Committees of the Board
The Board has four committees to assist in its duties pursuant to the respective committee charters: the Audit Committee, the Corporate Governance and Nomination Committee, the Personnel Committee and the Technology Committee. The Board makes decisions based on the preparation and resolution proposals by the committees. The Board may also establish ad hoc committees for detailed reviews or consideration of particular topics to be proposed for the approval of the Board. Any director who so wishes may attend, as a non-voting observer, meetings of committees of which they are not members.
The committee members are appointed by the independent members of the Board upon the recommendation of the Corporate Governance and Nomination Committee based on each committee’s member qualification standards. Consideration is given to the desires, skills and characteristics of individual directors.
As of 5 April 2022 the Audit Committee consists of the following five members of the Board:
The Audit Committee is established by the Board primarily for the purpose of oversight of the accounting and financial reporting processes of the company and audits of its financial statements. The Audit Committee consists of a minimum of three members of the Board who meet all applicable independence, financial literacy and other requirements as stipulated by Finnish law and the rules of the Nasdaq Helsinki and the New York Stock Exchange. The Board has determined that all members of the Audit Committee, including its Chair, are “audit committee financial experts” as defined in the requirements of Item 16A of the annual report on Form 20-F filed with the U.S. Securities and Exchange Commission (“SEC”) and “independent directors” as defined by Finnish law and Finnish Corporate Governance Code and in Section 303A.02 of the NYSE Listed Company Manual.
The Committee is responsible for assisting the Board in the oversight of:
- The quality and integrity of the company's financial statements and related disclosures;
- The statutory audit of the company's financial statements, including the sustainability reporting therein;
- The external auditor's qualification, independence and performance;
- The performance of internal controls and risk management operations of the company;
- The performance of the internal audit function;
- The compliance with legal and regulatory requirements and the performance of ethics and compliance program of the company.
The foregoing list of duties is not exhaustive, and the Committee may, in addition, perform such other functions as may be necessary or appropriate for the performance of its oversight function. Nokia’s disclosure controls and procedures, which are reviewed by the Audit Committee and approved by the President and CEO and the Chief Financial Officer, as well as the internal controls over financial reporting, are designed to provide reasonable assurance regarding the quality and integrity of the company's financial statements and related disclosures.
Under Finnish law, Nokia's external auditor is elected by shareholders by a simple majority vote at the Annual General Meeting for one fiscal year at a time. The Audit Committee prepares the proposal to the shareholders, upon its evaluation of the qualifications and independence of the external auditor, of the nominee for election or re-election as well as the proposal in respect of the fees of the external auditor, and approves the external auditor's annual audit fees under the guidance given by the Annual General Meeting.
In discharging its oversight role, the Audit Committee has full access to all company books, records, facilities and personnel. The Committee may appoint counsel, auditors or other advisors in its sole discretion, and must receive appropriate funding, as determined by the Audit Committee, from Nokia for the payment of compensation to such outside advisors.
The Audit Committee meets a minimum of four times a year based upon a schedule established at the first meeting following the appointment of the Committee. The Committee meets separately with the representatives of Nokia’s management, heads of the internal audit and ethics and compliance functions, and the external auditor in connection with each regularly scheduled meeting. The head of the internal audit function has at all times a direct access to the Audit Committee, without the involvement of management.
Corporate Governance and Nomination Committee
As of 5 April 2022 the Corporate Governance and Nomination Committee consists of the following four members of the Board:
The Corporate Governance and Nomination Committee consists of three to five members of the Board who meet all applicable independence requirements as stipulated by Finnish law and the rules of the Nasdaq Helsinki and the New York Stock Exchange.
The Corporate Governance and Nomination Committee's purpose is to prepare the proposals for the general meetings in respect of the composition of the Board and the director remuneration. The Committee also oversees issues and practices related to corporate governance and proposes necessary actions in respect thereof to reflect the best governance practices.
The Committee fulfills its responsibilities by:
- Actively identifying individuals qualified to become members of the Board and considering and evaluating the appropriate level and structure of director remuneration;
- Proposing to the shareholders the director nominees for election at the General Meetings as well as the director remuneration;
- Monitoring significant developments in the law and practice of corporate governance and of the duties and responsibilities of directors of public companies;
- Advising the Board with respect to significant developments in the law and practice of corporate governance, including the aspects of sustainable corporate governance as well as compliance with the company’s Corporate Governance Guidelines;
- Assisting the Board and each Committee of the Board in its annual performance evaluations, including establishing criteria to be used in connection with such evaluations; and
- Reviewing the company's disclosure in the Corporate Governance Statement.
The Committee has the power to appoint recruitment firms or advisers to identify appropriate candidates. The Committee may also appoint counsel or other advisers, as it deems appropriate from time to time. The Committee has the sole authority to appoint or terminate the services of such firms or advisers and to review and approve such firm’s or adviser’s fees and other retention terms. It is the Committee’s practice to appoint a recruitment firm to identify new director candidates.
As of 5 April 2022 the Personnel Committee consists of the following four members of the Board:
The Personnel Committee consists of a minimum of three members of the Board who meet all applicable independence requirements as stipulated by Finnish law and the rules of the Nasdaq Helsinki and the New York Stock Exchange.
The purpose of the Personnel Committee is to oversee and periodically review the personnel policies and practices related to Nokia’s human capital management and social responsibilities, including, but not limited to, company culture, occupational safety, employee wellbeing, diversity, equity and inclusion, talent management and development, succession planning, resourcing, recruiting, attrition, retention and employee engagement.
The Committee also assists the Board in discharging its responsibilities relating to the remuneration of the company's top executives and their terms of employment. The Committee has overall responsibility for evaluating, resolving and making recommendations to the Board regarding:
- The Remuneration Policy, setting the philosophy and general principles for the remuneration of the governing bodies of Nokia, to be approved by the shareholders (at least every four years);
- Remuneration of the company's top executives and their terms of employment; ensuring that the remuneration is performance-based, and designed to contribute to long-term shareholder value creation and alignment to shareholders’ interests, properly motivate management, and support overall corporate strategies.
- All equity-based incentive plans and other potential significant incentive plans as well as remuneration related policies and programs of the company affecting executives; and
- The Remuneration Report presented to the shareholders annually, and overseeing that the related disclosures meet the regulatory and other relevant requirements.
As of 5 April 2022 the Committee consists of the following five members of the Board:
The Technology Committee consists of a minimum of three members of the Board who meet applicable independence requirements and have such skills in innovation, technology and science matters as the Board determines adequate from time to time.
The Committee is established by the Board primarily as an advisory forum and for the purpose of reviewing the high-level key innovation and technology initiatives, formulated by the management and, when necessary, presented to the Board for decision. The Committee will engage in a dialogue with management with respect to major innovation and technology trends, related significant risks and opportunities as well as the company’s technology competitiveness and bets made from time to time.
The Committee will periodically review and, where appropriate, make related recommendations to the Board, inter alia, on the following:
- The company’s technologic competitiveness and new strategic technology initiatives;
- The company’s approach to major technological innovations;
- Key technology trends that may result in disruptive threats or opportunities;
- High-level risks and opportunities associated with the company’s Research and Development Programs; and
- Embedding sustainability in the technology strategy and roadmaps of the company.