CORPORATE GOVERNANCE STATEMENT 2020

GOVERNING PRINCIPLES

Aspo’s decision-making and administration comply with the Finnish Limited Liability Companies Act, securities market legislation, other regulations concerning public companies, Aspo Plc’s Articles of Association, and the rules and regulations of Nasdaq Helsinki Ltd.  

Aspo follows the Finnish Corporate Governance Code, effective from January 1, 2020, which is available on the Securities Market Association’s website www.cgfinland.fi.

In addition to the Corporate Governance Statement, Aspo has published a separate Management Report 2020 in Aspo’s Year 2020 publication. This statement will not be updated during the financial period, but the information on the subjects included in it, as well as other necessary and up-to-date information for investors is available on the company’s website at www.aspo.com.

The corporate governance statement as well as the company’s financial statements, annual report and auditor’s report are available on Aspo’s website at www.aspo.com.

GROUP STRUCTURE

The Aspo Group’s parent company, Aspo Plc, is a Finnish public company domiciled in Helsinki. The main responsibility for Aspo Group’s administration and operations lies with Aspo Plc’s governing bodies, which are the Shareholders’ Meeting, the Board of Directors and the CEO. The highest decision-making power is exercised by the shareholders at the Shareholders’ Meeting. The Board of Directors and the CEO are responsible for the management of Aspo Group. The Audit Committee and the Remuneration Committee support Board in its work.The Group Executive Committee assists the CEO in managing the Group.

Aspo is an industrial conglomerate that develops its group structure and businesses in the long term in a responsible and sustainable manner. Aspo Plc’s task is to own, lead and develop the operations of its subsidiaries and other Group companies, centrally administer the Group companies, take care of issues related to financing and strategic planning, and plan and implement financially expedient investments.

The Group’s operational business is carried out in the Group companies, ESL Shipping Ltd, Leipurin Plc, Telko Ltd, and Kauko Ltd, and in their subsidiaries in Finland and abroad.

SHAREHOLDERS’ MEETING

The Annual Shareholders’ Meeting is arranged every year on a date set by the Board of Directors, and it deals with the issues that are the Annual Shareholders’ Meeting’s responsibility as outlined in the Articles of Association, the proposals of the Shareholders’ Nomination Board and the Board of Directors, and other proposals to the Shareholders’ Meeting. The Annual Shareholders’ Meeting, for instance, confirms the financial statements, elects the Board members and the auditor, and decides on profit distribution and the remuneration of the Board members and the auditor.

When required, an Extraordinary Shareholders’ Meeting is convened. The Board of Directors is also obliged to convene an extraordinary shareholders’ meeting if an auditor or shareholders with a total of at least 10% of all shares so demand in writing in order for a given matter to be dealt with.

According to the Companies Act, the shareholders are entitled to have a matter falling within the competence of the Shareholders’ Meeting dealt with by the Shareholders’ Meeting if the shareholder so demands in writing from the Board of Directors well in advance, so that the matter can be included in the notice of the meeting.

The Board of Aspo Plc convenes the Shareholders’ Meetings. The notice of meeting is published in a stock exchange release and on the company’s homepages not earlier than two months and not later than twenty-one (21) days prior to the meeting, but at least nine (9) days prior to the record date for the Shareholders’ Meeting. In addition, the Board of Directors may, at their discretion, decide to announce the Shareholders’ Meeting in one or several newspapers. In addition, the following information is published on the company’s website 21 days before the Shareholders’ Meeting at the latest:

  • total number of shares and voting rights by share class on the date of the notice of meeting
  • documents to be presented to the Shareholders’ Meeting
  • decision proposal of the Board of Directors or some other competent body
  • any issue that is included in the agenda of the Shareholders’ Meeting but for which no decision is proposed


The resolutions of the Shareholders’ Meeting are published after the meeting in a stock exchange release. The minutes of the Shareholders’ Meeting with the voting results and appendices related to the decisions are published on the company’s website within two weeks of the Shareholders’ Meeting.

SHAREHOLDERS’ NOMINATION BOARD

The Shareholders’ Nomination Board of Aspo Plc prepares proposals to the Annual Shareholders’ Meeting for the election and remuneration of the members of the Board of Directors and the remuneration of the Board committees. The Shareholders’ Nomination Board of Aspo consists of the representatives of the four largest shareholders. In addition, the Chairman of Aspo’s Board of Directors acts as an expert member of the Nomination Board.

