Corporate Governance Statement

Applicable statutes

The Mint of Finland Ltd. is a Finnish limited liability company and its decision-making and administration are governed by the Finnish Limited Liability Companies Act and its own Articles of Association. In addition, The Mint of Finland Ltd. observes, as applicable, the Finnish Corporate Governance Code of the Securities Market Association which entered into force in 2009.

Group structure

In its management, The Mint of Finland Group (hereinafter The Mint of Finland) strives for straightforward, economical and clear-cut solutions. The business of The Mint of Finland Ltd. is made up of Circulation Coins and Collectibles. The Mint of Finland Ltd. has subsidiaries in both Finland and abroad. Some of the subsidiaries operate under the direct control of The Mint of Finland Ltd’s business while others have greater independence.

The statutory executive governing bodies of The Mint of Finland are The Mint of Finland Ltd’s annual general meeting of shareholders, Board of Directors and CEO as well as the Boards of Directors and managing directors of the Group’s subsidiaries. The members of the Boards of Directors of the subsidiaries and other Group companies are appointed by the CEO of The Mint of Finland Ltd, taking into account that the work of the statutory governing bodies can be performed in support of operative business management.

Operative business management in The Mint of Finland is the responsibility of the Vice President, the Group CFO and the company’s Executive Vice President, all of whom report directly to the CEO of Mint of Finland Ltd. Operative business management in the subsidiaries is governed by the companies’ managing directors, who report to their respective Board of Directors.

General meeting of shareholders

The highest decision-making body in The Mint of Finland Group is the general meeting of shareholders. Under the Articles of Association, general meetings of shareholders shall be convened by registered letter sent to shareholders no later than eight days prior to the meeting to the address notified for them in the share register. The annual general meeting of shareholders shall be held annually by the end of June, the specific date to be determined by the Board of Directors, either in the company’s domicile or in Helsinki.

The Board of Directors of The Mint of Finland Ltd. as well as the chairman and vice chairman of the Board are elected by the general meeting of shareholders.

Board of Directors

The Board of Directors of The Mint of Finland Ltd. consists of no fewer than three and no more than six members elected by the general meeting of shareholders to serve for a term of one year at a time. The Chairman and Vice Chairman are appointed by the general meeting of shareholders.

The Board of The Mint of Finland Ltd. is responsible for the management and supervision of The Mint of Finland in compliance with the Limited Liability Companies Act, the Articles of Association, the Board’s charter and instructions issued by company owners.

The Board acts as an independent body, in accordance with the Corporate Governance Code, and its aim is to take decisions relating to the business and to perform its statutory duty of supervision in keeping with the company’s best interests so as to ensure the company’s appreciation in the long term. The Board shall ensure that it has access to sufficient information for the performance of its duties. The Board shall ensure that the Group acts in accordance with adopted business principles and objectives.

The Board shall resolve on the key policies to be observed in the Group as well as matters which are of considerable magnitude and importance relative to the scope of the Group or which differ from the Group’s ordinary business, or the consideration and resolution of which the Board separately defines as coming within its remit. The principal tasks of the Board are stated in the charter (Appendix 2).

The Board monitors and evaluates its own practices through internal evaluations performed annually.

The remuneration of Board members is discussed in the section entitled “Remuneration of management”.

Chairman

Pentti Kivinen, b. 20 Aug 1943, LL.Lic.
Finnexpo, Managing Director

Key concurrent positions: Vice chairman of the Board of the Foundation for Economic Education, member of the Council and Chairman of the Elections Committee of the Central Chamber of Commerce of Finland, Chairman of the Boards of Lasten Päivän Säätiö foundation and Kansallissäätiö foundation, member of the Board of the Finnish National Opera

Key experience: Suomen Tukkukauppiaiden Liitto, Legal Counsel, 1969–1971; Rautakonttori Oy, managing director, 1977–1984; Tukkukauppojen Oy, President, 1985–1992

Chairman of the Board of The Mint of Finland since 2009, member since 2008

Vice chairman

Harry Linnarinne, b. 23 Feb 1965, D (Tech), MSc (Econ & Bus Admin)

Key concurrent positions: member of the board of the Darekon Oy

Key experience: Outotec plc, Director of Business Development 2007-2010, Nokia plc, various executive positions (Finland, Poland) 1998–2002, Finpro Head of Trade Center (Japan) 2005–2007

Vice Chairman of the Board of The Mint of Finland since 2009

Members

Riitta Mynttinen, b. 1960, Chemical Engineer (B.Sc.), MBA
Minerals Technologies Europe NV ja SMI, Europe, vice president

Key concurrent positions: –

Key experience: Powder Coatings, Rohm and Haas, Sales and Marketing Director 2004-2005, Powder Coatings, Rohm and Haas, Integration Manager 2003-2004, Graphic Arts Rohm and Haas, Global Market Manager 2002-2003, Paper and Printing Technologies, Rohm and Haas, Commercial Manager 2000-2002, Paper Chemicals, Rohm and Haas, Commercial Manager, 1998-2000, Ferro Corporation, Europe Corporate Marketing Manager 1996-1998

