paid, if a participant’s employment or service ends before the reward payment. The President & CEO must hold 50% of the net number of shares given on the basis of the plan, as long as his or her shareholding in total corresponds to the value of his or her annual gross salary. Such number of shares must be held as long as his or her employment or service in a group Company continues. Matching Restricted Share Plan 2019-2021 The President & CEO is a participant in the Company's Matching Restricted Share Plan (MRSP). The aim of the MRSP is to align the objectives of the shareholders and key employees in order to increase the value of the Company in the long-term, to retain key employees at the Company, and to offer them a competitive reward plan that is based on acquiring, receiving and accumulating the Company’s shares. The MRSP is directed to selected key employees in the Suominen Group. The prerequisite for receiving a reward from the plan is that a participant acquires the company’s shares, amounting to the number resolved by the Board. If the prerequisites set for a participant have been fulfilled and his or her employment or service in a company belonging to the Suominen Group is in force at the time of the reward payment, he or she will receive matching shares as a reward. The plan includes vesting periods, the duration of which is resolved by the Board. The potential reward will be paid partly in shares and partly in cash after a vesting period. The cash proportion is intended to cover taxes and tax-related costs arising from the rewards to the plan participants. The prerequisite for reward payment is that a participant’s employment or service is in force upon reward payment. According to the MRSP, the President & CEO is entitled to receive in total 20,000 Suominen shares (gross before taxes) on the condition that he has personally invested into 10,000 Suominen shares. The matching shares will be delivered in two equal installments in 2020 and 2021. First installment of 4 676 net shares were delivered to the CEO during 2020. Payment was made partially in shares and cash. Term of notice and severance pay According to the written contract made with the President & CEO, the period of notice is six months should either the Company or the President & CEO terminate the contract. Should the Company terminate the President & CEO’s contract, severance pay corresponding to 12 months’ salary shall be paid. The President & CEO has no specific contract related to the termination of his contract due to a public tender offer. Supplementary pension arrangement In addition to the statutory pension arrangements, Suominen’s President & CEO has a supplementary pension arrangement granting benefits for old-age, disability and survivor’s pension at the age of 63. The supplementary pension is a defined-contribution pension scheme and corresponds to 11.5% of the President & CEO’s annual salary (as defined in the Finnish Employees Pensions Act) for the year in question. The supplementary pension premium is based on the calculated annual earnings (fixed monthly salary plus estimated bonus). Any possible difference between the actual and calculated payment is taken into account in the following year’s payments. Remuneration of the other Executive Team members Decision-making procedure concerning remuneration The Personnel and Remuneration Committee of the Board of Directors of Suominen prepares the remuneration matters concerning the Company’s Executive Team. The Personnel and Remuneration Committee continuously evaluates the appropriateness of their remuneration by assessing how their remuneration is positioned to the market and ensuring the remuneration is aligned with the Company’s strategy and the shareholders’ interests. The Personnel and Remuneration Committee does not have independent decision-making power unless the Board of Directors resolves otherwise on individual matters. The Board of Directors determines the salary, bonuses and other benefits paid to the Executive Team. The General Meeting or the Board of Directors authorized by the General Meeting decides on the issue of shares, stock options or other special rights entitling to shares to the Executive Team. The Executive Team members are not involved in the decision-making process regarding their own remuneration. Main principles of remuneration Suominen strives to have a remuneration system that incentivizes to pursue towards the Company’s long-term financial performance and shareholder value creation. The Company aims to offer remuneration that attracts, motivates and retains the best possible executives who drive Suominen’s performance and strategy in alignment with essential stakeholder interests. The goal is to ensure that the philosophy of paying for performance is applied to Suominen’s remuneration. The current remuneration of the other members of the Executive Team consists of a fixed monthly salary and benefits, a performance-based bonus (short-term remuneration), and of share-based incentive plans (long-term remuneration). The remuneration system described above concerning the President & CEO applies also to the other members of the Executive Team, with the following exceptions: Short-term remuneration: For the financial year 2021, the potential reward is based, depending on the Executive Team member's role, on a selection of the following KPIs: Group EBITDA, Region EBITDA, Group Contribution Margin (CM), Net working Capital related KPIs and certain personal targets, and it may not exceed 50% of the annual base salary. Long-term remuneration through the Performance Share Plans: The potential rewards for other members of the Executive Team to be paid correspond to the value of an approximate maximum total of 267,000 shares from Performance Period 2019-2021, 338,500 shares from Performance Period 2020-2022 and 220,000 shares from Performance Period 2021-2023. Maximum total of shares includes also the proportion to be paid in cash. A member of the Executive Team must hold 50% of the net number of shares given on the basis of the Performance