Board of Directors

Composition


Pursuant to the Articles of Association, the Board comprises a minimum of five and a maximum of seven members, elected for a one-year term starting at closing of the Annual General Meeting (AGM) at which they were elected and expiring at closing of the following AGM. Board members may be elected or removed only by a resolution adopted by the shareholders in a general meeting. The number of terms a Board member may serve is not limited, nor is there any defined retirement age. The AGM shall elect the Chair of the Board and the Board elects a Deputy Chair for one year at a time from amongst its members.
 

In March 2021, the AGM elected the following six members to the Board:

  • Ms Pia Aaltonen-Forsell, born 1974, M. Soc. Sc.(Economics), MBA, CFO, Ahlstrom-Munksjö Oyj until end of February 2019 and CFO of Outokumpu Oyj as of 1 March 2019, member of the Uponor Board since 2017
  • Mr Johan Falk, born 1971, M.Sc. (Eng.), MBA, CEO, OneMed Group, member of the Uponor Board since 2018
  • Mr Markus Lengauer, born 1965, Master of Engineering, Doctorate in Mechanical Engineering, President and CEO, Oras Group until 31 December 2018 and member of the Board, Oras Group as of 1 January 2019, member of the Uponor Board since 2015
  • Mr Casimir Lindholm, born 1971, M.Sc. (Econ.), MBA, President and CEO, Eltel Group, member of the Uponor Board since 2018
  • Mr Michael G. Marchi, born 1959, B.S. (Marketing and Economics), MBA, CEO, MGM Executive Consulting, member of the Uponor Board since 2020
  • Ms Annika Paasikivi, born 1975, B.A, M.Sc. (Global politics), President and CEO, Oras Invest Ltd and CEO, Finow Ltd, member of the Uponor Board since 2014.

More detailed information on Uponor's Board members.

The Company complies with the recommendations on issues related to Board members, their independence and non-executive position, issued by the Securities Market Association. Based on the evaluation of the Board, all of the current Board members are independent of the Company. The Chair of the Board, Ms Annika Paasikivi, has served as a member and a Deputy Chair in the Uponor Board since 19 March 2014, and as a Chair since 13 March 2018. Based on the evaluation of the Board, all the current Board members, with the exception of Ms Annika Paasikivi and Mr Markus Lengauer, are also independent of major shareholders. According to Finnish legislation, all Board members are required to act in the best interest of the Company and its subsidiaries ("Group") as well as shareholders, and to disclose any potential conflicts of interest.

The AGM determines Board remuneration and fees. Based on the 2021 AGM's decision, the annual Board remuneration is as follows: €90,000 for the Chair of the Board, €51,000 for the Deputy Chair of the Board, €51,000 for the Chair of the Audit Committee and €46,000 for other members of the Board. Approximately 40% of the remuneration shall be paid by acquiring Uponor Corporation’s shares in public trading and/or by conveying Uponor Corporation’s shares held by the company and the rest shall be paid in cash or, alternatively, by paying the full remuneration in cash and obligating the Board member to use approximately 40% of the remuneration paid in cash to acquire Uponor Corporation’s shares in public trading. The yearly Board remuneration shall be paid within two weeks after the publication of the company’s half-year report for January-June 2021. In case the full remuneration is paid in cash, a Board member shall make the purchase of shares within two weeks after the publication of the company’s interim report for January-September 2021.Travel expenses related to Board meetings shall be paid according to the travel policy of the company.

Additionally, a remuneration per each actual board and committee meeting (excluding decisions without a meeting) shall be paid to the members of the Board of Directors amounting to €600 for meetings held at the country of residence of the member, €1,200 for meetings held elsewhere on the same continent, and €2,400 for meetings held on another continent. The remuneration for telephone meetings shall be the remuneration for meetings held at the country of residence of the member. In addition, a remuneration of €600 shall be paid to the Chair of the Board for each Board meeting and to the Chairs of the Board committees for each respective committee meeting.