Member of the Board of The Mint of Finland since 2010

Jukka Ohtola, b. 21 Oct 1967, MSc (Econ & Bus Admin), CEFA
Prime Minister’s Office, Ministerial Adviser

Key concurrent positions: member of the Board of Boreal Kasvinjalostus Oy, member of the Remuneration Committee

Key experience: Prime Minister’s Office, Ownership Steering Department, Ministerial Adviser, 2007–, Ministry of Trade and Industry, Ownership Policy Unit, senior officer 1997–2007, duties in the finance sector 1994–1996

Member of the Board of The Mint of Finland since 2008

Anssi Pihkala, b. 27 Apr 1963, LL.M. trained on the bench
Hansel Ltd, CEO

Key concurrent positions: member of the Board of KL-Kuntahankinnat Oy, vice chairman of the Board of the Finnish Association of Purchasing and Logistics (LOGY)

Key experience: Hansel Hansel Ltd, General Counsel, 2003–2005; Association of Finnish Local and Regional Authorities, Legal Counsel, 1997–2003; Asianajotoimisto Koivuhovi attorneys at law, attorney, 1994–1997

Member of the Board of The Mint of Finland since 2008

Anna Maija Wessman, b. 27 Oct 1958, Licentiate of Technology
Ahlstrom Oyj, Vice President, Sustainability

Key concurrent positions: Member of the Board Working Group of Sustainability for EDANA, European Disposables and Nonwovens Association since 2009, Member of the Board in PaperImpact, European Speciality Paper Manufacturers’ Association since 2010, Chairman for the Public Affairs and Legislation Committee at PaperImpact since 2009, member of Finnish Paper Engineers’ Association since 2008

Key experience: Ahlstrom Sales Helsinki Oy (was Ahlstrom Nordic Oy), Managing Director & Ahlstrom Sales LLC, Chairman of the Board, 2002–2008, Ahlstrom Atlanta, Inc., Ahlstrom Paper Group Boston, Inc., President and CEO 1998-2001, International Paper Company, Manager, Product Development 1993-1998, Jaakko Pöyry Consulting, Inc., Senior Consultant 1990-1993, Kymmene Corporation, Voikkaa Paper Mill , Product Development Manager 1986-1990, Finnish Pulp and Paper Research Institute, Senior Research Associate1980 – 1986

Member of the Board of The Mint of Finland since 2011

No Board members own shares in The Mint of Finland.

Board meetings in 2011

The Board convened for 9 meetings during the financial year and the attendance rate of Board members was 98 %.

CEO of The Mint of Finland Ltd.

The CEO takes decisions independently and with the support of the Group’s Executive Committee within the powers determined by the Board of Directors and in other respects prepares proposals to be submitted to the Board of The Mint of Finland Ltd.

The CEO

1. is responsible for the day-to-day management of the company and Group in accordance with the Articles of Association, the Limited Liability Companies Act and instructions issued by the Board of Directors;
2. reports to the Board of Directors;
3. is responsible for preparing and submitting to the Board for adoption the Group’s strategy and action plans;
4. gives the Board regular briefings on the company’s activities and financial position
5. refers matters to the Board for its decision unless the duties of referendary are entrusted to a VP or expert

Executive Committee of The Mint of Finland Group

The Executive Committee of The Mint of Finland Group assists the CEO and convenes in the composition noted by the CEO in each notice of meeting as warranted by the matters under consideration from time to time.

The Group’s Executive Committee

1. ensures that the decisions taken by the governing bodies are duly executed within the organisation;
2. submits proposals on developing the strategy of The Mint of Finland Group for adoption by the Board of Directors;
3. assists the CEO of The Mint of Finland Ltd in preparing for meetings and in investigating all matters submitted by the CEO to the Committee for examination;
4. actively promotes cooperation between the business units and agrees on shared principles and common development measures in Group management;
5. supervises business development; day-to-day development measures fall within the responsibility of business area management, while long-term development undertakings and projects separately assigned to the business areas are managed by the CEO and/or the Executive Committee;
6. convenes on notice from the CEO approximately once a month

Members of the Group’s Executive Committee

CEO Paul Gustafsson, Chairman
b. 10 Aug 1955, MSc (Eng)
With The Mint of Finland since 2003

Juha Hörkkö, b. 26 Jul 1962, MSc (Econ & Bus Admin)
CFO
With The Mint of Finland since 2006

Matti Rastas, b. 5 May 1967, MSc (Eng)
Vice President, Customer Relations and Sales
With The Mint of Finland since 2000

Jarmo Hakkarainen, b. 3 Mar 1971, BEng
Production Director
With The Mint of Finland since 2011

Henna Karjalainen, b. 8 Jul 1967, M.A.
Communications Director
With The Mint of Finland since 2009

Subsidiaries

The shareholders of Mint of Finland Ltd.'s subsidiaries in the general meetings will be represented by Mint of Finland's chairman of the board or another person appointed by him/her. Members for the subsidiaries' board of directors are appointed by the parent company's board of directors."

The Chairman of the Board of each subsidiary is responsible for the Board of that subsidiary adopting, in the manner required under law, the decisions necessary to implement the decisions taken by the Board of Directors and CEO of The Mint of Finland Ltd and by the Group’s Executive Committee in accordance with this Corporate Governance Statement.

