Aker Solutions’ goal is to ensure the greatest possible value creation over time, based on good corporate governance. Aker Solutions’ corporate governance principles establish an appropriate division of roles and responsibilities among the company’s owners, its Board of Directors, and its executive management. The following presents Aker Solutions’ practices regarding each of the recommendations contained in the most recent version of the Norwegian Code of Practice for Corporate Governance. Deviations from these recommendations are explained under the appropriate Code heading.
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. Aker Solutions’ corporate governance principles also help ensure that the group’s 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. The corporate governance policy has been prepared by the Board of Directors of Aker Solutions ASA. The principles are based on the Norwegian Code of Practice for Corporate Governance, dated 4 December 2007. The following presents Aker Solutions’ practices regarding each of the recommendations contained in the Code of Practice.
Our values
The Board has approved and adopted Aker Solutions’ corporate values, which are presented on page 10 of 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 business activities.” 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. The group’s financial goals and main strategies are presented in this annual report.
Equity and dividends
The group’s equity as of 31 December 2008 amounted to NOK 8 605 million, which corresponds to an equity ratio of 20.1 percent. Aker Solutions ASA regards the current equity structure as appropriate and adapted to the group’s objectives, strategy, and risk profile. Aker Solutions ASA’s dividend policy is discussed in the section Share and shareholder information, see page 126 of the annual report. The group’s dividend policy is among the factors considered in preparing the Board’s proposal for allocation of profit for 2008.
Board authorisations
The Board’s proposals for future Board authorisations are to be limited to defined issues and are to remain in force until the next annual shareholders’ meeting. The current Board authorisation to acquire company (treasury) shares is also presented in the section Share and shareholder information on page 126 of the annual report.
Equal treatment of shareholders and transactions with related parties
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’ preemptive rights are waived upon an increase in share capital, the Board must justify the waiver. Transactions in own (treasury) shares are executed on the Oslo Stock Exchange or by other means at the listed price. Aker Solutions ASA has prepared guidelines designed to ensure that members of the Board of Directors and executive management notify the Board of any material direct or indirect interest they may have in agreements entered into by the group. Aker ASA owns 60 percent of the shares in Aker Holding AS; as of 31 December 2008, Aker Holding owned 40.27 percent of Aker Kværner ASA (now Aker Solutions ASA) stock. The Norwegian parliamentary bill St.prp. no. 88 (2006–2007) provides further 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 group and various other companies associated with Aker ASA. For example, there is major potential in joint projects between Aker Solutions and other Aker companies that serve the oil and gas industry. Aker Solutions ASA is not regarded as a related party, under the Norwegian Public Limited Liability Companies Act, with regard to Aker ASA or companies in which Aker ASA has ownership interests. Nevertheless, the Board and management of Aker Solutions are keenly aware that Aker Solutions must conduct relations with Aker companies at arm’s length. Further, transactions of a certain size between Aker Solutions ASA and Aker group 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 Related parties to the consolidated accounts.
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. Holding Annual General Meetings as soon as possible after year-end is a priority. 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, and to distribute these documents to shareholders with known addresses within the deadlines set forth in the Norwegian Public Limited Liability Companies Act. The deadline for shareholders to register to attend is set as close to the date of the meeting as possible. Shareholders who are unable to attend the meeting in person may vote by proxy. Further information on procedures for registration and proxy voting is provided with the meeting notice and registration and proxy forms. Pursuant to Aker Solutions’ articles of association, the Board Chairman or another person appointed by the Board Chairman chairs Annual General Meetings. To the extent possible, Board members, the nomination committee chairman, and the company’s auditor attend Annual General Meetings. The nomination committee focuses on composing a Board that works as a team and on selecting Board members whose experience and qualifications complement each other. Thus, typically, the Annual General Meeting is invited to vote for the Board as a whole. Minutes of Annual General Meetings are published as soon as practical 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 its articles of association. The nomination committee comprises no fewer than three members, who normally serve for two years. 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. The members and chair of the nomination committee are elected by the company’s Annual General Meeting, which also determines their remuneration. Pursuant to the articles of association, the nomination committee recommends candidates for election to the Board of Directors. The nomination committee also makes recommendations as to the remuneration of Board members. The composition of the nomination committee is presented under the section Share and shareholder information in the annual report. The nomination committee is to provide written justifications of its recommendations.
