Corporate governance

This section describes our corporate governance model including information on our governance bodies, management remuneration, insider administration, as well as financial control systems and risk management procedures.

English

Dovre Group Plc is a public limited company registered in Finland, with its headquarters in Espoo, Finland. In its decision-making and governance, Dovre Group complies with the laws and regulations applicable to Finnish listed companies, the company’s Articles of Association, and the Finnish Corporate Governance Code issued by the Finnish Securities Market Association. The Code is available on the Association’s website at www.cgfinland.fi. Dovre Group’s subsidiaries comply with local legislation. 

 

Corporate governance documents

Governance bodies

Annual general meeting

The highest decision-making body in Dovre Group Plc is the General Meeting of shareholders. The Annual General Meeting is organized once a year on a date set by the Board of Directors and must be held within six (6) months of the end of the financial period. The Board of Directors may convene an Extraordinary General Meeting when necessary.

A shareholder has the right to put matters that fall within the competence of the General Meeting on the agenda of the Annual General Meeting, provided the shareholder makes a written request to the Board of Directors in time for the matter to be included in the notice of the meeting. Requests from the shareholders to put matters on the agenda shall be sent to Dovre Group's Board of Directors to Dovre Group Plc headquarters together with an explanation or a draft solution.

The General Meeting decides on the following issues:
  • Adoption of the income statement and balance sheet
  • Use of the profit or loss shown on the balance sheet
  • Discharging from liability the members of the Board of Directors and the CEO
  • The number of members on the Board of Directors and their election
  • Election of the auditor
  • Remuneration of the Board of Directors and compensation of the auditor
  • Raising or lowering the share capital
  • Issue of shares or authorization given to the Board of Directors
  • Amendment of the Articles of Association

Notice of a General Meeting shall be sent to the shareholders not earlier than three (3) months and not later than twenty-one (21) days before the meeting. The notice is published as a stock exchange bulletin and on Dovre Group’s website. Dovre Group may also publish a notice in Finnish daily newspaper(s). Candidates nominated for the Board of Directors are disclosed in the notice of the General Meeting, or in some other way after the publication of the notice and before the General Meeting, if the candidate has given his/her consent to the election and is supported by shareholders who account for at least 10% of the company’s shares. The company also announces the Board of Directors’ proposal for the company’s auditor.

The company aims to introduce all first-time Board candidates to the shareholders at the General Meeting that is convened for the purpose of the election of the Board.

 

 

Board of Directors

Composition and term of office

In accordance with the Articles of Association, Dovre Group’s Board of Directors is composed of no less than three (3) and no more than eight (8) members. The term of the members of the Board of Directors lasts until the end of the Annual General Meeting following the election.
All members of the Board of Directors are elected at the Annual General Meeting. The Articles of Association do not specify an upper age limit for of the maximum numbers of terms of office of the members of the Board, and place no other restrictions on the authority of the Annual General Meeting to elect members to the Board. The Board selects a Chairman and a Vice Chairman among its members.

Duties and operation principles

Dovre Group Plc’s Board of Directors is responsible for the administration and proper organization of the company's operations. The Board supervises the company's operations and management, and decides on significant issues concerning the company's strategy, organization, financing, and investments. The duties and responsibilities of the Board are determined in accordance with the Finnish Companies Act and the company’s Articles of Association. The Board prepares an annual charter that specifies the Board's meeting procedures and duties.
The Board shall handle all matters that carry financial, operational, or principal importance.

Meeting procedures and self-evaluation

The Board of Directors convenes normally once a month according to an agreed schedule. The Board has not assigned its members any particular areas of business for monitoring. The CEO of the company acts as the presenting officer at the meetings. The Board shall evaluate its operations and working methods on a regular basis by conducting a self-evaluation once a year.

Remuneration and other benefits of the Board of Directors

The remuneration of the Board of Directors shall be determined on a yearly basis by the Annual General Meeting.

Diverse composition of the Board of Directors

The company considers diverse composition of the Board as an important asset. In selecting candidates to the Board, the company pays attention, amongst other things, to the candidates' diverse and mutually complementary background, experience, and expertise, especially in international business. The company also aims to have, where possible, representatives of both genders on the Board.