In addition to ordinary business accountability and duty to report, the Board of Directors and Managing Director of each subsidiary in The Mint of Finland Group shall also:

• ensure that the respective company complies with the provisions of the Articles of Association and with instructions issued by Group administration;
• ensure that the respective company complies with all local legislation and statutes governing the business, monitor legislation and changes therein, and report on these to the relevant Vice President and the CEO of The Mint of Finland Ltd;
• ensure that all assignments given by the CEO of The Mint of Finland Ltd are carried out.

As a rule, companies with shareholders outside the Group observe the above procedure, taking into account however the rights of the shareholders and the provisions of the Articles of Association and any shareholder agreements.

Remuneration of management

Remuneration of Board members

Board members are paid the following monthly fees: chairman EUR 2,800; vice chairman EUR 1,970; and other members EUR 1,400. An additional attendance fee of EUR 600 is paid for each meeting of the Board.

Terms of employment of the CEO

In addition to a monthly salary, which in 2010 is EUR 15,000 including benefits, the CEO is also entitled to a performance bonus, which shall not exceed 40% of annual salary. The bonus criteria are the Mint of Finland Group’s operating profit and other specific objectives. The annual bonus objectives for the CEO are determined by the Board of Directors.

In the event of termination by the Board of Directors, the CEO’s period of notice is three months and he/she is also entitled to severance pay equal to twelve months’ salary. When notice is given by the CEO, the period of notice is three months.

Regarding pension entitlement, see below under “Pensions”.

Other remuneration of management

As a rule, no separate remuneration is paid to the members of Boards of Directors of subsidiaries who are in the employ of The Mint of Finland. The remuneration payable to Board members not affiliated with the Group is fixed by the Board of Directors. Members of the Boards of Directors of subsidiaries who are in the employ of The Mint of Finland can be paid remuneration when warranted in order to achieve equal treatment of Board members. The remuneration principles are agreed by the Board of Directors, which submits its recommendation on remuneration principles to the general meeting of shareholders of the relevant company for consideration.

In addition to monthly salary, the members of the Group’s Executive Committee are eligible for an incentive bonus, which shall not exceed three months’ salary. The incentive bonus criteria for the Group’s Executive Committee are determined by the Board of Directors on the proposal of the Group’s President and CEO.

The company has in place no share option schemes.

Pensions

The Vice Presidents on the Group’s Executive Committee, including the CEO, are covered under the statutory pension scheme under the Employees’ Pensions Act. Additional pension insurance has been taken out for the Group’s President and CEO. The CEO may retire at the age of 63. The retirement ages of other persons on the Executive Committee are determined in accordance with their respective employment contracts. Decisions on additional pension benefits are taken by the Board of Directors.

Internal supervision

The aim of internal supervision is to ensure the efficient and profitable operation of the Group companies, the reliability of information, and compliance with legislation and policies. Internal supervision is within the purview of the company’s Board of Directors.

Operations are managed and monitored on a monthly basis by business area and company. Examination of projections for the current financial year and annual projections constitute an integral part of the management and monitoring process.

Supervisory measures at the level of Group are managed by the CFO at the level of Group and by the Vice President of each business area at business area level. Supervision is implemented by controllers appointed for each business area, who together with management ensure that business transactions are recorded in a timely fashion and reported with expedience and efficiency in observance with the separately issued Group guidelines concerning the substance of internal supervision and reporting.

Internal auditing

The Mint of Finland Ltd has in place no distinct internal audit organisation. Internal auditing is within the purview of the Board of Directors. Audit plans are reviewed and adopted by the Board, which in cooperation with the auditors evaluates and ensures the appropriateness and function of the Group’s internal supervision system, the expediency and effectiveness of the functions, the reliability of financial data and reporting, and compliance with the policies and instructions enshrined in the rules of procedure. The Board also creates added value for the organisation through consultancy on these matters.

Risk management

The objective of risk management is to identify, measure and manage risks which, if realised, could jeopardise the company’s operations and the achievement of its objectives or, on the other hand, present opportunities.

Risk management is a part of ordinary business operations and the responsibility of all vice presidents and their staff. Responsibility for developing and implementing the Group’s risk management process and for coordinating risk management efforts resides with the CFO.

The perspective in risk management is comprehensive and the aim is to accomplish the all-encompassing survey and management of risks. Risks come under particular examination in the context of strategic planning, annual planning, and the planning of investments and projects. The vice presidents are tasked with reporting on risks. All major risks are discussed in the monthly reports package distributed to the Board of Directors and the Executive Committee.

The main risks to which the various business functions of the Group are exposed and the means of providing for these risks are also reported in the company’s annual report.

Statutory auditing

Statutory auditing in the Group is organised so that the firm of authorised public accountants elected by the general meeting of shareholders for the parent company performs its audit in Mint of Finland Group and is responsible for auditing across the entire Group.

The firm of authorised public accountants elected is Tuokko Tilintarkastus Oy with APA Timo Tuokko as principal auditor. The auditor is elected by the general meeting of shareholders to serve for one year at a time.