Annual general meeting 2023
The Annual General Meeting of KONE Corporation was held on Tuesday, February 28, 2023.
KONE - Investors
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Notice is given to the shareholders of KONE Corporation of the Annual General Meeting to be held on Tuesday 28 February 2023 beginning at 11.00 a.m. at Messukeskus Siipi Conference Centre, Rautatieläisenkatu 3, Helsinki. The reception of registered meeting participants and distribution of voting ballots will commence at the meeting venue at 10.00 a.m.
The General Meeting can be followed via a webcast. More detailed information about the webcast is available in Section C. 4. Other instructions and information in this notice.
A. Matters on the agenda of the General Meeting
At the General Meeting, the following matters will be considered:
1. Opening of the meeting
2. Calling the meeting to order
3. Election of person to scrutinize the minutes and persons to supervise the counting of votes
4. Recording the legality of the meeting
5. Recording the attendance at the meeting and adoption of the list of votes
6. Presentation of the annual accounts, the report of the Board of Directors and the auditor’s report for the year 2022
- Review by the President and CEO
The Annual Review which includes the company’s annual accounts, consolidated accounts, the report of the Board of Directors and the auditor’s report is available on the company’s website at https://www.kone.com/en/investors/annual-general-meetings/.
7. Adoption of the annual accounts
8. Resolution on the use of the profit shown on the balance sheet and the payment of dividends
The Board of Directors proposes that for the financial year 2022 a dividend of EUR 1.7475 is paid for each class A share and a dividend of EUR 1.75 is paid for each class B share. The date of record for dividend distribution is 2 March 2023 and the dividend is paid on 9 March 2023.
9. Resolution on the discharge of the members of the Board of Directors and the President and CEO from liability for the financial period of 1 January – 31 December 2022
10. Consideration of the Remuneration Report for governing bodies
The Remuneration Report for governing bodies is available on the company’s website at https://www.kone.com/en/investors/annual-general-meetings/.
11. Resolution on the remuneration of the members of the Board of Directors
The Nomination and Compensation Committee of the Board of Directors proposes to the General Meeting that the board members’ annual compensation is kept unchanged: Chairman of the Board of Directors EUR 220,000, Vice Chairman EUR 125,000 and board members EUR 110,000 per year. According to the proposal, 40 percent of the annual compensation will be paid in class B shares of KONE Corporation and the rest in cash. The Nomination and Compensation Committee proposes in addition that a separate annual compensation is paid to the members of the board committees: Chairman of the Audit Committee: EUR 20,000 and members of the Audit Committee: EUR 10,000, and Chairman of the Nomination and Compensation Committee: EUR 20,000 and members of the Nomination and Compensation Committee: EUR 10,000. The annual compensation of the members of the board committees is proposed to be paid in cash. In addition, it is proposed that annual compensation is not paid to a board member who is employed by the company. Possible travel expenses are proposed to be reimbursed according to the travel policy of the company.
12. Resolution on the number of members of the Board of Directors
The Nomination and Compensation Committee of the Board of Directors proposes to the General Meeting that nine board members are elected.
13. Election of members of the Board of Directors
The Nomination and Compensation Committee of the Board of Directors proposes that following persons are elected to the Board of Directors so that in case of possible election each candidate shall be considered separately:
a) Matti Alahuhta (present member)
b) Susan Duinhoven (present member)
c) Marika Fredriksson (new member)
d) Antti Herlin (present member)
e) Iiris Herlin (present member)
f) Jussi Herlin (present member)
g) Ravi Kant (present member)
h) Marcela Manubens (new member)
i) Krishna Mikkilineni (present member)
The proposed new member of the Board of Directors, Ms. Marika Fredriksson, M.Sc. (Econ), born 1963, a Swedish citizen, has previously served as CFO and Group Executive Vice President of Vestas Wind Systems A/S 2013–2022, CFO of Gambro AB 2009–2012, CFO of Autoliv Inc. 2008–2009, and has held various positions, including CFO and Senior Vice President Finance and Strategy at Volvo Construction Equipment Corporation 1996–2008. Current key positions of trust are member of the board of A.P. Møller - Maersk A/S, member of the board of AB Industrivärden, member of the board of Sandvik AB, member of the board of Saxo Group, member of the board of Ecolean AB, chairman of the board of emagine Consulting, and advisory board member of Axcel. Based on the evaluation of KONE Board of Directors, Marika Fredriksson is independent of both the company and of significant shareholders.
