These Rules of Procedure are set out with reference to Article 29 of the Act on Obligatory Pension Rights Insurance and Pension Fund Operation no. 129/1997 and discuss the implementation of the duties of the Board of Directors of Gildi Pension Fund.
1.1
These Rules of Procedure are set out with reference to Article 29 of the Act on Obligatory Pension Rights Insurance and Pension Fund Operation no. 129/1997 and discuss the implementation of the duties of the Board of Directors of Gildi Pension Fund.
2.1
Gildi Pension Fund operates on the basis of Act no. 129/1997 on Obligatory Pension Rights Insurance and Pension Funds Operations and the Fund’s Articles of Association.
2.2
The Fund's operations shall relate to the receipt, preservation and return of premiums and the payment of pensions. The Fund shall not engage in activities other than those necessary to achieve this purpose.
3.1
Gildi Pension Fund emphasises good governance in its operations and these Rules of Procedure are intended to support good governance in the operation of the Fund. The Board also emphasises that the organisation and internal regulations are in such a way that the standards of good governance are followed. Reference is also made to other rules of the Fund; investment policy, risk policy, shareholder policy, policy on responsible investments, procedures for the transactions of the Pension Fund, its Board and employees with financial instruments, and rules of communication and ethics.
3.2
The purpose of the Rules of Procedure is to further elaborate on instructions on the roles and tasks of the Board of Gildi Pension Fund, together with the tasks of the Chairman, Vice-Chairman, sub-committees, and Managing Director as appropriate, and the implementation of their tasks. The Rules of Procedure are also intended to reduce the risk that those covered by the Rules of Procedure are related to individual subjects of the Board and Gildi Pension Fund, so that the impartiality of that person can be called into question.
4.1
The Fund's Board of Directors shall convene after the Annual General Meeting to elect a Chairman and Vice-Chairman. The most senior member of the Board shall chair meetings until the Board has elected its official Chair, after which point the Chair shall take over.
4.2
The Chair requests nominations for the Chairman and Vice-Chairman. The representatives of employers and unions shall alternate each year to hold the chairmanship. The Board is authorised to select a Secretary from outside the group of board members.
4.3
The Chairman and Vice-Chairman are elected by a simple majority. In the event of even votes, lots shall be drawn to decide the issue.
4.4
In certain circumstances, the Board may ask one or more individual Board members, who agree to it, to look into specific matters and prepare information on them for discussion at a Board meeting. The division of tasks does not mean that the Board is exempt from its statutory role.
5.1
The Chairman of the Board is responsible for ensuring that the Board of Directors fulfils its role in an effective and organised manner.
5.2
The main duties of the Chairman of the Board are as follows:
a) Take the lead in preparing the Board's work schedule.
b) Convene Board meetings. The Chairman is, however, authorised to entrust the Managing Director or Secretary of the Board to convene a meeting.
c) To prepare, in co-operation with the Managing Director and Vice-Chairman, the agenda for each Board meeting.
d) Ensure that the Board's tasks, according to the work schedule of the Board, are taken into consideration as appropriate and when the occasion arises.
e) Chair Board meetings and ensure that Board meetings allow ample time for discussions and decision making, in particular with respect to larger and more complicated issues.
f) Encourage the active participation of all Board members in discussions and decision-making.
g) Take the lead in working according to the Board's Rules of Procedure, its work schedule, and good governance practices, together with a regular review thereof.
h) Ensure that new members of the Board receive necessary information and guidance in the procedures of the Board and the Fund’s affairs, including its policies, objectives and operations.
i) Act as a liaison between the Board and the Gildi Pension Fund members and other stakeholders, handle communication with them, and convey their views to the Board.
j) Be the contact person between the Board and the employees of the Fund.
k) Follow the progress of the execution of Board decisions and their implementation.
l) Be the Board’s spokesperson, e.g. in the media.
5.3
The Chairman shall give the Vice-Chairman the opportunity to participate in matters of the Board that fall under the Chairman's authority as such.
5.4
The Chairman of the Board may not assume responsibilities for the Fund other than those that may be considered a normal part of his work as a Chairman. However, the Chairman of the Board may carry out individual tasks that the Board assigns him, cf. provision 4.4.
6.1
The Board of Directors is the supreme authority in the affairs of the Fund and shall ensure that the organisation the Fund and its operations are always in order and in accordance with the laws and regulations that apply to it.