The following representatives of the largest shareholders were members of the Nomination Board which prepared proposals for the Annual Shareholders’ Meeting of 2021: Roberto Lencioni, Chairman (Vehmas family, including AEV Capital Holding Oy); Veronica Timgren (Nyberg family, including Oy Havsudden Ab); Annika Ekman (Ilmarinen Mutual Pension Insurance Company); and Pekka Pajamo (Varma Mutual Pension Insurance Company). In addition, Gustav Nyberg, Chairman of Aspo Board of Directors, has acted as an expert member of the Nomination Board.

In 2020, the Shareholders’ Nomination Board convened three times. The participation rate was 100%.


BOARD OF DIRECTORS

The Board of Directors sees to the administration of Aspo and the appropriate organization of its operations. The Board of Directors has established the Audit Committee and the Remuneration Committee to support its work. When required, the Board of Directors can decide to establish other permanent or temporary committees.

According to the Articles of Association, Aspo Plc’s Board of Directors comprises no fewer than five and no more than eight members. The number of members of the Board is determined at the Shareholders’ Meeting, where its members are also elected. The members of the Board of Directors elects a Chairman and a Vice Chairman from among its members. In the 2020 Annual Shareholders’ Meeting, six Board members were elected. The term of the members ends at the conclusion of the next Annual Shareholders’ Meeting following the election.

The Board constitutes a quorum when more than half of the members, including either the Chairman or Vice Chairman, are present. The Board of Directors seeks to make unanimous decisions, but the matters are put to a vote when required. The decisions are made by a majority of votes. In the event of a tie, the Chairman shall have the casting vote.

The Board of Directors convenes at regular intervals, and also whenever necessary.

The duties and responsibilities of the Board of Directors are set out in the Articles of Association, the Finnish Limited Liability Companies Act, and other applicable legislation. The particular duty of the Board of Directors is to promote the interests of the shareholders and the company, among other things, by taking care of strategic policy decisions and appropriate organization of the business and administration. The Board of Directors is also responsible for ensuring that the internal control of the company’s accounting and asset management has been appropriately organized. The Board of Directors processes and decides on all matters concerning the company’s operations that are most important for the company. The Board of Directors has competence in all matters that are not handled by other administrative bodies pursuant to law or the Articles of Association.

Aspo Plc’s Board of Directors has confirmed written standing orders which state that the matters to be handled by the Board include, but are not limited to:

  • Aspo Group’s strategic policies and divisional strategies
  • Group structure
  • matters to be presented to Shareholders’ Meetings
  • interim reports and consolidated financial statements
  • Group business plans, budgets and investments
  • expanding and scaling back operations, acquisitions/divestments of companies or operations
  • Group risk management, insurance and treasury policies
  • Group environmental policy
  • management remuneration and incentive plans
  • appointment of the CEO
  • monitoring the financial and financing situation of Aspo Group


The Board carries out an annual self-evaluation of its operations and working methods.

In 2020, the Board of Directors arranged 18 meetings. The participation rate was 100%. Due to coronavirus pandemic there were more meetings than usual.

BOARD MEMBERS ON DECEMBER 31, 2020


Gustav Nyberg
Chairman of the Board since 2009, member of the Board since 2008, Chairman of the Remuneration Committee since 2019
B.Sc. (Econ.), eMBA, born in 1956
Independent of the company, dependent on its major shareholders

Shareholdings in Aspo on December 31, 2020: 851,524 shares, or 2.71%, of the total number of shares, held by related party Oy Havsudden Ab: 3,262,941 shares, or 10.38%, of the total number of shares.
Aspo´s hybrid bond 2020: EUR 0.5 million, EUR 1.4 million held by related party Oy Havsudden Ab.
No holdings or rights based on share-based incentive plans.

Mammu Kaario
Member of the Board since 2012, Vice Chairman of the Board since 2018, Chairman of the Audit Committee since 2017, member of the of the Audit Committee since 2012,
Master of Laws with court training, MBA, born in 1963
Independent of the company and its major shareholders

Shareholdings in Aspo on December 31, 2020: 10,000 shares, or 0.03%, of the total number of shares.
No holdings or rights based on share-based incentive plans. 

