Corporate Governance

Transcription

1 Corporate Governance Presentation of corporate governance practices applied by Egis Pharmaceuticals PLC (the Company ) Updated: December 17, 2012 Contents 1. Officials of the Company and their professional background 2. Evaluation and remuneration of the management, remuneration of members of the Board of Directors and of the Supervisory Board 3. Risk management guidelines 4. Guidelines for disclosures 5. Guidelines on insider dealings 6. Relationships of the directors and members of the management with third parties 7. Committees 1

2 1. Officials of the Company and their professional background Board of Directors (BoD) Dr. SETA, Jean-Philippe Chairman BAZANTAY, Christian BOUTS, Nicolas DIAZ, Ange FEHÉRDI, Zsolt Technical Director GÁL, Péterné Dr. HODÁSZ, István CEO (Managing Director) LANGOURIEUX, Yves LAUREAU, Olivier POROSZLAI, Csaba CFO Dr. VERESS, József Supervisory Board (SB) KOVÁCS, Andor Dr. BÁLINT, Konrádné GUETH, János LABRITZ, Béla NAGY, Imre RADVÁNYI, Georges Dr. RESZEGI, László Chairman Audit Committee (AC) Dr. RESZEGI, László Dr. BÁLINT, Konrádné RADVÁNYI, Georges Chairman Management Dr. HODÁSZ, István BERTA, József FEHÉRDI, Zsolt Dr. MÁZSÁR, Péter POROSZLAI, Csaba Dr. SZEMERÉDI, Katalin Dr. SZENTPÉTERI, Imre Chief Executive Officer (MD) Director of Egis Körmend plant Technical Director Director of Operations Chief Financial Officer Director of Human Resources Director of R&D Names of independent members of the above bodies are underlined and printed in italics. According to the principles of the Company independent are those members who have no legal relations with the Company other than the above membership, in case of profitable activity of the Company have no right on basis of their membership to receive bonuses or remuneration of any kind from the Company or from the associated companies. Among seven independent members of the Board of Directors six directors are delegated by the main shareholder. 2

3 BAZANTAY, Christian Member of the Board of Directors since 1996 Mr. Bazantay (born in 1958) graduated in law. He started working for Servier Research Group in In charge of the legal and corporate matters in 1984, he was appointed as Secrétaire Général of the Group in Dr. BÁLINT, Konrádné Member of the Supervisory Board since 1991, member of the Audit Committee since 2007 Dr. Bálint (born in 1941) graduated in law (1964 ELTE, Faculty of Political Science and Law). She began her carrier at the National Savings Bank, had worked for the legal department of MEDIMPEX for 21 years taking over as Head of Department. BOUTS, Nicolas Member of the Board of Directors since 2009 Mr. Bouts (born in 1959), university post graduated in law and economy. He joined Servier Research Group in In May 2007, he was appointed as Vice-President Human Resources of the Group. DIAZ, Ange Member of the Board of Directors since 1996 Mr. Diaz (born in 1946) Doctor in Organic Chemistry, graduated in business administration. He joined the Servier Research Group in Since 1993, he has been appointed as General Manager for Worldwide Production and Information Technology. FEHÉRDI, Zsolt, Technical Director Member of the Board of Directors since 2012 Mr Fehérdi graduated from the Technical University of Budapest, Faculty of Mechanical Engineering, in branch of Chemical and Food Engineering in 1996, furthermore he took a degree from College of Finance and Accountancy, Faculty of Finance. His professional career: Bristol-Myers Squibb, Sanofi-Synthelabo, director of Technical Operations of Egis Pharmaceuticals PLC as from December 2007, technical director as from February GÁL, Péterné Member of the Board of Directors since 2006 Mrs. Gál (born in 1946) graduated as an economist from the Budapest University of Economic Sciences, Foreign Trade Faculty. She held positions as Head of Department at Medimpex and as Head of Trade Office at HUMAN National Institute for Serobacteriological Production and Research. Managing Director of Aventis Pharma, and predecessor companies (Roussel Uclaf, Hoechst Marion Roussel) as of In 2000 she was the elected chairperson of the Association of Innovative Pharmaceutical Manufacturers. As from December 1, 2005 deputy CEO, then Chief Executive Officer of Egis between 25 January 2006 and 30 September

