Corporate Governance and Transparency
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Evaluation
by an external consultant of HELLENiQ ENERGY Board of Directors effectiveness -
36%
of the HELLENiQ ENERGY Board of Directors members are independent and non-executive -
11
Board of Directors members (2 executive) serving a 3-year term at HELLENiQ ENERGY -
100%
participation in the 16 meetings of the HELLENiQ ENERGY Board of Directors
& Transparency
HELLENiQ ENERGY applies thorough yet flexible corporate governance mechanisms and management practices, ensuring the smooth operation of the Board of Directors and fair communications with shareholders and stakeholders.
Corporate Governance Structure
HELLENiQ ENERGY applies the principles of corporate governance and adopts best market practices in order to ensure transparency and responsible operation in all areas of its activity and to further boost the dialogue with shareholders and stakeholders.
The company also monitors developments in the current corporate governance framework, not only to guarantee its compliance with it, but also to develop new policies, values, and principles to govern its operations, ensuring transparency and responsibly protecting the interests of its shareholders, employees, the supply chain it leads, and all its stakeholders.
The adoption and faithful application of good corporate governance principles contributes to strengthening the confidence of shareholders and society in the Group and its subsidiaries, reinforcing its corporate reputation, enhancing the satisfaction of its stakeholders and raising their expectations for continuous improvement.
HELLENiQ ENERGY adheres to the Greek Corporate Governance Code (June 2021 edition) of the Hellenic Corporate Governance Council (HCGC) for Listed Companies (henceforth, the Code). The Code follows a “comply or explain” approach and requires that listed companies choose to apply it and disclose their intention to do so and either comply with the specific practices of the Code or explain their reasons for not complying with some of them. In 2023, HELLENiQ ENERGY complied with the provisions of the Code with minimal adjustments as detailed in Chapter D2 (p. 48) of the Corporate Governance Statement in the 2023 Annual Financial Report. The Code is available to all interested parties via the Group’s corporate website (www.helleniqenergy.gr/en).
Furthermore, in implementing an integrated and flexible corporate governance system, HELLENiQ ENERGY applies additional good corporate governance practices, beyond those required by the applicable legislation and concern the duties and general functioning of the Board of Directors (a detailed description of the Committees of the Board of Directors is included in Section D7, p. 60 of the Corporate Governance Statement in the 2023 Annual Financial Report).
The Board of Directors is HELLENiQ ENERGY’s highest governing body, which is collectively responsible for its long-term progress. It primarily shapes the strategy and development policy, and supervises and controls the management of the company’s assets. The Board of Directors acts in accordance with the Greek legislation, international best practices, the Articles of Association, and the resolutions of the General Meeting of HELLENiQ ENERGY’s shareholders.
BoD Members’ composition per years of participation
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11
Board of Directors members (2 executive)
serving a 3-year term in HELLENiQ ENERGY -
81.8%
of HELLENiQ ENERGY’s board members
are non-executive -
36%
of HELLENiQ ENERGY’s board members
are independent and non-executive -
100%
attendance at the 16 meetings
of HELLENiQ ENERGY’s Board of Directors
The Board of Directors consists of 11 members, elected in accordance with the provisions of article 20 of HELLENiQ ENERGY’s Articles of Association. In 2023, the Greek State had the right to appoint four (4) members to the Board of Directors, acting on behalf of the shareholder Hellenic Republic Asset Development Fund (HRADF S.A.), provided that its share exceeded 35% of HELLENiQ ENERGY’s voting shareholders. An Extraordinary General Meeting was held in December 2023 at the request of the HRADF S.A. shareholder, in accordance with the provisions of article 141, par. 1, of Law 4548/2018, and approved the amendment of the Company’s Articles of Association to allow the Greek State to appoint three (3) members to the Board of Directors if it holds less than 35% but more than 25% of the voting shares of HELLENiQ ENERGY (article 20, paragraphs 2a, 4, and 11 of the Company’s Articles of Association). The other members of the Board of Directors are elected by the General Meeting without the participation of HRADF, provided that the latter has exercised its right of direct appointment.
The Board of Directors’ term of office is three years. Its members are eligible for re-election and are freely revocable, while the term of office of the current Board of Directors is valid until 30.06.2024 and is extended until the date of the Annual General Meeting 2024.
The Board of Directors of HELLENiQ ENERGY has a suitable composition and diversity, as along with the necessary combination of executive, non- executive, and independent non-executive members, in accordance with the approved suitability policy with regard to gender, knowledge and skills, areas of activity and experience of members.
