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Proposals of Sampo plc's Board of Directors and its Committees to the Annual General Meeting

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Sampo Oyj
·14-min read
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SAMPO PLC STOCK EXCHANGE RELEASE 17 March 2021 at 09:45 am

Proposals of Sampo plc's Board of Directors and its Committees to the Annual General Meeting

Sampo plc's Board of Directors has decided to summon the Annual General Meeting for 19 May 2021. The notice of Annual General Meeting will be published on 17 March 2021 and registration will commence on 19 April 2021. The Board of Directors and its committees have made the following proposals to the Annual General Meeting.

- Proposal of the Board of Directors for Distribution of Profit

- Proposal of the Nomination and Remuneration Committee for the Remuneration of the Members of the Board of Directors

- Proposal of the Nomination and Remuneration Committee for the Number of Members of the Board of Directors and the Members of the Board of Directors

- Proposal of the Audit Committee for the Remuneration of the Auditor

- Election of the Auditor

- Proposal of the Board of Directors for Authorization to Decide on the Repurchase of the Company’s Own Shares

The Board proposes to the Annual General Meeting a dividend of EUR 1.70 per share and an authorization for the Board to decide on repurchasing a maximum of 50,000,000 Sampo A shares using funds available for the profit distribution.

The Nomination and Remuneration Committee of the Board of Directors proposes to the Annual General Meeting that the number of Board members remain unchanged and that eight members be elected to the Board. The Nomination and Compensation Committee proposes of that the current members of the Board Christian Clausen, Fiona Clutterbuck, Georg Ehrnrooth, Jannica Fagerholm, Johanna Lamminen, Risto Murto and Björn Wahlroos be re-elected for a term continuing until the close of the next Annual General Meeting. Of the current members Antti Mäkinen is not available for re-election. The Committee proposes that Markus Rauramo be elected as a new member to the Board.

The Nomination and Remuneration Committee of the Board of Directors proposes to the Annual General Meeting that each member of the Board of Directors be paid an annual fee of EUR 95,000 until the close of the next Annual General Meeting and the Chair of the Board be paid EUR 184,000. Furthermore, the Nomination and Remuneration Committee proposes that the members of the Board of Directors and its Committees be paid the following annual fees: the Vice Chair of the Board be paid EUR 26,000; the Chair of the Audit Committee be paid EUR 26,000; and each member of the Audit Committee be paid EUR 6,000. The proposed increase in the annual fees of the Board members is approximately 2 per cent. An increase to the annual fees of the Board members has lastly been made at the Annual General Meeting held on 2 June 2020.

The Board of Directors proposes, on the recommendation of the Board’s Audit Committee, that based on a tendering of auditors, the firm of authorised public accountants Deloitte Ltd be elected as the company’s Auditor for the financial year 2021.

The proposals are attached in full to this release.


SAMPO PLC
Board of Directors

For more information, please contact:

Jarmo Salonen
Head of Investor Relations and Group Communications
tel. +358 10 516 0030

Maria Silander
Communications Manager, Media Relations
tel. +358 10 516 0031

Mirko Hurmerinta
IR & Communications Specialist
tel. +358 10 516 0032

Distribution:
Nasdaq Helsinki
London Stock Exchange
The principal media
Financial Supervisory Authority
www.sampo.com

ANNEX 1

Proposal of the Board of Directors for distribution of profit

The parent company’s distributable capital and reserves totaled EUR 7,250,153,463.79 of which profit for the financial year 2020 was EUR 699,633,592.61.

The Board proposes to the Annual General Meeting a dividend of EUR 1.70 per share to the company’s 555,351,850 shares. The dividends to be paid are EUR 944,098,145.00 in total. The remainder of the funds are left in the equity capital.

The dividend will be paid to the shareholders registered in the Register of Shareholders held by Euroclear Finland Ltd as the record date of 21 May 2021. The Board proposes that the dividend be paid on 28 May 2021.

No other significant changes have taken place in the company's financial position since the end of the financial year. The impairment of Nordea shares published in a release on 11 February 2021 had no impact on Sampo plc’s distributable capital and reserves. The company's liquidity position is good and in the view of the Board, the proposed distribution does not jeopardize the company's ability to fulfill its obligations.

Helsinki, 17 March 2021

SAMPO PLC
Board of Directors

ANNEX 2

Proposal of the Nomination and Remuneration Committee for the remuneration of the members of the Board of Directors

The Nomination and Remuneration Committee of the Board of Directors proposes to the Annual General Meeting that each member of the Board of Directors be paid an annual fee of EUR 95,000 until the close of the next Annual General Meeting and the Chair of the Board be paid EUR 184,000. Furthermore, the Nomination and Remuneration Committee proposes that the members of the Board of Directors and its Committees be paid the following annual fees:

-the Vice Chair of the Board be paid EUR 26,000,
-the Chair of the Audit Committee be paid EUR 26,000, and
-each member of the Audit Committee be paid EUR 6,000.