Mikael Laine
Member of the Board since 2016, member of the Audit Committee since 2016
M.Sc. (Econ.), born in 1964
SVP, Strategy, Cargotec Corporation since 2014
Independent of the company and its major shareholders

Shareholdings in Aspo on December 31, 2020: 10,000, or 0.03%, of the total number of shares.
Aspo´s hybrid bond 2020: EUR 0.2 million.
No holdings or rights based on share-based incentive plans.

Salla Pöyry
Member of the Board since 2016, member of the Remuneration Committee since 05/2020, member of the Audit Committee from 2016 to May 2020
D.Sc. (Econ.), CEFA, born in 1984
Chairman of the Board (CEO), Procurator-Holding Oy since 2015
Independent of the company and its major shareholders

Shareholdings in Aspo on December 31, 2020: 1,000 shares, or 0.003%, of the total number of shares, held by related party Procurator-Holding Oy: 514,882 shares, or 1.64%, of the total number of shares.
Aspo’s hybrid bond 2020: EUR 1.5 million held by related party Procurator Holding Oy
No holdings or rights based on share-based incentive plans.

Tatu Vehmas
Member of the Board since 2018, member of the Remuneration Committee since 2019, mem­ber of the Audit Committee since 2020 and 2018–04/2019
Bachelor of Science, born 1994
Managing Director, TAAVi Capital Oy 2020–
Independent of the company, dependent on its major shareholders

Shareholdings in Aspo on December 31, 2020: held by related party AEV Capital Holding Oy: 3,160,935, or 10.06% of the total number of shares.
Aspo´s hybrid bond 2020: 2.0 million
No holdings or rights based on share-based incentive plans.

Heikki Westerlund
Member of the Board since 2020, member of the Audit Committee since 2020
M.Sc. (Econ.), born in 1966
Board professional since 2017
Independent of the company and its major shareholders

Shareholdings in Aspo on December 31, 2020: 15,000 shares, or 0.05%, of the total number of shares, held by related party Heiwes Oy: 20,000 shares, or 0.06%, of the total number of shares.
No holdings or rights based on share-based incentive plans.


ATTENDANCE AT THE MEETINGS BY MEMBERS OF THE BOARD AND ITS COMMITTEE MEMBERS IN 2020

      Attendance
  Board member since Committee membership Board Audit Committee Remuneration Committee
Nyberg Gustav 2008 Remuneration Committee (Chair) 18/18   8/8
Kaario Mammu 2012 Audit Committee (Chair) 18/18 5/5  
Laine Mikael 2016 Audit Committee 18/18 5/5  
Pöyry Salla* 2016 Audit Committee 18/18 2/2 7/7
Salo Risto** 2008 Remuneration Committee 18/18   1/1
Vehmas Tatu 2018 Remuneration Committee 18/18 3/3 8/8
Westerlund Heikki*** 2020 Audit Committee 18/18 3/3  

* Member of the Audit Committee until May 5, 2020, member of the Remuneration Committee since May 5, 2020
** Member of the Board and Remuneration Committee until May 5, 2020
***Member of the Board and Audit Committee since May 5, 2020


BOARD COMMITTEES

The Board of Directors may establish committees or other permanent or temporary bodies to carry out the tasks it orders in compliance with its rules of procedure. The Board of Directors elects the members of the committee and appoints its Chairman. The Board of Directors confirms the rules of procedure for each committee, specifying the key tasks and operating principles of the committee concerned. The majority of members of each committee must be independent of the company, and at least one member has to be independent of the company’s main shareholders.The members of committees must have the competence required for the range of tasks handled by the committee concerned.  

Audit committee
The Audit Committee is tasked with preparing issues related to the company’s financial reporting and control. The Audit Committee does not have independent decision-making authority, but the Board makes the decisions on the basis of preparations by the committee. The Audit Committee consists of the chairman and at least two members, who the Board appoints from among the Board members for one year at a time. In 2020, Mammu Kaario was the Chairman of the Audit Committee and Mikael Laine, Tatu Vehmas and Heikki Westerlund were committee members.

