Board of Directors

The Board of Directors, which should have at least five members according to the Articles of Association, currently has seven members. Ines Pöschel decided not to stand for re-election at the Annual General Meeting of 29 March 2022. Judith Bischof was newly elected to the Board of Directors. No member performs any operational management duties for Implenia Ltd. or for any of its Group companies. Nor has any member of the Board of Directors belonged to the Implenia Executive Committee of Implenia Ltd. or any of the Group companies thereof during the last three financial years preceding the reporting period. No member maintains significant business relationships with the Implenia Group. The members are therefore independent. The Board of Directors is composed of the following members as of 31 December 2022:

1 Annual General Meeting in the designated year 

The current composition of the Board of Directors covers a number of areas of competence. The members have many years of professional experience in a variety of industries. The graphs below illustrate the diversity of the Board of Directors.

The summary on the next pages provides essential information about the education and career path of each member of the Board of Directors. It also discloses the mandates held by each member of the Board of Directors outside the Implenia Group as well as any further significant activities and permanent positions in significant interest groups.

According to Art. 22e of the Articles of Association, each Board Member may hold no more than 14 mandates as a director or officer of legal entities outside the Implenia Group (no more than four of which may be held in exchange-listed companies), which are to be registered in the Swiss Commercial Register or a similar foreign register. If mandates are held in different legal entities of one and the same corporate group or are held on behalf of a corporate group or a legal entity, then these will be counted in their entirety as one mandate in each case. According to the above-cited provision of the Articles of Association, it is permissible to exceed the foregoing limits for short periods.

The Articles of Association with the exact wording of the above-cited provision can be viewed on Implenia’s website.

 https://www.implenia.com/goto/corporategovernance/2022/en/articles-of-association-20200324.pdf

The members of the Board of Directors have a one year term of office. It commences with the election and ends after the close of the next annual General Meeting, without prejudice to prior resignation or prior removal from office (Art.18 (3) of the Articles of Association). The members of the Board of Directors may be re-elected at any time (Art.18 (4) of the Articles of Association) subject to an upper age limit of 70 years of age. The retirement occurs at the end of the annual General Meeting following the 70th birthday (Art.18 (5) of the Articles of Association). In compliance with the Swiss Ordinance against Excessive Compensation at Stock Exchange Listed Companies (“OaEC”) respectively the Swiss Code of Obligations ("OR"), the members and Chairman of the Board of Directors and the members of the Nomination and Compensation Committee shall be elected individually by the General Meeting (Art. 9 (b) and Art.18 (2) of the Articles of Association). Similarly, in compliance with the OaEC, the independent proxy is elected by the General Meeting (Art. 9 (b) of the Articles of Association). Moreover, the Board of Directors generally constitutes itself and, in particular, appoints its Vice-Chairman and secretary of the Board of Directors.

If the office of the Chairman of the Board of Directors becomes vacant or the Nomination and Compensation Committee is not completely filled or the Company lacks an independent proxy, the Articles of Association have no rules to eliminate such organisational problems that deviate from Art. 4 (4), Art. 7 (4) and Art. 8 (6) OaEC.

The Board of Directors is responsible for the strategic and financial management of Implenia and the supervision of its management. It adopts resolutions as the highest corporate body, except in matters for which the General Meeting is competent by law. The Chairman of the Board of Directors shall call the Board of Directors’ meetings. If the Chairman is unable to call the meeting, the meeting shall be called by the Vice-Chairperson or, if need be, by a member of the Board of Directors designated for that purpose by the Board of Directors. The CEO and CFO shall attend the Board of Directors' meetings on a regular basis. The Chairman shall determine the agenda and prepare and direct the meetings. The Chairman shall also decide on a case-by-case basis whether to involve others in the deliberations of the Board of Directors. Board of Directors’ meetings may be called by any member of the Board of Directors by specifying the agenda item and giving a short justification for the call.

The duties, responsibilities and working procedures of the Board of Directors, as well as its conduct in case of conflicts of interest, are regulated by the Implenia OR and Table of Responsibilities of 11 July 2019 (hereinafter “Table of Responsibilities”). The Implenia OR (without the Table of Responsibilities) can be found on Implenia’s website.

 https://www.implenia.com/goto/corporategovernance/2022/en/or-implenia-20221024.pdf

The Board of Directors has the following two internal committees in the reporting year: the Audit Committee (AC) and the Nomination and Compensation Committee (NCC). The Board of Directors elects one Chair per committee. The AC and NCC analyses the areas assigned to them by the Board of Directors and submit reports to the Board of Directors to assist with the preparation of its resolutions or the performance of its supervisory duties. The Chairs of the individual committees inform the Board of Directors of all the essential points and make recommendations on decisions to be made by the plenary Board of Directors. The committees’ duties and responsibilities are defined in the Implenia OR, the Table of Responsibilities and the regulations issued by the Board of Directors.

