Investor Relations

 

Corporate governance

 

 

CORPORATE GOVERNANCE PRINCIPLES


P/F Bakkafrost Holding and Subsidiaries

(Adopted at Board meeting held on 29th January 2010. Guidelines Concerning Social Responsibility included in the CORPORATE GOVERNANCE PRINCIPLES 15th March 2011)

 


1. Principles of Corporate Governance
 

1.1 Introduction


P/F Bakkafrost Holding (the “Company”) is dedicated to maintaining high standards of corporate governance. The Company endeavors to be in compliance with the Norwegian corporate governance regime, as detailed in the Norwegian Code of Practice for Corporate Governance, published on 21 October 2009 by the Norwegian Corporate Governance Board (the “Code of Practice”).


The Company’s principles for corporate governance correspond with the Code of Practice. This document summarizes the key corporate governance principles of the Company.

 
To ensure adherence to the principles outlined in this summary, the Company has elaborated specific guidelines attached as appendixes:
 

-Appendix I: Instructions of procedure for the Board of Directors

 

-Appendix II: Instructions for the Nomination Committee

 

-Appendix III: Instructions for the chief executive officer and other management

 

-Appendix IV: Guidelines with regards to values and ethics

 

-Appendix V: Non-auditing work by the Company’s auditor

 

-Appendix VI: Investor Relations Policy

 

-Appendix VII: Guidelines relating to takeover bids

 

-Appendix VIII: Guidelines for related party transactions

 

-Appendix IX: Instructions for theaudit committee

 

-Appendix X: Guidelines Concerning Social Responsibility

 

 


1.2 Governance structure
 
The General Meeting

Through the General Meeting the shareholders exercise the highest authority in the Company. All shareholders are entitled to submit items to the agenda, meet, speak and vote at General Meetings.


The Annual General Meeting is held each year before the end of April. Extraordinary General Meetings may be called by the Board of Directors at any time. The Company’s auditor or shareholders representing at least 5 percent of the total share capital may demand that an Extraordinary General Meeting be called.


General Meetings are convened by the Board of Directors.

 

The General Meeting elects the members and Deputy Members of the Board of Directors, determines the remuneration of the members of the Board of Directors, approves the annual accounts, approves the Board of Director’s guidelines on management remuneration, approves the remuneration policy for Senior Management and decides such other matters which by law or the Company’s articles of Association are to be transacted at the General Meeting.



The Board of Directors

The Board of Directors has the overall responsibility for the management of the Company. This includes a responsibility to supervise and exercise control of the Company’s activities.

 

The proceedings and responsibilities of the Board of Directors are governed by a set of rules of procedure, attached as Appendix I to these Principles of corporate governance.

 

It is the Company’s intention that the members of the Board of Directors will be selected in the light of an evaluation of the Company’s needs for expertise, capacity and balanced decision making, and with the aim of ensuring that the Board of Directors can operate independently of any special interests and that the Board of Directors can function effectively as a collegiate body.

 

The majority of the shareholder-elected members of the Board of Directors shall be independent of the Company’s management and its main business connections. At least two of the shareholder-elected members of the Board of Directors shall be independent of the Company’s main shareholder(s). Members of the management shall not be members of the Board of Directors.

 

The term of office for members of the Board of Directors is two years.

 

 

Chief Executive Officer

The Chief Executive Officer is responsible for the day-to-day management of the Company. The Chief Executive Officer is responsible for ensuring that the Company's accounts are in accordance with existing Faroese legislation and regulations and other relevant laws, and that the assets of the Company are soundly managed.

 

The Chief Executive Officer is appointed by the Board of Directors and reports to the Board of Directors.

 

The powers and responsibilities of the Chief Executive Officer are defined in instructions adopted by the Board of Directors, see Appendix III to these Principles of corporate governance.

 
 

The Nomination Committee

According to its Articles of Associations the Company shall have a Nomination Committee. The Nomination Committee consists of 3 - 5 members. The members of the Nomination Committee, including the Committee Chairman are elected by the general meeting. Members of the Nomination Committee serve for two year periods.

 

The task of the Nomination Committee is to nominate candidates for election as members and deputy members of the Board of Directors and to make recommendations regarding the remuneration of the members of the Board of Directors.

 

Remuneration of the members of the Nomination Committee will be determined by the General Meeting.

 

 

Principles for the work and election of The Nomination Committee are enclosed as enclosed as Appendix II to these Principles of corporate governance and shall be presented to the General Meeting for approval.

 

 

1.3 Equal treatment
The Company has one class of shares. Each share in the Company carries one vote.
 

All shareholders shall be treated on an equal basis. The shareholders shall not be exposed to differential treatment that lacks a factual basis in the Company's and the shareholders' common interest.

 


1.4 Values and ethics

The Company aspires to create a sound corporate culture. Thus, the Board of Directors has resolved and adapted a code of conduct, cf. Appendix IV to these Principles of corporate governance.

 

 

1.5 Transferability

All shares in the Company are freely transferable.

 

 

1.6 Audit matters

The Board of Directors has resolved and approved guidelines for the Company’s Auditor and persons associated to the Auditor performing non-auditing work, cf. Appendix V to these Principles of corporate governance.