The tasks of the Audit Committee are:

  • monitoring the financial statements process
  • control of the financial reporting process
  • assessment of the use and presentation of alternative key indicators
  • monitoring the effectiveness of internal control, internal audit and risk management systems
  • review of the internal audit’s plans and reports
  • dealing with the plans and reports of the company’s compliance function
  • dealing with the report issued by the company regarding its corporate governance system and the report issued regarding non-financial information
  • monitoring the statutory audit of the financial statements and consolidated financial statements
  • assessing the independence of the audit firm
  • assessing the auxiliary services offered by the audit firm
  • preparing the decision on the election of the auditor
  • other contacts with the auditor in addition to the tasks required by regulation
  • definition of the principles concerning the monitoring and assessment of related party transactions

The Audit Committee convenes regularly at least twice a year. In 2020, the Audit Committee had five meetings. The participation rate was 100%. 

Remuneration committee
The Remuneration Committee is responsible for preparing matters related to the remuneration and appointment of the CEO and other members of the company’s management and to other personnel reward schemes. The Remuneration Committee does not have independent decision-making powers; the Board makes the decisions collectively on its behalf. The Remuneration Committee consists of the chairman and of two to three members, which the Board elects from among its members for one year at the time.

In 2020, Gustav Nyberg was the Chairman of the Remuneration Committee, with Salla Pöyry and Tatu Vehmas as its members.

The tasks of the Remuneration Committee are:

  • to prepare the appointment of the CEO and other members of the management, and to identify their successors;
  • to prepare the salaries and other financial benefits of the CEO and other members of the management;
  • to prepare matters related to the company’s reward schemes;
  • to assess the remuneration paid to the CEO and other members of the management, and to ensure that reward schemes are purposeful;
  • to assess and prepare recommendations of share-based incentive plans that are based on shares or special rights entitling their holder to shares and present recommendations about them to the Board of Directors;
  • to plan other personnel remuneration and related organizational development;
  • to prepare the remuneration report;
  • to draw up the Board’s diversity report;
  • to monitor the need to update the remuneration policy and to monitor its observance (regarding remuneration of the CEO);
  • to respond to questions related to the remuneration report at the Shareholders’ Meeting; and
  • to recommend an advisor for the company’s Board of Directors, if required, and to prepare a proposal for fees to be paid to the advisor.

The Remuneration Committee convenes regularly at least three times a year. In 2020, the Remuneration Committee had eight meetings. The participation rate was 100%. There were more meetings than usual due to the recruitment process of the new CEO.


CHAIRMAN OF THE BOARD

Gustav Nyberg, B.Sc. (Econ.), eMBA (64) has been the Chairman of the Aspo Plc’s Board of Directors.

DIVERSITY OF THE BOARD OF DIRECTORS

Aspo regards diversity of the Board of Directors as a significant part of sustainable operations and a success factor that enables the company to reach its strategic goals. Diversity is part of a functional Board of Directors that is able to work together and respond to the requirements set by the company’s businesses and strategic goals, and to challenge the company’s acting management in a proactive and constructive manner.

The Shareholders’ Nomination Board prepares and presents the proposal for the composition of the Board of Directors to the Annual Shareholders’ Meeting. When planning the composition of the Board of Directors, the Shareholders’ Nomination Board takes into account these diversity principles and particularly the needs and development phases of the company’s businesses, as well as the competence areas required by different Board committees. When selecting board members, the key objective is to ensure that the Board of Directors as a whole supports the development of Aspo's current and future business operations.

The Shareholders’ Nomination Board discusses the competence, know-how and suitability required of Board members so that each member can be assumed to have the required expertise and experience for successfully carrying out their duties. The objective of the preparatory work of the Nomination Board is to ensure that the Board of Directors forms a functional entity.

Diversity on the Board of Directors is examined from different perspectives. For the composition of Aspo's Board of Directors, key factors are, in particular, competence, with each board member supplementing one another, education and experience in different markets, fields of business, management and operations in different development phases, as well as the personal characteristics of each member. In addition, diversity in the Board of Directors is supported, among others, by experience in an international operating environment and consideration of the age and gender distribution. The objective is that both genders are represented by at least two members. Aspo fulfills this objective.

The members of Aspo’s Board of Directors must have the competence required for the position and the ability to allocate sufficient time to their duties. When composing the Board of Directors, the long-term needs and succession planning are also taken into account. The composition of the Board of Directors and the number of members must enable the Board of Directors to work effectively.

