2009
DSM has taken note of the amended Dutch corporate
governance code as published on 10 December 2008. In its 2009 annual report
DSM will include a chapter on the company’s compliance with the amended code
and present this chapter to the Annual General Meeting of Shareholders in 2010
for discussion as a separate agenda item. During 2009 DSM will review the code
and implement the amended principles and best practices where appropriate.
2008
DSM supports the 2004 Dutch corporate governance code
(Tabaksblat Code) and applies all but one of its 113 Best Practices. The only
exception is Best Practice III.5.11, which stipulates that the remuneration
committee shall not be chaired by the chairman of the Supervisory Board. DSM
considers remuneration to be an integral part of its nomination and retention
policy and hence of its human resource management policy for its senior
management. DSM therefore considers it desirable for the Chairman of the
Supervisory Board to be directly involved in preparing decisions taken by the
full Board, also in view of the role played by the Supervisory Board Chairman
vis-á-vis the Managing Board. This exception to the code was discussed in the
Annual General Meeting of Shareholders in 2005, where it met with no
objections. With respect to Best Practice provision II.1.7 it is to be
reported that in the course of 2007 Mr. Nico Gerardu, member of the Managing
Board, assumed the duties of chairman of the Supervisory Board of a listed
company. This is a temporary arrangement pending the appointment of a
successor as chairman of the Supervisory Board of this listed company.
With respect to the appointment of members of the Managing Board for a period
of at most four years (Best Practice II.1.1) it should be noted that DSM has
adhered to this Best Practice since the introduction of the corporate
governance code in 2004. Since DSM respects agreements made before the
introduction of said code, two current members of the Managing Board will
remain appointed for an indefinite period.
In respect to the Dutch corporate governance code it should be noted that any
substantial change in the corporate governance structure of the company and in
the company’s compliance with the code shall be submitted to the General
Meeting of Shareholders for discussion under a separate agenda item.
Annual General Meeting of Shareholders
On 25 March 2009 the
Annual General Meeting of Shareholders was held. The
agenda (PDF: 35 Kb) was to a large extent similar to that of previous
years. A special item on the agenda was a proposal to amend the Articles of
Association, amongst other things regarding the repurchasing (and retention)
of own shares by the company and in order to bring the Articles of Association
in line with recent changes in Dutch law, as well as a proposal to remove the
class cumulative preference shares C from the Articles of Association. All
resolutions that were tabled were passed.
One agenda item was removed from the agenda before the actual meeting. This
agenda item related to a proposal to adjust the remuneration policy for
members of the Managing Board and entailed a tightened up scheme for the
acquisition of share options and performance-related shares on the basis of
DSM’s total shareholder return. In the proposal, stock incentives could no
longer be acquired if performance fell below the median of the reference
group, whereas more stock incentives could be acquired for outstanding results
compared with the reference group. The total value of the stock incentives
under the new scheme would remain exactly the same as under the existing
system. This adjustment was exactly as requested by last year’s General
Shareholders Meeting.
In view of the social discussion and particularly because DSM wished to dispel
the impression that the members of the Managing Board would be rewarded
considerably more in future for their performance, it was decided to remove
this proposal from the agenda and therefore provisionally retain the existing
scheme for the acquisition of stock incentives on the basis of total
shareholder return. Click
here for the related press release on this subject.
DSM will further adjust its remuneration policy for the Managing Board on the
basis of the corporate values of the company and an appropriate balance
between the interests of the major DSM stakeholders. Adjustments will also be
made to comply with the revised Dutch Corporate Governance Code. In this
context, DSM will submit a proposal to the 2010 annual meeting for a revised
remuneration policy for the Managing Board, including a new scheme for the
acquisition of stock incentives on the basis of the total shareholder return.
