General meeting / Board of directors
The Ministry of Petroleum and Energy, in the person of the minister, represents the government as sole owner and serves as the company’s general meeting and highest authority. The annual general meeting is held before the end of June each year. It considers matters prescribed by Norwegian law, such as amendments to the articles of association and approval of the annual accounts. The Petroleum Activities Act lays down guidelines for issues to be considered by the company’s general meeting. The general meeting elects the board of directors, with the exception of the worker directors, and the company’s external auditor.
Board of directors and its work
Petoro’s board comprises seven directors, of whom five are elected by the general meeting. Two are elected by and from among the company’s employees. Three of the directors are women. Directors are elected for two-year terms. They have no commercial agreements or other financial relations with the company apart from the directors’ fees established by the general meeting and contracts of employment for the worker directors.
The board has overall responsibility for the management of Petoro, including ensuring that appropriate management and control systems are in place, and for exercising supervision of the day-to-day conduct of the company’s business. The work of the board is based on rules of procedure which describe its responsibilities and mode of working. The board met 13 times in 2012.
As an appendix to the instructions for its work, the board has adopted supple-mentary provisions for matters to be considered by it. An annual schedule of meetings has been established for the work of the board, with the emphasis on considering strategies, budgets and interim results. The board utilises a balanced scorecard system as a key instrument for monitoring results. This embraces financial/operational, organisational and relational aspects. The performance management model also covers both short- and long-term goals, quantitative as well as qualitative, and is well adapted to the company’s challenges.
The board considers major investment decisions within the portfolio, follow-up and consideration of activities in the licences, and monitoring of gas sales – including an assessment of the overall risk picture. The board has chosen to organise its work related to compensation through a sub-committee. No other committees have been established by the board. In the event of conflicts of interest, the practice has been for the director concerned to abstain from consideration of the matter by the board.
An annual self-assessment is conducted by the board, embracing an evaluation of its own work and mode of working and of its collaboration with the company’s management. The board was assisted in carrying out its self-assessment by an external consultant in 2012.
The board established guidelines in 2012 for exercising CSR. Petoro’s CSR has previously found expression in the board’s instructions for its own work and that of the president, and has also been reflected in the company’s guidelines on business ethics. Petoro reports on its work on CSR in a separate chapter of this annual report.
The individual director and the board as a collective body seek to strengthen their expertise in various ways. These include participation in courses and conferences and generally by following developments in the area. The board undertook a study trip in 2012 to strengthen its expertise.