CORPORATE GOVERNANCE

At EYDAP proper and responsible corporate governance is a key prerequisite to the creation of value for its shareholders and for society at large. EYDAP draws from the relevant local legal framework, rules and regulations, from international developments, as well as from its internal corporate values, in developing the principles of corporate governance that it implements. The corporate governance principles of EYDAP concern the composition and competencies of its Board of Directors and of its committees, the timely, accurately and two-way communication with its shareholders ensuring the effective exercise of their rights, the efficient operation of the control mechanism and the continuous monitoring of the control system in order to safeguard the assets of the company and to identify the most significant risks.

EYDAP aims to embed corporate governance principles in its wider corporate culture, making the first an inextricable part of the latter, as sound corporate governance is not limited to the typical observance of the law, but demands personal integrity and responsibility.

Effective Corporate Governance is not determined by a fixed programme but rather, by a continuous effort to integrate parameters proposed each time in conjunction with the ever increasing expectations of society. Correct corporate structures and procedures result in successful Corporate Governance, which promotes the recognition and reputation of the company.

EYDAP is committed to apply Corporate Governance principles throughout its operations. Along these lines, the Company approaches decision-making through business ethics and pledges to uphold the interests of its shareholders and all other related parties.

Α. Board of Directors

 

Remuneration of BoD

  1. The Annual General Meeting of Shareholders on April 30, 2014 approved of the remunerations paid for the Chairman of the BoD and the Chief Executive Officer for the financial year 2013, accountably for the period starting from 1.1.2014 until 30.4.2014 and approval in advance of the relevant remunerations for the period starting from 1.5.2014 to 30.06.2015.

    Especially approved:

    a. The remuneration of the Chairman of the BoD and CEO of the Company Mr. Antonios Vartholomeos, for the period from 1.7.2013 to 30.4.2014, amounting to €47.500,00 gross, as defined by Law 4093/2012 (G.G. 222A), the Law 4046/2012 (G.G. 28A) and the Circular 2/85127/0022/22.11.2012 of Ministry of Finance.

    b. The accountably remuneration of the Chairman of the BoD and CEO of the Company Mr. Antonios Vartholomeos, for the period from 1.5.2014 to 30.06.2015, amounting to €66.500,00 gross, pursuant to the provisions of the above mentioned Laws

     
  2. The Annual General Meeting of Shareholders on April 30, 2014 approved of of the remunerations paid and compensations for the BoD members, the Secretary of the BoD and the Members of the Audit Committee for the financial year 2013, accountably for the period starting from 1.1.2014 until 30.4.2014 and approval in advance of the relevant remunerations and compensations for the period starting from 1.5.2014 to 30.06.2015.

    Especially approved:

    a. The compensation paid to the Members of the BoD for their participation in the meetings of the BoD for the year 2013 amounting to €32.359,66 gross and meeting fees amounting to €35.257,54 gross, a total of €67.617,20 gross.

    b. The compensation paid to the Secretary of the BoD for the year 2013, amounting to €4,148.40 gross.

    c. The compensation paid to the three Members of the BoD that constitute the Audit Committee and have to oversee the Internal Audit function (Law 3693/2008, Art. 37) amounting to €5.799,38 gross and meeting fees amounting to € 5.799,38 gross, a total of € 11.598,76 gross.

    d. The accountably compensation paid to the BoD members, the Secretary and the Audit Committee members for the period from 1.1.2014 to 30.4.2014 at the same level as in 2013, which is analyzed as follows:

    • The Members of the BoD compensation amounting to €241.49 gross per month per person and €965,96 gross per four month period per person.
       
    • Meeting fees of the BoD members, with the exception of the Chairman and the CEO, amounting to €241.49 gross per month per person and €965,96 gross per four month period per person.
       
    • The compensation of the Secretary of the BoD, amounting to €345.70 gross per month and €1.382,80 gross per four month period.
       
    • The compensation of the three-member Audit Committee of the Board amounting to €156.74 gross per month per person and €626,96 gross per four month period per person.
       
    • Meeting fees of the three-member Audit Committee of the Board amounting to €156.74 gross per month per person and €626,96 gross per four month period per person.