 

 

1.7 Audit Committee

The Company shall have an audit committee which shall be elected by and among the members of the Board of Directors. The guidelines for the Audit Committee are enclosed as Appendix VI.

 

 

1.8 Equity

The Company shall have a level of equity which is appropriate to its objectives, strategy and risk profile.

 

 

1.9 Investor Relations

The Company’s information policy shall be based on openness and equal treatment of all shareholders, see Appendix VII to these Principles of corporate governance.

 

 

1.10 Take-over policy

The Company shall have a take-over policy which ensures that all shareholders are treated equally and that the Company’s business activities are not disrupted unnecessarily, see Appendix VIII.

 

 

1.11 Related party transactions

Any related party transactions shall be carried out in accordance with applicable legislation and the Company’s internal guidelines. Guidelines for Related Party transactions are enclosed as Appendix IX.

 

 

 

APPENDIX I

 

INSTRUCTIONS OF PROCEDURE FOR THE BOARD OF DIRECTORS OF

 

P/F Bakkafrost Holding

 

(Adopted at a Board meeting held on 29th January 2010)

 

 

1. Purpose

1.1 The purpose of these Rules of Procedures is to lay down rules on the work and administrative procedures of the Board of Directors of P/F Bakkafrost Holding (the “Company”). Under § 56, stk. 7 of the Public Limited Companies Act, the Company has an obligation to adopt Rules of Procedure when the employees are represented on the Board of Directors.

 


1.2 To the extent permitted by law, the Board of Directors can decide to make exceptions from these Rules of Procedure.

 

 

2. Responsibilities of the Board of directors

2.1 Pursuant to Chapter 9 of the Public Limited Companies Act, the Board of Directors is responsible for the management of the Company. The responsibilities of the Board of include the following:

 
 

a.  The Board of Directors shall decide the overall strategy of the Company.

 

b. The Board of Directors shall ensure that the Company’s business activities are soundly organised.

 

c.  The Board of Directors shall supervise the Company's day-to-day management.

 

 

d.  The Board of Directors shall draw up plans and budgets for the Company's activities.

 

 

e.  The Board of Directors shall keep itself informed of the financial position of the Company, and shall be responsible for ensuring that the Company’s activities, accounts and asset management are subject to adequate control.

 

 

f. The Board of Directors shall initiate such examinations as it finds necessary for the performance of its duties. The Board of Directors must initiate such examinations if so demanded by one of its members.

 

 

g.  The Board of Directors shall appoint the Company’s Chief Executive Officer and approve his/her terms of employment.

 

h. The Board of Directors shall review the Chief Executive Officer’s statementson the Company's activities, positions and profit/loss development.

 

 

i.  The Board of Directors shall review and approve the Company’s annual accounts, and issue an annual directors’ report as required by the Accounting Act.

 

The Board of Directors shall monitor the level of the Company’s equity. If the equity is lower than may be deemed appropriate to its objectives, strategy and risk profile the Board of Directors shall take immediate action.

 

 

j.  The Board of Directors shall consider all matters of an extraordinary nature or of major importance to the Company.

 

 

k. Guidelines for remuneration of members of the executive management.

 

 

l.  The Board of Directors shall establish guiding principles for how it will act in the event of a take-over bid on the company. The Board of Directors shall not impede take-over bid bids for the Company’s activities or shares unless there are particular reasons for this.

 

m.  The Board of Directors shall establish an Audit Committee and resolve guidelines for such committee.

 

 

n. The Board of Directors must ensure that the Company has sound internal control and systems for risk management that are appropriate in relation to the extent and nature of the Company’s activities. Annually, the Board of Directors shall carry out a review of the Company’s most important areas of exposure to risk and its internal control arrangements.

 

 

o.  In the annual report, the Board of Directors shall provide an account of the main features of the Company’s internal control and risk management systems, as they relate to the company’s financial reporting.

 

p.  The Board of Directors shall assess their work and competence on a yearly basis. The assessment shall be discussed in a yearly meeting with the Nomination Committee.

 

 

3. administrative procedures

3.1 The Board of Directors shall once a year adopt schedules for the Board meetings. being held during the next twelve months.

 

 

3.2 The Chairman, or in his absence the Deputy Chairman or the Chief Executive Officer, shall convene the Board Meeting according to the schedule, or as they otherwise find necessary or desirable.

 

 

3.3 Each member of the Board of Directors and the Chief Executive Officer may demand that a Board meeting be convened to discuss specific matters.

 

 

3.4 Board meetings shall normally be convened by at least seven days' prior written notice. The notice shall include an agenda of the meeting and such documents which may be necessary to give the Board of Directors satisfactory grounds on which to base its discussion. However, the Chairman may, if necessary, decide to convene Board meetings by telephone and/or by shorter notice and/or to distribute relevant documents after the notice has been sent.

 

 

3.5 A member who is unable to attend a Board meeting shall notify the Chairman or the Chief Executive Officer as soon as possible. Upon receiving such notice the Chairman and/or Chief Executive Officer shall, if applicable, give notice to an alternate member of the Board of Directors to participate in the meeting.

