Nomination Committee Report

The Nomination Committee now consists of four members following the appointment of Dr. Kirby in September 2016. During the year, the Nomination Committee was chaired by Mr. Burgmans until he was succeeded by Ms. Baldauf, also in September. Mr. Burgmans continues to be a member of the Nomination Committee. The other member of the Nomination Committee is Mr. Verwaayen. The Nomination Committee held five meetings in 2016. The attendance record can be found in the attendance chart, shown under Report of the Supervisory Board.

Board of Management and executive succession

In 2016, following the review, assessment and discussion of the performance of Mr. Büchner as CEO, the Nomination Committee recommended to the Supervisory Board his nomination for reappointment as member of the Board of Management at the 2016 . The Nomination Committee was closely involved in the discussions around the CEO’s contract and provided the Supervisory Board with its recommendations on the final terms of Mr. Büchner’s engagement. At the 2016 AGM, Mr. Büchner was reappointed for a further four-year term.

The Nomination Committee also considered the topic of executive succession planning more generally. The Nomination Committee was consulted and gave their advice regarding the CEO’s appointment of Mr. Thierry Vanlancker as Executive Committee member responsible for Specialty Chemicals. The Supervisory Board approved the appointment of Mr. Vanlancker, who joined the company in October 2016 and succeeded Mr. Werner Fuhrmann as Executive Committee member responsible for Specialty Chemicals in February 2017.

Talent management and talent pool development

To supplement the Nomination Committee’s discussions on executive succession, the Nomination Committee was presented with talent management updates from Human Resources during the year. Both the Supervisory Board and the Nomination Committee also continued their work in defining and identifying a talent pool for future development and the purposes of executive succession planning.

Members of the company’s executive leadership visited a digital production facility. (photo)

Members of the company’s executive leadership visited a digital production facility as part of a day of external visits focused on digital innovation and exploring potential growth opportunities.

Supervisory Board succession

An additional aspect of the Nomination Committee’s work is reviewing the appointment schedule for the Supervisory Board itself and making relevant recommendations accordingly. In 2016, the Nomination Committee sought to more thoroughly detail the process which it engages for Supervisory Board succession planning. The Nomination Committee has therefore drawn up and recommended to the Supervisory Board the introduction of a Supervisory Board skills matrix. This matrix was adopted by the Supervisory Board and, together with the Supervisory Board profile, provides a foundation for the Nomination Committee in its review of the skills required on the Supervisory Board, the identification of gaps and the development of criteria for proposed nominations. In turn, they provide a guideline for nominations and recommendations to the shareholders. The Supervisory Board skills and profile can be found below.

Supervisory Board skills and profiles

 

A. Burgmans

S. Baldauf

P. Bruzelius

B. Grote

L. Hughes

P. Kirby

D. Sluimers

B. Verwaayen

Independent

Consumer Goods end-user segment

 

 

Industrial end-user segment

Buildings and Infrastructure end-user segment

 

 

 

 

 

 

Transportation end-user segment

 

(International) business, commerce, finance/economics

Scientific/Information technology experience

 

 

 

Public sector experience

 

 

 

 

 

 

Management experience

Business strategy planning

Manufacturing experience

 

 

 

Supply chain/logistics experience

 

 

 

 

Social, environmental or sustainability experience

Finance expert

 

 

Four or less external directorships

Dutch/EU national

 

Non-EU national

 

 

 

 

 

 

Post-retirement benefit experience

 

 

 

 

 

 

 

Business-to-business sales experience

 

 

 

 

R&D experience

 

 

 

Legal experience

 

 

 

 

 

 

Industrial/employment relations

 

 

 

 

 

Risk management

 

 

 

 

Consulting

The Nomination Committee’s analysis of the Supervisory Board profile and skills led to the nomination of Ms. Baldauf and Mr. Verwaayen for reappointment to the Supervisory Board at the 2016 AGM. The Nomination Committee also engaged an external search agency for the fielding of candidates for succession and nomination to the Supervisory Board. A rigorous search process is undertaken by the agency after first gaining a thorough understanding of the culture of AkzoNobel, its strategy, leadership roles and the competencies needed. Based on the results of the Nomination Committee’s gap analysis, discussions and the work of the external search agency, the Nomination Committee was able to recommend to the Supervisory Board the nomination of Dr. Kirby as a new Supervisory Board member at the 2016 . Following her appointment to the Supervisory Board, the Nomination Committee recommended the appointment of Dr. Kirby as a member of the Nomination and Remuneration Committees during the year.

During 2016, the Supervisory Board also dedicated time to consider the succession planning for key Supervisory Board positions, and to the consideration of the nomination of a Deputy Chairman of the Supervisory Board. Following an analysis of the current profiles and skills matrix of Supervisory Board members, the Nomination Committee recommended the appointment of Mr. Grote as Deputy Chairman of the Supervisory Board. This recommendation was endorsed by the Supervisory Board in October. Full details of the current Supervisory Board composition, the schedule of Supervisory Board succession and the profiles of the members can be found on our website.

Nomination Committee evaluation

As with the Remuneration Committee, the Nomination Committee undergoes an annual evaluation of its effectiveness and performance as part of the Supervisory Board evaluation. Once every three years (unless it is decided to do so more frequently), this evaluation takes the form of an independent external assessment of the Nomination Committee’s effectiveness and performance, facilitated by a specialist consultant.

In 2016, it was decided that the Nomination Committee would undergo this external evaluation with regard to the year 2015. This is the second year in a row in which the evaluation was undertaken externally. The external assessment provided a follow-up to the findings of the external assessment undertaken during 2015 with regard to the year 2014. As with the process that was adopted for the Supervisory Board as a whole, the evaluation consisted of a questionnaire, followed by a personal interview with an external consultant. Results of the evaluation were subsequently reviewed by the Nomination Committee and the Supervisory Board.

This evaluation found that the Nomination Committee continues to operate effectively. Areas highlighted for improvement will be taken forward in 2017.

AGM

Annual General Meeting of shareholders.

AGM

Annual General Meeting of shareholders.