6.2
The Fund’s Board shall annually appoint a three-person Audit Committee, which monitors accounts, risk management, and the drafting of the Fund’s Annual Financial Statement in accordance with the provisions of Section IX, Section A of the Act on Annual Financial Statements no. 3/2006.
6.3
In its work, the Board has the interests of Gildi Pension Fund and its fund members as a guiding light. The Board of Gildi Pension Fund is also guided by the social responsibility of the Fund in other respects.
6.4
Board members shall familiarise themselves with the applicable laws and rules governing the operation and activities of Gildi Pension Fund and gain understanding of their personal roles and responsibilities as board members.
6.5
In their work, board members shall:
a) Devote sufficient time to perform board duties diligently.
b) Call for and study all documentation and information they feel they need in order to gain a full understanding of the operations and activities of Gildi Pension Fund.
c) Foster a positive working atmosphere and collaboration within the Board.
d) Make independent decisions in each separate case.
e) Maintain confidentiality and respect confidentiality towards Gildi Pension Fund.
f) Not make decisions that obviously favour individual fund members or others in an indecent manner at the expense of Gildi Pension Fund or other fund members.
g) Prevent their affairs or those of individual fund members, whether personal or business related, from leading to a direct or indirect conflict of interest between themselves, Gildi Pension Fund, and/or individual fund members.
6.6
The Board approves the annual estimate for operating costs for Gildi Pension Fund.
6.7
In other respects, the Board's tasks and meetings are in accordance with its work schedule, cf. clause 8.2.
6.8
The Board conducts a performance assessment, at least annually, on its activities, procedures, and working methods, or commissions a performance evaluation with the assistance of external parties, as appropriate. Performance evaluations carried out with the assistance of external parties shall normally be carried out at least every three years.
6.9
Self-assessment/performance assessment, cf. provision 6.8, involves assessing the strengths and weaknesses of the Board’s activities and procedures, and considering those aspects which the Board believes may be improved. Furthermore, the knowledge and experience of board members shall be mapped, and the compatibility of the composition of the Board with the needs of the Fund assessed. The Chairman and the Vice-Chairman shall communicate the results of such a mapping to the selection committees of the labour unions and the Confederation of Icelandic Employers (SA), pursuant to the pension provisions of the collective agreement of ASÍ and SA.
7.1
The Board is responsible for engaging the Managing Director and dismisses them. A written employment contract, in which the salary and other terms of employment are defined, shall be reached with the Managing Director.
7.2
Along with the engagement of the Managing Director, a letter of commission for the Managing Director must be drawn up. It shall stipulate measures that are considered unusual or major, and other measures for which the Managing Director must obtain the approval of the Board, together with the Managing Director's provision of information to the Board. The Managing Director's letter of commission is considered part of their employment contract.
7.3
The Board assigns its Chairman and Vice-Chairman to manage the contract negotiations with the Managing Director regarding wages and other terms.
8.1
Board meetings shall generally be held once a month. In addition, a board meeting must be held if the Chairman of the Board or the Managing Director deems it necessary. Board meetings shall be held at the Fund’s offices. In special cases, a meeting may be held elsewhere if the Chairman considers the subject of the meeting or other circumstances warrant it. Board members are allowed to participate in board duties by telephone or teleconferencing equipment, and this must be stated in the meeting minutes.
8.2
The Board prepares a work schedule for regular meetings during its operating year, where the dates and times of the meetings are specified and the main tasks of the Board are arranged on the agenda as appropriate, cf. Art. 6.7. If necessary, deviations from the approved work schedule must be explained when the agenda is sent to the Board.
8.3
If the Chairman, owing to specific circumstances, feels it is not possible to wait for a regular meeting of the Board to be held, they may decide to hold a teleconference or that the matter will be presented and discussed by the Board in writing or via telephone. Decisions made in this manner must be recorded in the minutes of the next board meeting.
8.4
If it is necessary to obtain the signatures of the board members to confirm the decisions made by the Board in accordance with these rules, it is permitted to obtain them from each board member individually and this shall be recorded in the minutes of the next board meeting.
8.5
The Chairman is under obligation to call a meeting of the Board if any of the Board members, a member of a sub-committee, the Managing Director, the internal or external auditor, or the Director of Risk Control so request.
8.6
Board meetings are to be convened with at least 7 days’ notice. The Chairman of the Board, however, can decide on a shorter deadline if considered necessary. Board members must approach the Chairman or the Managing Director with requests for matters to be included on the agenda of the board meeting.