 

 

3.6 The Board of Directors shall normally deal with matters at meetings. The Chairman may, however, decide that the Board of Directors shall deal with a matter by way of a telephone meeting or a video conference or in writing. However, each member of the Board of Directors and the Chief Executive Officer may always demand that a question be discussed at a meeting.

 

 

3.7 Board meetings shall be chaired by the Chairman, or in his/her absence, by the Deputy Chairman. If neither of these is present, the Board of Directors shall elect a chairman for the meeting.

 

 

3.8 The Board of Directors shall continuously consider whether it is in the Company’s interest to appoint Board committees for the preparations of Board matters..

 
4. Quorum - majority requirements

4.1 The Board of Directors constitutes a quorum if more than 3 members are present or participate in the discussion of the matter in question.

 

 

4.2 The adoption of a resolution by the Board of directors shall require that the majority of the members who have participated in the discussion of the matter have voted in favour of the proposal. In the event of a parity of votes, the chairman shall have the casting vote.

 

4.3 In connection with elections or appointments, the person who achieves the highest number of votes shall be regarded as elected or appointed.

 
5. Disqualification

5.1 A Board member may not participate in the discussion or decision of issues which are of such special importance to such Board member or to any related person of the Board member that he/she must be regarded as having a major personal or financial special interest in the matter.

 

 

5.2 A Board member may not participate in the discussion of a matter concerning a loan or other credit to himself/herself or on the furnishing of security for his/her debt. Loans or collateral may not be given to shareholders, Members of the Board or Directors.

 
6. Minutes of Board meetings

6.1 The Chief Executive Officer shall ensure that minutes are kept of the proceedings of the Board of Directors.

 

 

6.2 The minutes shall, as a minimum, state the time and venue of the Board meeting, as well as the participants, the proceedings and the resolutions adopted by the Board of Directors. If a resolution is not unanimous, it shall be stated who voted for and who voted against.

 

 

6.3 If a member of the Board of Directors or the Chief Executive Officer disagrees with a resolution, he/she may demand to have his/her view entered in the minutes.

 

 

6.4 Draft minutes shall be distributed to all members of the Board of Directors. Unless otherwise decided by the Board of Directors, the minutes shall be approved and signed at the next Board meeting. The minutes shall be signed by all members. If a resolution has been adopted at a meeting, the Board of Directors may however elect two members to sign the minutes, in which case a copy must be sent to all members with a deadline for comments.

 
7.The Board of directors' relationship with the general meeting

7.1 The Board of Directors shall call the annual general meeting of the Company, which shall be held not later than at the end of April.

 

 

7.2 The Board of Directors may at any time decide to call an extraordinary general meeting.

 

 

7.3 The Board of Directors shall call an extraordinary general meeting if so demanded by the Company’s auditor or shareholders representing at least ten percent of the total share capital. The Board of Directors shall ensure that the general meeting is called no later than two weeks after the demand being made and shall endeavour to call it no later than one month after.

 

 

7.4 The Board of Directors shall be responsible for the preparation of matters which are to be considered by the general meeting.

 

 

7.5 The Board of Directors shall be present at the Company’s general meetings.

 

 

7.6 The Board of Directors shall organise and summon for General Meetings in a way that enables the shareholders to exercise their rights and participate in General Meetings without unnecessary difficulties. Inter alia, the Board shall provide sufficient information in advance of such meetings.

 

 

7.7 No later than 8 days before the general meeting the minutes and the complete proposals in addition the annual report for the ordinary general meeting are to be tabled at the company office for the inspection of the shareholders and are to be sent to any shareholder who has requested it.

 

 

7.8 Issues which have not been put on the minutes may only be decided upon by the general meeting if all shareholders agree. This, however, does not apply in matters which according to the Articles of Associations are to be dealt with at the general meeting.

 
8. Duties of the chief executive officer

8.1 The duties of the Chief Executive Officer in relation to the Board of Directors shall be laid down in the instructions for the Chief Executive Officer.


9. duty of confidentiality

9.1 Members of the Board of Directors shall treat as confidential all non-public information and documents received from the Company in their capacity as Board members and all non-public information as to the proceedings of the Board of Directors. The members shall take the necessary steps to ensure that no unauthorised persons gain access to such information. The Board of Directors may decide to make exceptions from this duty of confidentiality.

 

 

9.2 Members of the Board of Directors shall not make any statements to the public or to unauthorised persons regarding matters which are dealt with by the Board of Directors and which are not publicly known.

 

 

9.3 Upon retiring from the Board of Directors, a member shall return or destroy (as the Board of Directors may instruct) all documents of a confidential nature received from the Company.

 

 

 

APPENDIX II

 

rules of procedure for the nomination committee of P/F Bakkafrost Holding

 

(Adopted by the Board of Directors of P/F Bakkafrost Holding 29th January 2010 based on the Articles of Associations § 9

 


 

1. Duties of the committee

 
1.1 The duties of the Nomination Committee are to nominate candidates to stand for election as members of the Board of Directors including the Chairman and Deputy Chairman, and to suggest the size of appropriate remuneration for the members of the Board. The Committee shall also nominate candidates for election to the Nomination Committee itself.

