Nomination and Governance Committee

Duties and responsibilities of the Nomination and Governance Committee are related to the composition and remuneration of the Board of Directors and to corporate governance. The committee’s work to perform these duties and responsibilities are described below.

Committee work

The Nomination and Governance Committee identifies individuals qualified to serve as directors and prepares a proposal to the general meeting for election or re-election of directors and for their remuneration. When needed, the committee also identifies individuals qualified to serve as the President and CEO and prepares a proposal to the Board of Directors for the appointment of the President and CEO. The committee may engage executive search firms to identify potential director and President and CEO candidates.

When preparing its proposal to the AGM regarding director nominees, the Nomination and Governance Committee reviews the size and composition of the Board as a whole from the point of view of the company’s current and evolving needs. The committee considers whether the Board reflects appropriate balance of sound judgment, business specialization, skills, experience, independence, and availability of service to the company and its shareholders. A decision on a search for potential new director candidates is taken in the committee’s first meeting in the autumn.

When reviewing the composition of the Board, the committee considers whether the Board is sufficiently diverse in terms of professional and educational backgrounds, gender and age, and whether it represents an appropriate balance of competencies in order to address the needs of the company’s business operations and strategic agenda. The committee has determined that desirable skills and qualifications for the directors include, among others, relevant industry experience, expertise in finance and accounting, senior executive level experience in global international business, experience in leadership and strategy formation, and experience in corporate governance.

Evaluation of director nominees’ independence is an essential part of the director nomination
process. As a part of this evaluation, the committee reviews the directors’ professional engagements and positions of trust and the results of the company’s verification procedures concerning director independence, conflicts of interest, related party transactions and other commitments that could jeopardise a director’s independence. Based on the results of such procedures, no such transactions took place and no conflicts of interest were identified in 2015. In addition, the committee reviews on a continuous basis reports on any changes in directors’ professional engagements and positions of trust and assesses the potential effects of such changes on directors’ independence and availability for Board work, and reports to the Board on the results of such assessments.

When preparing its proposal to the AGM regarding Board remuneration, the committee considers, among other things, the development of director remuneration and the level of director remuneration in peer companies. The committee has underlined the importance of aligning the interests of directors with those of shareholders and has preferred payment of Board remuneration in the form of shares and cash. The remuneration has remained the same since 2007. The cash portion of the remuneration is meant to cover the withholding tax.

The committee also annually reviews the composition, qualification criteria and duties of the Board committees, and makes a proposal to the Board of Directors for the election of committee members and chairmen. Further, the committee reviews regularly the adequacy of the Board and committee charters and assists the Board in the annual self-evaluation survey and review of the survey results.

The Nomination and Governance Committee's duties and responsibilities, as defined in the committee charter, are presented below. ​

Nomination and Governance Committee’s duties and responsibilities

​Board composition​Review annually the size and composition of the Board

Prepare annually a proposal to the general meeting for the election or re-election of the members of the Board and present the said proposal to the general meeting

Identify candidates for election or re-election to the Board

Evaluate shareholders’ potential proposals regarding Board member candidates
Board remuneration​Review annually Board remuneration

Prepare annually a proposal to the general meeting for the remuneration of the members of the Board for the term of election and present the said proposal to the general meeting
​Director independence​Evaluate annually the independence of the Board members and Board member candidates

Assist the Board in monitoring the compliance with the independence requirements applicable to Board members of publicly listed companies in Finland

Assist the Board in the assessment of the Board members’ ability to devote the necessary time and attention to the company
Board self-evaluationEstablish criteria for Board self-evaluation

Assist the Board in its annual self-evaluation​
​AppointmentsRecommend the appointment of the Chairman and the Deputy Chairman of the Board for Board approval

Identify individuals qualified to serve as the President and CEO and make recommendations to the Board for its approval of the appointment of the President and CEO
​Committees​Review annually committee assignments and the composition of the committees

Recommend annually to the Board nominees for each Board committee and Committee Chairmen
Charters​​Review and reassess periodically the adequacy of the Board and Committee Charters
​Conflicts of interest​​Consider questions of possible conflicts of interest of Board members and senior executives

Initiate appropriate action to address any conflicts of interest
​Other​​Assist the Board in connection with major management reorganizations

Perform any other duties or responsibilities delegated to the committee by the Board from time to time