Charter of the Board of Directors

Members of the Board of Directors

Svein Stavelin

Chairman of the Board of Directors
M.Sc. (Computer Science), Pedagogy (PUFS), Business Economist
Board member since 28 March 2018
Independent of the company and significant shareholders

Ilari Koskelo

Vice Chairman of the Board of Directors
M. Sc. (Management)
Board member since 26 February 2008
Independent of the company and significant shareholders
Ilari Koskelo's CV
Ilari Koskelo's holdings in Dovre Group

Antti Manninen

Member of the Board of Directors
M.Sc. (Econ.)
Board member since 28 March 2018
Independent of the company and significant shareholders

CEO

Arve Jensen, CEO

Chief Executive Officer as of November 1, 2018.
Arve Jensen has over 30 years of experience in the oil and gas industry.
After joining Dovre Group in 1997, he has held several senior management positions in the company and has served on the Group Executive Team since 2012.
Arve Jensen's CV

Executive team

Executive team

Executive team

  • Arve Jensen

    CEO


    Arve Jensen has over 30 years of experience in the oil and gas industry. He is highly experienced in developing and managing professional services businesses and has in-depth knowledge of working with customers in the large project industry. After joining Dovre Group in 1997, he has held several senior management positions in the company and has served on the Group Executive Team since 2012. Dovre Group Plc’s Board of Directors has appointed Arve Jensen as the new Chief Executive Officer of Dovre Group as of November 1, 2018.

    Arve Jensen's CV »

  • Mari Paski

    CFO

    Mari Paski acts as Dovre Group’s CFO as of January 1, 2018. She has worked for Dovre Group since 2011 as Head of Group Accounting, and holds a Master’s degree (M. Sc. (Econ)) from Aalto University in Helsinki, Finland.

  • Stein Berntsen

    President, Consulting


    Stein Berntsen has more than 25 years of experience in strategic and operational project management for the development and execution of complex projects in different industries. After joining Dovre Group in 1997, he has held several senior management positions in the Group and has served on the Group Executive Team as President for the Group's Consulting business since July 24, 2014.

    Stein Berntsen's CV »

Remuneration

The Annual General Meeting decides on the compensation of the Board of Directors. The Board decides on the compensation of the CEO and the Group Executive Team. The compensation of the management of the Group's business areas is based on the so-called one-over-one principle whereby the compensation decision must be approved by the supervisor of the employee's direct supervisor. In addition to normal salary, bonus and option programs are used in the Group.
Remuneration of the Board of Directors in 2017
The Annual General Meeting held on March 30, 2017, decided that the Chairman of the Board be paid EUR 35,000 (2016: EUR 35,000), Vice Chairman EUR 25,000 (2016: EUR 25,000), and each other Board member EUR 22,000 (2016: EUR 22,000) for the term of office, which lasts until the next Annual General Meeting. In 2017, of the annual remuneration, 40% of the total gross compensation was used to purchase Dovre Group Plc's shares in public trading through Nasdaq Helsinki Ltd.
Remuneration of the members of the Board of Directors in 2017
Board of DirectorsAnnual remuneration, EURNo. of shares purchased (40% of annual remuneration)
Häggblom, Rainer (Chairman)35,00049,261
Olsen, Ole (Vice Chairman)25,00035,186
Harrewijn, Louis22,00030,964
Koskelo, Ilari22,00030,964
Total104,000146,375

Remuneration of the CEO

Patrick von Essen serves as Dovre Group’s CEO since April 1, 2014. Based on the terms and conditions of employment of the CEO, Patrick von Essen's compensation consists of an annual salary of EUR 226,800 (including holiday pay, and car and phone benefits), a performance-based bonus decided by the Board, and a life insurance. The contract includes pension benefits pursuant to the Employees’ Pensions Act (TyEL). The contract does not specify the CEO’s retirement age. The contract may be terminated by either party by giving three (3) months' notice. Should the company decide to terminate the contract, the CEO is entitled to a severance pay equivalent of 12 months’ salary including fringe benefits in addition to the salary for the period of notice.

The CEO’s bonus is based on the company’s or its individual units’ performance and profitability or on the successful completion of organizational measures. These objectives are specified annually. The CEO’s bonus may not exceed EUR 115,000 over 12 months. The CEO is also eligible for the long-term incentive plans for the Group's key personnel.

In 2017, CEO Patrick von Essen's total compensation for his role as the company's CEO was EUR 226,654. Based on the information obtained from Euroclear Finland Ltd, on December 31, 2017, Patrick von Essen held a total of 675,000 stock options and a total of 151,000 shares in Dovre Group Plc.