The selection of candidates for the Board of Directors is carried out in accordance with the criteria set out in HELLENiQ ENERGY’s “Suitability Policy”, which is fully harmonised with the applicable provisions of Greek law. The purpose of the Policy is to define the basic principles addressed for the Nomination Committee in the selection, renewal of the term of office, and replacement of the members of the Board of Directors, as well as the criteria set for this purpose.
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Gender
9 men, 2 women
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Specialty
Master’s degree and above
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Citizenship
73% Greek citizenship
27% Double or other citizenship
In addition, when selecting the members of the Board of Directors, HELLENiQ ENERGY applies a “Diversity Policy” in order to promote a suitablelevel of diversity on the Board of Directors and a diverse group of members. Bringing together a wide range of qualifications and skills when selecting Board members ensures the necessary diversity of views and multi-level experience required to make sound decisions, promote equality, and eliminate discrimination. Further information regarding the Policy and its content is available in the “Suitability Policy”, available to all social partners via the Group’s corporate website https://www.helleniqenergy.gr/en.
HELLENiQ ENERGY has established, maintains and implements a Remuneration Policy for the members of the Board of Directors, which is aligned with its business strategy, goals, and sustainability. The Policy was approved by a resolution of the Extraordinary General Meeting of HELLENiQ ENERGY’s Shareholders dated 20 December 2019 and was amended by a resolution of the Ordinary General Meeting of Shareholders on 30 June 2021. The Remuneration Report 2022 is available on the Group’s website. The Remuneration Report for 2023 is available on the Group’s corporate website, which will be approved at the Annual General Meeting that will take place on June 27, 2024.
In addition, HELLENiQ ENERGY has and applies a Board of Directors’ Evaluation Policy and Procedure, while the Board of Directors’ Operating Regulations, which has been adopted by the company, provide for the annual evaluation of the effectiveness of the Board of Directors (as a collective body), its committees, and their individual members. Every three years, this evaluation is conducted by an external consultant.
The responsibilities between HELLENiQ ENERGY’s Management and Board of Directors are specified in the Articles of Association, and the Company’s Operating Regulations, which describe the role and responsibilities of the Board of Directors’ Committees. Further information is available in section D7 (p. 60) of its “Corporate Governance Statement” at the 2023 Annual Financial Report.
The Board of Directors has established five (5) committees to enhance its operation and effectiveness in achieving corporate objectives and ensuring the proper functioning of HELLENiQ ENERGY. More information regarding the committees is available in the 2023 Annual Financial Report.
| Audit Committee |
Remunertion and Succesion Planning Committees |
Nominations Committee |
Other Committees |
|
|---|---|---|---|---|
| BoD – Board of Directors | 3 members 100% independent |
3 members 67% independent |
3 members 67% independent |
Sustainable Development Committee — Strategy and Risk Management Committee |
The Sustainable Development Committee’s mission is to assist the BoD in strengthening the Company’s long-term commitment to creating value in all three pillars of sustainability (economy, environment and society) and to supervise the implementation of responsible and ethical business conduct, on matters regarding the Environment-Society and Governance (ESG).
The Committee is responsible for supervising the definition of the stakeholders and the mode of communicating with them, to understand their interests, identify the Company’s substantial issues, implement the sustainability policy and the commitments included in it, and provide guidelines on individual aspects / pillars for implementing the policy (such as health and safety, the environment and climate change, the society) and the risks related to them.
The Company’s and the Group companies’commitments refer to the health, safety, environment and sustainability policy, which is included in the Company’s Bylaws.
In parallel, the Executive Committee is both advisory and executive in nature, to the extent that specific executive powers are assigned to it by the BoD, and consequently by the Sustainable Development Committee for the respective topics. It processes and shapes strategic issues for all sectors of the Group’s and its subsidiaries’ (domestic and foreign) business activities.
Indicatively (and without limitation), the Executive Committee’s main responsibilities are:
- Formulating the strategy and development plan for the Group’s activities, in the form of mid-term and annual business plans.
- Monitoring the progress of the works of all Group activities through financial results and ΚΡΙs.
- Monitoring, information and coordination on issues affecting the Group’s activities and requiring a well-coordinated approach by the entire Management team.
The Committee met twice during 2023, on 14 March and on 28 July. During the first meeting of the year, the main topic of discussion was the Study for the strategy and operation of the Group regarding Sustainable Development and ESG related topics. During the second meeting, the results of the aforementioned study were presented, and the proposed changes were approved, which included the creation of a new organizational structure, as well as the introduction of a new governance model for Sustainable Development/ESG-related topics, with specific roles and responsibilities for all involved organizational units of the Group.
2023 Key Milestones
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Establishment of a Board of Directors’ Strategic Issues Day, with an annual meeting for strategic issues outside the established standard Board of Directors’ meeting schedule. The first Strategic Issues Day was held in February 2023 and focused on updating the Group’s “Vision 2025” strategy and identifying key drivers for its implementation.