The proposed new member of the Board of Directors, Ms. Marcela Manubens, MBA in International Business, University of Bridgeport, USA, Certified Public Accountant and Master's equivalent degree in Finance and Economic Science, Universidad de Belgrano, Argentina, Foreign Policy and Economic Affairs Program, American University, Washington DC, USA, born 1958, a US citizen, a founder and principal of Roxbury Global, LLC, USA, Executive Advisory services on Sustainable Business and ESG since 2021. Previously served as Global Vice President for Integrated Social Sustainability 2016–2021 and Global Vice President for Social Impact 2013–2016 at Unilever PLC, United Kingdom and in different positions at PVH Corp., USA 1991–2012 (Corporate Responsibility Officer 2012, Senior Vice President Global Human Rights and Social Responsibility Program 2006–2012, Vice President Global Human Rights Program 2000–2005, Director of Human Rights Program 1997–2000 and Global Consultant International Affairs 1991–1997). Previous key positions of trust: Member and Vice Chair of World Economic Forum - Human Rights Council; Member of the Integrity Advisory Committee at Sir Kensington’s; Member of the Board of Fair Labor Association, both Executive and Audit Committees, and Chair of the Board at Global Social Compliance Programme at Consumer Goods Forum. Current key positions of trust are Member of the Responsible Investment and Business Advisory Board at Sierra Global Management; and Member of the Advisory Board at Geneva Center for Business and Human Rights, Geneva School of Economics and Management. Further, Ms. Manubens is an educator and international speaker on sustainable business and global ESG. Based on the evaluation of KONE Board of Directors, Marcela Manubens is independent of both the company and of significant shareholders.
Jennifer Xin-Zhe Li does not stand for re-election to the Board of Directors, but she will remain as a consultant to the company.
Of the proposed members of the Board of Directors, Matti Alahuhta, Susan Duinhoven, Iiris Herlin, Ravi Kant and Krishna Mikkilineni are independent of the company. With the exception of Antti Herlin, Iiris Herlin and Jussi Herlin, the other Board members are independent of the company’s significant shareholders.
The proposed new members of the Board of Directors are presented on the company’s website at https://www.kone.com/en/investors/annual-general-meetings/.
14. Resolution on the remuneration of the auditors
The Audit Committee of the Board of Directors proposes to the General Meeting that the auditor to be elected is reimbursed as per their invoice.
15. Resolution on the number of auditors
The Audit Committee of the Board of Directors proposes to the General Meeting that one auditor is elected for the company for a term ending at the conclusion of the following annual general meeting.
16. Election of auditors
The Audit Committee of the Board of Directors proposes to the General Meeting that audit firm Ernst & Young Oy be elected as the auditor of the company for a term ending at the conclusion of the following annual general meeting.
17. Proposal by the Board of Directors to amend the Articles of Association
The Board of Directors proposes that the Articles of Association are amended by updating the article concerning the line of business of the company (2§) and changing the article concerning the general meeting (10§) so that the general meeting can be held completely without a meeting venue as a so-called remote meeting. The Board of Directors’ proposal for amending the Articles of Association with respect to articles 2§ and 10§ is presented in Annex 1 of this notice convening the General Meeting.
18. Authorizing the Board of Directors to decide on the repurchase of the company’s own shares
The Board of Directors proposes to the General Meeting that the General Meeting authorizes the Board of Directors to decide on the repurchase of no more than 52,930,000 treasury shares with the company’s unrestricted equity, so that a maximum of 7,620,000 class A shares and a maximum of 45,310,000 class B shares may be repurchased. The proposed maximum number of shares corresponds to approximately 10 percent of the company’s registered number of shares and votes for each share class at the time of the proposal. The consideration to be paid for the repurchased shares with respect to both class A and class B shares will be determined based on the trading price determined for class B shares on public trading on the date of repurchase.