    And the pre-approved of:

    e. The compensation that will be paid, for the period from 1.5.2014 to 30.06.2015 at the same level as in 2013, to the Members of the BoD, the Secretary of the Board and to the Audit Committee members of the BoD, which is analyzed as follows:

    • The Members of the BoD compensation amounting to €241.49 gross per month per person and €3.380,86 gross for the period of fourteen months per person.
       
    • Meeting fees of the BoD members, with the exception of the Chairman and the CEO, amounting to €241.49 gross per month per person and € 3.380,86 gross for the period of fourteen months per person.
       
    • The compensation of the Secretary of the BoD, amounting to €345.70 gross per month and 4.839,80 gross for the period of fourteen months.
       
    • The compensation of the three-member Audit Committee of the Board amounting to €156.74 gross per month per person and €2.194,36 gross for the period of fourteen months per person.
       
    • Meeting fees of the three-member Audit Committee of the Board amounting to €156.74 gross per month per person and €2.194,36 gross for the period of fourteen months per person.

 

 
Β. Shareholders

Functioning of Shareholders’ General Meeting

According to the Law 2190/1920 and the company’s Articles of Incorporation, the General Meeting of shareholders of the Company is the supreme body of the Company, being entitled to decide on any matter in connection with the Company.

The General Meeting of shareholders, convened by the Board of Directors, once every year, within six months at the latest after the end of each business year to approve of annual financial statements of the Company and discharge of the members of the Board of Directors and Auditors from any personal liability. The Board of Directors may also call an extraordinary General Meeting of shareholders, if it so deems advisable.

Sole the General Meeting has authority to decide on the following:

a. On any amendment of the Articles of Association; the increase of decrease of the capital of the Company is considered to be an amendment subject to para. 4 of article 8 and para. 5 of article 9 of the Articles of Association.

b. On the election of the members of the Board of Directors and the auditors subject to articles 11 and 13 of the Articles of Association.

c. On the approval of the annual financial statements of the Company.

d. On the appropriation of the annual profits and the approval of the emoluments to members of the Board of Directors.

e. On the discharge of the members of the Board of Directors and Auditors from any personal liability.

f. On the issue of bond loans of any type, subject to para. 4 of article 9 of the Articles of Association.

g. On the merger, division, conversion, revival, extension of the term and dissolution of the Company.

h. On the appointment of liquidators.

As to the rest, the provisions of article 34, para. 2, of C.L. 2190/20, as applicable, shall apply.

Shareholders rights and method of their exercise

Each share affords its owner the right to one vote at the General Meeting.

In the Shareholders General Meeting anyone who appears as a shareholder in the Dematerialized Securities System which is managed by Athens Stock Exchange S.A. has a right to participate. The proof of shareholders identity is established by the relevant written assurance of the above mentioned organization or by direct electronic connection of the Company with the organization. The person must be a shareholder five (5) days before the General Meeting (record date), and the relevant receipts or the electronic receipts concerning the shareholding capacity must come to the company at the latest the third (3) day before the General Assembly.

The shareholder participates in the General Meeting and votes either in person or via proxies. Each shareholder may appoint up to three (3) proxies. Legal entities may participate in the General Meeting appointing as proxies up to three natural entities. However, if the shareholder owns shares of the company that appear in more than one accounts, he may appoint different proxies. A proxy that acts on behalf of different shareholders may vote differently for each shareholder. The proxy holder is obliged to disclose to the Company, before the commencement of the General Meeting, any fact which might be useful to the shareholders in assessing whether the proxy holder might pursue any interest other than the interest of the represented shareholder. A conflict of interest within this context may in particular arise where the proxy holder:

a. Is a controlling shareholder of the Company, or is another entity controlled by such shareholder;

b. Is a member of the Board of Directors or the management of the Company, or of a controlling shareholder or an entity controlled by such shareholder;

c. Is an employee or an auditor of the company, or of a Controlling shareholder or an entity controlled by such shareholder;

d. Is a spouse or close relative (of 1st degree) with a natural person referred to in points (a) to (c).

