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The Supervisory Board hereby submits to shareholders the financial statements and the report of the Board of Management of Akzo Nobel N.V. for the financial year 2010, as prepared by the Board of Management and approved by the Supervisory Board in its meeting of February 2011. The 2010 financial statements were audited by KPMG Accountants N.V. and the Auditor’s report appears on page 136. The financial statements were discussed extensively with the auditors by the Audit Committee, and in the presence of the Chairman of the Board of Management (CEO) and the Chief Financial Officer (CFO). In addition, the 2010 financial statements were discussed by the full Supervisory Board with the full Board of Management, in the presence of the auditors. Based on these discussions, the Supervisory Board is of the opinion that the 2010 financial statements of Akzo Nobel N.V. meet all requirements for correctness and transparency, and that they form a good basis to account for the supervision provided. We recommend that the Annual General Meeting of shareholders adopts the 2010 financial statements as presented in this 2010 Report. We recommend the Annual General Meeting of shareholders to resolve that the total dividend for 2010 on each of the common shares outstanding will be €1.40, and that this amount, less the interim dividend of €0.32 – which was paid in November 2010 – will be payable on May 10, 2011. In addition, we request that shareholders discharge the members of the Board of Management of their responsibility for the conduct of business in 2010 and the members of the Supervisory Board for their supervision of management. Supervisory Board activitiesThe Supervisory Board met six times during 2010, including a one-day meeting fully dedicated to the company’s strategy. All meetings were plenary sessions with the full Board of Management present. With the exception of two meetings, all Supervisory Board members attended all the Supervisory Board meetings. In addition, a separate meeting was held – attended in part by the CEO – during which the Supervisory Board conducted a self-assessment and appraised its committees, working methods, procedures and performance, as well as evaluating the functioning of the Board of Management and its members. The Supervisory Board also assessed its relationship with the Board of Management and discussed the composition of the Supervisory Board and its committees. For this purpose, questionnaires were sent to the Supervisory Board. The answers were used as a framework for the evaluation discussion. This discussion was minuted and the conclusions and actions were discussed and confirmed at the next meeting of the Supervisory Board. The Chairman of the Supervisory Board prepared the meetings with the assistance of the CEO. During 2010, the Supervisory Board again devoted considerable time to discussing the company’s strategy and reviewing strategic options with the Board of Management. This included detailed discussions on objectives, associated risks and the mechanisms for controlling financial risks. Furthermore, the Supervisory Board discussed sustainability on a number of occasions, in the broader sense, but also specifically in relation to the Values part of the company’s medium-term strategy (for example safety) and the significant effort being put into talent development. Other topics included:
Regular agenda items included financial and operational performance, share price development, operational planning, course of business and the annual financing and investment plan. Business unit Managing Directors and Staff Directors are regularly invited to give presentations to the Supervisory Board. In September 2010, the full Supervisory Board and Board of Management met in the UK. The visit included meetings with local management, customers and other stakeholders, as well as a tour of AkzoNobel’s Slough site. The Board of Management keeps the Supervisory Board regularly informed of intended organizational changes and appointments of senior managers. One of the main topics for the Supervisory Board meeting in November 2010 was human resources, including succession planning. Composition and profile of the Supervisory BoardThe Supervisory Board – which currently consists of eight members – aims for an appropriate level of experience among its members in marketing, manufacturing, finance, economics, sustainability, human resources and other aspects of international business. Consequently, the current members have a diverse and appropriate mix of knowledge and experience of the markets in which AkzoNobel operates, as well as insights from different markets and non-operational areas. A further aim of the Supervisory Board – which its members believe is currently being met – is that at least one-third of the membership should meet the diversity criteria of gender (female) and/or nationality (outside of the European Union). This is in compliance with provision III.3.1 of the Dutch Corporate Governance Code, which ensures that its composition better reflects both society at large and the markets in which the company operates. In the Supervisory Board’s view, the Code’s provision III.2.1 (regarding independence) has been fulfilled. The terms of office of Mr. Bufe and Mrs. Bruzelius expire on May 1, 2011. Mr. Bufe and Mrs. Bruzelius are available for reappointment. It will be proposed at the 2011 Annual General Meeting of shareholders that Mr. Bufe and Mrs. Bruzelius be reappointed for a third and second term of four years respectively. Audit CommitteeThe Audit Committee consists of three members and is chaired by Mr. Van den Brink. Six meetings were held during 2010. As a rule, the CEO, the CFO, the Corporate Director Control, the internal auditor and the lead partner of the external auditor, KPMG, attend all regular meetings. After every Audit Committee meeting, the three members hold a separate meeting with only the internal auditor present, and one meeting with only the external auditor present. In addition, the Audit Committee met once without members of the Board of Management being present to conduct a self-evaluation and appraise performance. Discussions regularly focus on financial statements, internal and external control procedures, risk management, internal auditing reports, planning, tax, pensions and the external auditor’s performance and independence. Before each announcement of the company’s quarterly results, the Audit Committee was informed of the figures and consulted on the reports and press releases to be published. The Audit Committee also discussed topics including:
Issues discussed in Audit Committee meetings are reported back to the full Supervisory Board in subsequent meetings of this Board. Remuneration CommitteeThe Remuneration Committee consists of four members and is chaired by Mr. Burgmans. Four meetings were held in 2010. Recommendations were made on the remuneration and remuneration policy for members of the Board of Management and Executive Committee, including personal targets. Information on the remuneration of the Board of Management and the Supervisory Board can be found in the Remuneration report and in note 23 of the Financial statements. Nomination CommitteeThe Nomination Committee consists of four members and is chaired by Mr. Vuursteen. Three meetings were held in 2010. During the year, proposals were made for the reappointment of Mr. Bufe and Mrs. Bruzelius to the Supervisory Board. The Supervisory Board wishes to thank the Board of Management, as well as all employees, for their dedication and hard work for the company in 2010. Amsterdam, February 16, 2011 |
Main 2010 activities
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