Mr R.M. Wegman
First appointment: 1 July 1997
Relevant additional position: Supervisory Board member, Koninklijke Barenbrug B.V.
Ms D. van der Sluijs
First appointment: 1 March 2020
Relevant additional position: none
(Titular director as of 1 January 2022)
Mr R. Schuurman
First appointment: 1 March 2004
Relevant additional position: none
4.2 Supervisory Board member details
Mr G.F. Kolff
Profession/most recent primary position: managing director of Shtandart TT B.V.
Relevant additional positions: none
First appointment: 17 April 2012
Current term: 2020-2022
Supervisory board memberships: Paques Holding B.V.
Mr J.M.L. van Engelen
Profession/most recent primary position: professor of Integrated Sustainable Solutions, Faculty of Industrial Design Engineering, Delft University of Technology
Relevant additional positions: emeritus professor of Business Development, Faculty of Economics and Business, University of Groningen
First appointment: 16 April 2013
Current term: 2021-2023
Supervisory board memberships: Supervisory Board member at Espria, Supervisory Board member at Pensioen-fonds Zorg & Welzijn, Board member at Stichting Triade (UMCG)
Mr P.A.M. van Bommel
Profession/most recent primary position: CFO of ASM International
Relevant additional positions: non-executive director at SES S.A. (listed on Euronext Paris and Luxembourg), member of the board of Stichting Bernhoven, chairman of the Governing Board of the Executive Master of Finance & Control programme at Amsterdam Business School (University of Amsterdam)
First appointment: 24 June 2021
Current term: 2021-2025
Supervisory board memberships: member of the Supervisory Board of Aalberts N.V.
Ms M. Pijnenborg
Profession/most recent primary position: board member and entrepreneur
Relevant additional positions: founder of Winc Academy, founder and investor in Boralis BV, board member at MK24, board member at Stichting LOEY Award
First appointment: 4 April 2019
Current term: 2019-2023
Supervisory board memberships: none
Ms M.A. Scheltema
Profession/most recent primary position: professional supervisory board member
Relevant additional positions: board (deputy) of Netherlands Enterprise Court at the Amsterdam Court of Appeal, partner at Scheltema Tammenoms, member of the Advisory Board of RCBM (Register of Certified Board Members)
First appointment: 5 April 2018
Current term: 2018-2022
Supervisory board memberships: vice-chairwoman of the Supervisory Board of De Nederlandsche Bank N.V. (Dutch central bank), member of the Supervisory Board of Warmtebedrijf Rotterdam, member of the Supervisory Board of Stichting Open Nederland
4.3 Risk management
At Nedap, risk management is an essential element of the business strategy. The overriding risk management objective is to identify and mitigate risks with a potential major impact on achievement of our strategic and financial goals, and therefore on the overall value of our business. Ultimate responsibility for risk management lies with the Board of Directors.
Fulfilment of this board responsibility and the organisation of risk management have been brought into line with the corporate culture. Nedap has a culture of entrepreneurship where employees’ personal responsibility, independence and ownership come first. There is a firm belief across the organisation that such ownership leads to optimum risk management. The Board of Directors, managers, as well as Supervisory Board members, play a key role in this respect. They are the guardians of a culture where everyone feels empowered and free to handle risks responsibly.
This is based on the belief that Nedap has a workforce of highly competent specialists who have the kind of skills and experience needed to be able to anticipate the consequences of their actions and decisions. Strategic and operational decisions are targeted at creating sustainable value, which implies that decisions take long-term effects into account.
At the same time, this prevents decisions being made that serve only short-term gains and destroy value in the longer term. The benefit of this approach is that it ensures that risk management is solidly integrated into and inextricably linked to operations.
Read more on this topic in the annual report from page 57:
- risk appetite;
- risk management and control systems;
- the three levels of control;
- our financial management system and
- the financial instruments.
Nedap Compliance Framework
Applying worldwide to all business units and consolidated subsidiaries, the Nedap Compliance Framework describes the formal objectives, mission, responsibilities and scope of Nedap compliance, including its embedding in the organisation, compliance-related communications, compliance monitoring and sanctions. Subjects covered by the compliance framework include product liability, information security, privacy, insider trading, bribery, competition, products and entities subject to sanctions under external legislation and regulations and technical compliance (such as quality marks).
To uphold a culture of integrity and ethical behaviour, Nedap has laid down a number of rules in the Nedap Code of Conduct. Nedap also operates a whistle-blower policy that allows current and former employees, as well as others working for Nedap, to raise concerns and report wrongdoing internally.
"It's the culture, rather than the code of conduct that determines how an organisation behaves." - Warren Buffet
As detailed under ‘Impact of the COVID-19 pandemic’ in the accounting policies used for the financial statements, the COVID-19 outbreak and restrictions imposed by various governments to stem the spread of the virus had major consequences for the company in 2021 as well.
Strategy and risks
In March 2021, Nedap’s new strategic plan was presented at the Capital Markets Day. Implementation of the strategic plan is supported by a strategic calendar, which includes dates for regular talks with the Board of Directors and business unit leaders to review the progress of implementation of the strategy. This also includes detailed discussion of strategic risks with both the Board of Directors and the Supervisory Board.