Board composition and independence
Under an agreement with employee representatives the company does not have a corporate assembly, which is provided for under Norwegian law. Employees’ rights to representation and participation in decision making have been secured through extended employee representation on the Board of Directors, among other measures. Pursuant to the company’s articles of association, the Board comprises from six to 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 nomination committee’s recommendations generally propose an appointment for Board Chairman; the Board Chairman is elected by shareholders at the Annual General Meeting. The Board elects its Deputy Chairman. Board members are elected for a two-year period. The majority of shareholder-elected Board members are independent of Aker Solutions’ executive management and key business associates. Further, no fewer than four of the shareholder-elected Board members are independent of the company’s largest shareholder. The current composition of the Board and the Board members’ expertise, capabilities, and independence are presented on page 136 of the annual report. Board members’ shareholdings are presented in note 18 Salaries, wages, and social security costs to the consolidated accounts. The company encourages Board members to own Aker Solutions stock. The shareholder- elected Board members have a broad range of expertise, capabilities, and experience from finance, industry, and non-governmental organisations. Three of the shareholder-elected Board positions are up for election in 2009. The nomination committee’s recommendations and accompanying justification will be published on the company’s website and via the Oslo Stock Exchange’s message service, www.newsweb.no, as soon as it is available.
The work of the Board of Directors
The Board annually adopts a plan for its work, emphasising goals, strategy, and execution. Further, 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, notice and chairing of Board meetings, decision making, the President & CEO’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 control procedures and systems to ensure unified and reliable financial reporting. Each of the group’s business units must annually evaluate its internal control systems and financial reporting procedures. The group also regularly conducts internal audits of individual units’ adherence to systems and procedures. The Board receives reports on the company’s financial performance and status reports on the group’s most important individual projects on a monthly basis. Page 58 of the annual report presents a more detailed description of the management of operational and financial risks associated with the group’s business activities.
Board remuneration
Remuneration paid to Aker Solutions’ Board of Directors reflects the Board’s responsibilities, expertise, time spent, and the complexity of the business. Remuneration is not profit-dependent. Additional information on remuneration paid to Board members for 2008 is presented in note 18 to the consolidated accounts.
Remuneration of executive management
The Board has adopted guidelines for remuneration of Aker Solutions’ executive management in accordance with the rules and regulations of section 6-16a of the Norwegian Public Limited Liability Companies Act. Aker Solutions ASA does not have stock option plans or other share award programmes for employees for 2008, but a share purchase programme has been initiated for 2009. Further details are available on the company’s website. Note 18 to the consolidated accounts provides further details as to remuneration paid in 2008 to individual members of Aker Solutions’ executive management. The company’s guidelines for remuneration of executive management are discussed in note 18 to the consolidated accounts, and are presented to the Annual General Meeting.
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 long-term purpose of Aker Solutions’ systematic IR work is to ensure the company’s access to capital at competitive terms and correct pricing of shares for shareholders. These goals are to be accomplished through accurate and timely distribution of information that can affect the company’s share price; the company also complies 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 endeavors to hold public presentations of its financial reporting; such presentations are often broadcast simultaneously via the Internet. Aker Solutions’ financial calendar is published on the company’s website.
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 makes an annual presentation of its plan for auditing work to the Board. Further, the auditor has provided the Board with a written confirmation that the requirement of independence is met. The auditor participates in the Board meeting that deals with the annual accounts, and the auditor has reviewed the company’s internal controls with the Board. The Board of Directors has been given the opportunity to meet with the auditor without the company’s executive management present; however, no such meeting has been requested. The Board has not deemed it necessary to introduce guidelines for executive management’s use of auditors for services other than auditing. However, the Board receives an annual overview of services other than auditing that have been supplied to the company. Remuneration to auditors for auditing and other services is presented in note 7 Other operating expenses to the consolidated accounts. Such data and the selection of the auditor for the 2009 accounting year are also presented to the Annual General Meeting.
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