Class A shares will be repurchased in proportion to holdings of class A shareholders at a price equivalent to the average price paid for the company’s class B shares on public trading on the date of repurchase. Any shareholder wishing to offer their class A shares for repurchase by the company must state their intention to the company’s Board of Directors in writing. The company may deviate from the obligation to repurchase shares in proportion to the shareholders' holdings if all the holders of class A shares give their consent. Class B shares will be repurchased at a price determined on public trading at the time of the repurchase.
The Board of Directors proposes that the authorization will be valid until the conclusion of the following annual general meeting, however, at the latest until 30 June 2024. The authorization terminates the authorization to decide on the repurchase of the company’s own shares given to the Board of Directors by the General Meeting on 1 March 2022.
19. Authorizing the Board of Directors to decide on the issuance of shares as well as the issuance of options and other special rights entitling to shares
The Board of Directors proposes to the General Meeting that the Board of Directors be authorized to decide on the issuance of shares as well as the issuance of options and other special rights entitling to shares referred to in Chapter 10, Section 1 of the Limited Liability Companies Act as follows:
The number of shares to be issued based on this authorization shall not exceed 7,620,000 class A shares and 45,310,000 class B shares. The Board of Directors decides on all the conditions of the issuance of shares and of special rights entitling to shares. The authorization concerns both the issuance of new shares as well as the transfer of treasury shares. The issuance of shares and of special rights entitling to shares may be carried out in deviation from the shareholders’ pre-emptive rights (directed issue).
The Board of Directors proposes that the authorization will be valid until the conclusion of the following annual general meeting, however, at the latest until 30 June 2024. The authorization terminates the authorization to decide on the issuance of shares given to the Board of Directors by the General Meeting on 1 March 2022.
20. Closing of the meeting
B. Documents of the General Meeting
The proposals of the Board of Directors and its committees relating to the agenda of the General Meeting, the Remuneration Report, this notice and Annual Review including company’s annual accounts, consolidated accounts, the report of the Board of Directors and the auditor’s report are on view at KONE Corporation’s website at https://www.kone.com/en/investors/annual-general-meetings/. The proposals and other documents referred to above are also on view at the General Meeting. The minutes of the General Meeting are available on the above-mentioned website no later than 14 March 2023.
C. Instructions for the participants in the General Meeting
1. Shareholders recorded in the shareholders’ register
Each shareholder, who is registered in the shareholders’ register of the company held by Euroclear Finland Oy on the record date of the General Meeting, which is 16 February 2023, has the right to participate in the General Meeting. A shareholder, whose shares are registered on their personal Finnish book-entry account, is registered in the shareholders’ register of the company.
Registration to the General Meeting commences on 26 January 2023. A shareholder, who wants to participate in the General Meeting, shall register for the meeting no later than on 23 February 2023 at 3.00 p.m. by giving prior notice of participation. Such notice can be given:
a) on KONE Corporation’s website at https://www.kone.com/en/investors/annual-general-meetings/
Private individuals will log into the system through strong electronic identification with online banking credentials or mobile ID. Entities will need the number of the shareholder’s book-entry account together with the business ID or other identification code for the login. If an entity is using Suomi.fi e-Authorization, the registration of the authorized person requires strong electronic identification with online banking credentials or mobile ID.
b) by regular mail to: KONE Corporation, Share Register, P.O. Box 7, FI-02151 Espoo, Finland
c) by telephone +358 20 770 6873 between 9.00 a.m. and 4.00 p.m. from Monday to Friday
Any changes in the ownership of shares after the record date of the General Meeting do not affect the right to participate in the meeting or the number of votes of the shareholder.
