Corporate Governance

Applicable rules and regulations

Vapo Oy is a Finnish non-listed joint-stock company whose decision-making and management comply with the applicable legislation, such as the Finnish Limited Liability Companies Act, the Finnish Accounting Act and the company’s Articles of Association (Appendix 1) as well as the Shareholders’ Agreement between the company’s owners. In addition, Vapo Oy complies with the Government Resolution on the handling of Corporate Governance matters in publicly owned and affiliated companies issued by the Ownership Steering Department of the Prime Minister’s Office and, where applicable, the Securities Market Association’s Finnish Corporate Governance Code, which took effect on 1 January 2016.

The company’s Articles of Association (Appendix 1) include a redemption clause. Pursuant to the redemption clause, if a share is transferred to an outside party, other than one that exercises control over a shareholder of the company, the other shareholders shall have the right to redeem the transferred shares.

The company publishes this Corporate Governance Statement annually together with the annual report.

Divisions and business functions

Vapo Group’s operations consist of the Energy division, Grow&Care division, New Businesses division, the Supply Chain Management function and the Group Services function. The Energy division specialises in the production of solid fuels, heating, electricity and steam as well as the provision of various fuel and energy solutions and services. The Grow&Care division specialises in growing media, recycling, the wholesale of peat raw material and the production and sale of bedding peat. The New Businesses division focuses on the development of new products from peat and other natural materials. The Supply Chain Management function is responsible for the raw material supply, peat production, logistics, shared procurement and the management of environmental, quality and occupational safety issues for each of the Group’s divisions. The Group Services function consists of HR, Finance & Business Control, ICT, Communications & Public Relations and Legal Services & Internal Audit for the entire Group. Each division and function is responsible for its operations throughout Vapo Group’s operating countries and subsidiaries.

Vapo’s governance bodies

The highest decision-making power in Vapo is exercised by the shareholders at the General Meeting. The management of the Group is the responsibility of the Board of Directors appointed by the General Meeting and the CEO appointed by the Board of Directors. The work of the Board of Directors and CEO is supervised by the Supervisory Board appointed by the General Meeting. The Group Management Team and other senior management assist the CEO in his duties. The Board of Directors decides on the Group’s governance systems and ensures that the company observes good corporate governance.

The company publishes an annual Corporate Governance Statement together with the annual report.