8.7
Notices for meetings shall generally be in writing and must state the agenda. Notices for meetings can be sent to board members electronically. Meeting documents must be posted on the board portal as soon as they are ready and generally no later than two days before the meeting. Special confidential documents handed to board members for discussion at a board meeting must be returned at the end of the meeting, unless the Chairman decides otherwise.
8.8
A board member who is unable to attend a board meeting must notify the Managing Director, who is responsible for calling in an alternate. If the elected alternate of the Board of Directors is unable to make it to the convened board meeting, the Managing Director can call on another elected alternate in their place.
8.9
The Chairman, Vice-Chairman, and Managing Director must generally hold a preparatory meeting for the upcoming board meeting. The content of such meetings is informal, but the meetings are a forum for discussing the agenda of board meetings and issues that need to be discussed between board meetings.
8.10
Matters to be submitted for a decision shall be put to the Board in writing. Matters to be presented at Board meetings for information purposes may be presented orally.
8.11
As a rule, matters are not to be submitted for a decision during Board meetings unless Board members have received the data concerning the issue or sufficient information about it before the meeting and have had time to familiarise themselves with its substance.
8.12
The Board shall seek consultation from independent experts when needed, and individual board members are authorised to seek consultation from independent experts at the expense of Gildi Pension Fund, if they feel that would be necessary in order to be able to reach independent and informed decisions. Board members must inform the Chairman and Managing Director in advance about such consultation.
8.13
A board member may request a postponement of the processing of a case and the case shall then be postponed until the next regular meeting, unless the significant interests of Gildi Pension Fund oppose such a postponement.
8.14
The Managing Director attends meetings Board of Directors and has the right to debate and to submit proposals, unless the Board decides otherwise in individual instances. The Deputy Managing Director also attends the board meetings for information purposes. The Senior Attorney acts as the Secretary of the Board, unless the Board decides otherwise.
8.15
At least one meeting of the Board shall be held annually without employees, where the performance evaluation of the Managing Director's work and their commission letter shall be reviewed.
8.16
The Board may request other employees of the Fund to participate in individual cases during Board meetings. The minutes shall state when such employees arrive and when they leave the meeting.
8.17
The internal and external auditor and members of the Fund's Audit Committee must be called for a meeting where the Fund's internal control is discussed. They must also be called, along with an actuary, to a meeting where financial statements are discussed. Internal and/or external auditors must then be called for a board meeting if at least one board member requests it.
9.1
A majority of Board members shall constitute a quorum, provided that the meeting has been called in accordance with these Rules of Procedure. An important decision may not, however, be made unless all board members have been in a position to debate the matter if possible, e.g. if the decision relates to altering a previous board resolution, the decision is unusual in Gildi Pension Fund's operations, or it involves material deviations from the approved strategy, operating plan, or business practice.
9.2
Five members of the fund’s board must approve a resolution in order for it to be legal.
9.3
Board members are bound only by their personal conviction and not by any instructions from those who appointed them.
10.1
Regarding the special qualification of a board member due to participation in the processing of a case concerning the conclusion of a contract, a ruling on a pension, a lawsuit, or other decisions that may concern them or a party related to them, cf. Paragraph 9, Article 31 of Act no. 129/1997 on Obligatory Pension Rights Insurance, cf. the provisions of Section II of the of the Administrative Procedures Act no. 37/1993 and these Rules of Procedure as appropriate.
10.2
Board members and the Managing Director must disclose their interests and that of their spouses at the start of their employment, as well as any changes that occur to their circumstances during their tenure. Interests refers to information relating to the board member, Managing Director, and spouse, as appropriate, and relating to:
a) The employer that the person works for.
b) The employer that the person’s spouse works for if the spouse is a key member of staff.
c) Other commissions of trust, including membership on the board of other companies.
d) Shares and/or stock option agreements for shares in companies that amount to 10% or more of the respective company's share capital.
e) The main competitor or a company's industry in which the person has a significant interest.
f) Stakeholder interests with companies covered by the Gildi Pension Fund's shareholder policy.
10.3
The Secretary of the Board maintains and updates a register of the interests of the board members according to Art. 10.2 and the register is accessible to the Secretary of the Board, the Chairman and Vice-Chairman of the Board, the Managing Director, members of the sub-committees, and the internal and external auditor.
