REG - S.N.G.N. Romgaz S.A. - Current Report - Compliance with CCG of BSE

Societatea Nationala de Gaze Naturale Romgaz SAAnnouncement

22/03/2019 14:20

RNS Number : 7702T
S.N.G.N. Romgaz S.A.
22 March 2019
 


CURRENT REPORT
In compliance with the Bucharest Stock Exchange Rulebook
 
Report date: March 22, 2019
Company name: Societatea Nationala de Gaze Naturale ROMGAZ S.A.
Address: Medias, 4 Constantin I. Motas Square, Sibiu County - Romania, 551130
Phone/fax no: 004-0374-401020 / 004-0269-846901
Fiscal Code: RO14056826
LEI Code: 2549009R7KJ38D9RW354
Trade Register registration number: J32/392/2001
Subscribed and paid in share capital: 385,422,400 RON
Regulated market where the issued securities are traded: Bucharest Stock Exchange (BVB), London Stock Exchange (LSE)
 
 
Significant event to be reported:
 
·     Compliance with Bucharest Stock Exchange (BSE) Code of Corporate Governance
 
As company listed at Bucharest Stock Exchange, S.N.G.N. ROMGAZ S.A. applies the provisions of BSE Code of Corporate Governance since November 12, 2013.
 
During 2018, S.N.G.N. ROMGAZ S.A. Board of Directors approved both certain updated regulations (Board of Directors Terms of Reference and Audit Committee Charter) and new regulations (Board of Directors Evaluation Policy, the Remuneration Policy and Policy on related party transactions). The documents are published on the company's website.   
 
Therefore, currently, S.N.G.N. ROMGAZ S.A. complies with most of the Table of Compliance with the Bucharest Stock Exchange Code of Corporate Governance provisions.
 
Attached:
Table of Compliance with the Bucharest Stock Exchange Code of Corporate Governance
 
 
Chief Executive Officer,
Constantin Adrian VOLINTIRU
 
---------------------------------------------------------
 
Table of Compliance with the Bucharest Stock Exchange Code of Corporate Governance
 




Governance code provisions


Complies


Does not comply or partially complies


Reasons for non compliance/Explanations on compliance
 




1


2


3


4






A.1


All the companies must have an Internal Regulation of BoD that includes the reference terms/ the responsibilities of the Board and the company's key management positions, and that applies, among others, the General Principles in section A. 


x


 


 
 




A.2


The ToR of the BoD should include provisions for the management of conflict of interest stating that members of the Board should notify to the Board any conflicts of interest which have arisen or may arise and should refrain from taking part in the discussion (including by not being present where this does not render the meeting non-quorate) and from voting on the adoption of a resolution on the issue which gives rise to such a conflict of interest.


x


 


 




A.3


The BoD has at least five members.


x


 


 




A.4


The majority of the members of the BoD is non-executive; not less than two non-executive members of the BoD must be independent.
 
Each independent member of the BoD must submit a statement at the time of his/her nomination for election or re-election, as well as whenever a change in his/her status occurs, indicating the elements on which it is deemed independent in terms of its character and his judgment.


x


 


 




A.5


A Board member's other relatively permanent professional commitments and engagements, including executive and non-executive Board positions in companies and non-profit organizations, should be disclosed to shareholders and to potential investors prior to his/her nomination and during his/her mandate.


x


 


 




A.6


Any member of the BoD should submit to the Board information on any relationship with a shareholder who holds, directly or indirectly, shares representing more than 5% of all voting rights. This also applies to any relationship which may affect the member's position on matters decided by the Council.


x


 


 
 




A.7


The company should appoint a Board secretary responsible for supporting the work of the BoD


x


 


 




A.8


The corporate governance statement should inform on whether an evaluation of the Board has taken place under the leadership of the chairman or the nomination committee and, if it has, summarize key action points and changes resulting from it. The company should have a policy/guidelines regarding the evaluation of the BoD containing the purpose, criteria and frequency of the evaluation process.


 


x partially


The section on Statement on corporate governance in the Annual Board of Directors' Report includes statements on the evaluation of the BoD.
Romgaz prepared the Policy regarding evaluation and it was approved by BoD on 12 March 2019.

 
Following its approval the Policy regarding evaluation was published on the company's web site.



