Philips 2006 Annual Report Download - page 102

Philips Annual Report 2006102
the Corporate Governance and Nomination & Selection
Committee consulted in 2006 with the President/CEO
and other members of the Board of Management on
the appointment or re-appointment of candidates for
Supervisory Board membership and candidates to fi ll
current and future vacancies on the Board of Management
and the Group Management Committee, prepared
decisions and advised the Supervisory Board on the
candidates for appointment, and supervised the policy
of the Board of Management on the selection criteria and
appointment procedures for Philips’ senior management.
At the 2006 General Meeting of Shareholders, the
heads of the fi ve operating divisions were appointed
as members of the Board of Management. The offi cers
involved are Messrs Karvinen, Ragnetti, Provoost,
Van Deursen and Van Houten.
In connection with the sale of the Semiconductors division
Mr Van Houten, CEO of the Semiconductors division,
relinquished his position as member of the Board of
Management on September 29, 2006 to become the
CEO of NXP Semiconductors. On December 1, 2006,
Mr Karvinen, until November 1, 2006 the CEO of the
Medical Systems division, relinquished his position as
member of the Board of Management and left the
company
to become CEO of Stora Enso. As of November 1,
2006,
Mr Rusckowski succeeded Mr Karvinen as CEO of the
Medical Systems division and was appointed as member
of the Group Management Committee on the same
date. We would like to thank Messrs Van Houten and
Karvinen for their substantial contribution to the
performance of Philips.
The present four-year term of Mr Kleisterlee is due to
expire in 2008. In light of the importance of continuity in
the successful implementation of the Company’s strategy,
the Supervisory Board has deemed it desirable to ask
Mr Kleisterlee to stay on as President/CEO beyond that
date. The Supervisory Board is pleased he is prepared
to do so. To refl ect this continuity it has been decided to
propose to the 2007 General Meeting of Shareholders to
re-appoint Mr Kleisterlee as President/CEO and member
of the Board of Management for a new four-year term
ending April 1, 2011.
As of April 1, 2007, Mr Dutiné’s term as member of the
Board of Management will end. We are grateful that he
has made himself available for another term, and thus
the Supervisory Board will propose to the 2007 General
Meeting of Shareholders to re-appoint Mr Dutiné as
member of the Board of Management. The Supervisory
Board, in accordance with the Articles of Association,
will also propose, to the 2007 General Meeting of
Shareholders, to appoint Mr Rusckowski, CEO of the
Medical Systems division, as member of the Board of
Management, effective April 1, 2007.
In respect of the Group Management Committee, the
following other changes occurred in 2006. On May 1,
2006, Mr Westerlaken retired as member of the Group
Management Committee. As of April 1, 2006, Mr Harwig
was appointed as member of the Group Management
Committee and succeeded Mr Huijser as Chief
Technology Offi cer.
Mr Ruizendaal, Chief Strategy Offi cer and Group
Controller, and Mr Coutinho, Chief Legal Offi cer and
Company Secretary, were appointed as members of the
Group Management Committee as of February 1, 2007.
Also as of February 1, 2007, Mr Kroese succeeded
Mr Hooghiemstra as global head of Human Resources
Management and was appointed as member of the
Group Management Committee on the same date.
Report of the Remuneration Committee
The Remuneration Committee, currently consisting
of four members, who are listed in the chapter Our
leadership of this Annual Report, is responsible for
preparing decisions of the Supervisory Board on the
remuneration of individual members of the Board of
Management and the Group Management Committee.
It met fi ve times in 2006. The Remuneration Committee
proposes to the Supervisory Board the remuneration
policy for members of the Board of Management and
other members of the Group Management Committee,
and reports annually to the Supervisory Board on the
implementation of this remuneration policy. The
Supervisory Board, through the Remuneration
Committee, implements this policy and determines
on the basis of this policy the remuneration of the
individual members of the Board of Management and
other members of the Group Management Committee.
In performing its duties and responsibilities the
Remuneration Committee is assisted by a remuneration
expert acting on the basis of a protocol ensuring that
the expert acts on the instructions of the Remuneration
Committee and on an independent basis in which
confl icts of interest are avoided. The Remuneration
Committee’s tasks are laid down in the Charter of the
6 Financial highlights 8 Message from the President 14 Our leadership 20 The Philips Group