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BOARD OF DIRECTORS

INTERNAL ORGANISATION

The internal organisation of the Board of Directors is based on the company’s Organisational Regulations, which are issued by the Board of Directors and were last revised in December 2012. The Organisational Regulations may be viewed on the company website.

DIVISION OF DUTIES WITHIN THE BOARD OF DIRECTORS

Within the Board of Directors, the Chairman has the following duties and authorities. The Deputy Chairman deputises for the Chairman in his absence, and bears the same duties and authorities when doing so. Apart from these duties and authorities, the Chairman and Deputy Chairman have no particular function within the Board of Directors.

The Chairman is responsible for the formal and organisational leader- ship and management of the Board of Directors. In urgent cases, he shall also take the necessary decisions and precautions until the matter can be decided upon by the Board of Directors. The Chairman further monitors the observance of legal requirements, the Articles of Incorporation, regulations and directives by the company’s management bodies, and submits the requisite motions, requests and proposals to the Board of Directors. The Chairman also ensures, in collaboration with the Group Executive Board, that information is provided in good time on all major aspects of the company which are of relevance to the monitoring of its activities and to the corporate decision-making process. Further details of the duties and authorities of the Chairman of the Board are provided in Section 2.5 of the Organisational Regulations.

BOARD COMMITTEES

The Board of Directors has formed the following two committees to assist it in its work: the Audit Committee and the Nomination and Compensation Committee.

Each of these committees has written regulations specifying its tasks and responsibilities.

The Audit Committee currently consists of David Schnell (Chairman), Adrianus Nühn and John Lindquist . The Audit Committee has assured itself that the majority of its members have the requisite expertise in accounting and financial management. The Audit Committee reports to the Board of Directors on its conclusions, and the Board of Directors decides upon appropriate action.

The prime duty of the Audit Committee is to support the Board of Directors in its monitoring and supervision of the company’s accounting and financial management. Its main tasks therein comprise:

  • providing independent and objective monitoring of the integrity
  • of the company’s consolidated reporting process, internal financial control systems and accounting and their compliance with the relevant legal provisions;
  • assessing the independence and performance of both the external and the internal auditors;
  • ensuring open communications between the Group Executive Board, the Board of Directors and the internal and external auditors.

The Audit Committee further reviews:

  • the guidelines imposed by the Group Executive Board to ensure efficient financial reporting processes and controls;
  • periodic discussions of the current state of affairs with the Group Executive Board and the internal auditors and separately with the external auditors.

The Audit Committee also performs the following main tasks which have been assigned to it by the Board of Directors:

  • reviewing the Annual Report, the annual and interim financial statements, the nine-month Business Update and the auditing reports and management letters of the Kuoni Group and Kuoni Travel Holding Ltd. and submitting proposals to the Board of Directors;
  • ensuring compliance with set accounting standards within the Group;
  • approving the integrated audit plans of the external auditors as well as the internal auditors;
  • assessing and discussing the external auditors’ audit reports;
  • assessing the performance, independence and compensation of the external auditors;
  • selecting the auditing company to be proposed to the General Meeting of Shareholders for election as the company’s statutory auditor and submitting the corresponding proposal to the Board of Directors;
  • periodically reviewing internal processes and procedures;
  • periodically reviewing the suitability and effectiveness of the internal auditors;
  • submitting proposals to the Board of Directors on entries into the share register for shareholders with voting rights in connection with Article 5 of the Articles of Incorporation;
  • periodically reviewing the guidelines issued on ad-hoc publicity and the prevention of insider dealing;
  • submitting proposals to the Board of Directors on notifying the courts in the event of overindebtedness;
  • periodically reviewing all internal guidelines and directives that are not reviewed by any other committee.

The Audit Committee has its own authority on the following matters:

  • ensuring the auditors’ fulfilment of the legal requirements on licensing as stipulated in the Auditor O versight Act (AOA ) and independence (Swiss Code of Obligations, Article 728);
  • maintaining the share register;
  • periodically reviewing the organisation of the internal auditor;
  • reviewing strategic tax planning issues;
  • R emunerating external auditors for subsidiaries;
  • appointing and dismissing the Head of Internal Audit.

The Nomination and Compensation Committee is composed of Heinz Karrer (Chairman), Annette Schömmel and Raymond D. Webster. The main tasks of the Nomination and Compensation Committee are to monitor the organisation, qualification, performance and remuneration of management and the Board of Directors and to review the terms and conditions of any employee share purchase plan. Other tasks performed by the committee are assessing the performance of the CEO and of the members of the Group Executive Board, arranging succession plans for the members of the Board of Directors and the Group Executive Board, seeking and proposing new members for the Board of Directors and furthering the development of management as a whole. The Nomination and Compensation Committee enlisted the services of two external specialists, Hostettler Kramarsch & Partner, and PricewaterhouseCoopers, both in Zurich, in 2012 to assist it in its decisions and recommendations. The Nomination and Compensation Committee reports to the Board of Directors on its conclusions, and the Board of Directors decides upon appropriate action on the basis thereof. In this connection, please also see the Compensation Report (note 02_04_10).

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