Philips 2011 Annual Report Download - page 96

10 Supervisory Board report 10 - 10
96 Annual Report 2011
10 Supervisory Board report
Introduction
General
The supervision of the policies and actions of the
executive 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 and independent corporate body.
This independence is also reflected in the requirement
that members of the Supervisory Board can neither be a
member of the Board of Management, member of the
Executive Committee nor 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 9, 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 11, Corporate governance, of this Annual Report.
Activities of the Supervisory Board
In 2011, 10 meetings were held of which three meetings
were ad hoc to discuss specific topics such as the approval
of the formation of the TV joint venture. Furthermore,
the Supervisory board from time to time collectively and
individually interacted with management outside the
formal Supervisory Board meetings. All members were
frequently present at the meetings of the Supervisory
Board. 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 seven regular meetings.
During 2011 the Supervisory Board devoted considerable
time to discuss the Company’s strategy and performance
as well as the effects of the macroeconomic outlook on
Philips. Furthermore, the Supervisory Board engaged in
dedicated sessions on risk management, the formation of
the TV joint venture and the Accelerate! program.
In January the Supervisory Board discussed the financial
performance of the Philips Group in 2010, the
Management Agenda 2011, the strategy for the TV
business, the agenda for the 2011 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 and Supervisory Board. Moreover, the
Supervisory Board received an update on and discussed
M&A activities 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 2010. Furthermore, the Supervisory Board
discussed the developments in the TV business.
In March the Supervisory Board discussed the
performance of the Philips Group, various M&A
activities, the developments in the TV business and the
intention to form a TV joint venture, the IT strategy and
innovation strategy of the company. The Remuneration
Committee gave an update to the full Supervisory Board
on remuneration topics.
In April the Supervisory Board assembled in an ad hoc
session to discuss the formation of the TV joint venture
and the formation of the Executive Committee.
In May the Supervisory Board had a special session to
approve the acquisition of Povos (China).
In June the overall strategy of the Company and that of
the individual sectors was discussed including the main
risks related thereto. In addition, the Supervisory Board
discussed the capital and financing structure of the Philips
Group and possibility to launch a share buyback program,
the progress made in forming the TV joint venture,
elements of the Accelerate! program and the Philips
General Business Principles.