Philips 2010 Annual Report Download - page 120

11 Supervisory Board report 11 - 11
120 Annual Report 2010
11 Supervisory Board report
Introduction
General
The supervision of the policies and actions of the
executive management (the ‘Board of Management’) of
Koninklijke Philips Electronics N.V. (the ‘Company’) is
entrusted to the Supervisory Board, which, in the two-tier
corporate structure under Dutch law, is a separate body
and fully independent of the Board of Management. This
independence is also reflected in the requirement that
members of the Supervisory Board are not a member of
the Board of Management or an employee of the
Company. The Supervisory Board considers all its
members to be independent pursuant to the Dutch
Corporate Governance Code of December 2008 (the
‘Dutch Corporate Governance Code’) and the applicable
US standards.
While retaining overall responsibility, the Supervisory
Board assigns certain of its tasks to three permanent
committees: the Corporate Governance and Nomination
& Selection Committee, the Remuneration Committee
and the Audit Committee. The separate reports of these
committees are part of this report and are published
below. The members (of the committees) of the
Supervisory Board are listed in chapter 10, Supervisory
Board, of this Annual Report.
For further information on the Company’s corporate
governance structure and a more detailed description of
the duties and functioning of the Supervisory Board, see
chapter 12, Corporate governance, of this Annual Report.
Activities of the Supervisory Board
Six regular meetings were held in 2010. All members were
frequently present at the regular meetings of the
Supervisory Board. In addition to the regular meetings an
ad hoc meeting took place in November to discuss the
succession of the Chief Financial Officer of the Company.
The Audit Committee met five times. The Corporate
Governance and Nomination & Selection Committee had
four regular meetings and several ad hoc meetings in
connection with succession matters. The Remuneration
Committee had four regular meetings.
During 2010 the Supervisory Board devoted considerable
time to discuss the Company’s strategy and discussed the
performance and, more in particular, the strategy of the
three Sectors. The discussions in respect of the Sectors
took place during visits of the Supervisory Board to each
Sector, where in-depth discussions were held with the
Sector management teams. Furthermore, the Supervisory
Board discussed the performance and integration of
acquisitions, the economic situation and impact thereof
on Philips and the cost reduction and efficiency
improvement measures taken to confront the recession,
as well as the capital and financing structure of the Philips
Group extensively throughout the year.
In January the Supervisory Board discussed the financial
performance of the Philips Group in 2009, the
management agenda 2010 of the Board of Management,
the new strategy for BU Health & Wellness and the
agenda for the 2010 General Meeting of Shareholders,
including the proposed dividend to shareholders, the
dividend policy and recommendations for
(re)appointment of candidates for the Board of
Management. Moreover, the Supervisory Board received
an update on the M&A activities of the Company, and
made amendments to the Rules of Procedure of the
Supervisory Board.
In February the Supervisory Board discussed the report of
the external auditor of the Company and approved the
Annual Report 2009. Furthermore, the Supervisory Board
approved revisions made to the General Business
Principles and Directives of the Company.
In March the Supervisory Board received an update on the
M&A activities and the sustainability policy of the
Company. The Remuneration Committee gave an update
to the full Supervisory Board on remuneration topics.
In June the Vision 2015 strategy of the Company and the
Sectors, including risks and opportunities, and a variety of
growth scenarios in mature and emerging markets, were
discussed during a one and a half day meeting.
In August the Supervisory Board discussed the financial
results and received an update with respect to the
Company’s M&A activities and ongoing legal proceedings.
Further, the members of the Supervisory Board spent two
days with the Philips India leadership team and major
customers and business partners in New Delhi, India,
where they discussed, among other things, the
performance and set-up of the Company’s activities in
India and the local strategy going forward.