In connection with the registration, a shareholder shall provide the information requested such as their name, date of birth/personal identification number or business identification number, address, telephone number and email address as well as the name of any assistant or proxy representative, as well as the date of birth/personal identification number of a proxy representative. The personal information is used only in connection with the General Meeting and with the processing of related registrations.
The shareholder, their authorized representative or proxy representative shall, to the extent necessary, be able to prove their identity and/or right of representation at the meeting venue.
2. Holders of nominee registered shares
A holder of nominee registered shares has the right to participate in the General Meeting by virtue of such shares, based on which they on the record date of the General Meeting, i.e. 16 February 2023, are entitled to be registered in the shareholders’ register held by Euroclear Finland Oy. The right to participate in the General Meeting requires, in addition, that the shareholder on the basis of such shares has been temporarily registered into the shareholders’ register held by Euroclear Finland Oy at the latest by 23 February 2023 by 10.00 a.m. This is considered as sufficient registration for holders of nominee registered shares wanting to participate in the General Meeting. Any changes in the ownership of shares after the record date of the General Meeting do not affect the right to participate in the meeting or the number of votes of the shareholder.
A holder of nominee registered shares is advised to request without delay necessary instructions regarding the registration in the temporary shareholder’s register of the company, the issuing of proxy documents, voting instructions and registration for the General Meeting from their custodian bank. The account manager of the custodian bank has to temporarily register a holder of nominee registered shares, who wants to participate in the General Meeting, into the shareholders’ register of the company no later than the time stated above.
3. Proxy representative and powers of attorney
A shareholder may participate in the General Meeting and exercise their rights at the meeting by way of proxy representation. A proxy representative shall produce a dated proxy document or otherwise in a reliable manner demonstrate their right to represent the shareholder at the General Meeting. Proxy template is available on the company’s website at https://www.kone.com/en/investors/annual-general-meetings/. When a shareholder participates in the General Meeting by means of several proxy representatives representing the shareholder with shares in different securities accounts, the shares by which each proxy representative represents the shareholder shall be identified in connection with the registration for the General Meeting.
Any proxy documents should be delivered in originals to KONE Corporation, Share Register, P.O. Box 7, FI-02151 Espoo, Finland or by email to agm@kone.com before the last date for registration. In addition to providing the proxy documents, shareholders or the proxy representatives of the shareholders are also required to register to the General Meeting in the manner instructed in this notice.
Entities can also use Suomi.fi e-Authorization service instead of a traditional power of attorney. To do so an entity must authorize its representative in Suomi.fi e-Authorization at the address: https://www.suomi.fi/e-authorizations by using the mandate “Representation at the General Meeting”. In connection with the registration to the meeting, the authorized person must identify themself in Euroclear Finland Oy’s general meeting services through strong electronic identification after which the e-Authorization is automatically verified.
4. Other instructions and information
The meeting will be held in Finnish.
Pursuant to chapter 5, section 25 of the Finnish Companies Act, a shareholder who is present at the General Meeting has the right to request information with respect to the matters to be considered at the General Meeting.
On the date of this notice 26 January 2023, the total number of shares in KONE Corporation is 529,395,860 shares constituted of 76,208,712 class A shares and 453,187,148 class B shares. Based on the Articles of Association, each class A share entitles its holder to one vote and each full ten class B shares entitle their holder to one vote, but each shareholder has a minimum of one vote. On the date of this notice, the company holds 12,306,640 treasury class B shares. Pursuant to the Limited Liability Companies Act, treasury shares or shares held by a subsidiary do not entitle to participation in the General Meeting.
Each shareholder, who is registered in the shareholders’ register of the company held by Euroclear Finland Oy on the record date of the General Meeting, which is 16 February 2023, has a possibility to follow the General Meeting via a webcast. Instructions how to register as a follower for the webcast and how to follow the webcast are available on the company’s website at https://www.kone.com/en/investors/annual-general-meetings/. The shareholders following the webcast may present written questions or comments during the General Meeting through a chat functionality provided in the webcast platform. Following the webcast or presenting written questions or comments is not considered participation in the General Meeting or using shareholders’ right to request information or speak at the meeting in accordance with the Limited Liability Companies Act. Written questions presented in the chat are not questions referred to in the Limited Liability Companies Act. The written questions and comments presented in the chat will be brought to the audience of the General Meeting and answered in the General Meeting if the Chairperson of the meeting considers that appropriate.
