Corporate Governance

Introduction

The corporate governance report records the principles and conduct of management and supervision at the highest management level of the Micronas Group. Micronas meets the requirements of the ”Swiss Code of Best Practice for Corporate Governance”, which has been in force since July 1, 2002, and updated in 2007 and 2014, and the corporate governance guidelines of the SIX Swiss Exchange in force since October 1, 2014.

Mindful that effective, transparent and systematically implemented principles of corporate governance make an important contribution to the Micronas Group’s success and to increasing company value, we are sensitive to the justified expectations and demands of our stakeholders concerning responsible management. At Micronas, the way the leadership and management of the Company are organized and function in practice is clearly regulated, in particular with regard to the division of responsibilities and powers among the decision-making bodies, namely the Board of Directors, Management and Shareholders’ Meeting, as well as to accountability in respect of decisions taken. The Board of Directors works through efficient committees: a Nomination and Compensation Committee and a Risk and Audit Committee. In addition, specific topics are reviewed by a special internal auditor from time to time.

As we at Micronas see it, the core issue of good corporate governance is that it responds to our shareholders’ concern for prudent corporate policies and efficient deployment of resources, including an effective system of checks and balances. In this respect, the Code of Conduct of Micronas, including implementing guidelines, helps to ensure that all Micronas employees act in a responsible manner. The Code of Conduct is available under Documents as PDF.

In pursuance of these aims, the Micronas Group maintains an open information and communication policy toward shareholders, financial markets and interested sections of the public. Transparency and continuity in our dealings with investors – over and above what is legally required – are underpinned by comprehensive year-end financial statements, semi-annual financial statements in the form of a letter to the shareholders and quarterly financial updates for the first and the third quarter through respective press releases and constant updating of the relevant information on our website.

Implementation of Minder Rules at Micronas

The ordinance against excessive compensation in listed companies (Verordnung gegen übermässige Vergütungen bei börsenkotierten Gesellschaften) has come into effect on January 1, 2014 (the “Ordinance”). However, transitional rules allow an implementation until December 31, 2015.

Micronas had implemented most of the changes requested by the Ordinance already at the Shareholders’ Meeting held on March 21, 2014 and the Shareholders’ Meeting held on March 27, 2015 voted on the compensation of the Board and Management Board based on a separate compensation report audited by the Company’s auditors.