Corporate governance can be described as a system that determines how a company is to be managed and controlled.
Corporate governance describes how rights and responsibilities are divided between a company’s bodies, owners and other stakeholders, and it provides rules for decision-making processes related to the company’s objectives, strategies, tools and corporate relations. It also addresses companies’ control and feedback systems.
Ferd’s corporate governance objectives
The objective with our corporate governance is to contribute to better results over time by facilitating better decision-making processes, more precise risk assessment and improved decisions. This will, in turn, ensure that we operate in accordance with approved strategies and risk limits, and that these are adapted to our owners’ wishes.
A lean structure and unbureaucratic approach are two of Ferd’s important competitive advantages. To preserve these advantages, it is important that the company has clearly defined limits and levels of authorisation to allow decisions to be delegated to a large extent.
Our relationship to recommended practice
A range of the matters addressed in the Norwegian Code of Practice for Corporate Governance are not relevant to Ferd due to our private ownership. Ferd does, however, follow the Code’s recommendations where they are relevant, and they are a useful tool when Ferd is seeking to safeguard its shareholder rights at other companies. In Norway it is recommended to have a clear division between a company’s board of directors and executive management team (a two-tier board system). While at family-owned companies family members are often members of the board and executive management teams, Ferd has chosen a corporate governance model that is in line with recommended practice in Norway. The group’s owner is the chair of the Board and not a member of its management team. The four other members of the Board are external and independent of the group’s owner and executive management.