The participants of the General Meeting are kindly notified that coffee will be served after the meeting.
In Helsinki, 26 January 2023
KONE Corporation
THE BOARD OF DIRECTORS
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At the General Meeting, the following matters will be considered:
1. Opening of the meeting
2. Calling the meeting to order
3. Election of person to scrutinize the minutes and persons to supervise the counting of votes
4. Recording the legality of the meeting
5. Recording the attendance at the meeting and adoption of the list of votes
6. Presentation of the annual accounts, the report of the Board of Directors and the auditor’s report for the year 2022
- Review by the President and CEO
The Annual Review which includes the company’s annual accounts, consolidated accounts, the report of the Board of Directors and the auditor’s report is available on the company’s website at https://www.kone.com/en/investors/annual-general-meetings/.
7. Adoption of the annual accounts
8. Resolution on the use of the profit shown on the balance sheet and the payment of dividends
The Board of Directors proposes that for the financial year 2022 a dividend of EUR 1.7475 is paid for each class A share and a dividend of EUR 1.75 is paid for each class B share. The date of record for dividend distribution is 2 March 2023 and the dividend is paid on 9 March 2023.
9. Resolution on the discharge of the members of the Board of Directors and the President and CEO from liability for the financial period of 1 January – 31 December 2022
10. Consideration of the Remuneration Report for governing bodies
The Remuneration Report for governing bodies is available on the company’s website at https://www.kone.com/en/investors/annual-general-meetings/.
11. Resolution on the remuneration of the members of the Board of Directors
The Nomination and Compensation Committee of the Board of Directors proposes to the General Meeting that the board members’ annual compensation is kept unchanged: Chairman of the Board of Directors EUR 220,000, Vice Chairman EUR 125,000 and board members EUR 110,000 per year. According to the proposal, 40 percent of the annual compensation will be paid in class B shares of KONE Corporation and the rest in cash. The Nomination and Compensation Committee proposes in addition that a separate annual compensation is paid to the members of the board committees: Chairman of the Audit Committee: EUR 20,000 and members of the Audit Committee: EUR 10,000, and Chairman of the Nomination and Compensation Committee: EUR 20,000 and members of the Nomination and Compensation Committee: EUR 10,000. The annual compensation of the members of the board committees is proposed to be paid in cash. In addition, it is proposed that annual compensation is not paid to a board member who is employed by the company. Possible travel expenses are proposed to be reimbursed according to the travel policy of the company.
12. Resolution on the number of members of the Board of Directors
The Nomination and Compensation Committee of the Board of Directors proposes to the General Meeting that nine board members are elected.
13. Election of members of the Board of Directors
The Nomination and Compensation Committee of the Board of Directors proposes that following persons are elected to the Board of Directors so that in case of possible election each candidate shall be considered separately:
a) Matti Alahuhta (present member)
b) Susan Duinhoven (present member)
c) Marika Fredriksson (new member)
d) Antti Herlin (present member)
e) Iiris Herlin (present member)
f) Jussi Herlin (present member)
g) Ravi Kant (present member)
h) Marcela Manubens (new member)
i) Krishna Mikkilineni (present member)The proposed new member of the Board of Directors, Ms. Marika Fredriksson, M.Sc. (Econ), born 1963, a Swedish citizen, has previously served as CFO and Group Executive Vice President of Vestas Wind Systems A/S 2013–2022, CFO of Gambro AB 2009–2012, CFO of Autoliv Inc. 2008–2009, and has held various positions, including CFO and Senior Vice President Finance and Strategy at Volvo Construction Equipment Corporation 1996–2008. Current key positions of trust are member of the board of A.P. Møller - Maersk A/S, member of the board of AB Industrivärden, member of the board of Sandvik AB, member of the board of Saxo Group, member of the board of Ecolean AB, chairman of the board of emagine Consulting, and advisory board member of Axcel. Based on the evaluation of KONE Board of Directors, Marika Fredriksson is independent of both the company and of significant shareholders.
