Committees of the Board of Directors

The Board of Directors has formed two committees from among its members: the audit committee and the human resources committee. The term of office of these committees is one year. The term of office starts at the appointment of the committee after VR-Group Ltd’s Annual General Meeting and lasts until the following Annual General Meeting.

The committees convene 4–7 times a year. The rules of procedure for the committees have been confirmed by the Board and the committees report to the Board of Directors. The main content of the committees’ rules of procedure is described below.

The audit committee

The committee focuses on preparing matters concerning financial reporting and supervision for the Board to consider. The committee also looks after contacts with the auditors and the internal audit.

The committee must comprise at least three independent Board members possessing competence required in the task that are not employed by VR Group. At least one of the members must possess expertise in accounting or auditing.

The duties of the audit committee include:

• reviewing the annual budget;
• monitoring calculation models and changes in them;
• familiarising itself with essential issues concerning accounting and financial reporting, especially complex and exceptional arrangements involving discretion and business transactions that may have a significant effect on the picture on the financial performance and position of VR Group;
• monitoring the implementation and financing of economically important investments of long duration;
• monitoring the effectiveness of the company's internal control, internal audit and risk management and prepare a corporate governance code for these areas;
• approving the instructions and operating plan for internal audit, examining audit reports and maintaining contacts with internal audit;
• monitoring the statutory audit of the parent company and consolidated financial statements;
• assessing the independence of the auditor and audit firm prescribed by law and in particular the offering of non-audit services to the company being audited;
• in cooperation with the management and auditors, reviewing the audit plan and, on the basis of the audit, examine the observations made by the auditors and ensuring that the issues are properly examined;
• monitoring the financial situation of the company and the Group (interim financial statements);
• reviewing financial reporting, such as interim and annual reports and financial statements bulletins;
• monitoring business transactions between the company and parties related to it and any conflicts of interest that they involve;
• if necessary, reviewing legal processes that are of financial significance to the company and other legal matters;
• monitoring information security risks concerning the company's information systems and other important information security issues;
• preparing the decision concerning the selection of the auditor; and
• carrying out other duties specifically allocated to it by the Board of Directors.

Committee chair

• convenes the committee meetings;
• approves the agenda for committee meetings;
• is responsible for ensuring that minutes are prepared for each committee meeting;
• is responsible for ensuring that the committee reports on its work to the Board of Directors on a regular basis; and
• ensures that the committee adheres to its rules of procedure in its work.

On 23 April 2015, the Board of Directors elected the following persons as members of the audit committee: Maija Strandberg (chair), Riku Aalto, Roberto Lencioni and Tuija Soanjärvi. During 2015, the audit committee met six times and the average attendance rate for its members was 96 per cent.

The attendance rate of the audit committee members in the committee meetings is shown in the table below.

¹ At the audit committee meeting held on 21 April 2015, the committee comprised the following members: Maija Strandberg, Riku Aalto and Tuija Soanjärvi.

Human resources committee

The human resources committee focuses on preparing matters relating to developing incentive schemes for the President and CEO, other management and personnel and on preparing key appointments, for the Board of Directors to consider. As a rule, the committee has at least three members.

The duties of the committee include:

• preparing matters relating to the salary and other benefits of the company’s President and CEO;
• preparing matters relating to the remuneration of persons belonging to the Group’s Management Team and other senior management;
• preparing matters relating to the appointment of the President and CEO, members of the Group’s Management Team and where necessary of other key personnel;
• preparing matters concerning the company’s incentive schemes; and
• carrying out other duties specifically allocated to it by the Board of Directors and to the extent decided by the committee considering other issues affecting personnel such as personnel development, development of the work of supervisors, successor plans and developing safety at work.

The committee chair:

• convenes the committee meetings;
• approves the agenda for committee meetings;
• is responsible for ensuring that minutes are prepared for each committee meeting;
• is responsible for ensuring that the committee reports on its work to the Board of Directors on a regular basis; and
• ensures that the committee adheres to its rules of procedure in its work.

On 15 April 2015 the Board of Directors elected the following persons as members of the human resources committee: Hannu Syrjänen (chair), Heikki Allonen, Liisa Rohweder and Jarmo Kilpelä.

During 2015 the human resources committee met six times and the average attendance rate of its members was 100 per cent.

The attendance rate of the human resources committee members in the committee meetings is shown in the table below.

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