2. Election, remuneration and composition

 

2.1The Nomination Committee shall consist of 3 - 5 members being or representing share owners. The majority of members of the Committee must be independent from the Board of Directors and the executive management of the Company. Not more than one Committee member may be a member of the Board of Directors. The Chief Executive Officer and other members of the executive management of the Company may not be members of the Nomination Committee.

 

2.2The Members of the Nomination Committee, including the position as Committee Chairman are elected by the General Meeting on a two year basis. The members’ election periods shall deviate, to ensure member continuity.

 

 

2.3The General Meeting determines the remuneration for the Nomination Committee. The costs of the Committee are covered by the Company.

 

 

3.Rules of procedure

 

 

3.1The Nomination Committee constitutes a quorum when the Committee Chairman and at least one other member are present. In case 5 members are elected the chairman and at least two members must be present.

 

 

3.2Meetings in the Nomination Committee are held when summoned by the Chairman or when one other member, the Chief Executive Officer or the Chairman of the Board of Directors asks for a meeting.

 

 

3.3From each meeting, minutes should be written and signed by all the present members.

 

 

3.4The Chairman of the Board of Directors and the Chief Executive Officer shall, without having the right to vote, be summoned to at least one Committee meeting before the Committee issues its final decision.

 

 

3.5When performing its duties, the Nomination Committee shall monitor the need for any changes in the composition of the Board of Directors and be in contact with the different groups of shareholders, the members of the Board of Directors and the executive management. The Nomination Committee shall pay particular attention to the Board of Director’s annual report on its own performance. The Committee shall emphasize that the Board members are suitable for making independent considerations concerning the management and the business of the Company. A nominee must have accepted in advance to take the position as a Board member.

 

 

4. The recommendation of the nomination committee

 

 

4.1The recommendation of the Nomination Committee for the General Meeting concerning election of shareholder-elected Board members shall be distributed to the shareholders no later than two weeks before the relevant elections are to take place. The committee’s recommendation shall include relevant information on the candidates.

 

 

4.2 The Committee Chairman, or a person appointed by him, presents the recommendation for the General Meeting.

 


 

 

 

APPENDIX III

 

INSTRUCTIONS

 

FOR THE chief executive officer and other management OF

 

P/F Bakkafrost Holding

 

(adopted in a meeting of the Board of directors on 29th January 2010)

 


 

1.  PURPOSE

 

 

1.1  These instructions have been laid down by the Board of directors of P/F Bakkafrost Holding (the “Company”). The purpose of these instructions is to clarify the powers and responsibilities of the management of the company.

 

 

2. Powers and responsibilities of the management

 

 

2.1  The Management shall follow the guidelines and instructions issued by the Board of Directors.

 

 

2.2  The Chief Executive Officer is responsible for the day-to-day management of the Company.

 

 

2.3  The Chief Executive Officer represents the Company externally in matters which form part of the day-to-day management.

 

 

2.4  The day-to-day management does not cover matters of extraordinary nature or major importance.

 

 

2.5  The following matters shall always be decided by the Board of Directors:

 

 

2.6 The disposal or acquisition by the Company of assets with an aggregate value of more than DKR 5.000.000.

 

 

2.7  The conclusion by the Company of any contract with a contract value of more than DKR 20.000.000. However all salescontracts with higher value shall be done in cooperation with the Chairman of the board. The board of directors will be informed about each new contract latest on the next forthcoming board meeting.

 

 

2.8  The launching or settlement of any law suits or arbitration proceedings regarding an amount of more than DKR 5.000.000.

 

 

2.9 Any decision to take up a loan or issue a guarantee or provide security on behalf of any third party to an amount of more than DKR 5.000.000

 

 

2.10 The Chief Executive Officer is authorised to decide on matters of extraordinary nature or major importance in cases, including matters of the type listed in section 2.5, where the decisions of the Board of Directors cannot be awaited without this being of serious detriment to the Company. The Board of Directors must be notified of the decision as soon as possible.

 

 

2.11 The Chief Executive Officer shall ensure that the operations of the Company are carried out in accordance with all applicable laws and high ethical standards.

 

 

2.12 The Chief Executive Officer shall ensure that the Company's accounts are in accordance with existing Faroese legislation and regulations and other relevant laws, and that the assets of the Company are soundly managed.

 

 

2.13 The Management may not receive remuneration from any other party in connection with his work for the Company.

 

 

3. Duties towards the Board of directors

 

 

3.1 The Management shall ensure that the resolutions of the Board of Directors are carried out.

 

 

3.2 The Chief Executive Officer is responsible for, in co-operation with the Chairman of the Board of Directors, the preparation of matters which are to be considered by the Board of Directors. Such matters shall be prepared and presented in such a way that the Board of Directors has satisfactory grounds on which to base its discussion.

 

 

3.3 The Chief Executive Officer shall make a statement on the Company's activities, positions and profit/loss development to the Board of Directors at least every month.