Share Plan, as long as his or her shareholding in total corresponds to the value of half of his or her annual gross salary. For other members of the Executive Team, the notice period is up to 6 months should either the Company or the Executive Team member terminate the contract. Should the Company terminate the employment, executives are entitled to a severance pay corresponding up to 3 months’ salary unless relevant local legislation dictates otherwise. Except for one Executive Team member, the other executives are not covered by any special supplementary pension schemes. Pension arrangements in countries without statutory pensions are arranged through Suominen’s normal supplementary pension programs. Remuneration paid in the financial year 2020 The salaries and benefits paid to the other members of the Executive Team during 2020 totaled EUR 1,246,003, including benefits of EUR 62,101 and bonuses of EUR 237,063. In 2020, the members of the Executive Team received in total EUR 49,921 (4 676 Suominen shares + cash proportion to cover taxes) as remuneration from the Matching Restricted Share Plan and EUR 20,000 of supplementary pension payments. Articles of association 1 § The Company's name and domicile The Company's name is Suominen Oyj and in English Suominen Corporation. The Company's domicile is Helsinki. 2 § The Company's field of operations The field of operations of the Company is to practise, either directly or through subsidiaries or partnership companies, industrial activity and trade related to non-woven materials, heavy webbings and narrow fabrics and packaging as well as other corresponding industrial activity and trade. The Company's field of operations is also the management and financing services of the Group. The Company may trade in securities and practise other investment activity. 3 § Book-entry system The Company’s shares are incorporated in the book-entry system. 4 § Board of Directors The Board of Directors shall be responsible for the management of the Company and for the proper arrangement of the Company's operations. The Board of Directors shall consist of no less than three (3) and no more than seven (7) members. The Chair of the Board of Directors and the members of the Board of Directors are elected by the General Meeting. The Board of Directors elects from among its members the Deputy Chair of the Board of Directors. If during the term the Chair of the Board resigns or is permanently unable to perform his/her duties as the Chair of the Board, the Board of Directors may appoint a new Chair of the Board from among its members for the remaining term. The term of the members of the Board of Directors expires at the end of the first Annual General Meeting of Shareholders following his/her election. 5 § Managing Director The Company has a Managing Director who is elected by the Board of Directors. 6 § Auditor The Company has one (1) auditor who shall be an entity of Certified Public Accountants approved by the Finnish Central Chamber of Commerce. The term of the auditor shall expire at the end of the first Annual General Meeting of Shareholders following the election. 7 § Right to represent the Company The Chairman of the Board of Directors and the Managing Director, both alone, or by two members of the Board of Directors together shall have the right to represent the Company. The Board of Directors may grant to persons employed by the Company the right to represent the Company so that such persons shall have the right to represent the Company two together or each of them together with a member of the Board of Directors. 8 § Procuration Any authorisation for signing the Company's name per procuram will be decided by the Board of Directors. 9 § Financial year The financial year of the Company shall be the calendar year. 10 § Annual General Meeting of Shareholders The Annual General Meeting of Shareholders shall be held annually by the end of April on the date decided by the Board of Directors. 11 § Notice of General Meeting of Shareholders Notice of the General Meeting of Shareholders shall be announced on Company’s website no earlier than two (2) months and no later than three (3) weeks prior to the General Meeting of Shareholders, however, at least nine (9) days prior to the record date of the General Meeting of Shareholders. In addition, the Company may, if so decided by the Board of Directors, within the same time announce the time and place of the General Meeting of Shareholders as well as the address of the Company’s website in one newspaper. 12 § Informing of participation in General Meeting of Shareholders In order to participate in the General Meeting of Shareholders, a shareholder must inform the Company of the participation at the latest on the date mentioned in the invitation. The date may not be earlier than ten (10) days before the General Meeting of Shareholders. 13 § Matters to be addressed in the Annual General Meeting of Shareholders The Annual General Meeting shall: receive: 1. the Financial Statements consisting of Consolidated Financial Statements and the Report of the Board of Directors; 2. the Auditors’ Report; decide on: 3. the adoption of the Financial Statements and Consolidated Financial Statements; 4. the disposal of the profit shown on the balance sheet; 5. the discharge from liability for the members of the Board of Directors and the Managing Director; 6. the remuneration of the members of the Board of Directors and the auditor; 7. the number of members of the Board of Directors; elect: 8. the members of the Board of Directors and the Chair of the Board of Directors and 9. the auditor. Disclosure policy 1 Background Suominen Corporation (“Suominen” or the “Company”) complies in its communications with the applicable Finnish and EU legislation, such as the EU Market Abuse Regulation (the “MAR”), Nasdaq Helsinki Ltd’s rules, the Finnish Financial Supervisory Authority’s guidelines and the Company’s corporate governance principles. The purpose of this Disclosure Policy (the "Policy") is to describe the key principles that Suominen follows when communicating to the capital market and the media. 