Purpose
Aker Solutions’ corporate governance principles are intended to ensure an appropriate division of roles and responsibilities among the company’s owners, its Board of Directors, and its executive management. An appropriate division of roles is intended to ensure that goals and strategies are established, that adopted strategies are implemented, and that performance is subject to measurement and follow-up. Our corporate governance principles also help ensure that Aker Solutions’ activities are subject to satisfactory control. An appropriate division of roles and satisfactory control contribute to the greatest possible value creation over time, to the benefit of owners and other stakeholders.
Our values
The Board has approved and adopted Aker Solutions’s corporate values, which are presented on page 8 in the annual report. Our ethical guidelines and other policy documents have been prepared in accordance with these values.
Our business
Aker Solutions’ business purpose clause reads as follows:
“The company’s purpose is owning and operating industrial businesses and other, related activities, capital management and other Group functions, and participation in or acquisition of other businesses.”
The business purpose clause ensures that shareholders have control of the scope of the business activities and their risk profile, without limiting the Board or management’s ability to carry out strategic and financially viable decisions within the defined purpose. Aker Solutions’ financial goals and main strategies are presented on page 7 in the annual report and in the Board of Directors’ report.
Equity and dividends
Aker Solutions’ equity as of 31 December 2007 amounted to NOK 7 267 million, which corresponds to an equity ratio of 25.5 percent. Aker Solutions regards the current equity structure as appropriate and adapted to its objectives, strategy, and risk profile. Aker Solutions’ dividend policy is discussed in the section Share and shareholder information, see page 88 in the annual report. Dividend policy is among the factors considered in preparing the Board’s proposal for allocation of profit for 2007. Current Board authorisations to increase share capital and acquire own (treasury) shares are also presented in the section Share and shareholder information in the annual report.
Equal treatment of shareholders
Aker Solutions has a single class of shares; all shares carry the same rights in the company. Equal treatment of all shareholders is crucial. If existing shareholders’ pre-emptive rights are waived upon an increase in share capital, the Board must justify the waiver. Transactions in own shares must be executed on the Oslo Stock Exchange or by other means at the listed price.
Transactions with related parties
With regard to material transactions between the company and a shareholder or member of the Board or executive management, or parties closely related to the aforementioned, the Board shall ensure that such transactions are entered into on an arm’s length basis. If needed, external, independent evaluations of such transactions are sought. Aker Solutions has prepared guidelines designed to ensure that members of the Board of Directors and executive management notify the Board of any direct or indirect stake they may have in agreements entered into by the Aker Solutions. Aker ASA owns 60 percent of the shares in Aker Holding AS; as of 31 December 2007, Aker Holding owns 40.27 percent of Aker Kværner ASA stock. The Norwegian parliamentary bill St.prp. no. 88 (2006-2007) provides more details on the establishment of Aker Holding AS and the agreement between Aker ASA and the other Aker Holding AS shareholders. Based on its shared industrial history and ownership ties, Aker Solutions aims to maintain its close cooperation with the Aker companies and certain other companies associated with Aker ASA. For example, there may be mutual business opportunities in joint projects between Aker Solutions and other Aker companies that serve the oil and gas industry. Aker Solutions ASA is not viewed as a related party with regard to Aker ASA or companies in which Aker ASA has ownership interests, under the Norwegian Public Limited Liability Companies Act. Nevertheless, the Board and management of Aker Solutions are aware that Aker Solutions must conduct relations with Aker companies on an arm’s length basis. Further, transactions of a certain size between Aker Solutions ASA and Aker companies are subject to the procedures set forth in section 3-8 of the Norwegian Public Limited Liability Companies Act. For further information, see Note 5 to the consolidated accounts Related parties.
Freely negotiable shares
Aker Solutions’ shares are freely negotiable. No restrictions on transferability are found in the company’s articles of association.
Annual General Meetings
Aker Solutions encourages shareholders to participate in its Annual General Meetings. Our goal is to publish notices of shareholders’ meetings and comprehensive supporting information – including the recommendations of the nomination committee – on the company’s website no later than 21 days before the Annual General Meeting. These documents are distributed to shareholders with known addresses no later than two weeks before the Annual General Meeting. The deadline for shareholders to give notice of their intention to attend the meeting is set as close to the date of the meeting as possible, but not earlier than five days before the Annual General Meeting. Shareholders who are unable to attend the meeting in person may vote by proxy. Pursuant to Aker Solutions’ articles of association, the Board Chairman, or other person appointed by the Board Chairman, chairs Annual General Meetings. To the extent possible, Board members, the nomination committee leader, and the auditor attend Annual General Meetings. Minutes of Annual General Meetings are published as soon as practically possible via the Oslo Stock Exchange messaging service www.newsweb.no (ticker: AKSO) and on the company’s website www.akersolutions.com under the heading Investor Relations.