 

 

3.4 The Board of Directors may at any time require the Chief Executive Officer to report to the Board of Directors on specific matters.

 

 

3.5 The Chief Executive Officer shall have a right and an obligation to participate in meetings of the Board of Directors, and to make comments, unless otherwise decided by the Board of Directors on a case-by-case basis.

 

3.6 The Chief Executive Officer shall report any excesses of the investment budget by more than 20% to the Board of Directors.

 

 

4. disqualification

 

 

4.1 The Chief Executive Officer may not participate in the discussion or decision of issues which are of such special importance to the Chief Executive Officer or to any person related to the Chief Executive Officer that he may be regarded as having a major personal or financial special interest in the matter.

 

 

4.2 The Management may not participate in the discussion of a matter concerning a loan or other credit to themselves or on the furnishing of security for his/her debt or any related person.

 

 

5. Duty of confidentiality

 

 

5.1 The Management shall treat as confidential all information regarding contractual relations, economical matters, technical appliances and production methods, corporate analyses and calculations, as well as other non-public affairs of the Company.

 

 


 

APPENDIX IV

 

GUIDELINES WITH REGARD TO VALUES AND ETHICS

 

Approved by the Board of P/F Bakkafrost Holding on 29th January 2010)

 

 

6. Introduction

 

 

6.1This code of conduct (the “Code”) has been resolved and adopted by the Board of Directors of the P/F Bakkafrost Holding (the “Company”). It is the intention that the Code shall also be resolved and approved by the Board of Directors in each subsidiary company within the Bakkafrost Group (the “Group”).

 

 

6.2The purpose of the Code is to create a sound corporate culture and to preserve the integrity of the Company by helping employees to promote standards of good business practice. Further, the Code is intended to be a tool for self evaluation and a vehicle for development of Company identity.

 

 

6.3The Code applies to members of the Board of Directors, the CEO, members of management and other employees in all companies in the Group, as well as others acting on behalf of Bakkafrost companies. Compliance with these guidelines is the responsibility of every employee of the Group.

 

 

7. Ethics

 

 

7.1The Company’s policy requires its directors and employees to observe high standards of business and personal ethics in the conduct of their duties and responsibilities. Directors and employees must practice fair dealing, honesty and integrity in every aspect in dealing with other employees, business relations and customers, the public, the business community, shareholders, suppliers, competitors and government authorities.

 

 

7.2When acting on behalf of the Company, Directors and employees shall not take unfair advantage through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or other unfair dealing practices.

 

 

7.3The Company’s policy prohibits unlawful discrimination against employees, shareholders, directors, customers and suppliers on account of ethnic or national origin, age, sex or religion. Respect for the individual is the cornerstone of the Company policy. All persons shall be treated with dignity and respect and they shall not be unreasonably interfered with in the conduct of their duties and responsibilities.

 

 

7.4No director or employee should be misguided by loyalty to the Company or desire for the Company profitability to disobey any applicable law or Company policy.

 

 

7.5Violation of Company policy will constitute grounds for disciplinary action, including, when appropriate, termination of employment.

 

 

8.CODE OF CONDUCT

 


Values


8.1.1 The Company strives to be a reliable partner achieved by quality operations, strict discipline, prioritising high quality solutions, predictable deliveries and a high level of service.

 

 

8.1.2 The Company shall act with a sense of urgency in all aspects of its business. This means that the Company shall meet commitments in the minimum time required, make decisions fast but based on facts, accept change and manage new challenges and also be proactive.

 

 

8.1.3 The Company shall strive to combine the forces of the group and employees and representatives in all jurisdictions, companies and areas of expertise in the Group. The Company shall view customers and suppliers as partners.

 

 

8.1.4 The Company shall exploit and develop skills in production, product development and management. In this respect, professionalism and use of best practice are key elements.

 

 

8.1.5 The Company focuses on core businesses. Hereunder, the Company shall be better at doing what it is best at and create value for its customers and the the Group through a constant focus on running a profitable business.

 

 

8.2 Rules and legislation

 

 

8.2.1 It is Company policy to comply with all applicable laws and governmental rules and regulations in the country in which it is operating. It is the personal responsibility of each of the persons to adhere to the standards and restrictions imposed by those laws, rules and regulations.

 

 

8.3 Work environment


8.3.1 The Company shall be a professional and positive workplace with an inclusive working environment.

 

 

8.3.2 The Company shall focus on excellence in operations and strive to apply a working methodology, which ensures a good and sound working environment. Among other things, this means that the Company shall systematically promote employee satisfaction, seek to attain an injury and accident free work place, optimise raw material and energy consumption and minimise waste.

