Profile of the Supervisory Board
1. Introduction
The Supervisory Board (below 'SB') formulates a profile of its size and composition and will evaluate such profile every year. The profile will be made available to the public at large and be placed on the Company's website.
The profile was defined in February 1998 and most recently amended on 1 November 2004 on the basis of the provisions set forth in Article 2.1 of the SB Regulations. Taking into account the type of business, its operations and the required expertise, experience and independence of SB members, size, composition and assignment of duties shall be as described below.
2. Size
According to the Company's Articles of Association, the SB consists of at least 5 members. The SB uses a maximum of 7 members, taking into account (i) the Company's size and (ii) whether it is possible to work with various committees.
3. Composition
The SB will be composed in such manner that the combination of experience, expertise and independence of its members satisfies the requirements laid down in this profile and will provide the SB with the best possible tools to fulfil its various obligations vis-à-vis the Company and the parties involved, including the shareholders, in compliance with the applicable regulatory framework, including stock exchange rules.
4. Requirements
When composing the SB, the following rules are observed:
a) Each supervisory director must be able to assess the basic ideas of the Company's overall policy and its business.
b) Each supervisory director has the specific expertise required for the fulfilment of his duties assigned to him within the scope of this profile. His/her participation in the SB, in case of appointment, reappointment and thereafter, must create its composition in accordance with Article 3.
c) At least one member of the SB must be a financial expert, which means that such person has acquired relevant know-how and experience in the fields of financial administration and accounting with listed companies or other major legal entities.
d) All supervisory directors, with the exception of at most one person, are independent according to the definition in Article 7.
e) The term of office of a supervisory director on the SB is limited to three terms of four years.
f) The number of memberships of a supervisory director at Dutch listed companies has been restricted to such extent that a proper fulfilment of the duties is guaranteed and is set at five, whereby the chairmanship of such SB counts double.
g) The chairman of the SB may not be a former managing director of the Company.
5. Expertise
SB members will be selected on the basis of the following criteria:
a) Background/education/training/ diplomas
b) Experience, whether national or international
c) Skills
d) Independence
e) Ability to work in a team
f) Availability
6. Assignment of duties among the members
With due observance of the provisions set forth in Article 6.1 of the SB Regulations, the SB drafted the following assignment of duties:
a) Financial administration, accounting, internal risk and control systems, external reports: at least 2 supervisory directors, now 3;
b) Management strategy and risks related to the Company's business, at least 5 supervisory directors, now 6;
c) Management selection, recommendation and development: at least 2 supervisory directors, now 2;
d) Remuneration of the management: at least 2 supervisory directors, now 2;
e) Enforcement of the law, including European rules and directives, Articles of Association, stock exchange rules, corporate governance, at least 2 supervisory directors, now 3;
f) Analysts' reports, shareholders and relations, at least 2 supervisory directors, now 3;
g) Employee relations, at least 1 supervisory director, now 1.
7. Independence
The SB has been composed in such manner that the members may operate independently and critically vis-à-vis each other, the Board of Management and any partial interest whatsoever. A supervisory director will be considered as independent if the following dependence criteria do not apply to him. The said dependence criteria are that the supervisory director involved or his spouse, registered partner of other life companion, foster child or relative by blood or marriage to the second degree:
a) Has, in the five year prior to the appointment, been employee or managing director of the Company, including affiliated companies as referred to in Article 1 of the Disclosure of Major Holdings in Listed Companies Act 1996.
b) Receives a personal financial remuneration from the Company or any of its affiliated companies, other than the remuneration received for activities performed as a supervisory director, and to the extent that such remuneration does not arise in the ordinary course of business.
c) Has, in the year prior to the appointment, had a major business relation with the Company or any of its affiliated companies. Such relation includes, at any rate, the circumstance that the supervisory director or an office of which he is a shareholder, partner, employee or consultant, has acted as a consultant, external accountant, civil-law notary or lawyer of the Company, and the circumstance that the supervisory director is a managing director or employee of a banking institution with which the Company has maintained a permanent and significant relation.
d) Is a managing director of a company in which a managing director of the company which he supervises is a supervisory director.
e) Holds a block of shares of a least 10 percent in the Company, including the shareholding of natural persons or legal entities with whom or with which he cooperates on the basis of an express or tacit agreement, whether verbally or in writing.
f) Is a managing or supervisory director or otherwise represents a legal entity which holds at least ten percent of the shares in the Company, unless it concerns group companies;
g) Has, during the preceding twelve months, temporarily been in charge of the Company's management in the event of the absence or inability to act of managing directors.