The appointment and reverse of a proxy takes place in writing and is announced to the company at least three (3) days before the date of the General Meeting.

The forms for the appointment and revocation of a proxy holder are available on the Company’s website. The appointment form of a proxy holder, completed and signed by the shareholder must be submitted to the Company at least 3 days before the date of the General Meeting. The shareholders are requested to ensure the successful dispatch of the form and receipt thereof by the Company.

The fulfilling of the above mentioned rights (attendance and voting) does not require the prior bound of the shareholders΄ shares or any other procedure that limits the possibility of selling or transferring shares in the time between the record date and the date of the General Meeting.

In the General Meeting only those who are shareholders in the said date have a right to participate in the General Meeting. In case of non-compliance to article 28a of the law 2190/1920, the said shareholder participates in the General Meeting only after its license.

Ordinary quorum and majority vote at the General Meeting

A quorum shall be present and the General Meeting may validly transact the business contained in its agenda, when at least fifty one per cent (51%) of the paid-in share capital is represented thereat.

If no such quorum is present at the first meeting, a reiterative meeting shall be held within twenty (20) days as of the day of the cancelled meeting, upon a prior notice of at least ten (10) days, whatever the part of the paid-in share capital represented thereat.

All resolutions of the General Meeting are passed by absolute majority of the votes represented at the Meeting.

Qualified quorum and majority vote at the General Meeting

Exceptionally, a quorum shall be present and the General Meeting may validly transact the business contained in the following agenda when two thirds (2/3) of the paid-in share capital are represented thereat:

a) Change of the nationality of the Company;

b) Change of the object of the corporate business;

c) Increase of the shareholders' obligations;

d) Share capital increase, except for increases under article 8 (paragraphs 2 and 3), of the Articles of Association or those imposed under provisions of Law or effected by means of capitalization of reserves;

e) Share capital reduction;

f) Issuance of a bond loan, subject to the provisions of article 9, para. 4, of the Articles of Association;

g) Change of the manner of appropriation of profits;

h) Merger, division, conversion, revival, term extension or dissolution of the Company;

i) Delegation or renewal of power to the Board of Directors for Share Capital increase or issuance of a bond loan pursuant to article 8, para. 2 and 3, and article 9, para. 4, of the Articles of Association;

j) In any other case for which the Law and the present Articles of Association stipulate that, for the adoption of a certain resolution by the General Meeting the special qualified quorum provided for in this paragraph is required.

If the quorum specified in the preceding paragraph is not present in the first meeting, a first reiterative meeting shall be held within twenty (20) days as of such first meeting, upon a notice of a minimum of ten (10) days in advance; such meeting shall form a quorum and may validly transact the business contained in the original agenda if at least one half (1/2) of the paid-in share capital is represented thereat.

If again no such quorum is present, then a second reiterative Meeting shall be held according to paragraph 2 of Article 31 of the Articles of Association; such meeting shall form a quorum and may validly transact the business of the original agenda if at least one third (1/3) of the paid-in share capital is represented thereat.

All resolutions under paragraph 1 of this article are passed by a majority of two thirds (2/3) of the share capital represented in the General Meeting.

Minority shareholders rights

Minority interests’ shareholders have the rights as specified by Law 2190/1920

Concisely, the rights of the minority interest holders according to the percentages of representation and deadlines as defined by Law 2190/1920 are:

  • Request for convocation of Extraordinary General Meeting of Shareholders
  • Request for the inclusion of additional items in the Agenda of the General Meeting
  • Request for deferment of a resolution of the General Meeting
  • Request for the submission of specific information with respect to company matters, to the extent that these are useful for the actual assessment of the items of the agenda
  • Request for information on remuneration of Board members and Directors
  • Request for the submission of information with respect to the course of company affairs and the financial situation of the company.
  • Request for management control
  • Request for decision making of agenda items by roll-call vote in the General Meeting of Shareholders

Representation of minority shareholders on the Board

According to the company’s Articles of Incorporation, Articles 11 and 36, minority shareholders represented on the Board by two (2) members.

