Corporate governance codes
FMO abides by two governance codes: the Dutch Corporate Governance Code and the Dutch Banking Code. We comply with the Banking Code or will otherwise explain where and how we diverge from the Banking Code, including concrete examples. This document can be found on our website. Monitoring of the Code and other operational risks are further described in the ‘Non-financial risk’ section in the ‘Risk management’ chapter.
The Dutch Corporate Governance Code (‘the Code’) only applies to organizations whose shares are listed on a regulated market. As a non-listed bank, FMO is not required to adhere to the Code, but we have chosen to do so, nonetheless. The Supervisory Board and the Management Board fully endorse the basic principle on which the Code is based, namely that the company is a long-term partnership of our various stakeholders. In 2014, FMO published a policy specifically regarding bilateral contacts with our shareholders, which is provisioned by the Code and is available on our website.
FMO promotes diversity at all levels, including the Management Board and Supervisory Board. As principle 2.1.5 of the Code requires, FMO has diversity policies. The aim of our diversity policy - including for the Management Board and Supervisory Board - is to have well-balanced boards, which are up to their task and can come to good solutions, while considering the members’ different perspectives, backgrounds and experiences. The Management Board consists of one Ivorian member and two Dutch members. The Management Board, when at full capacity, consisted at year end of 33% women and 67% men.
The Supervisory Board also has one non-Dutch member, Dugald Agble, who has the Ghanaian and British nationality. The Supervisory Board consisted of 50% men and 50% women during the entire year. In both boards, the ages of the members are well distributed, and knowledge and experience comply with the applicable matrices.
The relevant principles and best practice provisions of the new Corporate Governance Code have been implemented, with the exception of the following principles and best practice provisions, which can be explained as follows:
BPP 1.3.6: This provision only applies if the company does not have an internal auditor. FMO does have an internal auditor.
BPP 2.2.2: This provision refers to the reappointment of Supervisory Board members. The third term of four years, as meant in the previous version of the Corporate Governance Code, is split into two terms of two years in the current version of the Corporate Governance Code. Section 2.7 of the Supervisory Board Standing Rules, which deals with reappointments and the duration thereof, will be amended accordingly at the next revision. None of the Supervisory Board members exceeded the eight-year term.
BPP 2.2.4: This provision requires a written (separate) succession plan, which focuses on knowledge, experience and diversity. At FMO, knowledge, experience and diversity are included in the profiles of the Supervisory Board and the Management Board. Succession and knowledge are regularly discussed in meetings of among others the Selection, Appointment and Remuneration Committee. The Supervisory Board retirement schedule is placed on the website. Therefore, there is no separate plan.
BPP 2.3.10: This provision states that the Supervisory Board is supported by the Corporate Secretary of FMO. Section 6.1 of the Standing Rules of the Supervisory Board states that the SB secretary might also be one of its members. In practice, it is the Corporate Secretary of FMO. This will most likely be amended at the occasion of the next amendment.
BPP 2.8.1-2.8.3: Stipulations on takeover bids are not implemented, given our stable majority shareholder, the State of The Netherlands.
BPP 4.1.4: The explanation of the agenda of the AGM is not published on FMO’s website, since this document is sent to all shareholders of FMO.
BPP 4.2.3: This provision relates to analysts’ meetings and presentations to institutional investors. This provision is of no practical significance to FMO and therefore does not apply.
BPP 4.2.6: This best practice provision requires the Management Board to provide a survey in the annual report of all anti-takeover measures to prevent control from being relinquished. FMO has not incorporated any anti-takeover measures in its articles of association, because it has a stable majority shareholder, namely the State of The Netherlands. Therefore, an overview as meant in this provision is not incorporated in this annual report.
BPP 4.3.3: This provision does not apply, as this provision refers to a legal entity that does not apply a so-called ‘structuurregime’. FMO is a so-called ‘structuur’ legal entity as defined in paragraph 2.4.6 of the Dutch Civil Code.
BPP 4.3.4: This provision does not apply, as it refers to financing preferred shares, which FMO does not use in its share capital.
BPP 4.3.5 and 4.3.6: These provisions do not apply, as FMO is not an institutional investor.
BPP 4.4.1 – 4.1.8: These provisions concern the issuing of depositary receipts for shares. There is no such requirement at FMO, apart from the articles of association, which lay down that the company is not permitted to cooperate in issuing depositary receipts of shares.
BPP 5.1.1 – 5.1.5: These provisions do not apply, as FMO does not have a one-tier board.