Pdf version (3.2 MB) - Kesko
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egion. Synergy benefits are achieved by<br />
capital expenditure on centrally guided purchasing<br />
and selections development, and<br />
in a shared enterprise resource planning<br />
system and logistics network.<br />
In the car and machinery trade, the market<br />
shares of the brands represented, including<br />
Volkswagen and Audi, will be increased<br />
by developing the retail sales and service<br />
network with an increasing customerdriven<br />
approach.<br />
<strong>Kesko</strong>'s strategy is presented in more<br />
detail in <strong>Kesko</strong>'s 2011 Annual Report on<br />
pages 9–11.<br />
The business models applied in <strong>Kesko</strong>'s<br />
sales to consumer-customers are retailing<br />
through retailer entrepreneurs and <strong>Kesko</strong>'s<br />
own retailing. <strong>Kesko</strong> is also engaged in<br />
B2B sales. More detailed information on<br />
the business models and responsible and<br />
efficient operating practices is available in<br />
<strong>Kesko</strong>'s 2011 Annual Report on pages 10–11.<br />
<strong>Kesko</strong>’s financial reporting and planning<br />
are based on the <strong>Kesko</strong> Group’s management<br />
system. The plans and actions relevant to<br />
corporate responsibility are integrated in<br />
the different sections of <strong>Kesko</strong>’s management<br />
system (see page 52). Management<br />
systems based on international standards<br />
have also been adopted.<br />
The progress and results of <strong>Kesko</strong>'s corporate<br />
responsibility work are discussed in<br />
<strong>Kesko</strong>'s responsibility programme 2008–<br />
2012 on pages 58–59 and in the GRI section<br />
on pages 60–90.<br />
CORPORATE GOvERNANCE<br />
<strong>Kesko</strong>'s decision-making and corporate governance<br />
are guided by <strong>Kesko</strong>'s values and<br />
responsible operating practices. Decision<br />
making and corporate governance comply<br />
with the Finnish Limited Liability Companies<br />
Act, regulations concerning publicly<br />
quoted companies, <strong>Kesko</strong>'s Articles of Association,<br />
the charters of <strong>Kesko</strong>'s Board of<br />
Directors and its Committees and the rules<br />
sTRaTEgIC OBJECTIVEs<br />
PROFITABLE GROWTH<br />
■ Our objective is to grow faster than<br />
market<br />
■ We seek growth in nearby areas,<br />
particularly in Russia<br />
■ We invest in the development of our<br />
store network<br />
■ We develop online services and<br />
e-commerce<br />
■ We increase our shareholder value<br />
and guidelines of NASDAQ OMX Helsinki<br />
Ltd. The company complies with the Finnish<br />
Corporate Governance Code for Listed<br />
Companies 2010. The code can be read in<br />
full at www.cgfinland.fi.<br />
As provided by the Comply or Explain<br />
principle of the Corporate Governance Code,<br />
the company departs from the Corporate<br />
Governance Code's recommendation concerning<br />
a Board member's term of office to<br />
the effect that the term of office of a <strong>Kesko</strong><br />
Board member is three years instead of the<br />
one-year term of office recommended by the<br />
Code. Read more at www.kesko.fi/investors<br />
or in the Annual Report on page 46.<br />
The highest decision-making power in<br />
<strong>Kesko</strong> is exercised by the company's shareholders<br />
at the company's General Meeting.<br />
The company's shareholders elect the<br />
company's Board and auditor at the Annual<br />
General Meeting. The company uses a socalled<br />
one-tier governance model. Read<br />
more about the General Meeting, the matters<br />
falling within the competence of the General<br />
Meeting, convening the General Meeting,<br />
right to participate in the General Meeting,<br />
its minutes, and the presence of governing<br />
bodies at www.kesko.fi/investors, or in the<br />
Annual Report on pages 46–47.<br />
<strong>Kesko</strong>'s Board is composed of seven members,<br />
one of whom is a woman. All Board<br />
members are non-executive directors.<br />
Based on the latest independence evaluation<br />
carried out on 4 April 2011, the Board<br />
considers that all of its members are independent<br />
of the company's significant shareholders,<br />
and that the majority of the members<br />
are also independent of the company.<br />
Three Board members (K-retailers) control<br />
companies each of which has a chain agreement<br />
with a <strong>Kesko</strong> Group company. The<br />
<strong>Kesko</strong> Board does not include representatives<br />
of the personnel.<br />
The Board regularly assesses its operations<br />
and working practices and carries<br />
out a related self-assessment once a year.<br />
SALES AND SERvICES FOR<br />
CONSUMER-CUSTOMERS<br />
■ We increase the value of our brands<br />
■ Our customer satisfaction exceeds that<br />
of our competitors<br />
■ Our competitive asset is the K-retailers<br />
who know the local customers and their<br />
needs<br />
■ We use loyal customer information<br />
efficiently to serve our customers<br />
REspONsIbIlITy IN day-TO-day aCTIVITIEs<br />
In 2011, the Board held 10 meetings. The<br />
Board members' attendance rate at the Board<br />
meetings was 94.3%. More information on<br />
the Board's operations in 2011 is available in<br />
<strong>Kesko</strong>'s Annual Report on pages 47–48 and<br />
at www.kesko.fi/investors.<br />
The Board has an Audit Committee and a<br />
Remuneration Committee, both of which are<br />
composed of three members. Neither Committee<br />
has independent decision-making<br />
power. Instead, the Board makes decisions<br />
based on the preparatory work of the Committees.<br />
In 2011, the Audit Committee held<br />
five meetings and the Remuneration Committee<br />
held three meetings. More information<br />
on the Committees' work is available on<br />
<strong>Kesko</strong>'s 2011 Annual Report on pages 48–49<br />
and at www.kesko.fi/investors.<br />
The Board has not appointed any of its<br />
members to concentrate especially on corporate<br />
responsibility matters, nor does<br />
<strong>Kesko</strong> have a separate process for evaluating<br />
the Board members’ competence in corporate<br />
responsibility. In its decision-making,<br />
the Board relies on the expertise of the Corporate<br />
Responsibility Advisory Board, as<br />
necessary.<br />
The Board members’ fees are not tied<br />
to the company’s corporate responsibility<br />
performance. The Board's remuneration<br />
plans and fees are presented in the<br />
Annual Report on pages 49–50 and at<br />
www.kesko.fi/investors.<br />
The Board discusses the Corporate<br />
Responsibility Report as soon as it has<br />
been completed, and as necessary, also<br />
other related issues brought out either by<br />
the Corporate Management Board or the<br />
Corporate Responsibility Advisory Board.<br />
The Board's principal duties are listed<br />
in the Annual Report, on page 47 and at<br />
www.kesko.fi/investors.<br />
The <strong>Kesko</strong> Group has a Corporate Management<br />
Board, the Chair of which is <strong>Kesko</strong>'s<br />
President and CEO. The Corporate Management<br />
Board has no authority based on<br />
RESPONSIBLE AND EFFICIENT<br />
OPERATING PRACTICES<br />
■ Our operating practices are responsible<br />
■ We efficiently combine retailer<br />
entrepreneurship and chain operations<br />
■ We leverage our economies of scale<br />
and competence for the benefit of<br />
customers<br />
■ We automate our processes<br />
<strong>Kesko</strong> Corporate Responsibility Report 2011 51