The proposed increase in the annual fees of the Board members is approximately 2 per cent. An increase to the annual fees of the Board members has lastly been made at the Annual General Meeting held on 2 June 2020. In determining the proposed fees, the Committee has considered the effect of financial regulation on the demandingness of the Board’s work and the annual fees paid to Boards of businesses similar to Sampo Group.

Potential statutory social and pension costs incurring to Board members having permanent residence outside Finland will, according to applicable national legislation, be borne by Sampo plc. In addition, actual travel and accommodation costs incurring to a Board member will be reimbursed.

A Board member shall, in accordance with the resolution of the Annual General Meeting, acquire Sampo plc’s A shares at the price paid in public trading for 50 per cent of his/her annual fee after the deduction of taxes, payments and potential statutory social and pension costs. The company will pay any possible transfer tax related to the acquisition of the company shares.

A Board member shall make the purchase of shares during 2021 after the publication of the Interim Statement for January-September 2021 or, if this is not feasible because of insider regulations, on the first possible date thereafter.

A Board member shall be obliged to retain the Sampo A shares under his/her ownership for two years from the purchasing date. The disposal restriction on the Sampo shares shall, however, be removed earlier in case the director’s Board membership ends prior to release of the restricted shares i.e. the shares will be released simultaneously when the term of the Board membership ends.

Helsinki, 11 February 2021

SAMPO PLC
Nomination and Remuneration Committee



ANNEX 3

Proposal of the Nomination and Remuneration Committee for the number of members of the Board of Directors and the members of the Board of Directors

The Nomination and Remuneration Committee of the Board of Directors proposes to the Annual General Meeting that the number of Board members remain unchanged and that eight members be elected to the Board. The proposal is in compliance with Sampo plc’s Board Diversity Policy.

The Nomination and Remuneration Committee of the Board of Directors proposes that the current members of the Board Christian Clausen, Fiona Clutterbuck, Georg Ehrnrooth, Jannica Fagerholm, Johanna Lamminen, Risto Murto and Björn Wahlroos be re-elected for a term continuing until the close of the next Annual General Meeting. Of the current members Antti Mäkinen is not available for re-election. The Committee proposes that Markus Rauramo be elected as a new member to the Board.

Markus Rauramo was born in 1968 and has a Master of Social Sciences degree from the University of Helsinki. He has made a long career in the energy sector as well as pulp and paper industry and is currently the President and CEO of Fortum Corporation. He started in this position in July 2020. Rauramo’s complete CV is enclosed to this proposal.

All the proposed Board members have been determined to be independent of the company and its major shareholders under the rules of the Finnish Corporate Governance Code 2020.

The CVs of all persons proposed as Board members are available at www.sampo.com/agm.

The Nomination and Remuneration Committee proposes that the Board members elect Björn Wahlroos from among its number as the Chair of the Board and Jannica Fagerholm as its Vice Chair. It is proposed that Christian Clausen, Risto Murto and Björn Wahlroos (Chair) be elected to the Nomination and Remuneration Committee as well as Fiona Clutterbuck, Georg Ehrnrooth, Jannica Fagerholm (Chair), Johanna Lamminen and Markus Rauramo be elected to the Audit Committee. The compositions of the Committees fulfil the Finnish Corporate Governance Code 2020’s requirement for independence.

Helsinki, 11 February 2021

SAMPO PLC
Nomination and Remuneration Committee

Annex
CV of Markus Rauramo

MARKUS RAURAMO, CV 11 February 2021
Born 1968


CURRENT POSITION

Fortum Corporation
-President and CEO

EDUCATION

University of Helsinki
-M. Soc.Sc. (Economics and political history)


CAREER

Fortum Corporation
-Chief Financial Officer 2017–2020, 2012–2014
-Acting CEO 2013
-Executive Vice President, City Solutions 2016–2017
-Executive Vice President, Heat, Electricity Sales and Solutions 2014–2016

Stora Enso Oyj
-CFO and Member of the GET 2008–2012
-SVP Group Treasurer 2004–2008
-VP Strategy and Investments 2001–2004
-VP Head of Funding 1999–2001
-Various finance positions 1993–1999

POSITIONS OF TRUST

Uniper SA
-Vice Chairman of the Supervisory Board 2018–

Teollisuuden Voima Oyj
-Member of the Board 2013–

Wärtsilä Oyj Abp
-Board Member 2011–2020, Vice Chairman 2020–2021

ANNEX 4

Proposal of the Audit Committee for the remuneration of the Auditor

The Audit Committee of the Board of Directors proposes to the Annual General Meeting that compensation be paid to the company’s Auditor against an invoice approved by the company.

As background for the proposal, the Audit Committee states that the Authorized Public Accountant Firm Ernst & Young Oy has acted as Sampo plc’s Auditor in 2020.

The fee paid to Ernst & Young Oy for statutory audit services rendered and invoiced in 2020 totaled EUR 512,000. In addition, Ernst & Young Oy was paid a total of EUR 222,000 in fees for non‑audit services, which is less than 70 per cent of the average fees as defined in article 4 section 2 of the EU Audit Regulation (Regulation (EU) No 537/2014 of the European Parliament and of the Council of 16 April 2014 on specific requirements regarding statutory audit of public-interest entities and repealing Commission Decision 2005/909/EC, “Audit Regulation”).

