3. Board of Directors

3.1 Members of the Board of Directors

The Board of Directors, which according to the Articles of Association must have at least five members, currently has six, after Calvin Grieder decided not to stand for re-election at the Annual General Meeting of Shareholders on 22 March 2017.

None of the Members of the Board of Directors performs an operational management role for Implenia Ltd. or any of its group companies. Neither has any Member of the Board of Directors been part of the Group Executive Board of Implenia Ltd. or any of its Group companies during the last three financial years. No Member of the Board of Directors has any significant business relationships with the Implenia Group.

On 31 December 2017 the Board of Directors had the following members:

3.2 Education, activities and interests 

The following list provides the main details of each Board Member’s education, training and professional career. It also details each Board Member’s mandates outside the Group, as well as other significant activities, such as permanent roles within major interest groups.

Hans Ulrich Meister

Hans Ulrich Meister

Hans Ulrich Meister (born 1959, Swiss, non-executive)

Hans Ulrich Meister has been a Member and Chairman of the Board of Directors since March 2016. Between 2008 and March 2016, Hans Ulrich Meister was CEO of the Switzerland Region for Credit Suisse. From 2011 he was also CEO of the Private Banking Division and from 2012 Head of the Private Banking & Wealth Management Division, responsible for private banking business in EMEA (Europe, Middle East, Africa) and Asia Pacific. In these roles he was also a Member of the Executive Boards of Credit Suisse Group AG and Credit Suisse AG. Previously, he performed various management functions for UBS in Switzerland and internationally for over 20 years, finishing as Head of Private and Corporate Clients between 2005 and 2007. From 2004 he was also a member of the UBS Group Managing Board. Before that he was responsible for the large corporates & multinationals business. In 2002 he worked for UBS’s Wealth Management USA in New York. Hans Ulrich Meister has a business degree from Zurich University of Applied Sciences and graduated from the Advanced Management Program of Wharton School and Harvard Business School.

Kyrre Olaf Johansen

Kyrre Olaf Johansen

Kyrre Olaf Johansen (born 1962, Norwegian, non-executive)

Kyrre Olaf Johansen has been Vice Chairman of the Board of Directors since March 2017 and a Member of the Board since March 2016. He is also a member of the Audit Committee. Since 2013, Kyrre Olaf Johansen has been CEO of Norsk Mineral AS, which works internationally in the minerals, real estate, industry, finance and renewable energy sectors. From 2008 to 2012 he was CEO of real estate company Entra Eiendom with a portfolio of almost CHF 3 billion. After completing his masters in construction engineering in 1986, he worked as an engineering consultant until 1991. In 1989, he earned a degree as business candidate at the BI Norwegian Business School. From 1991 to 1998 he held various management positions on construction projects at ABB Power Generation AG in Baden, Switzerland. In 1999 he became regional head of the Norwegian branch of NCC, an internationally active construction and real estate company based in Sweden. In 2000 he became CEO of the road construction division of NCC Industri, now NCC Roads. Between 2003 and 2008, as CEO of Mesta AS, he was in charge of one of Norway’s biggest roadbuilders. Kyrre Olaf Johansen has extensive management experience in various industries and is a leading proponent of a value-based management culture.

Chantal Balet Emery

Chantal Balet Emery

Chantal Balet Emery (born 1952, Swiss, non-executive)

Chantal Balet Emery has been a Member of the Board of Directors since March 2013. She is also a Member of the Nomination and Remuneration Committee. Chantal Balet Emery is a consultant lawyer at the Pratifori 5 law firm and partner in Cabinet Conseil Fasel, Balet, Loretan (FBL). From 1994 to 2008 she headed the Western Swiss office of the economiesuisse business association in Geneva. From 1984 to 1994 she worked as a self-employed lawyer and notary in Canton Valais. She is a member of the boards of directors of the following companies: Vaudoise Assurances Holding SA (Vice Chair), Vaudoise Générale, Compagnie d’Assurances SA (Vice Chairman), Vaudoise Vie, Compagnie d‘Assurances SA (Vice Chairman), Mutuelle Vaudoise, Société Coopérative (Vice Chair), Walliser Kantonalbank (Member), Maison Gilliard SA (Chairman), Domaines Maison Gilliard SA (Chairman), OLF SA (Member) and Clinique de Valère SA (Chairman).