The committees generally organise themselves. The Board of Directors shall enact appropriate regulations at request of the committees. The committees shall generally have an advisory function, with decision-making authority reserved for the plenary Board of Directors. The committees shall have decision-making authority only where so determined in the Table of Responsibilities or in a Committee’s Regulation or by a special Board of Directors resolution. The committees are authorised to conduct or have investigations conducted on all matters within their area of responsibility. They may call upon the services of independent experts. The Board of Directors may appoint ad hoc committees for certain tasks and assign preparatory, supervisory and/or decision-making authority to such committees (sections 5.1.1 and 5.1.6 of the Implenia OR). No ad hoc committee was formed in the reporting year.

The table below shows the committees existing in the reporting year and their members:

Audit Committee

The AC is independent and shall consist of at least two members of the Board of Directors designated by the Board of Directors. The AC is chaired by a member of the Board of Directors with proven expertise in auditing and finance. The AC shall perform all of the Board of Directors’ duties relating to accounting oversight and organisation,
financial controlling (including the internal control system), financial planning and risk management. Risk management shall include reporting on (current or impending) legal actions. In addition, the AC shall monitor and report on the Compliance Management System to the Board of Directors. The AC shall coordinate and define the internal and external auditing tasks and be responsible for regular communications with the internal and external auditors and formulate the internal and external audit engagements. It shall have the authority to order special audits (section 5.1.1 of the Implenia OR). For more information about the ACʼs tasks, also see the Implenia OR.

 https://www.implenia.com/goto/corporategovernance/2022/en/or-implenia-20221024.pdf

Nomination and Compensation Committee

The NCC shall be composed of two to four members of the Board of Directors who are elected individually by the General Meeting. The general principles of the duties and responsibilities of the NCC concerning compensation have been established by the General Meeting in Art. 21a of the Articles of Association and are described in greater detail in the Compensation Report (page 85 et seq.).

For more information about the NCCʼs tasks, also see the Implenia OR.

 https://www.implenia.com/goto/corporategovernance/2022/en/or-implenia-20221034.pdf

The Board of Directors and its committees shall meet as often as required by business, at least six times (Board of Directors) or three times (AC and NCC), respectively per year. The meetings shall be held at the invitation of the Chair of the relevant committee and accompanied by an agenda and meeting documents each time. Moreover, each member can call a meeting and request the inclusion of additional agenda items. The meetings of the Board of Directors and of the committees shall be presided over by their respective Chair. The presence of the majority of the members shall constitute a quorum. Members who participate in the meeting via telephone or videoconference shall be deemed present, too.

The resolutions and votes of the Board of Directors and its committees shall be carried by a majority of the voting members present. Abstentions are not permitted. In case of a tie vote, the Chairperson shall have the casting vote. The results of the negotiations and resolutions shall be recorded in the minutes. The Chairman of the Board of Directors shall decide whether or not the CEO participates (section 3.3.6 of the Implenia OR). In case of need, further IEC members or other persons may be invited to the meetings. Moreover, the Division and Function Heads shall report once a year on their division or function; in addition, the Division Heads shall give semi-annual and annual reports at the respective meetings of the Board of Directors.

The Chairman of the Board of Directors shall participate in the meetings of the AC and of the NCC as a permanent guest. Further participants in the AC generally include the CEO, CFO and General Counsel and, if necessary, a representative of Internal Audit and one or more representatives of the external auditor and other persons designated by the Chair. The CEO and Chief Human Resources Officer generally participate in the NCC meetings. Guests of the meetings of the Board of Directors and of the committees generally have no right to vote. In addition, the IEC members cannot attend meetings of the NCC or of the Board of Directors whenever their own performance or compensation is being discussed. The tables on the right and below give an overview of the meetings and video meetings of the Board of Directors, AC and NCC in 2022:

1 The IEC was usually present in the person of the CEO.

2 Resigned from the Board of Directors on 29 March 2022.

1 The Chairman of the Board of Directors, the CEO, the CFO, the General Counsel and the auditors attended all meetings.

2 Appointed to the Audit Committee on 29 March 2022.

3 Resigned from the Audit Committee on 29 March 2022.

1 The Chairman of the Board of Directors, the CEO as well as the Chief Human Resources Officer and the Head Compensation & Benefits attended all meetings.

2 In addition, supplementary and preparatory meetings as well as telephone conferences were held. Some of these meetings were with the full Board of Directors or involved third parties as deemed necessary.

3 Elected as member of the NCC on 29 March 2022 and appointed as Chair by the Board of Directors.

4 Resigned from the Board of Directors on 29 March 2022.

The overall management and supervision of the Group is assigned by law to the Board of Directors. In addition to the responsibilities reserved to the Board under Art. 716(a) of the Swiss Code of Obligations, the Board of Directors rules on the following major transactions in accordance with the Table of Responsibilities:

• the acquisition or sale of holdings with an Enterprise Value of CHF 25 million or more;
• the purchase and sale of land /buildings / 
  areas (commercial properties) worth more than CHF 30 million;
• the determination of target markets and the resolution to enter a market;
• the determination of the principles of the
  financial policy (debt-to-equity ratio and financial indicators);
• determination of the financing plan;
• procurement of outside capital of CHF 50 million or more (credit lines, bonds, private investments and other capital market transactions, finance leasing, hire-purchase activities, etc.);
• Fundamental issues and guidelines relating to the investment of financial resources;
• the granting of any kind of loan of CHF 5 million or more to third parties;
• the granting of group guarantees and sureties, other guarantees, bid, performance and payment bonds etc., other security interests and entering into contingent liabilities outside of the ordinary course of business of CHF 5 million or more; and
• the use of financial derivatives when not used strictly for hedging purposes.