4 GUETH, János Member of the Supervisory Board since 2010 Mr. Gueth (born in 1952) is a chemical technician, business administrator by profession. He joined the Company in For 19 years he has worked in the active ingredient production as technical manager, for 6 years at the Directorate of Commercial Operations as product manager. Since 1996 he has been a senior associate of the Quality Assurance Division. DR. HODÁSZ, István,Chief Executive Officer Member of the Board of Directors since 2006 Mr. Hodász (born in 1968) graduated as pharmacist from the Semmelweis University in He made an MBA degree in 1998 at the Manager Training Institute of Budapest University of Economics Sciences. In his professional carrier from 1991 he gained remarkable managerial experience with product launches, marketing and sales in the pharmaceutical industry in commitment with companies like Glaxo and various predecessors of Sanofi-Aventis. Director of operations at Egis Pharmaceuticals PLC since January 2006, and CEO since October KOVÁCS, Andor Chairman of the Supervisory Board since 1991 Mr. Kovács (born in 1934) is an economist (1958 Univ. Econ. Sc., Faculty of Finance). His earlier carrier includes managerial positions at the National Bank of Hungary, as Managing Director from 1984, deputy CEO at the Hungarian Creditbank in 1991, member of boards at various Hungarian banks and companies. LABRITZ, Béla Member of the Supervisory Board since 2010 Mr. Labritz (born in 1957 in Szentgotthárd). He is a chemical technician. He joined the Company in 1975 and started his career at the Chemical Plant 4 in Budapest. Since 1976 he has been working for the Galenic Plant in Körmend, currently having the position as groupleader of the section of aerosol production. Representative at the local government in Szentgotthárd since 2002, chairman of the Economic, Environment Protection, later of the Public Procurement Committee. LANGOURIEUX, Yves Member of the Board of Directors since 1996 Mr. Langourieux (born in 1943) holds degrees - BSc & PhD - in Organic Chemistry, and began his career with Les Laboratoires Servier in He is currently the Managing Director, International Operations, Canada, USA, Northern, Central & Eastern Europe, a sector generating sales exceeding 600 million Euros for the Group. 4

5 LAUREAU, Olivier Member of the Board of Directors since 2009 Mr. Laureau (born in 1957) university post graduated in law. He joined Servier Research Group in In October 2008, he was appointed as Group Finance Manager. Dr. MÁZSÁR, Péter, Director of Operations Dr. Mázsár is a medical doctor (Semmelweis University, Budapest) postgraduate degree in law (Eötvös Loránd University, Budapest), postgraduate degree in economics (Budapest University of Economic Sciences) and MBA (Budapest University of Technology and Economics).After several years of medical practice as emergency physician (National Ambulance Service), he started his pharmaceutical carrier as a medical representative then as product manager at Pfizer. Later he worked for Aventis and Sanofi-Aventis in product manager, business unit manager and business unit director positions. Joined Egis in 2006 as international sales and marketing director, and Director of Operations since October NAGY, Imre Member of the Supervisory Board since 2001 Mr. Nagy (born in 1958) graduated as an economist. He has been working for the Company since 1976 in various positions. He is a group leader of bulk production. POROSZLAI, Csaba, Chief Financial Officer Member of the Board since 2011 Mr Poroszlai started his professional career at Béres Pharmaceuticals Co. in 1998, holding the position of Chief Financial Officer as from He joined Egis in 2008 as Head of Strategic Controlling and since February 2011 he has been the CFO of Egis. RADVANYI, Georges Member of the Supervisory Board since 1998, member of the Audit Committee since 2007 Mr. Radványi (born in 1937), a French citizen, made his studies in Budapest and in France. He started his carrier as R&D manager in chemical engineering at various French companies, later he specialised in marketing. He holds board memberships in a number of different French and other European institutions. After retiring he continues as a consultant in the development of French-Hungarian joint ventures. Dr. RESZEGI, László Member of the Supervisory Board since 1991, chairman of the Audit Committee since 2007 Dr. Reszegi (born in 1940), Economist (Univ. Econ. Budapest), Associate University Professor, Dr. Univ. Econ. Sc., consultant to various industrial organisations. 5

