Dutch Corporate Governance Code of December 2003
Heineken N.V. endorses the Code's principles and applies virtually all
best practice provisions. In particular, the structure of the Heineken
Group - and specifically the relationship between Heineken Holding
N.V. and Heineken N.V. - prevents Heineken N.V. from applying
a small number of best practice provisions.
Report of the Executive Board corn ru d
The Annual Meeting of Shareholders of 20 April
2005 sanctioned the way Heineken deals with the
Code and in particular the non-compliance with a
limited number of best practice provisions. Below
are the best practice provisions not (fully) applied,
or applied with explanation. The full Comply or
Explain report was published in February 2003
and is available at www.heinekeninternational.com
II.1.1 An Executive Board member is appointed
for a maximum period of four years. A
member may be reappointed for a term
of not more than four years at a time.
Members of the Executive Board who have
been appointed before 31 December 2003
have been appointed for an indefinite
period. This best practice provision cannot
be applied, as it violates the law.
II.2.7 The maximum remuneration in the event
of dismissal is one year's salary (the
'fixed' remuneration component). If the
maximum of one year's salary would be
manifestly unreasonable for a member
of the Executive Board who is dismissed
during his first term of office, such board
member shall be eligible for a severance
pay not exceeding twice the annual
salary.
In the contracts of the members of the
Executive Board there is no mention of a
specific scheme in the event of dismissal.
This best practice provision will not be
applied as it violates the law.
III.2.1 All Supervisory Board members, with the
exception of not more than one person,
shall be independent within the meaning
of best practice provision III.2.2.
Heineken endorses the principle and
Heineken considers the members of the
Supervisory Board as independent. In
a strictly formal sense, however, three
members of the Supervisory Board do not
meet the applicable criteria.
III.2.2 A Supervisory Board member shall
be deemed to be independent if the
following criteria of dependence do
not apply to him. The said criteria are
that the Supervisory Board member
concerned or his wife, registered partner
or other life companion, foster child or
relative by blood or marriage up to the
second degree:
a. has been an employee or member of
the management board of the company
(including associated companies as
referred to in section 1 of the Disclosure
of Major Holdings in Listed Companies
Act (WMZ) 1996) in the five years prior
to the appointment;
Mr. De Jong was prior to his appointment
in 2002 member of the Board of Directors
of Heineken Holding N.V. for one year.
According to this criterion Mr. De Jong
would not be independent. With reference
to criterion f, which contains an exception
for management board positions in
a group company, Heineken does not
consider this as an impediment to
Mr. De Jong being independent.
b. receives personal financial compensation
from the company, or a company
associated with it, other than the
compensation received for the work
performed as a Supervisory Board
member and in so far as this is not
in keeping with the normal course
of business;
Mr. Das receives from Heineken Holding
N.V. a financial compensation as Chairman
of the Board of Directors of Heineken
Holding N.V. Messrs. Van Lede and de
Carvalho receive from Heineken Holding
N.V. a compensation for attending the
meetings of the Board of Directors
of Heineken Holding N.V. These
compensations are in keeping with the
normal course of business. No other
Supervisory Board member receives
CO Heineken N.V.
JO Annual Report 2006