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The first evaluation of the Board’s effectiveness by an external consultant was completed in March 2023. The evaluation addressed the collective capabilities of the Board of Directors as a body, its Committees, and the individual capabilities and contributions of its members.
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In May 2023, the Board of Directors decided to appoint one of its independent directors as a “Senior Independent Director” with responsibilities to: a) support the Chairman of the Board of Directors, b) coordinate effective communication between the Chairman and the members of the Board of Directors, c) lead the meetings of the non-executive directors, and the ongoing evaluation of the Chairman. Mr. Iordanis Aivazis, the most senior of the independent non-executive members of the Board of Directors, was appointed Senior Independent Director.
Business Ethics, Compliance,
and Transparency
Consistent Strengthening of Regulatory Compliance and Business Ethics
The Management of HELLENiQ ENERGY strictly adheres to the principles of healthy competition and demonstrates zero tolerance for incidents of corruption, while consistently adopting the strictest standards of Regulatory Compliance, always meeting the highest levels of corporate responsibility.
The company’s long-standing commitment to the highest levels of corporate responsibility strengthens its commercial position and consolidates its reputation, both within Greece and in the countries where it operates. This commitment fosters a climate of trust and security among stakeholders, including employees, customers, suppliers, consumers, shareholders, as well as residents living near its facilities.
The Code of Conduct sets out the principles that govern HELLENiQ ENERGY’s activities in Greece and abroad, and determines the way in which the Group operates in order to achieve its business objectives, with the ultimate aim of ensuring its sustainable growth. The Code of Conduct is binding for all Group employees in Greece and abroad and has been translated into all languages spoken in the countries where the Group operates, including English, and is accessible via the intranet and the Group’s website. It is also binding for any third party or body in their transactions with the Group.
The ongoing commitment of all Group parties to the Code of Conduct is ensured through repeated and regular acceptance and reaffirmation procedures of the Code’s commitments. The ongoing compliance with the procedures for accepting and reaffirming the Code commitments by employees is overseen by the Group’s Human Resources and Administrative Services Division. At the same time, the Compliance Department is in charge of ensuring proper and effective implementation of the Code, providing advice in accordance its provisions, as well as of investigating reports or complaints about incidents of its violation, while the internal structure and corporate governance of HELLENiQ ENERGY and its subsidiaries provide adequate safeguards, partnerships of two or more persons, internal approvals and controls, in order to prevent illegal operation and/or corruption.
For thirteen consecutive years, HELLENiQ ENERGY has conducted continuous and extensive education and training of executives and employees, including its subsidiaries, on the content, basic principles and commitments of the Code. This training is also part of the onboarding process for new recruits.
The revised Code of Conduct is expected to take effect in 2024, as part of the broader revision of the corporate governance system so that it complies with the latest legislative developments, mainly regarding corporate governance, the prevention and suppression of money laundering, and anti-corruption. At the same time, measures to protect individuals who report or disclose information obtained in an employment context and relating to illegal acts (whistleblowing) are strengthened and communication channels for reporting infringements are expanded. In accordance with Law 4990/2022 on protecting individuals who report violations of European Union law (Whistleblowing), the relevant Policy will be developed and implemented (within 2024). Similarly, in 2022, the preparation of the Policy on Combating Violence and Harassment at Work was completed, in accordance with the provisions of Law 4808/2021.
HELLENiQ ENERGY’s Divisions and Departments, aiming at an orderly, efficient and, transparent corporate operation, prepare policies and procedures under the Business Organization System (BOS) as part of Regulatory Compliance, which are approved based on their content and scope by Group Management and/or the Managers of the organizational units or subsidiaries, following the applicable BOS Implementation Policy.
- Procurement Regulation
- Investments Regulation
- Project Implementation Regulation
- Internal Work Regulation
- Regulation on the Removal & Disposal of Useless or Surplus Equipment or Material and Sale of Assets to Third Parties
- Operational Regulation of the Group’s Division of Legal Services
All Tax & Customs issues for all Group companies across jurisdictions where the Group has presence, are monitored, audited and coordinated centrally by the Group Tax & Customs Department (GT&CD). GT&CD ensures full compliance with tax and customs legislation, as well as with all transparency and audit requirements, both in Greece and in all other countries where the Group operates, in accordance with the existing institutional framework and the
Group’s practices and policies, in close cooperation with the competent Authorities. Specifically in Greece, where the Group’s main activities and the parent company are located, tax compliance is also verified annually for all companies, obtaining “unqualified” Tax Certificates issued by the certified auditors, following annual audits.