The minority shareholders shall be invited by the Board of Directors to a special General Meeting having as sole item on the agenda the election of the Board Members who are entitled to elect. Each shareholder entitled to propose and vote for a single member, irrespective of the number of shares held. The first or the first two majority candidates elected.

 
C. Control Mechanisms

Internal Audit System

The internal audit of the Company is conducted by the Internal Audit Division, which is an independent organization unit referring to the BoD of the Company. The internal audit division is supervised by the Audit Committee of the BoD as instituted by resolution of General Meeting and comprising by three non-executives BoD members one of each is independent in accordance to Law 3016/2002.

Audit Committee.

The Audit Committee consists of the following members:

  • Michail Stavroulakis, Chairman (Independent, Non-Executive Member of BoD)
  • Ioannis Kardaras (Non-Executive Member of BoD)
  • Eleutherios Magiakis (Non-Executive Member of BoD)

Meetings

During 2013 the Audit Committee held ten (10) meetings.

Role

The authorities and obligation of the Audit Committee are:

a. the observation of the procedure of financial information,

b. the observation of the efficient operation of the system of internal audit and the system of risk management, as well as the observation of the correct operation of the internal auditors of the company

c. the observation of the course of the obligatory check of the financial statements company

d. the overview and observation of issues contingent to the existence and preservation of the independence of the auditor especially on what concerns the providing of other services from the auditor

Internal Audit Division

The Internal Audit Division’s object is:

  • To examine and evaluate the adequacy and efficiency of the company’s Internal Audit System and to ascertain whether this system provides logical assurance regarding:
    • Compliance with the general functions of the Company and current legislation
    • The security of the company’s assets
    • The economical and effective use of resources
    • The reliability of the financial statements
    • The reliability and integrity of the information used in decision-making.
  • To inform the Management (or those executives who have been authorized to be responsible for the implementation of corrective actions) for the results of the audit, the opinion that was formed for each of them and their respective contributions made (by the same auditor).
  • To assess past actions taken in the course of rectifying audit issues previously identified and brought to the attention of the Management.

Among the Department’s responsibilities, the following are included:

  • Monitoring of the implementation and constant compliance with the company’s Bylaws and Articles of Incorporation, as well as with relevant legislation and particular laws which regulate the operations of companies and the stock market.
  • Reporting to the company’s Board of Directors conflict-of-interest issues related to the BoD members or senior executives, which are detected during the performance of the department’s duties.

The internal audit implements in an independent and objective way the following activities:

  • Identification and prioritization of business risks
  • Overview of the Company's activities in order to ascertain whether they are being implemented in an effective and efficient way, and in accordance to the instructions of the management, the policies and procedures.
  • Evaluation of the sufficiency and effectiveness of internal control system in all areas of activity and with specified priorities
  • Overview of the way the assets of the Company are being protected and confirmation of the existence of those data (inventory, counting, etc.).
  • Assessment of the cost effectiveness and efficiency in the use of resources, and suggestions to the problems that may exist.
  • Coordination with the work of the external auditors.
  • Evaluation of data processing systems in order to examine whether these systems meet their goals and objectives and whether adequate audit procedures have been incorporated.
  • Follow up of recommendations from previous audits, for which there have been commitments for corrective actions.

The Internal Audit Department fulfills its object by inspecting, controlling and evaluating functions and procedures, as well as by bringing relevant findings to attention and providing analyses, evaluations and recommendations that may improve the company’s functions.

External audit

The company’s regular audit is carried out by certified auditors. To this end, every year, the Ordinary General Meeting of Shareholders approves the appointment of an auditing firm to audit the company’s financial statements and business operations over a specific period.