 

 

8.3.3 The Company shall strive towards meeting, and preferably exceed, the requirements of all relevant legislation.

 

 

8.3.4 The Company has adopted a set of guidelines based on the highest health, safety and environment standards.

 

 

8.3.5 All employees shall help to create a work environment free from any discrimination.

 

 

8.3.6 The Company does not tolerate behaviour that can be perceived as degrading or threatening.

 

 

8.3.7 Neither the Company nor its business partners shall exploit children as a labour force.

 

 

8.4Relations with customers, suppliers, competitors and public authorities

 

 

8.4.1 Customers shall be met with insight, respect and understanding.

 

 

8.4.2 Suppliers shall be treated impartially and justly.

 

 

8.4.3 Public authorities shall be met in an appropriate and open manner.

 

 

8.4.4 The Company desires fair and open competition in all markets, both nationally and internationally. Under no circumstances shall the Company or any of its employees be part of actions that breach applicable competition legislation.

 

 

8.4.5 The Company is a firm opponent of corruption in any form (bribery, “facilitating” etc). No employee of the Company shall directly or indirectly offer, promise, give or receive bribe, illegal or inappropriate gifts or other undue advantages or remuneration in order to achieve business or other personal advantage.

 

 

8.4.6 The Company is a firm opponent to money laundering in any form. The Company will take the necessary steps in order to prevent its financial transactions from being used by other to launder money.

 

 

8.5 Pricing and taxes


8.5.1 The Company’s internal transfer prices are set in accordance with “arms length principles”. This means that the Company in principle operates its subsidiaries as independent companies, i.a. trade as if with a third party. This facilitates accounting and tax issues in the different entities.

 

 

8.6 Loyalty, conflict of interest and confidentiality

 

 

8.6.1 The Company will require all employees to be loyal to the Company, and to refrain from actions or to have interests that make it difficult to perform their work objectively and effectively.

 

8.6.2 All employees are responsible to notify the Board of Directors of a situation where he/she has a material direct or indirect interest in any transaction or other matter entered into by the company or binding on the company.

 

 

8.6.3 Conflicts of interests should be avoided. Should a conflict of interest arise, all employees will be required to evaluate the situation and notify the superior of the partiality or conflict of interest. A conflict of interest situation may involve, but are not limited to, customers, suppliers, contractors, present or prospective employees, competitors or relations.

 

 

8.6.4 All employees shall keep confidential all corporate and other matters that could provide third parties with unauthorised access to confidential information, and exercise caution when discussing internal affairs so as to avoid being overheard by unauthorised persons.

 

 

8.6.5 Only the CEO and the Chairman of the Board of Directors of the Company shall be entitled to make public statements on behalf of the Company.

 

 

8.7 Environmental issues

 

 

8.7.1 The Company shall strive to be market leading in environmental protection. All employees will be required to bear in mind the environmental effects work-related activities have on nature and the environment and apply environmentally friendly solutions to the extent reasonably possible.

 

 

8.8 Trading in the Company shares, accounting and reporting

 

 

8.8.1 Those of the Company’s employees who have information relevant to the pricing of the
Company shares in the exchange markets shall keep such information confidential and comply with applicable legislation and the Insider Trading Regulations of the Company.

 

 

8.8.2 The Company’s employees will only be entitled to trade in the Company shares in compliance with applicable legislation and the Insider Trading Regulations of the Company. All employees must familiarise themselves with applicable legislation and the Insider Trading Regulations of the Company before trading in the Company’s shares.

 

 

8.8.3 The Company shall establish accounting procedures, ensuring that all transactions are correctly registered in accordance with applicable laws and regulations. All employees will be required to follow the Company’s regulations concerning registration of transactions and proper documentation. All employees will be responsible for ensuring that business transactions are fully and correctly reported and documented and in accordance with generally accepted accounting practice.

 

8.8.4 The Company’s reporting shall in all material respects comply with applicable laws and regulations and be full, fair, accurate, timely and understandable.

 

 

8.9 Private interests and actions by employees

 

 

8.9.1 No employee of the Company should hold another position or carry out work for others during working hours without prior written permission from a supervisor.

 

 

8.10 Control and sanctions

 

 

8.10.1 As an integrated part of internal/external auditing, vendor assessment etc., the Company shall on a regular basis check that all aspects of the above guidelines are followed.

 

 

8.10.2 Any infringement of the Code should be raised immediately with a supervisor. If this is not possible, the infringement should be raised with a member of the Company’s Executive Management, or if applicable a member of the Board of Directors.

 

 

8.10.3 The Board of Directors of the relevant company within the Group shall take all action it considers appropriate, and investigate any violations of the Code reported to it. The respective Board shall, in respect of any not insignificant violations committed, also report to the Board of the Company.

 

 

8.10.4 If a violation has occurred, the relevant Board of directors or supervising manager shall take the necessary disciplinary and preventive actions, normally termination of employment, termination of supplier contract etc.

 

 



APPENDIX V

 

NON-AUDITING WORK by the company’s auditor

 

(Approved by the Board of Directors of P/F BakkafrostHolding on 29th January 2010)

 

1.

These guidelines have been adopted by the Board of Directors of P/F Bakkafrost Holding (the “Company”).

 

 

2.

These guidelines apply with respect to the statutory auditor of the Company from time to time (the “Auditor”).

 

 

3.

The primary task of the Auditor shall be to perform the audit work required by law and professional standards with the level of care, competence and integrity required by law and such standards. Assigning non-auditing work the Auditor or any affiliate of the Auditor may potentially create conflicts of interest and diminish the public confidence in the Auditor’s integrity and independence.

