Governance

Governance at a glance

Corporate governance

For more information see Corporate governance.

Core principles

The Board is responsible for Gemalto’s corporate governance structure and for compliance with the Dutch corporate governance code, as applicable during the 2010 financial year. The Company complies with the principles and best practice provisions of the Dutch corporate governance code with the exception of the best practice provisions listed in the Corporate governance section.

Board compliance statement

The Board compliance statement for purposes of compliance with the Dutch corporate governance code and in accordance with the implemented European Union Transparency Directive, can be found in the Board compliance statement.

Board structure

The Company has a one-tier Board comprising:

  • Executive Board member, the CEO.
  • Non-executive Chairman.
  • Eight further Non-executive Board members.

The Board held eight meetings during 2010, four in person and four by conference call.

The Board has ultimate responsibility for the management, general affairs, direction and performance of the business as a whole. The CEO conducts the day-to-day management of the Company.

The CEO is supported by the senior management team that consists of ten Executive Vice-Presidents, including the Chief Financial Officer.

Board committees

The Board committees are:

  • Audit committee – held six meetings during 2010.
  • Compensation committee – held five meetings during 2010.
  • Nomination and Governance committee – held four meetings during 2010.
  • Strategy and M&A committee – held six meetings during 2010.

Board composition

The members of the Board can be found in The Board and the Management section. Board member changes are set out in the Corporage governance section.

Report of the Non-executive Board members

The report of the Non-executive Board members describes the activities of the Board and the different Board committees during 2010. The report can be found in the Report of the Non-executive Board members.

Internal risk management and control systems

For more information see Internal risk management and control systems.

Core principles

The principal aim of Gemalto’s internal risk management structure and control systems is to manage business risks, with a view to enhancing the value of shareholders’ investments and safeguarding assets and cash flows. Management has put in place, and regularly reviews and updates, a number of key policies, processes and independent controls to provide assurance to the Board as to the integrity of Gemalto’s reporting and effectiveness of its systems of internal control and risk management.

Risk assessment

Risk assessment is part of management responsibilities at all levels. At Group level, a risk mapping was performed in 2007 and a new one was launched in 2010. The results and progresses on the action plans are regularly presented to the Audit committee and to the Board. For a detailed description, see Internal risk management and control systems.

Internal control

Gemalto’s management regards internal control as a responsibility that is shared by all managers and that is met by implementing a set of processes and procedures within Gemalto intended to provide reasonable assurance that risks are mitigated, financial reporting is reliable, applicable laws and regulations are complied with, and that the objectives of the Board can be attained (see Internal risk management and control systems).

Remuneration

For more information see Remuneration.

2010 Remuneration Report of the Board

The 2010 Remuneration Report of the Board, as drawn up by the Compensation committee, contains an account of the manner in which the Remuneration Policy for the CEO was implemented in 2010, and is scheduled to be implemented in 2011 (see Remuneration).

Remuneration Policy for the CEO

The Remuneration Policy for the CEO was adopted by the Annual General Meeting (AGM) on May 11, 2005 and was most recently amended by the AGM of May 14, 2008. The Remuneration Policy is published on Gemalto’s web site. The Remuneration Policy also serves as a guidance to establish the senior management remuneration.

The objectives of the Remuneration Policy and the remuneration policy for the management are to attract, retain and reward talented staff and management, by offering compensation that is competitive in the industry, motivates management to surpass the Company’s business objectives and aligns the interests of management with the interests of the shareholders. 

Remuneration of the CEO, including his function as Executive Board member

The General Meeting, upon the proposal of the Board, determines the Remuneration Policy for the CEO, including for his function as Executive Board member. The remuneration of the CEO shall, with due observance of the Remuneration Policy, be determined by the Board. For details on the compensation of the CEO for the financial year 2010, see Compensation package of the CEO.

Remuneration of the Non-executive Board members

The remuneration of the Non-executive Board members, including the remuneration of the Chairman of the Board and the members of the Board committees, is determined by the General Meeting. The remuneration is reviewed annually by the Compensation committee. For details on the remuneration structure for the Non-executive Board members, see Remuneration of the Non-executive Board members.

Long-term incentive plans – Global Equity Incentive Plan

Gemalto has established a Global Equity Incentive Plan enabling the Board to grant options, restricted shares units and/or share appreciation rights to eligible employees (see Long-term incentive plans).

Long-term incentive plans – Global Employee Share Purchase Plan

Gemalto has established a Global Employee Share Purchase Plan enabling the Board to offer the opportunity to eligible employees to purchase shares in the Company at a discount to the prevailing market price (see Long-term incentive plans).