G4-34 Governance structure, committees under the Board of Directors
The Board of Directors determines the strategic objectives and the general resources for achieving these, and decides on major business transactions. For details about the internal organization of the Board of Directors and its committees, see Business Report > Corporate governance > Board of directors > Internal organizational structure.
The operational management structure of Geberit is divided into the Group Divisions:
- CEO division
- Sales Europe
- Sales International
The assignment of clearly distinguished responsibilities minimizes the number of interfaces. For more details about the organizational structure, see Business Report > Management structure.
G4-35 Delegation of authority on economic, environmental and social matters
The Board of Directors determines the overall strategy. This includes the corporate strategy, see www.geberit.com > Company > Vision and Strategy and the Sustainability Strategy. To the extent legally permissible and in accordance with the Organization Regulations, the Board of Directors has assigned the operational management and the implementation of the strategy to the Chief Executive Officer. Within the operational management structure, responsibility for specific economic, environmental and social issues is delegated further, see Business Report > Management structure.
At every meeting, the members of the Group Executive Board inform the Board of Directors of current business developments and major business transactions of the Group or Group companies, as the case may be. Between meetings, the Board of Directors is comprehensively informed in writing about current business developments and the company’s financial situation on a monthly basis.
G4-36 Responsibility for economic, environmental and social matters
The Board of Directors determines the strategic objectives and the general resources for achieving these, and decides on major business transactions. Within the operational management structure, responsibility is determined for specific economic, environmental and social issues, see Business Report > Management structure. The responsible individuals report either directly to the CEO (including Corporate Human Resources, Corporate Communications and Investor Relations, Marketing, Strategic Planning), or to other members of the Group Executive Board.
The way in which the topic of sustainability is approached has been regularly reviewed within the company. For over 20 years, Geberit has had an Environment and Sustainability department, which has been reporting directly to the CEO for more than a decade. In recent years, this department has coordinated the further development of the Sustainability Strategy and related activities, although the responsibility for planning and implementation lies with the individual areas themselves.
G4-37 Consultation process between stakeholders and the Board
For the participatory rights of the shareholders, see Business Report > Corporate governance > Participatory rights of shareholders.
There is no employee representative on the Board of Directors. The employee representatives of the European sites meet regularly within the context of the Geberit Europe Forum with a member of the Group Executive Board and the Head Corporate Human Resources. Selected concerns can be addressed to the Board of Directors through this channel.
G4-38 Independent members of the Board of Directors
The Board of Directors consisted of five members at the end of 2014, of whom only the Chairman, Albert M. Baehny, was simultaneously involved in operative management in his capacity as CEO, see G4-39. All of the committees formed by the Board of Directors are comprised exclusively of independent members. For further information, see Business Report > Corporate governance > Board of directors.
G4-39 Separation of chair of Board of Directors and Executive Management
The Chief Executive Officer (CEO), Albert M. Baehny, was also Chairman of the Board of Directors from 2011 until the end of 2014. He passed on the role of CEO to Christian Buhl at the beginning of 2015, and will then serve exclusively as Chairman. For further information, see Business Report > Corporate governance > Board of directors.
G4-40 Nomination and selection process of the Board of Directors
With regard to the election and terms of office of members of the Board of Directors, see Business Report > Corporate governance > Board of directors > Elections and terms of office.
G4-41 Processes in place for the Board of Directors to avoid conflicts of interest
Detailed information on all members of the Board of Directors, including their memberships in other organizations, can be found in Business Report > Corporate governance > Board of directors.
The Articles of Incorporation and the organizational regulations of the board of directors stipulate how conflicts of interest of members of the Board of Directors are avoided: The members of the Board of Directors are obliged to refrain from involvement in the handling of matters affecting either their personal interests or those of a company with which they have an affiliation. This obligation to refrain from involvement has no influence on the requirements for a quorum when passing resolutions. Business dealings between the company and members of the executive or governing bodies or related parties are subject to the principle of conclusion at conditions as with independent third parties.
G4-42 Role of top management and Board of Directors in development of guiding principles and strategies
Geberit’s longstanding success is based on the fact that, together with the Board of Directors, the Group Executive Board pursues a long-term perspective. The Board of Directors and Group Executive Board have defined and adopted key mission statements and principles such as the Geberit Compass and the Geberit Code of Conduct, see G4-56. The Sustainability Strategy is examined and approved by the Group Executive Board and the Board of Directors, see G4-45.