 




A.9


The corporate governance statement should contain information on the number of meetings of the Board and the committees during the past year, attendance by directors (personally and in their absence) and a report of the Board and committees on their activities.


x


 


 




A.10


The corporate governance statement should contain information on the precise number of the independent members of the Board of Directors.


x


 


 




A.11


The BoD should set up a nomination committee formed of non-executives, which will lead the process for Board appointments and make recommendations to the Board.
 
The majority of the members of the nomination committee should be independent


x


 


 




B.1


The Board should set up an Audit Committee and at least one member should be an independent non-executive.
 
The Audit Committee should be formed of at least three members and the majority should be independent.
 
The majority of members, including the chairman, should have proven an adequate qualification relevant to the functions and responsibilities of the Committee. At least one member of the Audit Committee should have a proven and appropriate accounting and auditing experience.


x


 


 




B.2


The Chairperson of the Audit Committee should be an independent non-executive member.


x


 


 




B.3


Among its responsibilities, the Audit Committee should undertake an annual assessment of the internal control system.


x


 


The responsibility for monitoring the effectiveness of the company's internal control, internal audit and risk management systems is specified in the ToR of the Audit Committee.
 
For 2018 the Audit Committee performed the annual assessment of the internal control system.




B.4


The provision mentioned in section B.3 should consider the effectiveness and scope of the internal audit function, the adequacy of risk management and internal control reports to the Audit Committee of the Board, and management's responsiveness and effectiveness in dealing with the failures and weak points identified during the internal control and submit relevant reports to the Board.


x


 


See section B.3
 
 




B.5


The Audit Committee should review conflicts of interests in transactions of the company and its subsidiaries with affiliated parties.


x


 


This provision is already mentioned under Art. 8, par. 2 of CCG ROMGAZ.


The ToR of the Audit Committee approved by the BoD in the meeting of May 14, 2018 contains provisions in relation to this obligation.
 
Also, Romgaz has developed a Policy on affiliated parties and this was approved by the BoD on March 20, 2019.
 
Following the approval it is published on the company's website.
 
 
For 2018, the Audit Committee performed evaluation on conflicts of interest whenever was the case.




B.6


The Audit Committee should evaluate the efficiency of the internal control system and risk management system


x


 


The responsibility for monitoring the effectiveness of the company's internal control systems, internal audit and risk management systems is specified in the ToR of the Audit Committee.
 
For 2018, the Audit Committee performed the annual assessment of the risk management system.




B.7


The Audit Committee should monitor the application of statutory and generally accepted standards of internal auditing. The Audit Committee should receive and evaluate the reports of the internal audit team.


x


 


 




B.8


The Audit Committee should report periodically (at least annually) or adhoc to BoD with regard to the reports or analyses undertaken by the committee.


x


 


 




B.9


No shareholder may be given undue preference over other shareholders with regard to transactions and agreements made by the company with shareholders and their related parties


x


 


 




B.10


The BoD should adopt a policy ensuring that any transaction of the company with any of the companies with which it has close relations that is equal to or higher than 5% of the company's net assets (as stated in the latest financial report), it should be approved by the Board following a mandatory opinion of the Audit Committee and fairly disclosed to the shareholders and potential investors, to the extent such transactions fall under the category of events subject to disclosure requirements.


x


 


The provision is already mentioned under Art. 9 of CCG ROMGAZ and it will be implemented by the Policy for transactions with affiliated parties, policy approved by the BoD on March 20, 2019.
 
 
Following the approval, the policy will be published on the company website.
 




B.11


The internal audits should be carried out by a separate structural division (internal audit department) within the company or by hiring an independent third-party entity


x


 


 




B.12


The Internal Audit Department should functionally report to the BoD via the Audit Committee. For administration purposes and for the scope related to the obligations of the management to monitor and mitigate risks, the Internal Audit Department should report directly to the Director General.


x


 




 
 


 




C.1


The company should publish on its website the Remuneration Policy. The Remuneration Policy must be formulated so as to allow the shareholders to understand the principles and arguments underlying the remuneration of the members of the Board and of the General Director. Any significant change occurred in the Remuneration Policy must be posted in due time on the company's website.
 
The company must include in its Annual Report a statement on the implementation of this Policy during the annual period under review.
 
The Report on Remuneration must present the implementation of the Remuneration Policy for persons identified in this Policy during the annual period under review..


x


 


The provision is already mentioned under Art. 11, par. 5 of CCG ROMGAZ.
 
The section Statement on corporate governance in the Annual Board of Directors' Report includes statements regarding the implementation of the Remuneration Policy and the remuneration of the Board of Directors members and of the directors.
 
