Board of Directors and Committees

Diversity and assessment of independency of the Board of Directors

For the versatile support and development of the Company's business, the Company's Board of Directors composition should be sufficiently diverse. Both genders shall be represented on the Board of Directors. The overall aim of the Board composition is to achieve sufficiently extensive qualifications, expertise and experience. The sufficient diversity of the Board of Directors, including age and gender, as well as educational and professional background, is taken into account in the preparation of a proposal for the composition of the Board of Directors. For the evaluation of the diversity and composition of the Board of Directors, each candidate shall provide confident information necessary for the assessment of skills and time management for the preparation of a proposal for the composition of the Board, in accordance with the instructions provided by the Company.

The proposal for the Board composition is prepared by the largest shareholders.

The Board of Directors must evaluate the independence of its members. The majority of the members must be independent of the Company. In addition, at least two of the members representing this majority shall be independent of significant shareholders of the Company.

Jukka Leinonen, Leena Niemistö, Heli Iisakka, Kim Ignatius and Tiina Kurki are independent of the Company and major shareholders.

The Duties and Responsibilities of the Board of Directors

The duties and responsibilities of the Board of Directors are defined in the Limited Liability Companies Act, the Company's Articles of Association and the written Charter of the Board of Directors. The Board of Directors conducts an annual evaluation of its operations and working methods and updates its Charter as needed. According to its Charter, the Board of Directors:

• considers and approves the Company’s long-term strategic plan and goals;
• approves the Company’s business plan, budget and financing plan and monitors their implementation;
• confirms the principles of the Company’s internal control and risk management;
• reviews the material risks affecting the Company’s operations and their management, and supervises the adequacy, relevance and efficiency of the Company’s administrative processes;
• processes and approves business acquisitions and arrangements and other significant decisions, such as large municipal outsourcings;
• elects the CEO and deputy CEO, releases them from their duties and decides on the terms of their service;
• confirms, based on the CEO's proposal, the members of the Group's Management Team, the heads of the operating segments and the direct subordinates of the CEO;
• approves the incentive systems of the CEO and other management and the Company's remuneration principles;
• approves the Company's Corporate Governance statement
• confirms the Company's insider guidelines and practices relating to related party transactions and monitors compliance with these;
• decides on the Company's disclosure policy and monitors compliance with it.

Board meetings

The Board has regular meetings. The timing of the Board Meetings will be confirmed in advance for the financial period. The Board shall have additional meetings as needed. At least one of the meetings is a strategy meeting and in at least one meeting the Board meets the Company auditor.

In the Board meeting there are present the Chief Executive Officer (CEO), Chief Financial Officer CFO and the Secretary of the Board. Meeting arrangements and the agenda is prepared by the CEO and the Board Secretary together with the Chairman of the Board.

Committees

Audit Committee

Pihlajalinna Plc's Board of Directors has established from among its members an Audit Committee which monitors the reporting process of financial statements and the efficiency of the Company’s internal control, internal audit and risk management systems. The Audit Committee also reviews the description of the main features of the internal control and risk management systems in relation to the financial reporting process, which is included in the Company’s Corporate Governance Statement, monitors the statutory audit of the financial statements and consolidated financial statements and corporate sustainability auditing, evaluates the independence of the statutory auditor or audit firm or authorized sustainability auditor, particularly the provision of related services to the company.

The members of the Audit Committee must have the expertise and experience necessary to perform the responsibilities of the Committee and at least one of the members must have special expertise in accounting, bookkeeping or auditing. The Audit Committee comprises three to five members who are elected from among the Board of Directors. The majority of the members of the Audit Committee must be independent of the Company, and at least one member must be independent of major shareholders.

The Members of the Audit Committee are Kim Ignatius (Chair), Heli Iisakka and Tiina Kurki. 

People and Sustainability Committee

Pihlajalinna Plc's Board of Directors has established from among its members a People and Sustainability Committee which assists the Board by preparing matters pertaining to the remuneration of the Company’s CEO and other management, as well as the Company's remuneration principles. The People and Sustainability Committee comprises three to five members.

When carrying out its duties, the People and Sustainability Committee acts independently of the Company's operational management. The majority of the members of the People and Sustainability Committee must be independent of the Company. The Company’s CEO or other person from the Company’s management cannot be members of the People and Sustainability Committee.

The Members of the People and Sustainability Committee are Leena Niemistö (Chair),  Jukka Leinonen and Mikko Wirén.