The Auditor’s fees for services provided to Sampo Group have been presented in note 36 of the annex to the consolidated financial statements.

Helsinki, 17 March 2021

SAMPO PLC
Audit Committee

ANNEX 5

Election of the Auditor

The Board of Directors of Sampo plc proposes, on the recommendation of the Board’s Audit Committee, to the Annual General Meeting on 19 May 2021 that based on a tendering of auditors, the firm of authorised public accountants Deloitte Ltd be elected as the Company’s auditor for the financial year 2021. If Deloitte Ltd is elected as Sampo plc’s auditor, the firm has announced that APA Jukka Vattulainen will be the auditor with principal responsibility.

Helsinki, 17 March 2021

SAMPO PLC
Board of Directors

Recommendation to the board of directors for the election of auditor

Sampo plc has an obligation to organize an audit firm selection procedure in accordance with the EU Audit Regulation (Regulation (EU) No 537/2014 of the European Parliament and of the Council of 16 April 2014 on specific requirements regarding statutory audit of public-interest entities and repealing Commission Decision 2005/909/EC, the “Audit Regulation”) concerning the audit for the financial year 2021. The Audit Committee has arranged the statutory tendering of auditor, organized a statutory audit firm selection procedure and prepared its recommendation in accordance with the Audit Regulation.

In accordance with Article 16 (2) of the Audit Regulation, the Audit Committee shall submit a recommendation to Sampo plc’s Board of Directors for the proposal for the election of an audit firm. In accordance with the Audit Regulation, the Audit Committee’s recommendation shall contain two choices for the audit engagement and express a justified preference for one of them.

The Audit Committee has requested and received two offers. The Committee has met both audit firms that submitted an offer, and has used various selection criteria to evaluate the candidates, including suggested audit approach and methodologies, experience and composition of the audit team, audit quality and price, international team work in Sampo Group’s geographical operating area and utilisation of technology. The selection process included multiple rounds of information submissions, introduction of Sampo management, discussions and presentations by the candidates as well as external reference checks. After careful consideration based on the selection criteria, the Audit Committee’s primary recommendation for audit firm for the financial year 2021 is Deloitte Ltd and the secondary recommendation is KPMG Oy Ab.

The Audit Committee notes that its recommendation is free from influence by a third party, and the Audit Committee is not subject to compliance with any such clauses referred to in Article 16(6) of the Audit Regulation that restrict the choice as regards the election of a statutory auditor or audit firm.

The Audit Committee of the Board of Directors proposes that the Authorized Public Accountant Firm Deloitte Ltd be elected as the company’s Auditor until close of the next Annual General Meeting. Deloitte Ltd has announced that Jukka Vattulainen, APA, will act as the auditor with principal responsibility if the Annual General Meeting elects Deloitte Ltd to act as the company’s Auditor.

Helsinki, 17 March 2021

SAMPO PLC
Audit Committee

ANNEX 6

Proposal of the Board of Directors for authorization to decide on the repurchase of the company’s own shares

The Board of Directors proposes to the Annual General Meeting that the Annual General Meeting authorize the Board to resolve to repurchase a maximum of 50,000,000 Sampo plc’s A shares representing approximately 9.0 per cent of all A shares of the company. The repurchased shares will be cancelled.

The shares may be repurchased either through an offer to all shareholders on equal terms or through other means than in proportion to the existing shareholdings of the company’s shareholders (directed repurchase) if the Board of Directors deems that there are weighty financial reasons for it.

The price paid for the shares repurchased under the authorization shall be based on the current market price of Sampo plc’s A shares on the securities market. The minimum price to be paid would be the lowest market price of the share quoted during the authorization period and the maximum price the highest market price quoted during the authorization period.

The repurchases under the authorization are proposed to be carried out by using funds in the unrestricted shareholders’ equity, which means that the repurchases will reduce funds available for distribution of profit.

The authorization for repurchases is proposed to be carried out in such marketplaces the rules of which allow companies to trade with their own shares. Sampo plc’s A shares will be repurchased at a market price at the time of the repurchase in public trading in those marketplaces in which the company share is publicly traded. The company may enter into derivative, stock lending or other arrangements customary in capital market practice within the limits set by law and other regulations. In repurchases through such marketplaces, the company will follow the rules and guidelines regarding, among other factors, the determination of the repurchase price, settlement and disclosure of trades, of the marketplace in which the repurchase is carried out.

The Board of Directors shall be authorized to decide on all other terms relating to the repurchase of the company’s own shares.

The holder of all Sampo plc’s B shares has given its consent to a buy-back of A shares.

It is proposed that the authorization be valid until the close of the next Annual General Meeting, provided this does not occur later than 18 months from the Annual General Meeting's decision.

Helsinki, 17 March 2021

SAMPO PLC
Board of Directors