 

 

4.

Consequently, before assigning any non-audit work to the Auditor or any affiliate of the Auditor, the relevant decision-making body in the Company must make a careful assessment that the assignment a) is clearly in the best interest of Company and b) is not likely to jeopardise the Auditor’s integrity and independence in light of the following factors:

 

 

5.

Audit work should have the auditor’s top priority and performance of non-audit work must not be prioritized at the expense of audit work;

 

 

6.

Management must be comfortable that no conflict of interest will arise as a consequence of the Auditor performing both auditing and non-auditing work for the Company.

 

 

7.

References to “affiliates” of the Auditor shall include any entity controlling, controlled by or under common control with the Auditor and any partner, director or employee of the Auditor or any of the aforesaid.

 

 

8.

The Auditor’s fee for non-auditing work should normally be agreed in advance. Management must keep the Board of Directors informed of non-auditing work exceeding 50% of the auditing fee performed by the Auditor or its affiliates.

 

 

9.

The Auditor shall provide the Board of Directors with an annual written confirmation that it continues to satisfy the requirements for independence.

 

 

10.

The Auditor shall annually provide the Board of Directors with a summary of all services in addition to audit work that have been undertaken for the Company.



APPENDIX VI

 

INVESTOR RELATIONS POLICY

 

Approved by the Board of Directors of P/F Bakkafrost Holding on 29th January 2010

 

 

1. Communication with shareholders, investors and analysts is a priority for P/F Bakkafrost Holding (the “Company”). The Company’s objective is to ensure that the financial market and the shareholders have sufficient information about the Company to be certain that pricing reflects underlying values. Care will be taken by the Company to ensure an impartial distribution of information when dealing with shareholders and analysts. The Company will arrange open investor presentations in connection with the Company’s annual and quarterly reports. Presentations made for investors in connection with the annual and quarterly reports will be made available on the Company’s website. Important events affecting the Company will be reported immediately.

 

 

2. The Company shall present its annual accounts in April.

 

 

3. The Company will present its accounts on a quarterly basis, no later than 60 days after each quarter has ended.

 

 

4. All information will be given in English.

 

 

5. The Chief Executive Officer will be responsible for communication with shareholders outside the general meeting.

 

 

 

 

 

Appendix VII

 

Guidelines relating to take-over bids

 

Approved by the Board of Directors of P/F Bakkafrost Holding on 29th January 2010

 

 

1.1 In the event of a take-over bid being made for the Company, the Board of Directors will follow the overriding principle of equal treatment for all shareholders, and will seek to ensure that the Company’s business activities are not disrupted unnecessarily. The Board of Directors will strive to ensure that shareholders are given sufficient information and time to form a view of the offer.

 

 

1.2 The Board of Directors will not seek to prevent any take-over bid unless it believes that the interests of the Company and the shareholders justify such actions. The Board of Directors will not exercise mandates or pass any resolutions with the intention of obstructing any take-over bid unless this is approved by the General Meeting following the announcement of the bid.

 

1.3 If a take-over bid is made, the Board of Directors will issue a statement in accordance with statutory requirements and the recommendations in the Code of Practice.

 

 

1.4 In the event of a take-over bid, the Board of Directors will consider obtaining a valuation from an independent expert. If a major shareholder, any member of the board or executive management, or related parties or close associates of such individuals, or anyone who has recently held such a position, is either the bidder or has a particular personal interest in a take-over bid, the Board of Directors will arrange for an independent valuation.

 

 

1.5 Any transaction that is in a significant effect a disposal of the Company’s activities will be submitted to the General Meeting for its approval.

 



Appendix VIII

 

Guidelines for related party transactions

 

Approved by the Board of Directors of P/F Bakkafrost Holding on 29thJanuary2010


 

 

 

1.1 Members of the Board of Directors and the executive management shall notify the Board of Directors c/o the Chairman in writing if they have any material direct or indirect interest in any transaction entered into by the Company.

 

 

1.2 Members of the Board of Directors and the executive management who have an interest in any transaction entered into by the Company shall refrain from participating in considering such transaction.

 

1.3 The Board of Directors shall consider the need for shareholder approval of any related party transaction or the Company’s internal guidelines.

 

 

1.4 To the extent shareholder approval is not required, the Board of Directors shall nonetheless consider whether it is appropriate to obtain independent third party valuations of any materially related party transaction.

 

 

1.5 All transactions between related parties shall be executed according to arm´s length principles.

 

 


Appendix IX

 

Instructions for the Audit Committee

 

Approved by the Board of Directors of P/F Bakkafrost Holding on29th January 2010

 


1. Role

 

The Audit Committee is a subcommittee of the Board of Directors of P/F Bakkafrost Holding (the ”Company”) and it shall act as a preparatory body for the Board of Directors and support the Board in the exercise of its responsibility for financial reports, audits, internal control and overall risk management.

 

 

The Committee is responsible to the full Board of Directors of the Company. The liability of the Board and each individual director is not altered as a result of the Audit Committee's work.