G4-43 Measures to further enhance the top management's and Board of Directors' related know-how on economic, ecological, and social topics
Internal business processes are designed to ensure continuous improvement and innovation. These values are closely associated with the Geberit brand. At the same time, stakeholder concerns are taken seriously, and the Group Executive Board and Board of Directors receive feedback and input for the continued development of the sustainability strategy as part of the stakeholder panel, for example.
Every year, the Board of Directors undertakes at least one assessment of the way in which it works together. This includes an assessment of how well-informed the members of the Board of Directors are about the Group and its business performance, see organizational regulations of the board of directors.
G4-44 Processes for evaluation of the sustainability performance of the Board of Directors
Geberit’s longstanding success is based on the fact that, together with the Board of Directors, the Group Executive Board pursues a long-term perspective, thus enabling the company to demonstrate its performance clearly in areas including sustainability. There is no formal procedure for assessing the performance of the Board of Directors from an integrated sustainability perspective. As part of the annual review of the sustainability strategy, findings are discussed and areas where action is needed are determined, see G4-45.
Geberit’s remuneration policy states that remuneration programs must be balanced between the reward of short-term success and long-term value creation. For information about the remuneration of the management bodies, see Business Report > Remuneration report.
G4-45 Board level procedures for overseeing sustainability performance
The Sustainability Strategy is examined and approved by the Group Executive Board and the Board of Directors. Results and the achievement of objectives are submitted to the Group Executive Board and Board of Directors for verification at least once annually. This also comprises the Communication on Progress UN Global Compact and the Geberit Compliance Report, including the audit results with respect to the Code of Conduct.
In 2014, Geberit consulted an external Stakeholder Panel for the second time. Its mandate consisted of providing feedback on the sustainability strategy and sustainability communication, as well as the associated risks and opportunities. This input is used for the strategic review and continued development of the company.
G4-46 Assessment of the effectiveness of sustainability related risk management procedures
Based on the Organization Regulations of the Board of Directors, the Audit Committee has implemented a comprehensive system for monitoring and controlling the risks linked to the business activities. This process includes the risk identification, analysis, control and reporting.
Operationally, the Group Executive Board is responsible for the controlling of the risk management. In addition, responsible persons are designated in the company for significant individual risks. These responsible parties decide on specific actions for the risk management and monitor their implementation. Every other year, the Internal Audit Department issues a risk report for the attention of the Board of Directors. Significant risks are also constantly discussed in the meetings of the Group Executive Board and Board of Directors, which take place on a regular basis.
For an overview of the Geberit compliance system, see Business Report > Business and financial review > Compliance.
G4-47 Frequency of review of risks and chances in the area of sustainability
G4-48 Review and approval of sustainability reporting
Sustainability reporting is examined and approved by the Board of Directors and Group Executive Board as part of the integrated annual report.
G4-49 Procedure for communicating crucial concerns to the Board
The Board of Directors is available at any time to address the concerns of stakeholders and shareholders.
G4-50 Nature and total number of critical concerns communicated to the Board
Matters brought by shareholders before the General Meeting will be dealt with in accordance with the Articles of Incorporation. In addition, only a very small number of matters were submitted directly to the Board of Directors in 2014. It proved possible to discuss and to settle these matters directly with the individuals concerned. There are no significant matters outstanding at the present time.
G4-51 Renumeration policies for highest governance body's
Geberit publishes a detailed annual Remuneration Report, which discloses the precise points of its remuneration policy, see Business Report > Remuneration report.
G4-52 Process for determining remuneration
Geberit publishes a detailed annual Remuneration Report, which discloses the precise points of remuneration to the Board of Directors and Group Executive Board, see Business Report > Remuneration report.
G4-53 Handling of stakeholder views on remuneration
In advance of the 2014 General Meeting, the transparency of the remuneration system was improved and stakeholder concerns addressed, see Business Report > Remuneration report.
G4-54 Annual total compensation ratios
The ratio of the annual remuneration paid to the highest-paid employee to the level of annual remuneration for all employees (excluding the highest-paid employee) was 25.0 in Switzerland, 5.2 in Germany, 3.6 in Austria and 3.2 in Italy.
G4-55 Annual compensation related percentage increase ratios
The ratio of the percentage increase in annual remuneration paid to the highest-paid employee to the level of the percentage increase in annual remuneration for all employees (excluding the highest-paid employee) was 8.8 in Switzerland, 2.1 in Germany, 2.3 in Austria and 8.8 in Italy.