The risk table from page 64 shows the latest developments and mitigating measures for the strategic risks. The risk of imbalance in the supply chain, such as in the availability and supply of components, has been added to these risks.
Nedap Risk Management Framework
In 2021, we had extensive talks with the management of the various business units about the Nedap Risk Management Framework. The idea is to maintain risk awareness and take measures to counter possible new risks.
The main risks
The year 2021 was marked by the ongoing COVID-19 pandemic and the imbalance in the global supply chain, which led to shortages of various materials, including components, and logistics processes grinding to a halt. Apart from the pandemic and imbalance in the supply chain, no risks in the ‘Vital’ and ‘Critical’ categories materialised in the 2021 financial year.
To give stakeholders more detailed insight into Nedap’s risk profile, we have identified and explained the following main risks:
- Proposition development.
- Supply chain.
- Attracting and retaining talent.
In 2022, the Board of Directors will maintain its focus on controlling the risks associated with the COVID-19 pandemic and, therefore, on the aforementioned priorities of employee health, continuity in the supply chain, and the company’s continuity and financial solidity. Aside from that, the following topics will continue to have priority over the coming year:
- Proposition development.
- Talent development.
- Nedap Compliance Framework.
- Active monitoring of the Nedap Risk Management Framework.
Nedap has designed its Risk Management Framework around its business processes. Scenario and other analyses were used to identify the risks involved in each business process. For each risk, an assessment has been made of the potential impact on the organisation. Risks are grouped in four categories:
- Strategic risks.
- Operational risks.
- Financial and reporting risks.
- Compliance risks.
Our Create & Scale business model is based on developing our own propositions. Our risk appetite for this aspect of our operations is relatively high, meaning that analysing and controlling all other risks must be an important part of our strategic process. We have identified the risks; the risk table on the next page lists the main risks and their potential impact, as well as the main measures taken to mitigate these risks.
For many years now, Nedap has pursued a responsible and conservative tax policy as an integral part of the value creation model (see also section 1.3). We consider paying taxes part of the process of creating sustainable long-term value for all stakeholders. Our tax policy starts from the given that we pay taxes globally based on the economic value of our activities.
This basic given has been captured in the following principles:
- Nedap’s primary financial target is to create sustainable value.
- The design of the Nedap organisation is based on operational considerations, not on taxation.
- Nedap pays taxes in line with the economic value created by activities.
- Nedap complies with relevant tax legislation and regulations and respects the spirit of the law.
- Nedap maintains timely and comprehensive communications with tax authorities.
- Tax compliance is integrated into the Nedap Risk Management Framework.
4.5 Corporate Governance
The Supervisory Board and Board of Directors of Nedap are responsible for the company’s corporate governance, as well as for compliance with the 2016 Dutch Corporate Governance Code.
Nedap N.V. is a two-tier board company that was founded and is based in the Netherlands. The company’s governance structure is determined by Dutch laws and regulations and the company’s articles of association. The articles of association are available at: https://nedap.com/investors/corporate-governance/. Nedap shares have been admitted to trading on the Euronext Amsterdam regulated stock market. Being a listed company, Nedap is subject to the Corporate Governance Code (Code). The Code contains principles and best practice provisions that regulate the relationship between the Board of Directors, the Supervisory Board, and the shareholders. These principles are broadly supported general opinions on good corporate governance that have been captured in specific best practice provisions. For the full text of this Code, please refer to www.commissiecorporategovernance.nl.
In this report, we are rendering account vis-à-vis our compliance with this Code, which is based on the principle of ‘apply or explain’. The information required under the Code can be found in various sections of this report for 2021.
4.6 Directors’ statement
In line with best practice provision 1.4.3 of the Code, the Board of Directors states to the best of its knowledge that:
- the Directors’ Report as included in this report offers an adequate level of insight into the shortcomings in the operation of Nedap’s internal risk management and control systems;
- the aforementioned systems provide reasonable assurance that Nedap’s financial reporting is free from material misstatement;
- it is justified based on Nedap’s current operations that the financial reporting has been prepared on a going concern basis; and
- the Directors’ Report contains material risks and uncertainties that are relevant in the formulation of expectations as to Nedap’s continuity for a period of 12 months after preparation of the Directors’ Report.
In addition, the Board of Directors states, in compliance with Article 5:25(c) of the Dutch Financial Supervision Act and to the best of its knowledge, that:
- the financial statements provide a faithful representation of the assets, liabilities, financial position, and profit/loss of the issuing entity and the companies included in the consolidation; and
- the Directors’ Report provides a faithful representation of the position at 31 December 2021 and the development and performance during the 2021 financial year of the company and the undertakings included in the consolidation taken as a whole and that the Directors’ Report describes the significant risks the company is facing.
Groenlo, the Netherlands, 17 February 2022
Board of Directors
Mr R. M. Wegman, CEO
Ms D. van der Sluijs, CFO