A separate document on Remuneration Policy was drafted and approved by the BoD on March 12 2019.
 
Following the approval, the policy is published on the company website.
 


The Annual Report on Remuneration is presented together with the Annual Board of Directors' Report. It presents details of the principles applied for the determination of the Board Members and directors.




D.1


The company should establish an Investors Relation Department - indicating to the public the responsible person/persons or the organizational unit.
Besides the information required by the legal provisions, the company should also include on its corporate website a dedicated Investor Relations section, both in Romanian and English, with all the relevant information of interest for investors, including:


x


 


 




D.1.1


Main corporate regulations: the articles of incorporation, general meeting of shareholders procedure;


 


x partially


Items on the GMS organization are presented to shareholders at each meeting.
 
A separate document on the GMS Procedure and Rules was prepared and it will be submitted for BoD approval in a meeting subsequent to this statement of conformity.




D.1.2


Professional CVs of the members of the company's governing bodies, other professional commitments of Board member's, including executive and non-executive Board positions in companies and non-profit organizations.


x


 


 




D.1.3


Current reports and periodic reports (quarterly, semi-annual and annual reports) - at least those specified in Note D.8- including current reports with detailed information related to non-compliance with the Bucharest Stock Exchange Code of Corporate Governance


x


 


 




D.1.4


Information related to GMS: the agenda and supporting materials; the procedure approved for the election of BoD members, the arguments for the proposal of candidates for the election to the Board together with their professional CVs; shareholders' questions related to the agenda and the company's answers, including the decisions taken by the GMS


x


 


 




D.1.5


Information on corporate events (such as payment of dividends and other distributions to shareholders, or other events leading to the acquisition or limitation of rights of a shareholder) including the deadlines and principles applicable to such operations.
The information will be published within a period of time allowing investors to take investment decisions.


x


 


 




D.1.6


The names and contact data of the persons who should be able to provide knowledgeable information on request;


x


 


 




D.1.7


Corporate presentations (for example presentations for investors, presentations on quarterly results etc.), financial statements (quarterly, semi-annual, annual), audit reports and annual reports.


x


 


 




D.2


The company will have a policy for annual cash distribution of dividend or other benefits for shareholders, proposed by the Director General and adopted by the BoD as the company's Guideline on net profits distribution.
The principles of the annual distribution of dividends policy to Shareholders will be published on the company's website.


x


 


 
 




D.3


The company shall adopt a policy with respect to forecasts, whether they are made public or not. The Policy on forecasts will determine the forecasts' frequency, period and content and will be published on the company's website.


x


 


 




D.4


GSM rules should not restrict the participation of shareholders in general meetings and the exercising of their rights. The modification of rules will become effective no sooner than the following shareholders' meeting.


x


 


 




D.5


The external auditors should attend the shareholders' meetings when their reports are presented there.


x


 


External auditors are invited to attend GMS meetings when their reports are presented in said meeting.




D.6


The BoD should present to the GMS a brief assessment of the internal controls and significant risk management system, as well as opinions on issues subject to resolution at the general meeting.


x


 


 




D.7


Any professional, consultant, expert or financial analyst, may participate in the shareholders' meeting upon prior invitation from the BoD.
Accredited journalists may also attend the GMS, unless the Chairman of the Board decides otherwise.


x


 


 




D.8


The quarterly and semi-annual financial reports should include information in both, Romanian and English, regarding the key drivers influencing the change in sales, operating profit, net profit and other relevant financial indicators, both on quarter-on-quarter and year-on-year terms.


x


 


 




D.9


The company should organize at least two meetings/conference calls with analysts and investors each year. The information presented on these occasions should be published on the company website in the IR section at the time of meetings/teleconferences.


x


 


 




D.10


If the company supports various forms of artistic and cultural expression, sport activities, educational or scientific activities, and considers the resulting impact on the innovativeness and competitiveness of the company is part of its business mission and development strategy, it should publish the policy guiding its activity in this area.


x


 


 




 
Legend:
GMS                       = General Meeting of Shareholders
BSE                        = Bucharest Stock Exchange
BoD                        = Board of Directors
CCG                       = Code of Corporate Governance
CCG ROMGAZ     = the Code of Corporate Governance of S.N.G.N. ROMGAZ S.A., approved on January 28, 2016.
CV                          = Curriculum Vitae
ToR                         = Terms of Reference
 




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