Corporate Governance
Rockwool International A/S’ (RI) corporate governance charter consists of a framework of principles and rules, including the Articles of Association, Business Procedures for the Board of Directors and Management Instructions for “the Direktion”, and is in accordance with the more general values and business rules used in the Group, called People & Brands and Principles of Leadership. The Group Management in cooperation with the Board of Directors reviews these principles and rules regularly in the light of prevailing best practices.
Pursuant to the provisions of the Danish Companies Act and RI’s Articles of Association, the supervision and direction of RI is divided among the Group Management and the Board of Directors (Board) and the General Meeting of shareholders.
Group Management
Group Management is responsible for the day-to-day management of the company. It consists of the President / CEO and nine other executives. Three Executives including the CEO are registered as “Direktion” according to Danish Law.
The Board appoints Group Management members and determines their remuneration. The chairmanship – consisting of the Chairman and the Vice-Chairman, together with the CEO, identify successors to executives, who are then presented to the Board for approval.
The Board
The Board decides on matters of substantial importance for the Group’s activities. Such matters include decisions on strategic guidelines, approval of periodic plans, and decisions on major investments and divestments.
An important part of the Board’s work is monitoring the risk factors associated with the company’s operations. The boards of all Rockwool companies are charged with gaining an overview of the main risks associated with their activities, which can then be consolidated into a Group risk profile for regular evaluation.
Members elected by the General Meeting are elected for a period of one year.
When members are elected to the Board, emphasis is given to candidates’ ability to contribute to the Group’s strategic development. Board members with good knowledge of the market, in which the Group operates, are prioritised.
The members of the Board appointed by the General Meeting currently comprise six persons, five Danes and one Dutchman. Board members must step down at the first General Meeting following their 70th birthday. Additional members are elected by employees in accordance with Danish legislation.
The Board appoints its Chairman and Deputy Chairman from among its members. Both are appointed for one year at a time.
The Board has established two committees: an Audit Committee and a Compensation Committee. The preparatory activities of the committees have made the Board work more efficient.
The Board met on five occasions in 2007. Meetings are held in English.
As described in the extensive review of Corporate Governance in the Rockwool Group on www. rockwool.com, the Board made in the start of 2007 an evaluation of the Board and another evaluation of Top Management. The result was that the Board is working and cooperating with management in a professional way. Some suggestions for changes were made, which might lead to further improvements
General Meeting and shareholders
The company’s share capital is made up of two classes of shares: A shares (59.5% of the capital) carrying ten votes each, and B shares (40.5% of the capital) carrying one vote each. Removing the distinction between these share classes is not currently on the agenda. Given the interesting but capital-intensive growth opportunities that the Group is set to encounter over the next few years, these two share classes provide the platform for the long-term planning that can best create shareholder value.
The company’s Board and Group Management are not aware of the existence of any shareholders’ agreements containing pre-emption rights or restrictions in voting rights.
The Rockwool Foundation – the company’s biggest shareholder with 23% of the share capital – works to the benefit of society, but also takes due consideration to the long-term interests of the company. RI Board member Tom Kähler and one of the three employee-elected members, Connie Enghus, are also board members of the Rockwool Foundation.
As mentioned in the Prospectus from 1995, an agreement exists between certain members of the Kähler family to the effect that they are to meet regularly to coordinate the family’s interests in the company, including their voting strategy at the company’s General Meetings, although the agreement does not require them to vote jointly. Tom Kähler and Thomas Kähler – both members of the Board – participate in these meetings.