Henner Mahlstedt

Henner Mahlstedt

Henner Mahlstedt (born 1953, German, non-executive)

Henner Mahlstedt has been a Member of the Board of Directors since March 2015. He is also Chairman of the Audit Committee. Henner Mahlstedt studied civil engineering at the Technical University of Braunschweig. From 1980 to 2001 Henner Mahlstedt held various management positions at Strabag Hoch- und Ingenieurbau AG in Hamburg, Berlin and Cologne, from 1997 to 2001 as a Member of the Executive Board. He then served as CEO of Pegel & Sohn GmbH + Co. KG in Berlin before moving in 2003 to take charge of the new federal states for Hochtief Group. In 2005 he was appointed to the Executive Board of Hochtief Construction AG in Essen; from 2007 until the end of 2010 he was the Chairman of the Executive Board. Henner Mahlstedt was then appointed Chairman of the Executive Board of Hochtief Solutions AG in Essen. From 2007 to 2012 he was also a Member of the Global Group Executive Committee of Hochtief AG. In addition, he held various positions on the committees of the German Construction Industry Federation and the German Society for Concrete and Construction Technology. Henner Mahlstedt has worked at Mahlstedt Consultants GbR since mid-2012. He is also a member of the advisory board of Huesker Synthetic GmbH and Franzen Holding GmbH, and is a lecturer at Westfälische Hochschule.

Ines Pöschel

Ines Pöschel

Ines Pöschel (born 1968, Swiss, non-executive)

Ines Pöschel has been a Member of the Board of Directors since March 2016. She is also Chairman of the Nomination and Remuneration Committee. Since 2007 Ines Pöschel has been a Partner at law firm Kellerhals Carrard, and since 2010 a member of the firm’s Steering Committee. Before that she worked in various positions at well-known law firms in Switzerland and the USA, including as a lawyer at Bär & Karrer from 2002 to 2007, and as Senior Manager at Andersen Legal from 1999 to 2002. Ines Pöschel completed her legal studies at the University of Zurich in 1993 and was called to the bar in 1996. She is a member of various boards of directors and boards of trustees (including at Bernexpo Holding AG, Wirz Partner Holding AG, Reichle Holding AG and Foundation Lotti Latrous), and she sits on the Swiss Federal Commission of Experts for the Commercial Register. She regularly lectures at renowned universities. Ines Pöschel specialises in company and capital markets law, corporate governance, and M&A transactions at private and listed companies.

Laurent Vulliet

Laurent Vulliet

Laurent Vulliet (born 1958, Swiss, non-executive)

Laurent Vulliet has been a Member of the Board of Directors since March 2016. He is also a Member of the Nomination and Remuneration Committee. Laurent Vulliet is an independent advisor and Professor of Soil Mechanics at the Swiss Federal Institute of Technology in Lausanne (EPFL), where he also teaches risk management. Having graduated as a construction engineer from the ETH Zurich in 1980 he obtained his doctorate in 1986 from the EPFL. In 2008 he completed the Advanced Management Program at INSEAD in Fontainebleau (France). Between 2006 and 2015 he was a Member of the Board and since 2008 also CEO of BG Ingénieurs Conseils SA in Lausanne. For three years from 1986 he taught at the University of Arizona in Tucson (USA). From 1989 he worked as Senior Engineer at Cérenville Géotechnique SA in Ecublens. From 2001 until the end of 2007 he was Deacon of the ENAC faculty at the EPFL, which encompasses architecture, infrastructure and environmental sciences. Laurent Vulliet is a Member of the Swiss Academy of Engineering Sciences. From 1997 to 2007 he was also a member of the Non-Parliamentary Commission for Natural Hazards and from 2009 to 2013, Vice Chairman of the Swiss Engineers and Architects Association (SIA).

3.3 Rules included in the Articles of Association relating to the number of permitted activities allowed under Art. 12 para. 1 point 1 OaEC 

According to Art. 22e of the Articles of Association, the number of mandates that members of the Board of Directors can take in the most senior management and supervisory bodies of legal entities outside the Implenia Group that are registered in the Swiss Commercial Register or similar foreign register is limited to a maximum of 14 mandates, of which no more than four may be at listed companies. If mandates are exercised in different legal entities within one group, or on behalf of one group or legal entity, these are counted altogether as one mandate. A Member can exceed the maximum limits for a short time in line with the provision of the Articles mentioned above.

