Corporate governance
NHST Media Group tries to follow the recommendations of the Oslo Stock Exchange with regard to good corporate governance and company management. An account of central factors and any departures follows.
Every business depends on good relations if it is to succeed. A good reputation and good financial development are prerequisites for building and maintaining confidence among important target groups such as shareholders, customers, employees, suppliers, partners and public authorities. This requires the company to be run using good control and management mechanisms. Open, honest communication and equal treatment of the company’s shareholders are also important when it comes to increasing shareholder value and inspiring confidence. The company has annual rolling four-year strategic plans, an annual budget and comprehensive rules for journalism activities, as well as providing supplementary information in the annual report on other matters relating to corporate governance and company management. In addition, the company has rules for the Board of Directors and the CEO. See also the rest of the account.
OPERATIONS
The objectives of the company are set out in the Articles of Association,
while its goals and strategies are described in the annual report.
EQUITY
NHST Media Group AS has share capital of NOK 12,879,250. Equity stood at NOK
110,300,840 on 31 December 2009, i.e. an equity interest of 28.1 %. The
equity interest for the group was 28.1 %.
DIVIDEND
NHST endeavours to be financed through equity and aims to offer a competitive
return on its shares in the form of price rises and dividends. When
assessing the size of the dividend, the Board of Directors attaches
importance to the company’s dividend capacity, the requirement for adequate
equity and the need to have sufficient financial resources for future
development. No dividend is being proposed for 2009 on account of the need
to boost the company’s financial capacity.
SHARE ISSUES
In June 2009 NHST Media Group AS had a successful share issue, which raised
NOK 50 million. No further share issues have been proposed.
TREASURY SHARES
Holdings of treasury shares were unchanged in 2009. The holding consists -of
44,752 treasury shares.
EQUAL TREATMENT OF SHAREHOLDERS AND TRANSACTIONS WITH RELATED PARTIES
The company’s General Meeting is open to all approved shareholders and all
approved shares carry equal voting rights. All shareholders may attend in
person or by proxy. It is not possible to attend and/or vote via the
Internet. There are no known shareholders’ agreements. The General Meeting
is convened with the statutory minimum notice.
FREE NEGOTIABILITY
There is just one class of shares and each share carries one vote at the
General Meeting. The shares are freely negotiable, though the Board of
Directors may refuse to allow a share transfer on reasonable grounds. The
right to refuse consent for the acquisition of shares is based on the need
for editorial and commercial -independence.
GENERAL MEETING
The documents for the General Meeting, including the recommendations of the
election committee, are sent to shareholders no less than two weeks before
the General Meeting is held. Importance is attached to the documents
containing the information necessary for the shareholders to be able to
decide on the business on the agenda. According to the Articles of
Association, the Chairman of the Board of Directors chairs the General
Meeting.
COMMITTEES
In 2009, in addition to an internal -committee for elections, the Board used a
subcommittee to look at matters to do with group financing. The nomination
committee was elected by and from among the members of the Board of
Directors for reasons of expediency. - The group has a compensation
committee consisting of 3 Board Members.
CORPORATE ASSEMBLY AND BOARD OF DIRECTORS – COMPOSITION AND INDEPENDENCE
NHST Media Group AS does not have a corporate assembly.
NHST Media Group aims to balance the composition of its Board of Directors so that it takes account of expertise, experience and background relevant to the company’s activities and represents the composition of shareholders. The company’s management is not represented on the Board of Directors. There are no family ties with the General Manager or other senior employees. Performance-related directors’ fees are not used. The Board of Directors normally consists of five representatives elected by shareholders. All representatives are elected for two years at a time on a rotating basis. Three of the Board Members elected by shareholders have direct or indirect shareholdings in the company (see note 16). None of the Board Members has significant business relations with the company.
WORK OF THE BOARD OF DIRECTORS
The Board of Directors receives a monthly complete income statement and a
management report describing developments in the past month. The company’s
strategy is discussed on a broad basis at an extended Board Meeting every
year. There is also a rotating review of subsidiaries at individual Board
Meetings. The work of the Board of Directors is evaluated annually.
RISK MANAGEMENT AND INTERNAL CONTROL
The group is exposed to various types of financial risk linked to ordinary
operations. In the short term this involves unpredictable advertising
markets in particular. There is also a financial risk associated with
technical business interruption and distribution. The group therefore has
comprehensive systems in place to deal with such a situation. The group is
exposed to risks associated with operations in foreign currency. During the
year the risk has been limited and is managed by means of established
routines and internal control. In addition, there is continuous assessment
of whether to hedge net anticipated liquidity surpluses
in foreign currency. Hedging as at 31 December is described in detail in the notes to the accounts. The group has a relatively diversified customer portfolio and therefore runs a credit risk on these.
During 2009 the group focused on outstanding receivables and the Board of Directors judges the risk of significant losses to be relatively small. The company’s equity financing is necessary in order to manage financial and liquidity-related risks.
DIRECTORS’ REMUNERATION
The General Meeting fixes remuneration for the Board of Directors every year.
In 2009 the total remuneration paid to the Board of Directors was NOK
740,000. This was made up of NOK 160,000 for the Chairman of the Board of
Directors and NOK 100,000 for each of the other directors (reduced in
proportion to attendance at Board meetings).
REMUNERATION OF SENIOR EMPLOYEES
NHST Media Group attaches importance to being an attractive employer. The
company wants to attract skilled employees with relevant experience.
The company therefore aims to have a competitive remuneration system.
INFORMATION AND COMMUNICATION
NHST Media Group endeavours to provide good, correct information externally
every quarter, with such information being given to shareholders on an equal
basis. Reports and announcements are also available on NHST’s website at www.nhst.no.
The company does not make specific assumptions about future revenue and profits. NHST’s shares are listed on the OTC list in Oslo (stockbrokers’ list of unlisted shares) and the share price is published daily under “Børs og marked” in Dagens Næringsliv. At the turn of the year the share price was NOK 420.
COMPANY TAKEOVER
The company has no defence mechanisms against possible takeover bids in its
Articles of Association. Nor has it prepared guidelines for how the company
would act in the event of a possible takeover bid.
AUDITOR
The company uses the same firm of accountants for all its subsidiaries on all
the markets where it is active with the exception of Sweden and Finland. The
overall auditing quote is discussed and approved by the Board of Directors
and CEO. The auditor is not used as a consultant for strategic matters. The
CFO approves any consultancy assignments.
The auditor attends the Board Meeting at which the financial statements are discussed. The auditor’s remuneration is reported at the Ordinary General Meeting and described in the notes to the accounts.