Scandinavian Tobacco Group complies with the corporate governance recommendations. A detailed overview can be found in Scandinavian Tobacco Group’s Statutory Report on Corporate Governance.
The Audit Committee’s tasks include review, assessment and supervision of the Company’s financial reporting, the audit process and the internal control and risk management systems. The Audit Committee also assesses the independence of the external auditor, supervises the work of the external auditor and assesses the need for an internal audit function. The CFO and the external auditor participate in meetings of the Audit Committee, and the Chief Executive Officer may participate in meetings of the Audit Committee if requested by the Audit Committee. The members of the Audit Committee currently are: Marlene Forsell (Chairman), Dianne Blixt and Anders Obel. All members of the Audit Committee are considered independent and have relevant financial expertise. In 2021, the Audit Committee held six meetings, and the attendance rate was 100%.
Main activities in 2021 were:
- Review of the annual report and the quarterly financial statements
- Review of the main accounting principles and significant accounting estimates
- Review of the adequacy and effectiveness of the Group’s internal control and risk management organisation and systems
- Review of the Group’s treasury, tax and insurance policies
- Assessment of financing and capital structure
- Assessment of the need for an internal audit function
- Recommendation for the selection of external auditors, including evaluation of independence and competences
- Review of the committee’s Rules of Procedure
- Status of reporting under the Group’s whistleblower scheme.
The Remuneration Committee provides recommendations to the Board of Directors with regard to the remuneration applicable to the Board of Directors and the Executive Management for subsequent approval by the General Meeting of Shareholders. The Remuneration Committee further submits proposals for the remuneration of the Board of Directors and the Executive Management. The Remuneration Committee currently consists of three members: Henrik Brandt (Chairman), Dianne Blixt and Claus Gregersen. All members of the Remuneration Committee with the exception of Claus Gregersen qualify as being independent of the Company. In 2021, the Remuneration Committee held four meetings with a 100% attendance rate.
Main activities in 2021 were:
- Determination of the key performance indicators and targets related to the long-term and the short-term incentive programmes and assessment of actual performance
- Determination of participants under the long-term and short-term incentive programmes
- Assessment/review of the remuneration of the Executive Management and the Board of Directors
- Approval of the Remuneration Report
The Nomination Committee supports the Board of Directors’ decisions with respect to the nomination of the members of the Board of Directors and the appointment of members of the Executive Management. The Nomination Committee carries out the annual evaluation of the Board of Directors, assesses the structure, size and composition of the Board of Directors and the qualification, knowledge and experience of each member of both the Board of Directors and the Executive Management. It shall report its assessments to the Board of Directors. The Nomination Committee currently consists of three members: Henrik Brandt (Chairman), Dianne Blixt and Claus Gregersen. All members of the Nomination Committee with the exception of Claus Gregersen qualify as being independent. In 2021, the Nomination Committee held two meetings with a 100% attendance rate.
The main activities in 2021 included:
- Assessment of qualifications and competences required in the Board of Directors
- Evaluation of the composition of the Board of Directors
- Evaluation of the performance of the Executive Management
- Evaluation of the Board of Directors’ self-evaluation and assessment of results hereof
Søren Ørjan Jensen, State-Authorized Public Accountant
Michael Groth Hansen, State-Authorized Public Accountant
The responsibility for the governance of risks lies with our Board of Directors. On behalf of the Board of Directors, the Audit Committee monitors the effectiveness of our Group's risk management and evaluates the design annually. The Executive Board manages the operational part of our risk management and our Executive Management ensures proper and complete reporting to the Audit Committee.
Risk assessment process
Scandinavian Tobacco Group operates with a framework including various principles that secure a structured and cross-functional approach to risk management. The approach is a top-down facilitated process with the intent to identify risks and support risk management throughout the organisation, and ensure consistent follow-up and reporting on risks to the Executive Board during the year. To receive input from the organisation, a Risk Team works with key stakeholders across the business to ensure an effective assessment before presenting recommendations to the Executive Board. The Executive Board performs an annual risk assessment based on the impact and likelihood of a risk materialising. The process ensures that appropriate actions are taken to reduce, prevent or mitigate risks and to ensure that the Group is transparent and compliant in its external communication on these risks. The main risk categories identified are regulation, excise taxes, total market development, cyber risk and implementation of a new Group Enterprise Resource Planning (ERP) system.