The Articles of Association, containing the precise wording of the provision mentioned above, can be found on Implenia’s website.
http://www.implenia.com/goto/corporategovernance/2017/en/Articles-of-Associations-20150324.pdf

3.4 Election and term of office 

The term of office of Board Members is one year. This commences on the date of election and finishes at the end of the subsequent Annual General Meeting, unless the Member resigns or is dismissed before this (Art. 18 para. 3 of the Articles of Association). Members of the Board can be re-elected at any time (Art. 18 para. 4 of the Articles of Association), but are subject to an upper age limit of 70 years. They must leave the Board at the Annual General Meeting of Shareholders following their 70th birthday (Art. 18 para. 5 of the Articles of Association).

In accordance with the provisions of the Ordinance against Excessive Compensation at Stock Exchange Listed Companies (OaEC), the Members and Chairman of the Board of Directors and the members of the compensation committee (Nomination and Remuneration Committee) are elected individually by the General Meeting of Shareholders (Art. 9b and Art. 18 h. 2 of the Articles of Association). Also in line with the relevant provisions of the OaEC, the independent proxy is also elected by the General Meeting of Shareholders (Art. 9b of the Articles of Association). Otherwise, the Board of Directors constitutes itself and appoints its own Vice Chairman and Secretary.

With regard to dealing with a vacancy in the Chairmanship of the Board of Directors, or with the Nomination and Remuneration Committee not having sufficient Members, or with the company not having an independent proxy, the Articles of Association do not include any provisions that deviate from Art. 4 para. 4 OaEC, Art. 7 para. 4 OaEC and Art. 8 para. 6 OaEC.

3.5 Internal organisation

3.5.1 Distribution of responsibilities within the Board of Directors

The Board of Directors is responsible for strategic and financial leadership of Implenia and for supervising the operational management team. It takes decisions as the most senior body, except on matters where the law gives responsibility to the General Meeting of Shareholders.

The Chairman of the Board of Directors convenes the Board’s meetings. If the Chairman is indisposed, the Vice Chairman, or if necessary a Member of the Board of Directors nominated by the Board, convenes the meeting. The CEO and CFO regularly attend meetings of the Board of Directors. The Chairman determines the agenda, prepares the meetings and chairs them. He decides on a case-by-case basis whether to involve other people in the Board’s deliberations. Any Member can request that a Board meeting be convened provided they supply an agenda and a brief justification.

The Board of Directors’ duties, powers and working methods, as well as its approach to conflicts of interest, are set out in Implenia’s OR and in the Table of Responsibilities of 17 February 2017 (“Table of Responsibilities”).

Implenia’s OR (excluding the Table of Responsibilities) can be found on the Implenia website.
http://www.implenia.com/goto/corporategovernance/2017/en/OR-Implenia-20151221.pdf

3.5.2 Committees of the Board of Directors

The Board of Directors has formed two committees, the Audit Committee and the Nomination and Remuneration Committee. It elects a Chairman for each committee. The Audit Committee and the Nomination and Remuneration Committee analyse the areas assigned to them by the Board of Directors and submit reports to the Board of Directors to help it prepare its resolutions and perform its supervisory function. The Chairman of the individual committees inform the Board of Directors about all major points and give recommendations for the decisions that have to be taken by the Board as a whole. The committees’ tasks and responsibilities are set out in Implenia’s OR and in the Table of Responsibilities, as well as in regulations issued by the Board of Directors.

The committees organise themselves. The Board issues regulations in response to committee proposals. The committees are fundamentally advisory bodies; decision-making power is reserved for the Board of Directors as a whole. The committees only have decision-making power when this is stipulated in the Table of Responsibilities or committee regulations, or by special resolution of the Board of Directors.

The committees are authorised to carry out or commission investigations into all matters relating to their area of responsibility. They can bring in independent experts to help. The Board of Directors can appoint ad hoc committees for specific tasks and allocate powers of preparation, monitoring and/or decision-making to these committees (Section 3.1 paras. 1 and 6 Implenia’s OR). No ad hoc committees were formed during the year under review.