Nomination committee
The company has a nomination committee, as set forth in the company’s articles of association. Pursuant to the articles of association, the nomination committee comprises no fewer than three members. The composition of the nomination committee must reflect the interests of shareholders, as well as maintain the committee members’ independence from Aker Solutions’ Board and executive management. Nomination committee members and chair are elected by the company’s Annual General Meeting, which also determines remuneration payable to committee members. Pursuant to the articles of association, the nomination committee recommends candidates for the Board of Directors. The nomination committee also makes recommendations as to remuneration of Board members. The composition of the nomination committee is presented under the section Shares and shareholder information in the annual report.
Board composition and independence
Pursuant to the company’s articles of association, the Board comprises between six and ten members, one-third of whom are to be elected by and among Aker Solutions employees. Further, up to three shareholder-elected deputy board members may be elected. The Board chairman and deputy chairman are elected by the Board under an agreement with employee representatives; the agreement provides that the company is not to have a corporate assembly. Board members are elected for a period of two years. The current composition of the Board is presented on page 96 in the annual report; the Board members’ expertise, capabilities, and independence are also presented. Board members’ shareholdings are presented in Note 18 to the consolidated accounts Salaries, wages, and social security costs. The shareholder- elected Board members have a broad range of expertise, capabilities, and experience from finance, industry, and non-governmental organisations.
The work of the Board of Directors
The Board has adopted board instructions that regulate areas of responsibility, tasks, and division of roles of the Board, Board Chairman, and President & CEO. The Board instructions also feature rules as to Board schedules, rules for notice and chairing of Board meetings, decision-making rules, the general manager’s duty and right to disclose information to the Board, professional secrecy, impartiality, and other matters. Pursuant to the Board instructions, the Board evaluates its own performance and expertise once a year. The Board has appointed a compensation committee.
Risk management and internal control
Aker Solutions has established a comprehensive set of internal procedures and systems to ensure unified and reliable financial reporting. Each of Aker Solutions’ business units must annually evaluate its internal control systems and procedures with regard to financial reporting. Aker Solutions also regularly conducts internal audits of individual units’ adherence to systems and procedures. The Board receives monthly reports on the company’s financial performance and status reports on Aker Solutions’ most important individual projects. Page 27 in the annual report presents a more detailed description of the management of operational and financial risks associated with Aker Solutions’ business activities.
Remuneration to the Board of Directors
Aker Solutions’ Annual General Meeting determines the Board’s remuneration based on the recommendations of the nomination committee. Additional information on remuneration paid to Board members for 2007 is presented in Note 16 to the consolidated accounts Salaries, wages, and social security costs.
Remuneration of executive management
Aker Solutions’ guidelines for remuneration of executive management are presented in Note 18 to the consolidated accounts Salaries, wages, and social security costs. The guidelines are given to Aker Solutions’ Annual General Meeting each year as part of its processing of the annual accounts. Note 18 also provides details as to remuneration paid in 2007 to individual members of Aker Solutions’ executive management.
Information and communication
The company has prepared an Investor Relations (IR) policy, which is available at Aker Solutions’ website. Aker Solutions’ reporting of financial and other information is to be based on openness and on equal treatment of market participants. The purpose of Aker Solutions’ systematic IR work is to ensure the company’s access to capital at competitive terms and to ensure shareholders correct pricing of shares. These goals are to be accomplished through correct and timely distribution of information that can affect the company’s share price; the company is also to comply with current rules and market practices, including the requirement of equal treatment. All stock-exchange notices and press releases are made available on the company’s website www.akersolutions.com; stock exchange notifications are also available from www.newsweb.no. All information that is distributed to shareholders is simultaneously published on Aker Solutions’ website. The company’s financial calendar is found on page 4 in the annual report.
Takeovers
In light of Aker Solutions’ ownership structure, the Board has thus far not deemed it appropriate to prepare separate guidelines for takeover situations.
Auditor
The auditor participates in the Board meeting that deals with the annual accounts. Remuneration for auditors, presented in Note 7 to the consolidated accounts Other operating expenses, is separately stated for auditing and non-auditing services. The Board will evaluate whether guidelines should be established for executive management’s use of auditors for services other than auditing.
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