© 2015 asociatia administratorilor independentiasociatia administratorilor independenti

© 2015 Asociatia Administratorilor Independenti

http://www.administratorindependent.ro/





© 2015 Asociatia Administratorilor Independenti

Independent Directors Association is established for Shareholders and Boards of Directors

from Romanian private companies.

2

“To see far is one thing, going there is another.”

Constantin Brancusi





© 2015 Asociatia Administratorilor Independenti 3

INCREASE OF COMPANY

VALUE

Expertise and objective of the members of the Association:

.






We increase compan

y value

• Through our expertise

• Through becoming responsible, for medium and long term, along with the company, as:

Independent Director or Director

• Through aligning us with the interests of the shareholders and of the company






• Aligning interests in the company

• Decreasing cost of capital increases

• Revising strategy

Corporate Governance

Reducing dilution of shareholders

“Leadership” - “top & middle management” Increase sales and profitability

We increase

company value






• Valuation of company together with Board of Directors and Top Management

Key factors for valuation are re-analyzed and re-validated

• Facilitating and guiding shareholders in moving towards the next step: Chairman of the Board vs. CEO/General

Manager

• Bringing focused expertise through network (members and non-members)

Romanian and foreign experts, from Romania and abroad

We increase company value






We align interest

s

• Aligning interests from the company though instruments oferred by Corporate Governance

• Corporate Governance is a practical and efficient tool for aligning interests of:

Shareholders Members of Board of Directors Top Management Employees






Corporate

Governance

“Corporate governance involves a set of relationships between a company’s management, its board, its shareholders and other stakeholders. Corporate governance also provides the structure through which the objectives of the company are set, and the means of attaining those objectives and monitoring performance are determined. Good corporate governance should provide the proper incentives to pursue objectives that are in the interest of the company and shareholders and should facilitate effective monitoring, thereby encouraging firms to use resources effectively.” Source: “Corporate Governance in Romania-2001”, OECD






We decrease the cost

of raising

new capital

• Identifying the best moment for attracting new capital in order to maximize company value

• Identifying the most appropriate shareholders for the stage of development of the company:

“Private” shareholders (non-listing/non-trading to the Stock Exchange)

• Investment Funds – private equity• Strategic Companies

“Public” shareholders (listing/trading to the Stock Exchange)• Institutional investors• Individual investors

• Reducing financing costs






We decrease the cost

of raising

new capital

Survey 2010 - 29 fund managers investing in emerging markets: • 100% of fund managers: “The investment fund I

manage will pay a bigger premium for corporate governance when buying a company, in emerging markets vs. developed countries”

• 41% of fund managers: “The investment fund I manage considers the corporate governance an essential condition for deciding if we invest in a company in emerging markets and for valuating the premium which we will pay for such a company”

Source: Bucharest Stock Exchange (BSE), IGC Group BVB, EBRD Workshop “BSE corporate governance code”, October 2015






Scadem costul

maririlor de

capital

Survey 2010 - 29 fund managers investing in emerging markets: • 55% of fund managers: “The investment fund I run will

pay a premium of at least 10% for good corporate governance for the companies acquired in emerging markets”

• 38% of fund managers: “The investment fund I run will pay a premium of a t least 20% for good corporate governance for companies acquired in emerging markets”

Source: Bucharest Stock Exchange (BSE), IGC Group BVB, EBRD Workshop “BSE corporate governance code”, October 2015






We understa

nd the current

strategy

• Analyzing the last 2 annual budgets (2014 and 2015): Realized vs. Planned

• We agree with the company the factors determining positive or negative deviations

• We analyze the budget correlations

• Current strategy for 2016 – 2019 (“As Is”): Understanding the existing strategy Analizing the need for attracting new investors Calculation of current company value






We revise

the strategy

2016-2019

(“To Be”)

• Propozing ways to increase sales, to organizational improvements

• Identifying actions for increasing leadership • Analyzing in detail the opportunities of the company

and making the decision for their implementation • Analyzing in detail the problems and finding solutions • Writing the strategic plan and making the detailed

financial projects • Making the valuation of the company • Implementation of the revised strategic plan






Chairman

vs. General

Manager






We facilitate

the transitio

n

… from General Manager

toChairman of the Board of Directors.

We believe the shareholders have the following main objectives:

Leadership

Vision

Strategy

Business Development

Warren Buffet is shareholder in more than 45 companies without being general manager.






We work with

synergy

• Contributing to the efficiency of the team Shareholders–Board of Directors–Management

• Accelerating implementation of the strategy and budgets

• Doing “on the job” mentoring & training, executive coaching






We contribut

e throughnetworki

ng

Through our network of professionals, if it is needed, we bring to the company:

- Romanian and foreign experts- From Romania and abroad- Members and non-members of the Association

- Additional expertise, in addition to what we are offering as independent directors/directors – for specific needs.

Ex. Increasing sales in Central and South East Europe - FMCG






How we work?

• Months 1- 3

We understand:• Company activity• Budgets 2014 & 2015• Current strategy

We make company valuation

• At the end of month 3 of cooperation we propose:

Objectives of cooperation

Calendar of cooperation

Financial terms of cooperation

• Fiixed and variable remuneration, correlated with the increase of company value






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© 2015 asociatia administratorilor independentiasociatia administratorilor independenti

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