4. Board of Directors
Fingrid’s annual general meeting elects a Board once per year. In accordance with the articles of association, the Board of Directors consists of five (5) members. Shareholders who hold Series B shares in the company are entitled to elect one (1) member of the Board through a simple majority decision in accordance with the quantity of Series B shares held. Individuals who are Board members in a company which practices the sale or production of electricity or natural gas, or in a body which represents such a company, may not be elected as a member of the Board. The general meeting elects one Board member to serve as the Chair of the Board and one member to serve as the Deputy Chair of the Board. The Board is convened by the Chair or Deputy Chair of the Board.
The Board constitutes a quorum when more than half of its members are present, and one of these is the Chair or the Deputy Chair. The decisions of the Board of Directors are made through a simple majority on the basis of the Board members present in the meeting. New Board members are familiarised with the company’s operations. A Board member’s period of office expires at the closing of the next annual general meeting following his or her election.
4.1 Duties of the Board of Directors
The tasks and responsibilities of Fingrid’s Board are set out by the Limited Liability Companies Act and other applicable legislation, as well as the articles of association. The Board of Directors is responsible for the administration and appropriate organisation of the operations of the company. The Board of Directors makes sure that the company adheres to the relevant rules and regulations, articles of association of the company, and guidelines provided by the annual general meeting. The primary duties and principles of the Board of Directors are also specified in the Board’s working order, according to which the Board:
- Decides the company strategy.
- Approves the annual action plan and budget on the basis of the strategy and supervises its implementation.
- Approves Fingrid’s management system and other business principles to be determined on the Board level.
- Confirms the values to be followed in Fingrid's operations.
- Approves the total amount of purchases and capital investments and its distribution on the various sectors, and decides separately on budgeted purchases, capital investments and sales in excess of 10 million euros, and on purchases, capital investments and sales outside the budget in excess of 2 million euros.
- Reviews and approves the audit plan, financial statements, interim reports and the related stock exchange releases, as well as the annual review.
- Addresses and decides on the proposals to be presented to the annual general meeting in accordance with the regulations of the Limited Liability Companies Act and the recommendations in the Corporate Governance Code;
- Annually reviews the risks relating to the company’s operations and the management of such risks.
- Decides on the operating model and annual plan of the internal audit and reviews the internal audit reports.
- Addresses the company’s corporate social responsibility report at least once a year.
- Appoints and dismisses the President & CEO of the company and his/her deputy.
- Approves the basic organisation and composition of the executive management group of the company.
- Decides on appointments to the boards of the company’s subsidiaries and associated companies and addresses the nominations for the CEOs of the subsidiaries and associated companies.
- Decides on the principles of the remuneration system and on the remuneration of the President & CEO and the executive management group.
- Holds part of the meeting at least once a year without the presence of executive management.
- Holds part of the meeting at least once a year with the auditor without the presence of executive management.
- Assesses its activities, work methods and efficiency once a year.
- Appoints from amongst its own members the audit committee and remuneration committee.
- Appoints an advisory committee whose task is to act as a link between the Board and the company management and customers. The advisory committee has 10–14 members who represent electricity producers, transmitters, sellers, users and other electricity market actors. The term of office is three (3) calendar years. The Board confirms the advisory committee’s regulations.
- Deals with other business which the Chair of the Board, a Board member or the President & CEO has proposed for inclusion in the agenda.
4.2 Board of Directors in 2017
The Board of Directors in 2017 was represented by Juhani Järvi (Chair), Juha Majanen (Deputy Chair), Anu Hämäläinen, Sanna Syri and Esko Torsti.
Of the Board’s members, Juhani Järvi, Anu Hämäläinen and Sanna Syri are independent from the company and its significant shareholders; the other members are independent from the company. The company’s President & CEO, CFO and general counsel, who is the Board’s secretary, participate in Board meetings. Board members do not own shares in the company.
The Board convened 11 times over the course of the year and approved the financial statements and annual review for 2016, and decided on, among other things, Fingrid’s new strategy, the budget and annual action plan for 2018, the grid service pricing for 2018, new investments in the grid and ICT, the principles of risk management and continuity management, the remuneration of executives and all significant policies affecting the company. In its meeting, the Board additionally addressed how the third alternating current (AC) connection between Finland and Sweden and the Datahub project are progressing, as well as the proposal b y the Norwegian and Swedish TSOs concerning balance management in the real-time markets.
Fingrid’s Board of Directors on 31 December 2017
|Name||Year of birth||Education||Main position and independence||Attendance at Board meetings||Attendance at committee meetings|
|1952||M.Sc. (Finance)||Board work, independent from the company and significant shareholders||11/11||
Audit committee 5/5Remuneration committee 4/4
|Deputy Chair Juha Majanen||1969||LL.B.||Ministry of Finance, Budget Counsellor, Deputy Head of Budget Department, independent from the company, non-independent of significant shareholders||10/11||Audit committee 2/5 (until 24 May 2017)
Remuneration committee 3/4 (as of 24 May 2017)
|Anu Hämäläinen||1965||M.Sc. (Accounting and Finance)||Wärtsilä Corporation, Vice President, Group Treasury and Financial Services & Support, independent from the company and significant shareholders||11/11||
Remuneration committee 4/4
|Sanna Syri||1970||D.Sc. (Technology)||
Aalto University, Professor,independent from the company, independent from significant shareholders
Audit committee 3/5
(as of 24 May 2017)
1/4(until 24 May 2017)
|Esko Torsti||1964||Lic. Pol.||Ilmarinen Mutual Pension Insurance Company, Vice President, independent from the company and non-independent from significant shareholders||11/11||
Audit committee 5/5
4.3. Diversity of the Board of Directors
The Board of Directors’ diverse composition supports the accomplishment and development of the goals and targets set by the company for its operations. An aim of the company is for all Board members to have adequate and mutually complementary experience and expertise in the areas essential for both the operations and societal role of the company. Fingrid additionally strives to assess the composition of the Board in terms of age and gender and to comply with the gender equality targets recommended by the state ownership steering. A proposal on the Board composition is prepared by significant shareholders.
Fingrid Board members possess wide-ranging business and management expertise, also outside of Finland. The sectors and areas of expertise represented in the Board include industry, energy sector, financing and accounting as well as state administration. Forty per cent of the Board members are female and 60 per cent male. The ages of the Board members range between 47 and 66 years.