AT THE BOARD LEVEL
Credence views an eective, professional, and independent board as essential for good corporate governance. The board cannot substitute for talented professional managers, nor change the economic environment in which Credence operates. It can, however, inuence the performance of Credence through its supervision, guidance, and control of management in the interests and for the benet of Credence shareholders. Executive bodies also play a crucial role in the governance process. Eective interaction between the board and management, and a clear separation of authorities, are key to sound corporate governance.
The board’s scope of authority is set forth in the board’s articles of association and charter.
COMPOSITION AND INDEPENDENCE
The composition of the board is determined in a manner that combines the representatives of various shareholder groups. The board’s composition (competencies, skills and appropriate mix) is adequate for oversight duties, and the development of Credence direction and strategy. Each individual member of the board has the experience, knowledge, qualications, expertise, and integrity necessary to eectively discharge board duties and enhance the board’s ability to serve the long-term interests of Credence and its shareholders. The board has a broad range of expertise that covers Credence main business, sectors, and geographical areas, and includes experienced nancial experts who are non-executive, independent directors. A full and complete set of information on the directors’ qualications is set forth and annually reviewed by the board upon the recommendation of its corporate governance and nomination committee.
Credence board is composed of not more than (25%) of executive directors who are team members of Credence. To ensure the impartiality of decisions and to maintain the balance of interests among various groups of shareholders, three of the board’s members are independent directors. Credence denes those directors who have no material relationship with Credence as independent. The board ascertains which members are to be deemed independent during the rst board meeting. The denition of director independence shall be based on Egypt’s Code of Corporate Governance, complemented by other internationally recognized denitions, and specied in the board’s charter and annual report.
STRUCTURE AND COMMITTEES
Credence has established the following board committees:
The audit committee;
The remuneration committee; and
The corporate governance and nominations committee.
All committees have charters containing provisions on the scope of authority, competencies, composition, working procedures, as well as the rights and responsibilities of the committee members. The board’s Executive Chairman assigns directors to chair committees upon recommendation by the corporate governance and nominations committee. Each committee is to provide provisional consideration of the most important issues that fall within the authority of the board. After each of its meetings, the committee shall report on the meeting to the board.
The board, upon the recommendation of its corporate governance and nomination committee, recommends the appropriate size of the board. Achieving the required quality and mix of directors is the primary consideration in arriving at the overall number.
The board meets according to a xed schedule, set at the beginning of each year, which enables it to properly discharge its duties. As a rule, the board shall meet at least four times a year. Non-executive directors meet separately at least four times per year.
Detailed procedures for calling and holding meetings of the board are dened in the board’s charter. All directors are provided with a concise but comprehensive set of information by the Board Secretary in a timely manner, concurrently with the notice of the board meeting, but not less than ve business days before each meeting. This set of documents is to include an agenda; minutes of the prior board meeting; key performance indicators, including relevant nancial information prepared by management; and clear recommendations for action. The board keeps detailed minutes of its meetings that adequately reect board discussions, signed by the Executive Chairman.
The board conducts a yearly self evaluation. This process is to be organized by its corporate governance and nomination committee and the results are to be discussed by the full board. Independent consultants may also be invited to assist the board in this process.
TRAINING & ACCESS TO ADVISERS
Credence oers an orientation program for new board members on the company, its business, and on other subjects that will assist them in discharging their duties. Credence also provides general access to training courses to its board members as a matter of continuous professional education. The board and its committees shall also have the ability to retain independent legal counsel, accounting or other consultants to advise the board when necessary.
The remuneration of (non-executive) board members is comprised of an annual fee, and an additional fee for heading a committees or the board itself. The remuneration package shall, however, not jeopardize a director’s independence. Executive Directors are not paid beyond their executive remuneration package. The board’s remuneration committee periodically reviews the remuneration paid to directors. All board members sign a letter of appointment with Credence. Credence publicly discloses the remuneration of each director on an individual basis. Credence will not provide personal loans or credit to its board directors. Further, Credence shall not provide stock options to its directors.
DUTIES & RESPONSIBILITIES
Members of the board act in good faith, with due care and in the best interest of Credence and all its shareholders — and not in the interests of any particular shareholder — on the basis of all relevant information. Each director is expected to attend all board and applicable committee meetings. The board must decide whether its directors can hold positions in the governing bodies of other companies. Credence shall not unreasonably prohibit its directors from serving on other boards. Directors are expected to ensure that other commitments do not interfere with the discharge of their duties. However, the number of other directorships a director can hold is disclosed and capped at three. Board members shall not divulge or use condential or insider information about Credence. Members of the board shall abstain from actions that will or may lead to a conict of interest with Credence. When such a conict exists, members of the board shall disclose information and the conict of interest to the other board members and shall abstain from voting on such issues.