Moreover, the Board of Directors is in charge of determining the sustainability strategy.

The Board of Directors delegates the management of the Implenia Group to the CEO, unless provided otherwise by law, by the Articles of Association or the Implenia OR, and insofar as such powers have not been delegated to the IEC or to individual members of the IEC. The CEO shall take care of the management and representation of the Implenia Group, unless delegated to other governing bodies by law, by the Articles of Association or by the Implenia OR. He is responsible for the conduct of business and representation of the Group, in particular, for leadership of its operations and the implementation of corporate strategy. Insofar as such powers have not been reserved to the Board of Directors, the CEO is authorised to organise, perform and/or delegate to qualified subordinates the duties and powers assigned to him according to the Implenia OR, subject to providing such subordinates with proper instructions and supervision.

The CEO shall be assisted with the conduct of business by members of the IEC and other Function Heads. They report directly to him. The CEO is responsible for reporting to the Chairman of the Board of Directors and/or to the Board of Directors (section 6.2.3 of the Implenia OR). For the details of the division of responsibilities among the Board of Directors, CEO and IEC, see the Implenia OR and Table of Responsibilities.

 https://www.implenia.com/goto/corporategovernance/2022/en/or-implenia-20221024.pdf

In order to monitor how the CEO and members of the IEC perform their assigned responsibilities, the following information and control instruments are available to the Board of Directors, among others:

The IFRS Financial Reporting shall be delivered to the Board of Directors quarterly. The Half-Year Report is subject to approval by the Board of Directors and then released for publication.

As part of the budget planning for the following year, the indicators are determined based on the expected economic trend and specified together with the corporate objectives for each Division. Such indicators are used as a basis for budgeting the balance sheet, income statement, cash flow statement and liquidity planning. The annual planning for the next three calendar years (three-year plan) is performed like the budget planning.

The IEC and the Board of Directors evaluate the Implenia Group’s risk position annually, specifying and assessing the main Group risks in terms of their consequences and probability. The implementation and impact of the specified measures are monitored constantly by the IEC. When assessing the operational risks, current or impending legal actions are taken into account, as well as major scope changes in construction projects. The related reports show the risks and opportunities at the Group and Division levels and are constantly updated by the operational managers in cooperation with the Legal & Finance Functions, in order to introduce measures and monitor their effectiveness. As part of the Result Delivery Assessment (RDA) reporting, management reports on the volume of completed and open claims at each regular AC meeting.

All the divisional projects and the choice of construction consortium partners shall undergo in-depth evaluation thanks to the value assurance process, with the Value Assurance Committee (VAC) acting as the steering body. The VAC has been set up on four levels: Group (class 1), Global Division (class 2), Country Unit (class 3) and Regional Unit (class 4). In the VAC reports, VAC class 1 shall give the AC reports, at least every six months, on the outcome of its assignments and the appropriateness and effectiveness of the project management.

Litigation reports on (current or impending) legal actions are given in each ordinary AC meeting.

As part of the compliance reporting, a report is given in each ordinary AC meeting on the Compliance Management System (incl. data protection) in general and, in particular, on compliance cases, the state of progress in the investigations and the measures taken.

The Internal Control System is audited by the external auditor as required by law, and the resulting report is given to the Board of Directors (Art. 728a (1) (3) and 728b (1) of the Swiss Code of Obligations). The reports on the individual information instruments are prepared and consolidated by the Finance Function and Legal Function. They are then delivered
simultaneously to the Board of Directors and the IEC. At the meetings of the IEC and AC, the reports are presented by the CFO respectively by the General Counsel and commented on.

The CEO and CFO each provide detailed information about the course of business, comment on it and answer the questions of the members of the Board of Directors and AC.

The Board of Directors has engaged a recognised audit firm to conduct the internal audit. The AC determines the focal points of the internal audit based on a multi-year audit plan. In the reporting year, the focus was on IT & Digitalization Strategy, SG & A incl. Management Out-Sourcing Partners Switzerland, Travel & Entertainment Expenses CH, CSA Review, Health Check Austria, Project Audits as well as a follow-up on past audits. The Internal Audit’s audit plan is implemented in coordination with the CFO. Internal Audit created the audit plan according to the reports that the AC submitted together with the necessary comments and recommendations. Internal Audit reports directly to the AC. The reports of Internal Audit are transmitted to the external auditor without limitation. A regular exchange of information takes place between Internal and External Audit.