6 Dr. SETA, Jean-Philippe, MD : Chairman of the Board of Directors since 1996 Dr. Seta (born in 1953), specialist in internal and respiratory medicine. He joined the Servier Research Group in 1984 as a Clinical Research Project Leader. Presently he is the Deputy President and Chief Executive Officer of the Group. Dr. SZEMERÉDI, Katalin. Director of Human Resources Dr. Szemerédi (born in 1955) is a Pharmacist, Dr. Univ., and MBA. She has been working for the Company since Director of Human Resources since In her former position she was Head of the Office of the CEO. Dr SZENTPÉTERI, Imre, Research and Development Director Dr Szentpéteri, MD, graduated as medical doctor in After getting clinical experience he obtained postgradual qualification in internal medicine and clinical pharmacology. He has been working at Egis Pharmaceuticals PLC since 1996 in different management positions related to research and development. Since 2009 he has been the Director for Regulatory and Medical Affairs reporting directly to the CEO. Dr. VERESS, József Member of the Board of Directors since 1991 Dr. Veress (born in 1949) is a University Professor. Graduated in economics, holds a qualified degree (DSc) of the Hungarian Academy of Sciences. Dean of the Budapest University of Technology and Economics. 6

7 2. Evaluation and remuneration of the management, remuneration of members of the Board of Directors and of the Supervisory Board The Board of Directors performs a continuous assessment of the management s activity, and additionally carries out extensive performance evaluation once a year. The remuneration of managers (CEO) has an established system at the Company. On top of the base salary managers are entitled to receive bonus if the development of the Company meets the long term targets and targets of the relevant business year. The bonus is linked with the development of sales revenue, profit, and with the fulfilment of the most important specific tasks set in advance for the business year. The Company does not apply share option scheme which is directly linked with the share price. The Board of Directors is on the view that the long term successful operation of the Company is reflected in the positive evolution of the share price. The applied system of remuneration in this way also makes managers indirectly interested in long term improvement of the share price without the potential negative effects of a share option programme. Monetary and non-monetary types of compensation1, provided for members of the Board of Directors and for members of the Supervisory Board during 2011/2012 in their capacity as such, were as follows (in HUF): Board of Directors Dr. SETA, Jean-Philippe 2 (chairman) 0 BAZANTAY, Christian 2 0 BOUTS, Nicolas 2 0 DIAZ, Ange 2 0 DIETZ, András (until ) 1,564,450 FEHÉRDI, Zsolt (as of ) 3,367,550 GÁL, Péterné 4,932,600 Dr. HODÁSZ, István 4,932,600 LANGOURIEUX, Yves 2 0 LAUREAU, Olivier 2 0 POROSZLAI, Csaba 3,354,290 Dr. VERESS, József 4,932,600 Supervisory Board KOVÁCS, Andor (chairman) 7,834,680 BÁLINT, Konrádné dr. 3,571,800 GUETH, János 3,571,800 LABRITZ, Béla 3,571,800 NAGY, Imre 3,571,800 RADVÁNYI, Georges 3,571,800 Dr. RESZEGI, László 3,571, Only fix membership fee is paid to members of the Board of Directors and of the Supervisory Board in this capacity. 2 Waived remuneration in this capacity. 7