Remuneration of the Group Executive Team

The Group Executive Team’s remuneration consists of total salary (including salary in money and typical fringe benefits such as car and phone) as well as long- and short-term incentives as decided by the Board of Directors. Short-term incentives include a yearly performance-based bonus decided by the Board. Long-term incentives include option plans, for which all members of the Group Executive Team are eligible. The Board decides on option plans. The Group has not taken out any additional pension insurance for the members of the Group Executive Team.

The Board approves annually the terms and criteria of the Group Executive Team's short-term incentives (bonuses). Any bonuses are based on the achievement of financial targets, such as operating result of net sales and other related targets, on either Group and/or business unit level. In addition, members of the Group Executive Team may have either individual or team objectives.

In 2017, the total salaries and benefits of the Group Executive Team, not including the CEO, were EUR 992,719 (2016: EUR 696,028). Performance bonuses totaled EUR 119,525 (2016: EUR 135,590).

Group Executive Team Remuneration in 2017
Fixed annual based salary including fringe benefits, EURShare and share based remuneration in 2017Profit based incentives 2017, EUR
CEO226,654-0
Other members992,719-119,525
Total1,219,373-119,525

Long-term incentive plans for key personnel (option plans)

In 2017, the company had one open option plan, option plan 2013, directed to the Group's key personnel. Each stock option entitles the holder to subscribe one share in Dovre Group Plc.

The 2013 option plan was approved by the company’s Board of Directors in their meeting on January 24, 2013 based on the authorization given by the Annual General Meeting held on March 15, 2012. The share subscription price and period per series under the 2013 option plan are as follows:

  • 2013A: Subscription price EUR 0.39; subscription period March 1, 2015 – February 29, 2018.
  • 2013B: Subscription price EUR 0.52; subscription period March 1, 2016 – February 28, 2019.
  • 2013C: Subscription price EUR 0.44; subscription period March 1, 2017 – February 28, 2020.

At the end of 2017, the company had granted a total of 2,350,000 options under the 2013 option plan. The company had in reserve a total of 650,000 options.

The full terms and conditions of the 2013 option plan are available here.
(Updated on March 6, 2018)

Auditors

According to the Articles of Association, Dovre Group has one Auditor who shall be an audit firm. The term of the auditors expires at the end of the first Annual General Meeting following their selection. The Board’s proposal for the auditor is disclosed in the notice of the General Meeting.

The primary purpose of an audit is to verify that the financial statements give accurate and adequate information concerning the Group’s result and financial position for the financial period. In addition, the auditors report to the Board of Directors on the ongoing auditing of administration and operations. The Annual General Meeting held on March 28, 2018 elected the Authorized Public Accountant entity BDO Ltd as the Company's auditor, with Authorized Public Accountant Ari Lehto as the principal auditor.

Exceptions to the Finnish corporate governance code

Dovre Group complies with the Finnish Corporate Governance Code 2010 issued by the Finnish Securities Market Association with the following exception:

The Board of Directors does not have any designated board committees. The establishment of committees has not been deemed necessary due to the size of the company and the Board.

Insider administration

Dovre Group complies with the disclosure obligations relating to the disclosure of inside information included in, and maintains its insider lists in accordance with, current legislation, the guidelines and regulations of the Finnish Financial Supervisory Authority (FSA), and the Guidelines for Insiders issued by Nasdaq Helsinki Ltd, effective as of July 3, 2016.
 
In accordance with current legislation, persons discharging managerial responsibilities in Dovre Group as well as their closely associated persons are obliged to notify the company and the FSA of every transaction in the company’s financial instruments. The notification obligation applies to all transactions once a total amount of EUR 5,000 has been reached within a calendar year. Dovre Group will disclose all such transaction notifications as stock exchange bulletins within three (3) business days of the date of transaction. The stock exchange bulletins are kept available on the company website for at least five (5) years and can be found in the Material archive under Releases and events as well as in the table below under “Transactions”. The aggregated holding figures presented below include also changes that do not exceed the threshold of EUR 5,000.

Persons discharging managerial responsibilities in the company may not trade in any of the company’s financial instruments during a closed period of 30 calendar days before the announcement of the company's half year financial report, annual financial statements, and Q1 and Q3 trading statements. The trading restriction applies also to the company’s employees participating in the preparation, drawing up, and disclosure of the company’s financial reports.
 