The committees and their Members for the year under review are shown in the table below:

3.5.2.1 Audit Committee

The Audit Committee consists of at least two Members of the Board of Directors, who are nominated by the Board of Directors. The Audit Committee handles all Board business relating to the monitoring and structuring of the accounting system, financial controlling (internal control system), financial planning and risk management. This includes reporting on (current and impending) legal cases. The Audit Committee also monitors the Compliance Management System and reports on this to the Board of Directors. It coordinates and harmonises the work of the internal and external auditors, is responsible for regular communication with the internal and external auditors and formulates instructions for the internal and external audit. It has the authority to order special audits (Section 3.2 Implenia’s OR).

Please also refer to Implenia’s OR for details of the Audit Committee’s responsibilities:
http://www.implenia.com/goto/corporategovernance/2017/en/OR-Implenia-20151221.pdf

3.5.2.2 Nomination and Remuneration Committee

The Nomination and Remuneration Committee is made up of between two and four Members of the Board of Directors, each of whom are elected individually by the General Meeting of Shareholders. The principles governing the tasks and responsibilities of the Nomination and Remuneration Committee in relation to remuneration are determined by the General Meeting pursuant to Art. 21a of the Articles of Association and are described in more detail in the Remuneration Report (see pages 172–174).

Please also refer to Implenia’s OR for details of the Nomination and Remuneration Committee’s responsibilities:
http://www.implenia.com/goto/corporategovernance/2017/en/OR-Implenia-20151221.pdf

3.5.3 Working method of the Board of Directors and its committees

The Board of Directors and its committees meet as often as business requires, but at least six times a year (Board of Directors), three times a year (Audit Committee), and twice a year (Nomination and Remuneration Committee). Meetings take place at the invitation of the chair of the committee concerned. Invitations are accompanied by an agenda and meeting documents. In addition, each member is entitled to request that a meeting be convened and can request that items are added to the agenda. Each meeting of the Board of Directors is chaired by the Chairman of the Board; the committee meetings are led by the committee chairs. Meetings are quorate if the majority of members are in attendance. Members who take part in the meeting via telephone or video conference shall be regarded as being present at the meeting.

The Board of Directors and its committees pass resolutions and elect members by simple majority of the votes cast by attending members. Abstentions are not permitted. If votes are tied, the person chairing the meeting has the casting vote. The results of discussions and the resolutions made are minuted. The CEO and CFO also regularly attend meetings of the Board of Directors. If necessary, other Members of the Group Executive Board and/or Business Unit Heads are invited to attend the meetings. In accordance with Section 2.3c of Implenia’s OR, the Board of Directors also holds meetings without the participation of the CEO, CFO or Members of the Group Executive Board.

The Chairman of the Board of Directors participates in meetings of the Audit Committee and the Nomination and Remuneration Committee as a standing guest. The Audit Committee’s meetings are generally also attended by the CEO, the CFO, the Head of Corporate Controlling, the Head of Corporate Reporting & Tax, where necessary a representative of Internal Audit, and one or more representatives of the external auditors and other persons selected by the Chair. Meetings of the Nomination and Remuneration Committee are generally attended by the CEO, the CFO and the Head of Human Resources Group. Guests of the meetings of the Board of Directors and the committees do not have the right to vote. Furthermore, Members of the Group Executive Board do not attend meetings of the Nomination and Remuneration Committee or of the Board of Directors if their own performances are being assessed, or if their remuneration is being discussed.

The following tables provide an overview of the meetings and conference calls of the Board of Directors, the Audit Committee and the Nomination and Remuneration Committee in 2017:

3.6 Definition of areas of responsibility 

The Board of Directors is responsible by law for the ultimate direction and supervision of the group. As well as the powers of authority reserved under Art. 716a of the Swiss Code of Obligations, the Board of Directors also takes decisions on the following major areas of business as shown in the Table of Responsibilities:

  • Purchases or sales of holdings with an enterprise value of CHF 25 million or more;
  • Defining target markets and deciding to enter a market;
  • Defining financial policy principles (level of debt and financial indicators);
  • Defining the funding concept;
  • Obtaining debt capital (credit facilities, bonds, private placements and other capital market transactions, leasing, hire purchase) of more than CHF 50 million;
  • Fundamental issues and guidelines relating to the investment of financial resources;
  • Issuing group guarantees, warranties, bid, performance and payment bonds etc., other collateral, and contingent liabilities outside regular business activity worth more than CHF 5 million;
  • Use of derivative financial products when not deployed exclusively to reduce risks.