GT&CD also acts as tax advisor to the Group, by providing suggestions and instructions, directly monitoring the developments and constant changes in the respective institutional framework, in addition actively participating in committees and bodies for consultation and submission of additional proposals and adjustments to the competent authorities.
It also appropriately utilizes the framework for the optimization of tax cash flows and refunds, while it also examines the inclusion of investments within the framework of development/incentive laws, with the aim of optimal overall management of tax and customs issues at all levels, taking into account the respective impact, risks and opportunities.
Since 2018, HELLENiQ ENERGY has adopted a Competition Policy and drafted a compliance manual. This Policy underscores the company’s ongoing commitment to comply with Greek and European competition laws, as well as the national laws of the countries in which it operates.
Furthermore, the Policy aims to assist the Group’s Management, executives and employees to understand the fundamental rules of Fair Competition and their impact on the Group’s day-to-day operations and the formation of its business practices.
The Competition Policy and the compliance manual were revised in September 2023 so that they are adapted to recent changes in legislation, building on the relevant Guidelines issued by the Competition Commission (CC).
The implementation of HELLENiQ ENERGY’s business objectives, as well as the operation and the economic activity of the Group as a whole, takes place in accordance with the rules of Competition Law, thus contributing to its sustainable development and the strengthening of the Group’s competitiveness. At the same time, any infringements of competition law that could damage the Group’s reputation and expose either the Group or an individual employee to the risk of severe sanctions are prevented.
Supply Chain Sustainable Management
HELLENiQ ENERGY has an extensive list of more than 14,000 active suppliers for purchasing materials and equipment or obtaining services. The Group’s partners include multinational companies, as well as large, medium, small and medium-sized local companies and are important partners that contribute to the achievement of the Group’s business objectives. They contribute to its competitiveness and sustainable development, influencing not only its financial performance but also its relations with other stakeholders.
Thus, the Group ensures that it remunerates its partners on time and in accordance with the Procurement Regulation and the payment policy in force at the time, including small and medium-sized enterprises. Especially for the latter category, the Group is in dialogue with its suppliers to achieve a mutually satisfactory payment framework.
The Procurement Division’s primary objective is to establish and maintain a robust, reliable and sustainable supply chain, seeking:
- Optimal coverage of the Group’s procurement needs.
- Promotion of healthy competition and equal opportunities.
- Fostering of synergies and long-term relationships of mutual benefit.
- Total transparency and meritocracy.
- Implementation of a strict ethical procurement framework.
- Creating multiple options to safeguard security of supply and minimise business risks.
- Adopting sustainable practices in environmental, social and economic issues to maximise positive results.
- Support to local communities through the selection of local suppliers wherever possible, as this contributes to both local development and the achievement of the Group’s objectives.
In order to achieve the above and aiming to further disseminate the sustainable development principles it has adopted and applies, HELLENiQ ENERGY follows an established framework of cooperation, which includes a Code of Conduct, Procurement Regulations, policies and procedures for the promotion of health and safety, commitment to environmental rules and responsible labour practices with respect to human rights, as well as a supplier evaluation process.
The partners of the Group’s Procurement Department are selected and evaluated, both upon their inclusion in the list of suppliers and during the cooperation with them, based not only on business criteria, but also on sustainability criteria. The Division’s contracts incorporate a “condition of compliance” of its suppliers with the principles of the UN Global Compact in the areas of human rights, labour, the environment, and anti-corruption.
In 2023, the Group’s Procurement Division implemented a major digital transformation project in order to optimise the relevant processes. The project includes among others standardisation of processes for registering and qualifying vendors as well as assessing them based on the following four pillars:
- Regulatory & Legal Framework (sanctions and watch lists, bribery and corruption, IT security, fraud, anticompetitive behaviour, corporate crime, etc.).
- Environmental & Social Framework (human rights, labour issues, health and safety, environmental issues, conflict materials, unethical practice, decertification etc.).
- Financial Framework (bankruptcy, insolvency, mergers and acquisitions, divestiture, credit rating downgrade, downsizing, liquidation, tax issues, etc.).
- Operational Framework (natural disasters and accidents, shutdowns, labour issues, product issues, project delays, etc.).
Scope expansion and further improvements are scheduled for 2024.
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HELLENiQ ENERGY includes among others standardisation of processes for registering and qualifying vendors as well as assessing them based on the following four pillars:
1. Regulatory & Legal Framework
2. Enviromental & Social Framework
3. Financial Framework
4. Operational Framework
Product Marketing and Promotion
All activities relating to advertising and product promotion are fully in line with the Code of Conduct of the Hellenic Advertising Association and the Association of Advertising and Communication Companies.
Marketing Department executives participate in training programs and seminars to stay updated on best practices and new regulations at the European and international levels governing the field of advertising and product promotion.