8 3. Risk management guidelines The Company is committed to creating long-term value both for its customers, shareholders, employees having direct relationship with the Company and for the whole society. The Company is aware of the risks representing threats by dangers and losses form integral part of the promising business opportunities and processes. Accordingly, the Company considers the conditions of successful operation not in the context of overall avoidance of risks but in rational reduction of unfavourable effects of risks on objectives relating to business and society. The right balance between opportunities and related risks measured and reduced by proper methods is in the centre of the Company s risk management. The recognition and the effective management of risks play an important role in the continued growth and success of the Company. Therefore the Company deems risk management as one of the tools of effective management of the Company.The objective of the Company is to create and operate such external relationships and internal environment, procedures for monitoring and interposing controls that enable timely identification, understanding and assessment of risks and their efficient management. The Company views risk management as one of the tools for effective company management. The Company s risk management approach helps the Company develop those abilities by which the risk factors affecting the business objectives are manageable more efficiently. In relation to risk management the Company is of the view that not every aspect of risk management can be determined from above and in advance therefore in its risk related decision making process permanently places confidence and trusts in the skills, experience and judgements of its employees who carry out their work in compliance with internal expectations and regulations. The risk management method of the Company involves the following aspects: A risk assessment procedure by which the direct risks the Company faces can be explored. A common risk language encompassing strategic, operational, compliance and financial risks to facilitate internal communications and decision-making on risks. In respect of risk tolerance that is, the extent and manner the Company avoids and accepts risks. Periodic management review process to update the risk profile and monitor the effectiveness of risk management and internal controls. Accountability and governance structure in relation to risk management. The implementation of risk management approach of the Company is incorporated into the Company s overall governance model through the following ways: The Board of Directors has responsibility for overseeing and controlling the complete risk management of the Company, including requesting reports from the Executive Management on the identified key risk areas, and the effectiveness of risk management and internal control procedures. 8

9 First of all the Executive Management has responsibility for the Company s risk management so it is the Executive Management s task and responsibility to establish and maintain system of internal controls which ensures the effective management of risks affecting the operation of the Company so that the Company can achieve its objectives. The leaders of business areas are accountable for the identification, grouping, evaluation of the risks at their own field and making relating action plans. During the approval process the Executive Management ensures the accord of the action plans of the different business areas. The Internal Audit analyzes the full scale of risks and provides, based on the approved annual plan, independent and objective assessment on the adequacy of the system of internal control in effective management of risks. Internal Audit reports at least once a year on risk management, internal controls and corporate governance functions to the Executive Management. 9

10 4. The Company s guidelines for disclosures The Company s disclosures are managed in compliance with the rules of the Budapest Stock Exchange. By way of quarterly reports and annual reports the Company publishes results, and manages the disclosure of extraordinary information which may occur in the operations and may have direct or indirect relevance with the share price or information judged essential for the most important investment decisions of market participants. Furthermore, the Company duly publishes data categorised as other information. Dissemination of regulated information is performed in any case on the website of the Budapest Stock Exchange (both and in addition to publication on (Officially Appointed Mechanism in compliance with the EU regulations and Article 56/3 of Hunagrian Act on the Capital Market) and on the Company s website The Company ensures that the same publications are disseminated throughout the European Union. sent via to major news agencies, and upon request to other interested parties. The Company is actively involved in organising local investor conferences and setting up international telephone conferences for investors once every three months in order to present the latest results, furthermore the Company demonstrates its commitment to transparency by involvement in various forms of investor road-shows, by participation in conferences. Besides, it fosters continous disposal, contacts to investors through the Corporate Office of the Company servicing the information need of investors. 10

11 5. The Company s guidelines on insider dealings The scope of insider persons is clearly regulated by law. The Company puts an emphasis on the enforcement of the law, sets internal rules laid down in by-laws of the Company, including a recordkeeping activity of insiders. 11

12 6. Relationships of the directors and members of the management with third parties Labour contracts of managers include a condition of disqualification / conflict of interest by their involvement in business entities of similar profile. Members of the Board of Directors declare soon after being elected that their function is in no way conflicting with other personal commitments. 12

13 7. Committees The Company established an Audit Committee with the participation of three independent members in accord with the valid regulations in The Company has no Remuneration Committee and Nomination Committee, because size, structure and ownership background of the Company would not necessitate and justify the condition to set up such bodies. Relevant functions are performed by the independent members of the Board of Directors without formal setup as a committee. 13