2. Composition

 

The members of the Audit Committee shall be elected from among Board Members by the Board of Directors.

 

 

The Audit Committee shall be composed of at least three]of the members of the Board of Directors. The Audit Committee shall be composed so that it can act independently of special interests and it shall collectively have the expertise required to perform the Audit Committee's role, based on the Company's organisation and business operations. At least one of the members shall be independent from the business and have accounting expertise.

 

 

The independent auditor shall normally participate in the meetings.

 

3. Meetings

 

The Audit Committee meets as frequently as it finds necessary, but at least quarterly. The Committee shall draw up an annual meeting schedule. At least once a year, the Committee shall have separate meetings with the independent auditor and the CEO, respectively.

 

4. Authority

 

The Audit Committee has the authority to investigate all aspects of the Group's operations. All employees of the Group are to provide any information and assistance requested by the Committee. The Committee can contract external expertise as needed.

 

 

5. The Audit Committees duties and responsibilities

 

 

5.1 Financial reporting

 

In connection with the presentation of the annual financial statements/Directors’ Report, half-yearly financial statements and the quarterly financial statements, the Committee shall discuss material issues related to accounting with management and the independent auditor and otherwise prepare the Board of Director’s discussions.

 

 

5.2 Relationship to the independent auditor

 

 

In relation to the independent auditor, the Committee shall:

 

 

· ensure that the independent auditor acts independently relative to management, including ensuring compliance with current rules and decisions regarding the purchase of additional services from the auditor;

 

 

· discuss with the auditor the plans for the audit, including risk assessment and the scope of the audit;

 

 

· assess for and nominate to the Board of Directors an independent auditor for election by the Group and the auditor's remuneration;

 

 

· assess for and make recommendations to the Board of Directors regarding financial parameters and the nature of the assignment insofar as planned and anticipated additional services from the independent auditor are concerned;

 

 

· review the independent auditor's reports to the Board; and

 

 

· review letters from the independent auditor to the corporate management board and management's answer.

 

 

 
 

5.3 Other duties


In addition to the duties mentioned above, the Audit Committee shall:

 

 

· review the Group's routines for overall risk management and internal control, including;

 

 

o a) reviewing management's procedures for dealing with risk management and the follow up of risk; and

 

 

o b) evaluating the procedures for dealing with operational risk relative to the financial risk (risk management systems);

 

 

· review all transactions between the Company and related parties, including members of the Board of Directors and the management of the Company and other Group companies;

 

 

· monitoring compliance with current rules of conduct and the guidelines for the Company's operations and reporting;

 

 

· assess other matters as identified by the Board of Directors or which the Committee itself or the auditors wishes to address; and

 

 

· at least once a year, assess its own work and propose potential improvement measures, including amendments to these instructions.

 

 

 

 

6. Relationship to the Board of Directors and reporting

The Audit Committee provides oral reports to the Board on any critical matters at the first Board meeting after each meeting of the Audit Committee. Beyond this, the full Board of Directors shall regularly receive reports from the Committee. The minutes of the meetings of the Audit Committee are to be available to the directors.

 

 

Otherwise, the Committee shall not take decisions on behalf of the Board of Directors, but shall present its assessments and recommendations to the Board.

 



Appendix X

 

Guidelines Concerning Social Responsibility

 

Approved by the Board of Directors of P/F Bakkafrost Holding on15th March 2011

 
 

SOCIAL RESPONSIBILITY

The activities of the company have both direct and indirect impact on society. During execution of its activities the company seeks to avoid negative impacts on its surroundings. The company must therefore include social and environmental concerns in connection with preparation of its strategy. The company must likewise in executing its daily operation to the greatest extent possible seek to avoid harmful impacts on society and the environment.

 

 

Bakkafrost must appear a responsible operator in society. The company is to aim at operating a sustainable business within sea farming. The company must likewise aim at value adding its products thus participating in generating larger values to society.

 

 

Bakkafrost must seek to create values through a profitable operation, both locally, nationally and internationally. The company is to aim at obtaining the greatest possible return of its capital, while contributing means to necessary research, and the company must seek to promote activities for the development of new products and markets.

 

 

Bakkafrost must seek to create good surroundings for the local community in which the company is operating. The company is to aim at using local resources as well as local labour. The company is to donate money to local arrangements consisting of among other things financial support through sponsorship agreements.

 

 

The values and ethical guidelines of the company require all employees to have a conscious relationship to the company’s responsibility to society. This requires the company’s employees to demonstrate a high personal morality in executing their assignments for the company.

 

 

The management of the company as well as the employees must act in a just, honest manner and with personal integrity towards other employees, business contacts, competitors and public authorities. The management of the company as well as the employees must seek to create a work environment where nobody is discriminated.

 

ENVIRONMENT

Bakkafrost is to operate a sustainable business. The goal of the company is to reduce the company’s impacts on the environment. All employees are strongly emphasised to demonstrate a responsibility towards the environment and must be held liable to having necessary knowledge of which environmental dangers go with the operation of the company as well as the necessary knowledge of how these dangers can be reduced. The company must to the greatest extent possible seek to develop and apply environmental solutions.