Jennie S. Mills Milford International Associates Ltd
The importance of “independents” on the
supervisory board
Jennie Mills
Jennie S. Mills Milford International Jennie S. Mills Milford International Associates LtdAssociates Ltd
Slovak Corporate GovernanceSlovak Corporate Governance
Slovak Corporate Governance Code Slovak Corporate Governance Code 2002 based on OECD Principles 19992002 based on OECD Principles 1999
Annex 1. Board Committees 2003Annex 1. Board Committees 2003
The ROSC Assessment 2003The ROSC Assessment 2003
Annex 2. The Role of the boardsAnnex 2. The Role of the boards
Jennie S. Mills Milford International Jennie S. Mills Milford International Associates LtdAssociates Ltd
EU DevelopmentsEU Developments
The Corporate Governance Action The Corporate Governance Action PlanPlan
The Recommendation on supervisory The Recommendation on supervisory board members October 2004board members October 2004
The Recommendation on The Recommendation on remuneration of board members remuneration of board members October 2004October 2004
Jennie S. Mills Milford International Jennie S. Mills Milford International Associates LtdAssociates Ltd
EU Recommendation on EU Recommendation on supervisory board memberssupervisory board members
Comply and explain approach Comply and explain approach endorsedendorsed
Role of independent is to Role of independent is to constructively challenge constructively challenge management decisions & provide management decisions & provide independent oversightindependent oversight
Sound CG practices benefit business, Sound CG practices benefit business, large and small, family owned as well large and small, family owned as well as listed companiesas listed companies
Jennie S. Mills Milford International Jennie S. Mills Milford International Associates LtdAssociates Ltd
Oversight critical where conflicts of Oversight critical where conflicts of interest existinterest exist
Nomination of board membersNomination of board members RemunerationRemuneration AuditAudit
Other benefits important alsoOther benefits important also• Particular experience/ skillsParticular experience/ skills• Objective & fresh perspectiveObjective & fresh perspective• ContactsContacts
Jennie S. Mills Milford International Jennie S. Mills Milford International Associates LtdAssociates Ltd
Slovak Code on Board CommitteesSlovak Code on Board Committees
Committees of SBCommittees of SB Audit: 3-5 members mainly or wholly Audit: 3-5 members mainly or wholly
independent to meet at least 4 times independent to meet at least 4 times per annum.per annum.
Remuneration: composition as Remuneration: composition as above, meetings twice p.a.above, meetings twice p.a.
Nomination: composition as above, Nomination: composition as above, meetings four times p.a.meetings four times p.a.
Jennie S. Mills Milford International Jennie S. Mills Milford International Associates LtdAssociates Ltd
Qualification of supervisory board Qualification of supervisory board membersmembers
Each Co must determine this itselfEach Co must determine this itself Depends on size, activities & Depends on size, activities &
environmentenvironment Specific qualifications Specific qualifications Critical that each can devote Critical that each can devote
sufficient time to the rolesufficient time to the role IndependenceIndependence
Jennie S. Mills Milford International Jennie S. Mills Milford International Associates LtdAssociates Ltd
Nature of independenceNature of independence
Absence of close ties, business, Absence of close ties, business, family or otherwise with:family or otherwise with:• ManagementManagement• Controlling shareholdersControlling shareholders• The company itselfThe company itself
Annex II gives outlineAnnex II gives outline
Jennie S. Mills Milford International Jennie S. Mills Milford International Associates LtdAssociates Ltd
Number of independentsNumber of independents
Slovak Code in line with OECD Slovak Code in line with OECD Principles looks to majority of Principles looks to majority of independents on SB over a period of independents on SB over a period of years.years.
EU Recommendation EU Recommendation
““sufficient to ensure that any sufficient to ensure that any material conflict of interest involving material conflict of interest involving directors will be dealt with”directors will be dealt with”
Jennie S. Mills Milford International Jennie S. Mills Milford International Associates LtdAssociates Ltd
Induction, director development & Induction, director development & evaluation evaluation
Induction to board & CoInduction to board & Co Director development…..”directors Director development…..”directors
are not born but develop”are not born but develop” Evaluation of performance annually Evaluation of performance annually
for :for :• MembershipMembership• Organisation Organisation • Operation as a groupOperation as a group• Includes board committeesIncludes board committees
Jennie S. Mills Milford International Jennie S. Mills Milford International Associates LtdAssociates Ltd
The Central European Corporate The Central European Corporate Governance AssociationGovernance Association
Promote CGPromote CG
Support board members Support board members
Promote potential board membersPromote potential board members
Assist in director developmentAssist in director development
Jennie S. Mills Milford International Jennie S. Mills Milford International Associates LtdAssociates Ltd
How to joinHow to join
Contact:Contact: • Eva Hornakova at [email protected] Hornakova at [email protected]
• Barbora Lazarova at [email protected] Lazarova at [email protected]