EYDAP’s Ordinary General General Meeting of Shareholders in April 2014 agreed to assign the regular audit of the 2014 financial statements to the auditing firm DELOITTE S.A. “Hatzipavlou – Sofianos & Kampanis S.A.” and elected the ordinary auditors, Mr. Michalis Hatzipavlou, Chartered Accountant (SOEL num. 12511) and Mr. Nikolaos Papadimitriou, Chartered Accountant (SOEL num. 14271)
 

 
D. Risk Management

The Company focuses on the effective monitoring and management of potential risks in order to maintain the stability and continuity of its work, as follows:

  • In forming a comprehensive framework and proposing strategy, policies and procedures for managing and monitoring the risks that would undertaken by the Company in accordance with the directions of the management.
  • The definition, acknowledgment and assessment of the undertaken risks.
  • Developing and implementing adjusted tools in relation to the risk of billing of services and education of the organizational units for their use.
  • In preparation of Crisis Management Plan.
  • In forming a corporate culture of risk management in each hierarchical level of the Company

For the effective application of those tasks, the responsible Division, has access to all the activities of the Company and all data and information necessary for the fulfillment of its tasks.

 
E. Transparency and Disclosure

Established procedures

Placing special emphasis on transparency, the Company implements various relevant procedures, which stem from the legislative framework in force:

a) Procedure of regulated information disclosure

A procedure of regulated information disclosure, in accordance with Law 3556/2007, Decision 1/434/3.7.2007 and Circular No.33 of the Hellenic Capital Market Commission concerning information disclosure and transparency requirements for companies which are publicly traded on stock exchanges is applicable. The aim of this disclosure procedure is to inform the investment community and all interested parties, of any significant changes in the company’s participations (acquisitions or disposals) in a timely and accurate manner, under Law 3556/2007 and to ensure EYDAP’s compliance with applicable laws

b) Procedures within the framework of Law 3340/2005 for the protection of the capital market from actions of inside information abuse and market manipulation and of Corporate Governance Law 3016/2002.

In enforcing the above Laws, the company has adopted:

  • Transactions disclosure procedure:

    The persons that carry out managerial duties in the company and persons closely affiliated with those persons should notify the company of transactions conducted on their own account relating to shares issued by EYDAP, derivatives or other financial instruments linked to them
  • Procedure that deters the improper use of inside information:

    The persons who possess inside information about the company are forbidden to use this information in order to acquire or dispose, either directly or indirectly, financial instruments of the company to which the information relates

    EYDAP’s Corporate Announcements Department is responsible for monitoring the above mentioned procedures and for the company’s compliance with the obligations, set by Hellenic Capital Market Commission and Stock Exchange regulatory framework, for publication of regulatory and other information.

Communication with shareholders

Apart from established procedures that ensure transparency, EYDAP has adopted a number of other practices that enhance transparency and dissemination of information to shareholders and investors, such as the:

  • Managing and maintaining shareholder records.
  • Servicing and responding to shareholder requests both individual and institutional, in Greece and abroad related to the exercise of their rights and the payment of dividends.
  • Organizing Company’s General Meetings of Shareholders and providing information related to the exercise of their rights and to agenda items.
  • Preparation and distribution of the Company’s Annual Repor
  • Publishing of company-related information on the Company website so that all shareholders and investors can have equal and timely access to informatio
  • The release of corporate publications which enhance the continuous flow of information on issues that relate to the company’s operation, strategy, targets, and performanc
  • A two-way communication channel between company representatives and the investment community.
  • Timely and equal dissemination of information on issues related the financial results through, corporate presentations roadshows and investor meetings.

EYDAP’s Investor Relations & Shareholders Services Department has the responsibility of timely, accurate and equal service and communication to Shareholders and Investors.

 
ΣΤ. Corporate Governance Code

Following the provisions of institutional framework, the Company compiled the Code of Corporate Governance, which facilitates the formulation of policies and practices of corporate governance according to the specific needs of EYDAP.

The updated version of the Rules is clearly structured to present information relating to corporate governance, internal control system, the assessment and management of operational risks, the organizational structure of the Company as well as the importance of social responsibility that the Company demonstrates as part of its operation.

This Regulation facilitates the formulation of policies and corporate governance practices in order to meet the current operating conditions EYDAP.

The purpose of the regulation is to promote good governance, believing that this will enhance the long-term success and competitiveness of EYDAP. The application of the Rules addressed by the company or its investors as a process that adds value to the company and is not seen as mere law compliance.

EYDAP S.A would greatly benefit by adopting and systematically apply these principles in a fully voluntary basis, which enhances the confidence of our shareholders, employees and other stakeholders as well as improves organizational effectiveness.