A collection of corporate governance principles

Following the Rules of Giełda Papierów Wartościowych w Warszawie S.A. [Warsaw Stock Exchange], Grupa KĘTY (hereinafter referred to as the ‘Company’ or the ‘Issuer’), as a public company, is obliged to abide by ‘The Best Practice for GPW Listed Companies 2021’ (‘Best Practice’), which is a collection of the principles of conduct applicable specifically to the governing bodies of GPW listed companies and their shareholders.

The document is available at the GPW website.

Grupa KĘTY decided not to apply other corporate governance principles than those referred to above. Moreover, it has not been applying corporate governance practices exceeding the requirements of the Polish laws.

In 2022, an analysis of the application by Grupa KĘTY of the Best Practice principles was carried out and information on the status of their application was published on 25 May 2022. The Issuer informed that in connection with passing by the Annual General Meeting of the Company on 25 May 2022 of a resolution regarding the Remuneration Policy of the Management Board and Supervisory Board Members, which provides for additional monthly remuneration for the Supervisory Board Members on account of work at the Audit Committee or the Nomination and Remuneration Committee, Principle 6.4 of the Best Practice 2021 has been fully applied by the Company. The document is available HERE.

Principle 2.1 ‘Companies should have in place a diversity policy applicable to the management board and the supervisory board, approved by the supervisory board and the general meeting, respectively. The diversity policy defines diversity goals and criteria, including gender, among others, education, expertise, age, professional experience, and specifies the target dates and the monitoring systems for such goals. With regard to gender diversity of corporate bodies, the participation of the minority group in each body should be at least 30%.’

Company comments: Grupa KĘTY S.A. has not implemented a diversity policy with regard to the members of the Company managing and supervising bodies, which would be approved by the Supervisory Board and the General Meeting. The Company has not limited or discriminated the candidates to the said bodies in any respect, and specifically with regard to gender. The appointment of the Management Board and Supervisory Board Members is made particularly based on their subject-matter knowledge, competence and experience.

Principle 2.2 Persons making decisions to elect Members of the Management Board or the Supervisory Board of the Company should ensure that the composition of those bodies is diverse, by appointing persons ensuring diversity, among others in order to achieve the target minimum participation of the minority group of at least 30% according to the goals of the established diversity policy referred to in Principle 2.1.

Company comments: Owing to the fact that the Company has not implemented a diversity policy in reference to the Company managing and supervising bodies, the above principle has not been applied.

Principle 3.7 Principles 3.4 to 3.6 apply also to the Company Group entities which are material to its activity if they appoint persons to perform such tasks.

Company comments: Principle 3.7 does not apply to the Company. At the other companies of the Capital Group of major importance for its operations there have not been appointed persons responsible for managing the audit, compliance, risk management and internal control systems. Responsible for the maintenance of the functions efficiency within the whole Capital Group and management of the same are the persons employed by the parent company, i.e. Grupa KĘTY S.A., who are functionally supported by the selected employees of the companies of major importance to the operations of the Capital Group. Grupa KĘTY S.A. carries out a periodical review of the systems operation within the Capital Group, considering the scale and specifics of its operations, among other things. If a decision is made on a change in the method of the systems functioning and employing people responsible for the functions at other companies, the Principles 3.4–3.6 will be taken into account.