Aspo owns and develops businesses belonging to the Group. The Boards of Directors of each subsidiary prepare and decide on the strategies of each business. The subsidiaries are independent of one another, and they have separate objectives, customer needs, capital structures and business cycles. Therefore, they need independent Boards of Directors that produce genuine added value for the development of the companies. Aspo’s CEO acts as the chairman of the Boards of all subsidiaries. Top experts in their fields are sought for the Boards of subsidiaries. The same degree of diversity is sought for the Boards of subsidiaries as the Aspo Board of Directors. Through their work, the Boards of Directors of the subsidiaries support diversity in the Board of Directors of Aspo.

CHIEF EXECUTIVE OFFICER

Aspo Plc’s CEO is selected by the Board of Directors. The Board also decides on the remuneration payable to the CEO, on the long-term and short-term incentive programs, and on other terms and conditions of the CEO’s contract of service. The terms and conditions of the CEO’s contract of service are specified in a written contract approved by the Board of Directors. The CEO is appointed for an indefinite term.

Aki Ojanen, eMBA (60), acts as the CEO of Aspo. The CEO leads and develops of the Group’s business and is responsible for the operative management in accordance with the instructions of the Board of Directors. The CEO presents matters and reports to the Board of Directors. The CEO is responsible for the Group administration in accordance with the instructions of the Board of Directors, and for the company accounting complying with applicable legislation and the reliable arrangement of the company finances. He also serves as the Chairman of the subsidiary Boards and acts as the operational supervisor of the Managing Directors of the subsidiaries and Group administration. He is also responsible for the internal audit and for Group risk management, which are coordinated by the CFO.

GROUP EXECUTIVE COMMITTEE

The CEO is assisted by the Group Executive Committee. The Group Executive Committee is responsible for developing the strategic structure of Aspo Group and its earnings, and it prepares the policies and common practices. The Croup Executive Committee consists of the Group CEO, Group CFO, Group Treasurer, Group Legal Affairs, and the Managing Directors of the Group companies. The Group Executive Committee convenes at least six times a year.

GROUP EXECUTIVE COMMITTEE MEMBERS ON DECEMBER 31, 2020

Aki Ojanen
CEO, Aspo Plc, 2009–
eMBA, born in 1961
Shareholdings in Aspo on December 31, 2020: 67,377 shares, or 0.21%, of the total number of shares. 

Heli Arantola
Managing Director, Leipurin Plc, 08/2020–
D.Sc. (Econ.), born in 1969
Shareholdings in Aspo on December 31, 2020: no Aspo shares

Matti-Mikael Koskinen
Managing Director, ESL Shipping Ltd, 2013–
M.Sc. (Econ.), born in 1972
Shareholdings in Aspo on December 31, 2020: 52,957 or 0.17% of the total number of shares

Keijo Keränen
Group Treasurer, Aspo Plc, 2020–
M.Sc. (Econ.), born in 1977
Shareholdings in Aspo on December 31, 2020: 26,362 shares, or 0.08%, of the total number of shares. 

Arto Meitsalo
CFO, Aspo Plc, 2009–
Managing Director, Aspo Services Ltd, 2013–
M.Sc. (Econ.), born in 1963
Shareholdings in Aspo on December 31, 2020: 57,696 shares, or 0.18%, of the total number of shares.

MIKKO PASANEN
Managing Director, Telko Ltd., 2019–
M.Sc. (Econ.), born in 1973
Shareholdings in Aspo on December 31, 2020: 30,004 shares, or 0.09%, of the total number of shares.

Toni Santalahti
Director, Legal Affairs, Aspo Plc, 2017–
LL.M, born in 1971
Shareholdings in Aspo on December 31, 2020: 20,427 shares, or 0.06%, of the total number of shares. 

REMUNERATION

The Remuneration Policy concerning Board members and the CEO was approved by the Board of Directors of Aspo on February 13, 2020. The Remuneration Policy describes the decision-making procedures and principles concerning the remuneration of the Board of Directors and the CEO, and it is presented to the Annual Shareholders’ Meeting every four years or whenever it is amended.

The salaries, remuneration and other financial benefits of the CEO and the Board of Directors are presented in a separate Remuneration Report available on the company’s website at www.aspo.com/remuneration.

AUDIT

The statutory duty of the independent external auditor is, in particular, to ensure that the financial statements provide correct and sufficient information on the company's financial results for the period and its financial position.