The attached table shows the total annual remuneration paid to Board members in 2020:

 
Board of Directors Audit Committee Personnel and Remune­ration Committee Remune­ration in cash Remune­ration in shares Remune­ration in shares Remune­ration for Board and committee meetings
      Number of shares Value, € Total,€
Paasikivi, Annika, Chair   Chair 53,432 2,352 35,992 15,600
Aaltonen-Forsell, Pia Chair   30,275 1,333 20,399 10,200
Falk, Johan Member until 16 March   27,312 1,202 18,394 7,200
Lengauer, Markus Member   30,275 1,333 20,399 7,800
Lindholm, Casimir   Member 27,312 1,202 18,394 7,800
Marchi, Michael G. Member as of 16 March    27,312 1,202 18,394 5,400
Nygren, Eva (Member until 16 March)     - - - 1,800
In total     195,918 8,4624 131,971 55,800

Duties


In accordance with the Finnish Companies Act, the Board of Directors is responsible for the management of the Company and the proper organisation of its activities. The Board’s main duty is to direct the Group’s strategy in such a way that enables, in the long run, the Group to meet the set financial targets and the return to shareholders is secured, while simultaneously taking the expectations of various stakeholders into account. In addition to the statutory duties, the Board takes decisions on all other significant issues.

According to the charter of the Board of Directors, the Board shall, among other things:
 
  1. annually review and determine the rules of procedure of the Board and the Executive Committee ('ExCom');
  2. approve the Group's values and monitor their implementation;
  3. approve the Group's basic strategy and monitor its implementation and updating;
  4. determine the dividend policy;
  5. make a proposal to the general meeting of shareholders on the payment of the dividend, including the amount and time of payment;
  6. approve the annual operational plan and budget based on the strategy, as well as monitor their implementation;
  7. annually approve the total amount of investments as well as any investments that exceed the approved total annual investment limit;
  8. approve investments and leasing arrangements whose net present value exceeds the limit specified in the Signing and Authorisation Policy;
  9. approve acquisitions, joint ventures, partnerships, licensing arrangements and asset divestments that exceed the limits specified in the Signing and Authorisation Policy;
  10. approve the Group's general organisational structure;
  11. appoint and dismiss the President and CEO and determine the terms of his/her service contract;
  12. prepare and approve the President and CEO's annual compensation;
  13. approve the appointment and dismissal of members of ExCom;
  14. approve annual compensation for the members of ExCom;
  15. prepare and approve a succession plan for the President and CEO;
  16. approve succession plans for members of ExCom;
  17. approve the interim reports, the half year financial report, the annual report and the annual financial statements;
  18. meet the external auditor at least once a year in a closed session without the management;
  19. prepare the proposals for general meetings of shareholders;
  20. annually evaluate the performance of the President and CEO and members of the Board as well as that of the Chair;
  21. approve far-reaching key Group policies, policies relating to Uponor values and as required by respective regulation;
  22. deal with other issues raised by the Chair or the President and CEO.


Meetings and decision-making


The Board meets on average 10 times a year. Some meetings may be held as teleconferences. Two of the meetings should take place at a business unit, a different one each time. The Board may also meet at any time without the presence of the management and make decisions without holding a meeting. Minutes of a meeting are taken in English for each meeting.

During 2020, the Board held nine meetings in total. COVID-19 pandemic impacted the practical arrangements of the Board meetings. Only the first three meetings were held as physical meetings (and in the second meeting five Board members and in the third meeting four Board members participated remotely) and the rest of the meetings were organised fully remotely by using Microsoft Teams. No meetings in 2020 were arranged at a business unit. One non-attendance was recorded (Michael G. Marchi). Further, the Board made four decisions without having a meeting. 

In 2020, in addition to the normal duties based on regulations and the Board charter, the Board of Directors focused on the following topics: (1) health and safety of Uponor employees, especially in the COVID-19 pandemic as well as business continuity during and after the pandemic (2) close follow-up of the execution of the Operational Excellence programme and (3) talent management – what is our leadership and competence base, and securing we have succession plans for all relevant key positions, including the President and CEO.
 


