Internal organization

The General Meeting elects together with the members of the Board of Directors the Chairman of the Board of Directors and the members of the Compensation & Nomination Committee. In all other respects, the Board of Directors constitutes itself. The Board of Directors elects a Vice-Chair and, if necessary, a Lead Independent Director from among its members for a term of office of one year until the end of the next Annual General Meeting. The functions of Vice-Chair and Lead Independent Director may be performed by two different members of the Board of Directors or by one member of the Board of Directors (combined role). The duties of the Vice-Chair and a Lead Independent Director, if any, are governed by the Organizational Regulations (see articles 5 and 6 of the Organizational Regulations).

• Organizational Regulations

Details concerning the internal organization of the Board of Directors and its Committees can be found in the Organizational Regulations and the Committee Charters, which are available on the website of Chocoladefabriken Lindt & Sprüngli AG.

• Organizational Regulations
• Audit Committee Charter
• Compensation and Nomination Committee Charter
• Sustainability Committee Charter

If the Chairman resigns from the Board of Directors before the end of the term of office, the Board of Directors appoints a new Chairman from among its members until the election at the next General Meeting. Should one or more members of the Compensation & Nomination Committee retire early, the Board of Directors can appoint substitutes from among its members until the conclusion of the next General Meeting. If the Vice-Chair and / or, if previously appointed, the Lead Independent Director and / or a Committee chair position is vacant, the Board of Directors designates a successor from among its members.

The Chairman leads the Board of Directors in the exercise of its non-transferable duties and is, in coordination with the CEO, responsible for the preparation of the agenda, the organization and the lead of the meetings of the Board of Directors in accordance with the provisions of the law, the Articles of Association and the Organizational Regulations. He acts as a link between the Board of Directors and the CEO, ensures the proper information flow to the Board of Directors and the alignment of the Committees to the strategy of the Board of Directors. Furthermore, the Chairman has the following powers and duties:

• Lead the Board of Directors and chair the General Meetings;
• Take a leading role in designing the Group’s corporate governance;
• Work closely with the Compensation & Nomination Committee in all nomination-related activities including succession planning and with respect to evaluations of performance of the Board of Directors and its Committees;
• Oversee the Group’s reputation and take an active role in representing the Group towards stakeholders, as agreed with the Board of Directors and the CEO; and
• Receive the agenda, documents and minutes of the Group Management meetings, whereby he may request information about any matters relating to the company, and examine reports, proposals and minutes of meetings of any functions or Committees, markets or businesses.

As an exception, urgent decisions falling within the authority of the Board of Directors may, in accordance with the Organizational Regulations, be taken by the Chairman. Such decisions must be brought to the attention of the Board of Directors as soon as possible.

The Board of Directors may entrust the Chairman with additional duties and appoint him as Executive Chairman of the Board of Directors. The individual executive duties and the division of duties between the Chairman and the CEO and the other members of the Group Management are set out in the employment contract and the relevant directives of the Board of Directors.

If and as long as the Chairman of the Board of Directors is unable to perform his functions, or if and to the extent that there is a conflict of interest of the Chairman, the Vice-Chair assumes all duties of the Chairman of the Board of Directors. In order to support appropriate control mechanisms, the Board of Directors may appoint an experienced, independent member of the Board of Directors as Lead Independent Director if it deems this appropriate and in the interest of the Group. In particular, the Lead Independent Director convenes and chairs meetings of the Board of Directors in the event of a conflict of interest of the Chairman of the Board of Directors and the Vice-Chair. In the case of a matter requiring separate consideration or a decision or act on behalf of the independent members, the Lead Independent Directors convenes and chairs meetings of some or all independent members of the Board of Directors.

According to the Organizational Regulations, the CEO is, with support from the Group Management, the company’s and the Group’s supreme executive authority, subject to the powers and duties reserved to the Board of Directors, the Committees and the Chairman of the Board of Directors. The CEO presides over Group Management, and the company’s and the Group’s whole organization and staff are subordinated to the CEO. Further details about the tasks of the CEO and Group Management can be found in the chapter “Allocation of competences” in this Annual Report and the Organizational Regulations.

• Organizational Regulations

The Board of Directors meets as often as necessary, but at minimum four times a year on invitation by the Chairman of the Board of Directors, the Vice-Chair, or in the event of their absence, another member of the Board of Directors. In addition, the Board of Directors must be convened without delay upon written request for a meeting by a member of the Board of Directors to the Chairman, stating the reasons for doing so.

The Chairman presides over the meetings. Along with members of the Board of Directors, the meetings may also be attended by members of Group Management and other non-members. The Chairman decides whether non-members may participate in meetings of the Board of Directors, unless the whole Board of Directors decides otherwise. In the reporting year, ten ordinary meetings were held, four of which were held physically and six of which were held as conference calls. All physical meetings of the Board of Directors were attended by all elected members (Dr Dieter Weisskopf as of his election to the Board of Directors). Four conference calls were attended by all elected members of the Board of Directors (Dr Dieter Weisskopf as of his election to the Board of Directors), while one or two members, respectively, were absent in each case from one conference call. The average attendance rate at the meetings of the Board of Directors was approximately 95% and varied between 80% and 100% for the individual members.

No circular resolutions were taken. The physical meetings lasted around three hours each. The telephone conferences lasted around one hour. Members of Group Management regularly attended these meetings in compliance with exclusion principles. No external consultants attended meetings of the Board of Directors.