According to the Articles of Association, the Annual Shareholders’ Meeting elects the auditor, which must be an audit firm approved by the Finland Chamber of Commerce. In addition, the Annual Shareholders’ Meeting decides on the fee payable to the auditor and its basis. The term of the auditor ends at the close of the next Annual Shareholders’ Meeting following the election. When changing the auditor, the Annual Shareholders’ Meeting elects the new auditor on the basis of the proposal of the Board of Directors, prepared by the Audit Committee.

The auditor elected by the Annual Shareholders’ Meeting is responsible for instructing and coordinating the audit work centrally in the Group. As part of the annual audit, the auditor audits the company’s accounts and administration. In addition, the auditor audits the consolidated financial statements and other relations between Group companies.

The auditor provides the company’s shareholders with the auditor’s report required by law in connection with the financial statements. The Board also receives other possible reports and statements issued by the auditor.

The 2020 Annual Shareholders’ Meeting elected the Audit Firm Deloitte Oy as the auditor. Jukka Vattulainen, APA, has been the auditor in charge. In 2020, companies belonging to the Deloitte Oy in Finland and abroad were paid approximately EUR 304,000 for performing the audits for the Aspo Group companies. In addition, other services were procured for about EUR 16,500.

INTERNAL CONTROL

The particular objective of Aspo’s internal control is to ensure the profitability and efficiency of operations, reliable financial reporting, as well as compliance with the applicable laws and regulations and the agreed practices and operating principles. Aspo’s internal control includes the control that is built in to the business processes, the Group’s management system, and financial reporting covering the entire Group. Internal control is an integral part of the company’s management, risk management and administration.

The aim of internal control is to create sufficient certainty of goals and objectives being reached in the following issues:

  • operational profitability and efficiency and capital management
  • reliability and integrity of financial and operational information
  • compliance with laws, regulations and agreements, as well as ethical principles and social responsibility
  • safeguarding and responsible management of assets and brands


The responsibility to arrange the control lies with the Board of Directors and the CEO both at Group level and in the different business areas. Aspo’s Board is responsible to the shareholders and the CEO to the Board. The chain of responsibility continues throughout the organization so that each Aspo employee is responsible to his/her superior for control. Group company controllers have control responsibility concerning compliance with legislation and Group instructions. As well as to the subsidiary management, they also report to the CFO. The CFO reports to the CEO and Board on possible findings. The internal audit function supports the Group management in their control task and the aim is to offer the Aspo board sufficient assurance that the internal controls are functioning.

FINANCIAL REPORTING

The control of financial reporting is based on monitoring of business processes. The information for financial reporting is created as business processes progress, and responsibility for correct information is shared by all participants in the process. The financial reporting process is decentralized and monitored by the Audit Committee.

The financial statements of the Group are prepared according to the IFRS standards as adopted by the EU. The financial statements of the parent company and the Finnish subsidiaries are prepared according to the Finnish Accounting Standards. Each separate company complies with the legislation of the country where it is located, but reports the information according to Aspo’s internal accounting instructions. Separate companies may have their own chart of accounts, but all information is consolidated on the basis of a common chart of accounts to the unit level, where their reliability is assessed before the information is transferred to Group level. Aspo Group’s financial information is verified, and assessed on monthly basis. At each phase the unit responsible for the quality and generation of information will assess its reliability. The Group-level monitoring and reconciliation mechanisms are used on both monthly and quarterly bases.

The systems required for financial reporting are decentralized and used according to the principles of internal control. Achieving the set targets is monitored on a monthly basis with the Group’s consolidation and reporting system. In addition to actual and comparative figures, the system provides up-to-date forecasts. The reports are provided to the Aspo Board of Directors monthly. The Board of Directors assesses the Group’s position and future based on the provided information. The Board of Directors is responsible for the contents and publication of the financial statement.

Besides the Audit Committee, the reliability of reporting and processes are assessed by an independent, external audit firm.

INTERNAL AUDIT

The purpose of the internal audit is to support assessment and assurance of the Group to verify the efficiency of risk management, control, management and administration. The internal audit assists the management and the organization in ensuring the Group targets and in ensuring the effectiveness and development of the control system.

The Board of Directors approves the principles of the internal audit as part of internal control. The Group CFO is responsible for coordination of the internal audit, and reports the findings to the CEO, the Audit Committee and the Board of Directors. The internal audit is organized corresponding to the size of the Group. Additional resources and special skills will be obtained for demanding assessments, when required. The target is to perform several risk-based audits annually. The audits are based on risk assessment as defined in the risk analyses of individual business units. The objects of the audit assessment and assurance are profitability and efficiency of activities, reliability of financial and operational reporting, compliance issues and safeguarding of assets. 