Board diversity principles


When designing the composition of the Board of Directors, the Nomination Board of the company assesses the Board composition from the viewpoint of the company’s current and future business needs, while taking into account the diversity of the Board.

The diversity of the Board of Directors will be assessed from various viewpoints. The members of Uponor’s Board of Directors shall have sufficient and complementary experience and expertise in the key industries and markets relevant to Uponor’s business. In addition, an essential element is the personal characteristics of the members and their diversity.

Expertise

  • Knowledge on the company’s value creation drivers
  • Industry
  • Relevant markets and technologies
  • Accounting and finance
  • Governance

Personal characteristics

  • Professional experience
  • Education
  • Gender
  • Age
  • Personality

Objective


The company’s aim is that the Board of Directors represents diverse expertise in different industries and markets, diverse professional and educational background, diverse age distribution and both genders. Concerning gender diversity the objective is that both genders are represented in the Board by at least two members. The objective was well achieved in 2020.

The realisation of the diversity principles is monitored and reported in the company's Corporate Governance Statement.
 
Board Committees

Audit Committee

 

According to the charter of the Audit Committee it shall have the following duties:

  • to monitor the reporting process of financial statements and assuring that the reporting process generates correct information, to deal with any exceptional and material items and their handling and to approve important accounting principles;
  • to review and oversee the quality and integrity of the annual report and the annual financial statements as well as the interim reports and the half year financial report;
  • to monitor the financial and liquidity position of the company and prepare matters and proposals to the Board on a need-to-know basis;
  • to monitor the efficiency, plans and processes of the Group's internal control, internal audit and risk management systems;
  • to review the Company's corporate governance statement including the description of the main features of the internal control and risk management systems pertaining to the financial reporting process;
  • to approve the annual plan and budget, to issue instructions on and to review and monitor the operations, plans and reports of the internal audit function, to receive status reports of the internal audit function in every meeting and to meet with the internal auditor at least twice a year;
  • to review the external audit plan and to monitor the statutory audit of the financial statements and consolidated financial statements, to approve the budget of the external audit as well as new assignment above the limit set by the Audit Committee;
  • to meet with the external auditor quarterly and to review all material reports from the auditor;
  • to evaluate the independence of the statutory auditor or audit firm, particularly the provision of related services to the company to be audited;
  • to prepare the proposal for a resolution on the election of the auditor;
  • to monitor the Company’s compliance with legal and regulatory requirements, including the performance of its ethics and compliance programme and
  • to meet with the management of the company, particularly the President and CEO and the CFO, but also others responsible for internal control and risk management.

The invitation and materials of the Audit Committee meetings shall be sent to the Board members, who all have the right to attend the meetings.

Audit Committee in 2021

The Board decided to re-establish the Audit Committee in March 2021. The appointed members of the Audit Committee are Pia Aaltonen-Forsell, Markus Lengauer and Michael G. Marchi. Pia Aaltonen-Forsell was elected as the committee chair.

During 2020, the Committee held four meetings, three of which were held remotely via Microsoft Teams. One non-attendance was recorded (Markus Lengauer).


Personnel and Remuneration Committee

 

According to the charter of the Personnel and Remuneration Committee, it shall have the following duties:

  • preparing the appointments of the President and CEO and the members of the Executive Committee, and the terms and conditions of their employment
  • preparing matters to be brought to the Board relating to personnel, evaluation of top management and succession planning as needed
  • to prepare matters pertaining to the remuneration and other financial benefits of the managing director and other executives ;
  • to prepare matters pertaining to the remuneration schemes of the company;
  • to evaluate the remuneration of the managing director and the other executives as well as to see that the remuneration schemes are appropriate;
  • to review the remuneration statement;
  • to answer questions related to the remuneration statement at the general meeting.

Personnel and Remuneration Committee in 2021

The Board decided to re-establish the Personnel and Remuneration Committee in March 2021, with the same charter as earlier. The appointed members of the Personnel and Remuneration Committee are Annika Paasikivi (chair) and Casimir Lindholm.

The Personnel and Remuneration Committee held four meetings in 2020, with zero non-attendances.