In accordance with MAR (EU) No 596/2014, the disclosure of Insider Information data has been suspended. Final revisions to the data took place on July 2, 2016, when MAR (EU) No 596/2014 came into effect. The list below presents the information concerning those individuals that were identified as the company’s public insiders on July 2, 2016, when the company’s public insider list was terminated. The information will be available on the company website for 12 months of the closure of the company’s public insider list. The company reports the total amount of holdings by the members of the Board of Directors and the company's executive management as part of the company's annual report.
 
 

Control systems & risk management

Internal audit

The Group has no separate internal audit organization. The establishment of an internal audit organization has not been deemed necessary due to the size of the company. The Group’s Executive Team assesses and ensures the sufficiency and effectiveness of the Group’s internal control, as well as supports the Board with its monitoring responsibility.

Risk management

The Group’s risk management is guided by legal requirements, business requirements set by shareholders of the company, and the expectations of customers, personnel, and other important stakeholders. The goal of risk management is to acknowledge and identify systematically and comprehensibly any risks relating to the company’s operations and to make sure that all such risks are appropriately accounted for when making business decisions.

The Group's risk management procedures support the achievement of the Group's strategic goals and seeks to ensure the continuity of the Group's business operations. The Group takes risks that are a natural part of its strategy and objectives. The Group is not ready to take risks that might endanger the continuity of its operations or be uncontrollable or that may significantly harm the Group’s operations.

In accordance with the Group’s risk management procedures, the Board of Directors receives an annual report of the most significant risks facing the Group. The Board analyses the risks from the point of view of shareholder value.

The company’s risk management process includes an annual identification and analysis of risks pertaining to financial reporting. In addition, the company seeks to analyze and report all new risks immediately as soon as they have been identified. Taking into account the extent of the Group’s business operations, the most significant risks pertaining to the reliability of financial reporting relate to revenue recognition, impairment testing (including goodwill), and tax reporting.

Financial reporting controls

The purpose of the Group's internal control is to support the implementation of the Group’s strategy and to ensure that the Group complies with all relevant rules and regulations. The Group’s internal control framework is based on the Dovre Group Authorization Matrix, which specifies the authority and the responsibilities of the Group's management. The Authorization Matrix is approved by the Board of Directors, which also acts as the highest supervisory body of the Group’s internal control. The implementation of internal control measures is supervised primarily by the CEO and CFO, who report to the Board.

The ultimate responsibility for accounting and financial administration lies with Dovre Group’s Board of Directors. The Board is responsible for internal control, and the CEO is responsible for the day-to-day organization and monitoring of the control system. The steering and monitoring of business operations is based on the reporting and business planning system that covers the entire Group. The CEO and CFO report monthly to the Board and the Group Executive Team on the Group’s financial situation and development.

The purpose of financial reporting is to ensure that all assets and liabilities in the financial statements belong to the company; that all rights and liabilities of the company are presented in the financial statements; that items in the financial statements have been classified, disclosed, and described correctly; that assets, liabilities, income, and expenditure are entered in the financial statements at the correct amounts; that all transactions during the reporting period are included in the accounts; that transactions entered in the accounts are factual transactions; and that assets have been secured.

Control functions

The correctness and reliability of financial reporting are ensured through compliance with Group policies and guidelines. Control functions that ensure the correctness of financial reporting include controls related to accounting transactions, to the selection of and compliance with the accounting principles, to information systems, and to fraud or malpractice.

Revenue recognition is supervised by the CFO and is based on the required sale and delivery documents.

The Group’s bad debt provision is reviewed monthly. Any eventual bad debt provisions are based on the aging of trade receivables per sales company.

The Group’s goodwill is tested for impairment at the end of each financial year on the balance sheet date. Key variables used in the calculations are net sales growth and the estimated change of profit margin. In addition, indications of impairment are monitored regularly. If indications of impairment are detected, a separate testing is performed.

The performance of business operations and attainment of annual goals is assessed monthly in Group Executive Team and Board meetings. Monthly management and Board reporting includes both the actual and the estimated results compared to the budget and the actual results of previous periods. Financial reports generated for the management are used for monitoring certain key indicators associated with the development of sales, profitability, and trade receivables on a monthly basis.

In accordance with its strategy, Dovre Group may complement its organic growth with acquisitions. In making acquisitions, the Group follows due diligence and utilizes its internal competence together with external advisors in the planning phase (e.g. due diligence), takeover phase, and when integrating acquired functions into the Group's operations.