The Audit Committee monitors the operations and efficiency of the company’s internal audit in its meetings. The committee also reviews the plans and reports of the internal audit.

RISK MANAGEMENT

The goal of risk management is to ensure the implementation of Group strategy, development of financial results, shareholder value, ability to pay dividends and continuity of business. Risk management is systematic, proactive and holistic. Risk management covers the entire operations of the Group and all major areas of risk. This means that key risks are systematically identified, assessed, managed, monitored, and reported as part of business operations. The operational management of the business units is responsible for risk management. They are also responsible for determining sufficient measures and their implementation, and for monitoring and ensuring that the measures are implemented as part of daily management of operations. Risk management is coordinated by the Group CFO, who reports to the Group CEO.

The Audit Committee monitors the efficiency of the risk management systems and deals with processes, plans and reports of the risk management.

Each business unit has a separate risk management program. Business risks and their management are dealt with in the business unit management teams. The functions common to the whole Group will ensure that sufficient risk assessment and reporting procedures are incorporated into the processes they are responsible for. In terms of certain risks, the risk management principles and main content have been defined in Group-level policies and guidelines. The Group administration is responsible for Group-level insurance plans.

Risk management is essentially based on the aforementioned procedures of internal control, where the chain of responsibility extends throughout the Group. The most important factors in business risk management are a profound understanding of the business and command of the tools which are used for daily business operations and their management. Characteristic risks in each business area are identified in the business units, assessed in the business unit management teams, and reported to the subsidiary Boards and, if need be, also to the Aspo Board of Directors or the Audit Committee.  

Risks are continuously assessed and their management is discussed in the business unit management teams. Risk assessments are updated according to Aspo’s management policy and the most noteworthy findings are presented in the quarterly interim reports. Larger projects always include a separate risk analysis. The most significant risks for the Group are assessed once a year and the results are presented in the annual report.

Financial risks, their management principles and related organization are presented in the notes to the consolidated financial statements.

RELATED PARTY TRANSACTIONS

Aspo complies with the legislation governing related party transactions, the Finnish Corporate Governance Code, and the rules and instructions of Nasdaq Helsinki Oy. On these bases, Aspo must evaluate and monitor business transactions in which it is engaged with its related parties, and ensure that any conflicts of interest are appropriately addressed in decision-making. Aspo maintains a list of related parties and verifies any changes at least once a year. If related party transactions are significant for Aspo and differ from regular business activities, or have been carried out on the basis of unusual market conditions, decision-making processes associated with these related party transactions must be described in the financial statements.

Aspo’s related party transactions are described in Note 5.3 Related Parties of the consolidated financial statements. Related party transactions are not significant for the company, nor do they differ from the company’s normal business activities, and they have been carried out at normal market conditions.

INSIDER MANAGEMENT

The Aspo Group complies with the EU Regulation (EU No 596/2014) on market abuse and regulations issued pursuant to it, including the Guidelines for Insider issued by Nasdaq Helsinki Oy.

Permanent insiders of Aspo Plc include members of the Board of Directors, the Group’s Executive Committee, the auditor and other individuals who have regular access to insider information. Individuals working in managerial positions at Aspo Plc include members of the Board of Directors and the Group’s Executive Committee. When necessary, Aspo establishes and maintains project-specific insider registers regarding individuals who participate in the preparation of insider projects.

The 30-day closed window preceding the publication of interim reports, half year financial reports and financial statement release applies to individuals working in managerial positions at Aspo and to permanent insiders. During the closed window, transactions using Aspo’s financial instruments in one’s own name or in the name of a third party are not permitted. Furthermore, individuals entered in project-specific insider registers cannot trade on securities issued by the company during the specific project period. Individuals working in managerial positions at Aspo and their related parties must report any business transactions associated with the company’s financial instruments to the company and the Finnish Financial Supervisory Authority.

The Group’s CFO is responsible for the control and monitoring of insider issues.

Aspo Plc’s insider register and project-specific insider registers are maintained in the Sire service, an application service provided by Euroclear Finland for its customers to maintain registers associated with insider management.

 

ASPO PLC

Board of Directors

 

Published on March 4, 2021



Updated: 29.07.2021