Amstelveen, April 11, 2005
Supplementary to the Agenda for the General Meeting of Shareholders of Royal
Wessanen nv, which has been published today, Wessanen’s Supervisory and
Executive Boards wish to clarify the company’s vision of corporate governance.
With a view to the remuneration policy, also published today, this press
release further explains the switch from options to restricted shares and
provides more details about the remuneration of Mr D. Vierstra, candidate for
the post of CFO, and the severance package for Financial Director, Mr Kramer,
who left the company at the end of 2004.
Transparency is the spearhead
The Wessanen Board believes that the Tabaksblat Code is an excellent answer to
the need for transparent business practices and accountability towards
financial backers. This is why the Code has largely been implemented at
Wessanen. The main changes include:
The Stichting Preferente Aandelen has ceased to exist.
The directors’ contracts have been converted into 4-year contracts.
Remuneration packages and bonuses have been brought into line with the
principles of the Code. The remuneration policy and the remuneration report
will be presented to the Shareholders’ Meeting for approval.
All underlying arrangements regarding the performance of the members of the
Executive Board and the Supervisory Board, the Code of Conduct etc. have been
brought into line with the Tabaksblat Code and publicized on the Wessanen
website (www.wessanen.com). Consequently, the Joint Meeting of the Executive
and Supervisory Boards has also been discontinued, making for a stronger
emphasis on independent responsibility in both bodies.
The representative of the Supervisory Board has been permanently withdrawn from
the Board of the Stichting Administratiekantoor Aandelen Koninklijke Wessanen,
thus increasing the independence of the Administratiekantoor.
At the forthcoming Shareholders’ Meeting (April 27, 2005) the company will
propose that the conditions for converting depositary receipts of shares
(Article 11, Articles of Association) be scrapped, thus dispensing with the
protective function of the Stichting Administratiekantoor Aandelen Koninklijke
Wessanen. These new proposals will take account of the need to protect minority
shareholders, a matter which is not regulated in the Netherlands , in contrast
with many other countries.
No more depositary receipts of shares
Wessanen’s corporate governance ambition is driven by a desire to provide
maximum transparency, verifiability and accountability for its financial
backers. This eventually implies a shareholder structure in which the financial
backers can exert direct influence (obviously through the appropriate channels)
with none of the constraints imposed by depositary receipts of shares. To
achieve this, however, a reasonable quorum of shareholders will have to be
represented at the meeting and the protection of minority shareholders will
have to be addressed. Wessanen is therefore actively and intensively engaged in
increasing shareholder participation.
In addition to improved results in the short term Wessanen’s strategy is aimed
primarily at long-term value creation. This strategy is reflected in Wessanen’s
remuneration policy whereby, from now on, Board members and management will be
awarded restricted shares. These shares will only be allocated if a specific
objective is met each year in a 3-year period. The objective for year 1 (2005)
is the realization of a specific level of income for the company. For year 2
(2006) it is the realization of a specific level of Total Shareholders’ Return
(TSR) in relation to a peer group of companies and, for year 3 (2007), the
strategic goals for Return on Sales (result as a percentage of sales). This
remuneration component achieves both long-term motivation and alignment of the
interests of shareholders and executives.
The remuneration policy for Wessanen’s current executives now complies with the
standards of the Tabaksblat Code. This likewise applies to the remuneration
package for Mr Vierstra, who will be appointed for a period of 4 years. The
maximum severance pay in the event of premature termination is one year’s
salary. Mr Vierstra’s remuneration package consists of a fixed basic salary of
EUR 335,000 and a cash bonus amounting to a maximum of 80% of the annual salary
upon realization of the targets for EBITAE, cash flow and a personal agenda. He
is, in addition, entitled to 11,500 restricted shares over 2005 and received
60,000 options and 15,000 restricted shares upon commencement of employment.
Mr Kramer was in the service of the company throughout 2004 and therefore
received a fixed salary, a contribution to his pension capital, a bonus and
expenses totaling EUR 484,000. In 2004 he also received severance pay of EUR
373,000, which is equal to one year’s salary (including pension contributions).
Supervisory and Executive Boards
Royal Wessanen nv
Back to press releases