2 General principles Suominen’s communications are based on facts and the key principles of being systematic, open, honest, equal, and active. Suominen communicates both positive and negative issues equally to all external stakeholders, and aims to give a fair and correct view of the Company’s operations without undue delay. The goal of Suominen’s investor relations is to support the correct valuation of Suominen’s share by communicating reliable, sufficient and up-to-date information to the capital markets about Suominen’s operations, operating environment, strategy, objectives, and financial performance. 3 Regulated disclosure practices Suominen discloses information about its financial performance according to a schedule announced in advance. The Company's IR calendar regarding the planned release dates for the annual financial statements and the following year’s quarterly reports is published prior to the beginning of a new financial year. The IR calendar is also available on the Company’s website. In principle, information about the Company’s financial performance, financial position, outlook, profitability development, or other essential matters related to Suominen’s operations and operating environment is given in interim reports, half year reports, and financial statements. All new information between the publication of these reports which is deemed to have a significant effect on the Company’s financial instruments, is always published as a stock exchange release. Disclosure of insider information Any inside information that directly concerns Suominen is made public as soon as possible, and a business matter containing inside information is disclosed to the market at the time when it is deemed to become insider information. The Board of Directors of Suominen or in urgent cases the President and CEO is responsible for defining whether information falls under the definition of inside information. The Company may postpone the disclosure of inside information if all of the following requirements are met: (i) the immediate disclosure of the information is likely to prejudice the legitimate interests of the Company; (ii) postponing the disclosure of the information is not likely to mislead the public and (iii) the Company is able to ensure the confidentiality of the information. In connection with a decision to postpone the disclosure of inside information, the preconditions for postponement are documented, an insider list concerning the matter is established and a formal decision on postponement is made. Financial targets and outlook statement Changes to the Company's financial targets are published in a stock exchange release. Suominen gives a financial outlook as part of the Company’s financial statements release which includes the management’s estimation for the EBITDA (earnings before interest, taxes, depreciation and amortization) for the current financial year. The outlook is published also in connection with each interim report during the financial period. Suominen does not publish outlooks for individual quarters. Suominen reserves the right not to publish financial outlooks in exceptional circumstances. Profit warning A profit warning will be issued without undue delay if Suominen’s financial results during a financial period deviate in an unexpected and significant way from what could reasonably be expected based on information previously disclosed by the Company. Suominen’s President and CEO will estimate and decide, together with the Chair of the Board, whether there is a need to issue a profit warning. A profit warning is always published as a stock exchange release. Changes in shareholdings Shareholders of listed companies have an obligation to notify both the Finnish Financial Supervision Authority and the listed company in question of changes in their holdings. Changes must be disclosed when 1) direct holdings, 2) holdings through financial instruments or 3) the sum of these reach, exceed, or fall below 5%, 10%, 15%, 20%, 25%, 30%, 50%, 90% or two-thirds of the company’s voting rights or the total number of shares. Suominen will publish this information as a stock exchange release without undue delay after the shareholder has notified Suominen and Financial Supervisory Authority of such a change. Managers’ transactions Suominen publishes notifications on transactions related to Suominen’s share conducted by persons discharging managerial responsibilities and persons closely associated with them when the transaction reaches a threshold of EUR 5,000 (without netting) on a yearly level in accordance with the provisions of the MAR. Persons obliged to disclose such transactions consist of the members of Suominen’s Board of Directors as well as the President and CEO and other members of the Company's Executive Team, including persons closely associated with them. Notifications of transactions are published as a stock exchange release within two business days of receiving notification of the transaction. 4 Other disclosure practices Contact with investors, analysts and media Suominen’s Communications and IR function handles the communication with investors, analysts and media centrally. Suominen’s top management, together with a representative from Investor Relations, participates in meetings with investors, analysts and media. The goal of the meetings is to provide useful information about Suominen and its operating environment. Discussions are based on information previously published by Suominen or on information generally available to the market. New information that would be deemed to have a significant effect on the value of the Company’s financial instruments is not introduced in such meetings. Silent period Suominen observes a 30-day silent period prior to the publishing of its financial result. During this time Suominen does not comment on the Company’s financial performance, markets, its future outlook or business prospects. During this time Suominen’s management and other employees do not meet with the representatives of