10.4
When the agenda of the board meeting is available, the Secretary of the Board must ascertain the eligibility of the board member and/or Managing Director to participate in the proceedings. If any doubt arises about the eligibility of the person concerned, the Secretary of the Board shall draw the attention of the Chairman to the disqualification of the board member and/or Managing Director to participate in the proceedings. Furthermore, board members and the Managing Director must always disclose such incidents and others that could cause their disqualification as soon as they become aware of them.
10.5
If there is a dispute about the special eligibility of a board member to participate in the handling of a case, the Secretary of the Board, in consultation with the Chairman, must obtain information about the special eligibility of the board member and give the person concerned the opportunity to provide further information and comments. Once this is done, the Board makes a decision on the special eligibility of the board member.
10.6
Documents regarding the case in question is not sent to a board member who is not considered eligible to participate in the processing of the case, and the board member must withdraw from the meeting during the Board's proceedings.
10.7
At the beginning of each board meeting, a statement by the board members regarding their eligibility to discuss and/or process the individual cases that are presented according to the agenda shall be recorded.
10.8
All agreements that a Board member or Managing Director may enter into with Gildi Pension Fund, as well as all agreements between Gildi Pension Fund and a third party if the Board member or Managing Director has a significant interest in such agreement that could contravene the interests of the company, must be submitted to the Board for approval (or rejection). The provision does not cover the payment of premiums or applications for member loans.
11.1
The Secretary drafts the minutes, recording everything that happens during Board meetings and the decisions taken by the Board.
11.2 Minutes shall contain the following:
a) Where and when the meeting was held.
b) Number of the Board meeting.
c) Attendees at the meeting and who chairs the meeting.
d) The agenda.
e) Whether individual cases are intended for information purposes, discussion, or decision.
f) What documents are attached to each agenda item.
g) Which documents were distributed before the meeting and which documents were distributed at the meeting.
h) If a board member, Managing Director, or other person leaves the meeting during discussions or decision on an item of the agenda, when they left the meeting, the reason for the disqualification, who takes the place of the board member, as appropriate, and whether the person in question had access to the documents for debate or decision.
i) A short description of the discussions had at the meeting and any decisions taken and, as appropriate, the main criteria for the decision.
j) Who drafted the minutes.
k) When the next Board meeting will be held.
11.3
A Board member, or the Managing Director, who is not in agreement with a decision by the Board is entitled to have their dissenting opinion entered in the minutes.
11.4
At the beginning of a board meeting, the minutes of the previous board meeting shall be presented for consideration.
11.5
Minutes must be signed by the board members. Minutes that have been signed are considered full proof of all that transpired in Board meetings. Board members who did not attend the Board meeting to which the minutes apply shall confirm with their signature that they have read the minutes.
11.6
Efforts shall be made for the minutes to be ready as soon as possible after the board meeting and be available on the Board's web portal no later than 3 working days after the meeting.
11.7
The Secretary of the Board manages the secure storage of meeting minutes and supporting documents.
12.1
All board members have an equal right to information about Gildi Pension Fund and must be granted access to all the information provided to the Board or individual board members, whether it is data from board meetings or individual inquiries from board members.
12.2
Board members can send enquiries to the Managing Director between board meetings about individual issues concerning the operation and activities of Gildi Pension Fund. Enquiries to the Managing Director must be sent via email that other board members receive a copy of (cc). Responses to enquiries must be presented to the entire Board simultaneously.
12.3
Communication between the Chairman, Vice-Chairman, and Managing Director regarding the preparation of board meetings and matters that otherwise fall under the role of the Chairman, cf. Art. 5 is exempt from provisions 12.1 and 12.2.
12.4
Board members must not obtain information by contacting Gildi Pension Fund’s employees, unless in special circumstances, e.g. regarding salary payments to them and other things that do not concern their actual board duties. However, board members are always permitted to obtain information and communicate with the Secretary of the Board for the purposes of the board's duties, even if they are an employee of the Fund.
12.5
The Secretary ensures that Gildi Pension Fund's website contains information about the Fund's governance in accordance with good governance practices at all times.
13.1
Board members are bound by professional secrecy as regards the affairs of the Fund, its employees, fund members, pension recipients, and other issues of which they become aware in their work as members of the Board and which must remain confidential according to law, their nature or the Board’s decision. Confidentiality remains in effect even in the event of cessation of employment.
13.2
Board members must securely preserve all data that they receive as Board members.
