Board’s Committees

Kesko’s Board of Directors has established an Audit Committee and a Remuneration Committee to support the Board’s work and prepare matters the Board is responsible for. Each Committee is composed of three (3) Board members. At the close of the Annual General meeting, the Board elects from among its members the Committee Chairmen, Deputy Chairmen and members for the whole three-year term of office of the Board. In the election of committee members, the independence and competence requirements for the committee in question are to be taken into account.

The Committees have no independent decision-making power. Instead, the Board makes decisions on matters based on the Committees' preparatory work. The Board has confirmed written charters for the Committees detailing the Committees’ duties and operating principles. Each Committee Chair reports on the Committee's work at the Board meeting following the Committee's meeting. Minutes of the Committee meetings are submitted for the information of the Board members. The actions and working practices of the Committees are assessed annually in conjunction with the Board evaluation.

Audit Committee

The Board elected in its organisational meeting, held after the Annual General Meeting on 12 April 2021, the following Board members as the Audit Committee members:

• Jannica Fagerholm (Chair)
• Timo Ritakallio (Deputy Chair)
• Piia Karhu

 
All members of the Audit Committee are independent of the Company and of the Company's significant shareholder. In the election of the Audit Committee members, the competence requirements for Audit Committee members have been taken into account.

In accordance with its charter, the Audit Committee:

• monitors Kesko Group's (Kesko) financial position and funding
• monitors and assesses Kesko’s financial reporting system, including the process for financial statements reporting
• monitors and assesses the effectiveness of Kesko's internal control, internal audit and risk management systems
• approves the operating instructions for the Company’s internal audit and annually assesses the need for changes, approves the annual audit plan, budget and resources and related material changes, and reviews reports submitted to the Committee
• monitors the statutory auditing of the Company and the Group
• discusses matters that emerge in connection with auditing and in relation to the Committee’s duties with the Company’s Auditor when necessary and otherwise handles contacts with the Auditor
• reviews the Auditor’s Report and possible audit minutes and reports presented by the Auditor to the Committee
• monitors and evaluates the independence of the Company’s Auditor and, in particular, the non-audit services provided to Kesko by the Auditor and its network audit companies
• prepares the appointment of the Company’s statutory Auditor and recommends an Auditor
• monitors and assesses how agreements and other legal acts between the Company and its related parties meet the requirements of ordinary course of business and arm’s-length terms
• prepares a recommendation to the Board of Directors regarding the review of interim reports, the half year financial report, and the financial statements
• reviews the Company’s Corporate Governance Statement and non-financial report
• prepares and reviews other tasks given by the Board to the Committee

 
Operation in 2022

In 2022, the Audit Committee held five meetings. The attendance rate of Committee members at the meetings was 100%. The Group's Chief Financial Officer, the Group Controller, the Chief Audit and Risk Officer, and the Group General Counsel regularly reported on their areas of responsibility to the Committee at the meetings. The Auditor is present at the Committee meetings and presents their audit plan and report to the Audit Committee.

During the year, the Committee reviewed reports on the Group’s financial situation, including the financial statements release, the half-year financial report and the interim reports and updated forecasts, and made a recommendation to the Board on the review of the reports and the financial statements release. The Committee reviewed reports on the Group’s external and internal audits, risk management, cyber security and compliance, the report on related party transactions, and the Corporate Governance Statement. The Committee also reviewed reports related to the Company’s financing, taxation, requirements of EU taxonomy, and insurances. In terms of risk management, the Audit Committee concentrated in particular on general economic development, the war in Ukraine and cyber security and related business risks by reviewing said risks at each meeting. The Audit Committee approved the 2023 audit plan, personnel resources and budget for the Group’s internal audit. The Committee also reviewed the results of goodwill impairment testing. The Committee monitored and assessed the Auditor’s independence and the additional services provided by the Auditor and other auditing firms to Kesko. The actions of the Audit Committee were assessed as part of the evaluation of Kesko’s Board work.

Remuneration Committee