The Board of Directors delegates management of Implenia Group to the CEO to the extent that the law, the Articles of Association, or Implenia’s OR do not stipulate otherwise, and provided that responsibilities are not delegated to the Group Executive Board or to its individual Members.

The CEO is responsible for operational management and for representing Implenia Group to the extent that these duties are not assigned to other bodies by the law, the Articles of Association or Implenia’s OR. He is responsible for managing the Group’s business and for representing the Group, and especially for its operational management and for implementing strategy. Unless these are reserved for the Board of Directors, he is empowered to arrange or perform the duties and powers of authority assigned to him by Implenia’s OR, and/or delegate these to qualified subordinate units if he instructs and monitors them accordingly. The CEO is supported in managing the business by the Members of the Group Executive Board and the Business Unit Heads, all of whom report directly to him. The CEO is responsible for reporting to the Chairman of the Board of Directors and to the Board of Directors (Section 4.1 f. Implenia’s OR). The division of powers between the Board of Directors, the CEO and the Group Executive Board is described in detail in Implenia’s OR and the Table of Responsibilities.
http://www.implenia.com/goto/corporategovernance/2017/en/OR-Implenia-20151221.pdf

3.7 Information from and control instruments vis-à-vis the Group Executive Board 

To help it monitor how the CEO and Members of the Group Executive Board are performing the tasks entrusted to them, the Board of Directors has information and control instruments at its disposal, including the following:

The MIS (Management Information System) provides monthly reporting on how business is going. The MIS report contains information about turnover, margins, costs and the operating result, plus information about orders on hand, capital spending, invested capital, liquidity and headcount. The relevant documents are submitted to the Group Executive Board and the Board of Directors together with a quarterly updated commentary and an estimate for the year as a whole.

IFRS financial reporting is submitted to the Board of Directors on a quarterly basis. Half-yearly reporting is signed off by the Board of Directors and released for publication.

As part of the budget planning for the following year, the key figures used in the MIS are estimated on the basis of expected economic developments, and defined along with the business goals for each Business Unit. These are then used to prepare the budgeted balance sheet, income statement, cash flow statement and liquidity position. The annual planning for the coming three calendar years (three-year plan) is done in the same way as the budget.

Implenia Group’s risk situation is evaluated once a year by the Group Executive Board and Board of Directors. They define the main Group risks and assess these in terms of impact and likelihood. The evaluation of the risk situation includes an assessment of (current and impending) legal cases. The Group Executive Board continually monitors the implementation and effectiveness of defined measures.

The “Risk Map” of operational risks and opportunities (e.g. from projects) in each Business Unit is evaluated semi-annually by the operational managers in collaboration with the finance department. These risks and opportunities are subjected to a worst/real/best case assessment. The finance department consolidates the identified risks at the segment and Group level, and monitors the measures taken by operational managers. Risk Maps, consolidated by segment and Group, are explained to and discussed by the Audit Committee twice a year.

As part of Compliance Reporting, reports are made every six months about the Compliance Management System in general, and specifically about compliance cases, the status of investigations, and measures taken.

The internal control system is examined by the external auditor, which reports its findings to the Board of Directors in accordance with the law (Art. 728a para. 1 Section 3, and Art. 728b para. 1 SCO). Reports on the individual information tools are prepared and consolidated by the Finance department. These are then presented simultaneously to the Board of Directors and Group Executive Board. At meetings of the Group Executive Board and the Audit Committee, the reports are presented and explained by the CFO and Head of Corporate Reporting & Tax.

The CEO,  the CFO, the Head of Corporate Controlling and the Head of Corporate Reporting & Tax provide detailed information about the course of business, comment on this and answer questions asked by the Members of the Audit Committee.

The Board of Directors has hired a recognised audit company to perform the internal audit function. The main focuses of the internal audit are set by the Audit Committee on the basis of the multi-year audit plan. During the year under review, the focus was on project controlling, managing net working capital, and compliance, as well as on follow-ups to previous audits. The plan for internal audit activities is implemented in consultation with the CFO. The internal auditor prepared reports in line with the audit plan and submitted these to the Audit Committee together with the necessary comments and recommendations. The Internal Audit Unit reports directly to each meeting of the Audit Committee. The internal auditor’s reports are given to the external auditors without qualification. There is regular communication between the internal and external auditors.