13.3
Board members, other than the Chairman, shall not address the media or the general public as regards the affairs of Gildi Pension Fund, except with the permission of the Chairman.
14.1
The Board sets Gildi Pension Fund’s shareholder policy that outlines the policy and corporate governance of Gildi Pension Fund as a shareholder in the companies in which it invests and thus promotes transparency in the Fund’s investments and its responsibility as an owner.
14.2
Board members shall familiarise themselves and comply with the provisions of law, the Fund’s Articles of Association, the general rules of the stock market, and the Fund's special rules for handling confidential information and insider trading.
14.3
Board members must be aware that their conduct in their work for Gildi Pension Fund and outside of their work for the Pension Fund may cause a reputational risk for the Pension Fund. If a board member is exposed to conduct or a violation of the law that, if it were public, could cause the Pension Fund's reputation to be at risk, or an allegation of such conduct has received public attention or has been received by the Pension Fund in a formal or informal manner, the Pension Fund's Board shall discuss the Fund's response and take appropriate measures in the Board's opinion. Under the above falls, e.g. a violation of the laws listed in Paragraph 1, Art. 31 of the Act on Obligatory Pension Rights Insurance and Pension Fund Operation, violation of other laws or reprehensible conduct in the private life of a board member.
14.4
The responsibilities, powers, and work of the Fund’s Board of Directors shall be governed, in respects other than provided for in these Rules of Procedure, by the Act on Pension Fund Operation, the Fund’s laws and Articles of Association, and other general acts of law and rules which apply to the Fund's field of activity.
14.5
The Managing Director shall notify the Financial Supervisory Authority of the appointment and subsequent changes to the board and Managing Director in accordance with the provisions of the Act on Obligatory Pension Rights Insurance and Pension Fund Operation.
15.1
The Managing Director informs the Board and the Secretary of the Board about new board members.
15.2
When a new board member takes a seat on the Board, the Managing Director must ensure that an introductory meeting is held on the main aspects of the Fund's operations and governance. The introductory meeting must be held before the first board meeting is held after the division of the Board’s tasks. This shall include a presentation of the following:
a) The main laws and regulations that apply to the Fund.
b) The Fund’s Articles of Association.
c) The Fund’s member associations.
d) The Fund's activities, e.g. organisational chart, main areas of operation, services, assets, and obligations.
e) Introduction of the main key managers of the Fund, their roles, and responsibilities.
f) The Board’s work schedule and educational plan.
g) The Board’s Rules of Procedure.
h) The Board’s sub-committees.
i) Internal rules, i.e. investment policy, risk policy, shareholder policy, policy on responsible investments, Code of Conduct and Code of Ethics, procedures for the transactions of the Pension Fund, its Board, and employees with financial instruments.
j) Performance evaluations of the Board of Directors and Managing Director for the previous year.
k) Anything else which ensures that the board members can clearly understand the activities of the Fund and its status.
15.3
The Secretary of the Board prepares a declaration of confidentiality cf. Article 32 of Act no. 129/1997 on Obligatory Pension Rights Insurance and Pension Funds Operations and prepares or ensures that presentation materials are prepared for the introductory meeting of new board members. At the introductory meeting, the board member must sign the declaration of confidentiality.
15.4
When a board member has signed a declaration of confidentiality, the Managing Director ensures that the board member's access to the board portal is created and granted. The Managing Director also ensures the registration of the board member in the payment system for the board salary.
15.5
At the first board meeting after a presentation for a new board member, the Secretary of the Board must submit a confirmation that the presentation has taken place and that the board member has read the aforementioned documents, for the board member to sign.
15.6
The Managing Director must ensure that a new board member informs the first board meeting about their own knowledge and experience by submitting a CV for the Board for the mapping of their and the Board's knowledge and experience, and an analysis of the need for education and/or further education for the board member and/or the Board. At the same time, the CV of other board members must be presented.
16.1
Only the Board may amend these Rules of Procedure. A simple majority vote of the Board is required to amend these Rules of Procedure and the Board shall sign the Rules as amended.
17.1
As a rule, the original of these Rules of Procedure, with subsequent amendments if applicable, shall be kept securely by the Secretary of the Board together with the Fund's meeting minutes and accompanying documents of the meeting minutes.
17.2
The Secretary of the Board shall deliver to the board members, Managing Director, and the Fund's internal and external auditor a copy of the Fund's Rules of Procedure that are in force at any given time.
Thus approved at the Fund’s board meeting on 9 March 2023.