the capital markets or the financial media. Rumors, market speculations and leaks Suominen does not comment on market rumors, share price development, actions of competitors or customers, or analyst estimates. If the management of the Company estimates that a market rumor is likely to have a significant effect on the price of Suominen’s financial instrument, Suominen may consider publishing a stock exchange release to correct incorrect or misleading information and to provide correct information in a non-discriminatory way. Suominen does not comment business matters in preparation. However, in the event that information expected to have a significant impact on Suominen's financial instruments is leaked, Suominen will publish a stock exchange release on the matter. Spokespersons Suominen’s President and CEO, CFO and Vice President of Communications & IR are in co-operation responsible for the Company's financial reporting and investor communication. Comments relating to Suominen’s financial performance, markets, and outlook are given by the President and CEO and the CFO. In addition to them, only the Chair of the Board may provide statements regarding the financial standing and development of the Company. 5 Releases published by Suominen Suominen’s releases are divided into two categories: stock exchange releases and press releases. The category of the release is determined based on significance and relevance of the information and according to internal guidelines. Stock exchange releases In stock exchange releases Suominen publishes important decisions, matters and developments that are deemed to have a significant effect on the value of Suominen’s financial instrument. A stock exchange release is used to announce, for example, financial statements, interim reports, key strategic matters and significant changes in the financial and general outlook. A stock exchange release is also used to announce e.g. changes in the Board of Directors or the Company’s management, significant investments, financial arrangements and transactions, significant new direction for business or new co-operation arrangement, information on share issue, purchase or redemption offer or other change related to the Company’s financial instruments such as combination or splitting of share series, initiation of major legal proceeding or ruling therein or significant decisions by authorities. Also invitation to the general meeting, proposals by the Board of Directors and Nomination Board for the general meeting, issuance of shares, change of the auditor of the Company, share based incentive plans, significant transactions between the Company and its related parties and purchase or conveyance of the Company’s own shares are disclosed as a stock exchange release. Suominen’s President and CEO or a person authorized by him approves stock exchange releases and Communications and IR fuction publishes them through Nasdaq Helsinki. Press releases Suominen’s press releases are used to communicate events related to Suominen’s business that do not include inside information but are estimated to be newsworthy or of general interest to stakeholders. Communications publishes Suominen’s press releases. 6 Channels, distribution of releases and their availability Suominen publishes all inside information as a stock exchange release through Nasdaq Helsinki and main media channels. However, the main source of information about Suominen is the Company’s website at www.suominen.fi. Stock exchange releases and press releases published by Suominen are available on Suominen’s website without undue delay after the information has been disclosed. The website includes an archive of previously published releases and financial reports dating back a minimum of five years. As an obligation of a listed company on Nasdaq Helsinki stock exchange, Suominen’s official reporting language is Finnish. All official material will be published both in Finnish and English. Suominen may also provide a public webcast when financial results and important news are being disclosed. 7 Communications in exceptional situations In crisis situations, the local management of Suominen’s business units commences crisis management procedures, including communications procedures. In case the management of the Company estimates the situation to be so serious that it is likely to have a significant effect on the price of Suominen’s financial instruments, the responsibility of communications is transferred to Suominen’s Communications function and a stock exchange release shall be published as soon as possible. 8 Insider guidelines In issues related to inside information, Suominen complies with the applicable legislation, standards of the Finnish Financial Supervisory Authority as well as Nasdaq Helsinki Ltd’s guidelines for insiders. Suominen observes a 30-day closed window period prior to the publication of financial reports, such as interim reports, half-year reports and financial statements. During this period, the members of Suominen’s Board of Directors and Executive Team as well as other Suominen employees who participate in preparing these financial reports are not permitted to buy or sell securities issued by Suominen. 9 Interpretations and deviations The interpretation and application instructions related to this Policy are provided by the President and CEO or a person nominated by him/her. Approved by the Board of Directors on 23 September 2008 Revised and amended on 3 February 2021 About us Suominen as a company Business Operating environment Products Sustainable products Baby wipes Flushable wipes Household wipes Hygiene products Medical products Personal care products Workplace wipes Business contacts Investors Suominen as an investment Key figures Materials Operating environment Shares and shareholders Corporate Governance Investor relations IR calendar Sustainability Sustainability Agenda People and safety Low impact manufacturing Sustainable nonwovens Corporate citizenship Policies Careers Apply Why choose Suominen? 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