The proposed new member of the Board of Directors, Ms. Marcela Manubens, MBA in International Business, University of Bridgeport, USA, Certified Public Accountant and Master's equivalent degree in Finance and Economic Science, Universidad de Belgrano, Argentina, Foreign Policy and Economic Affairs Program, American University, Washington DC, USA, born 1958, a US citizen, a founder and principal of Roxbury Global, LLC, USA, Executive Advisory services on Sustainable Business and ESG since 2021. Previously served as Global Vice President for Integrated Social Sustainability 2016–2021 and Global Vice President for Social Impact 2013–2016 at Unilever PLC, United Kingdom and in different positions at PVH Corp., USA 1991–2012 (Corporate Responsibility Officer 2012, Senior Vice President Global Human Rights and Social Responsibility Program 2006–2012, Vice President Global Human Rights Program 2000–2005, Director of Human Rights Program 1997–2000 and Global Consultant International Affairs 1991–1997). Previous key positions of trust: Member and Vice Chair of World Economic Forum - Human Rights Council; Member of the Integrity Advisory Committee at Sir Kensington’s; Member of the Board of Fair Labor Association, both Executive and Audit Committees, and Chair of the Board at Global Social Compliance Programme at Consumer Goods Forum. Current key positions of trust are Member of the Responsible Investment and Business Advisory Board at Sierra Global Management; and Member of the Advisory Board at Geneva Center for Business and Human Rights, Geneva School of Economics and Management. Further, Ms. Manubens is an educator and international speaker on sustainable business and global ESG. Based on the evaluation of KONE Board of Directors, Marcela Manubens is independent of both the company and of significant shareholders.
Jennifer Xin-Zhe Li does not stand for re-election to the Board of Directors, but she will remain as a consultant to the company.Of the proposed members of the Board of Directors, Matti Alahuhta, Susan Duinhoven, Iiris Herlin, Ravi Kant and Krishna Mikkilineni are independent of the company. With the exception of Antti Herlin, Iiris Herlin and Jussi Herlin, the other Board members are independent of the company’s significant shareholders.
The proposed new members of the Board of Directors are presented on the company’s website at https://www.kone.com/en/investors/annual-general-meetings/.
14. Resolution on the remuneration of the auditors
The Audit Committee of the Board of Directors proposes to the General Meeting that the auditor to be elected is reimbursed as per their invoice.
15. Resolution on the number of auditors
The Audit Committee of the Board of Directors proposes to the General Meeting that one auditor is elected for the company for a term ending at the conclusion of the following annual general meeting.
16. Election of auditors
The Audit Committee of the Board of Directors proposes to the General Meeting that audit firm Ernst & Young Oy be elected as the auditor of the company for a term ending at the conclusion of the following annual general meeting.
17. Proposal by the Board of Directors to amend the Articles of Association
The Board of Directors proposes that the Articles of Association are amended by updating the article concerning the line of business of the company (2§) and changing the article concerning the general meeting (10§) so that the general meeting can be held completely without a meeting venue as a so-called remote meeting. The Board of Directors’ proposal for amending the Articles of Association with respect to articles 2§ and 10§ is presented in Annex 1 of this notice convening the General Meeting.
18. Authorizing the Board of Directors to decide on the repurchase of the company’s own shares
The Board of Directors proposes to the General Meeting that the General Meeting authorizes the Board of Directors to decide on the repurchase of no more than 52,930,000 treasury shares with the company’s unrestricted equity, so that a maximum of 7,620,000 class A shares and a maximum of 45,310,000 class B shares may be repurchased. The proposed maximum number of shares corresponds to approximately 10 percent of the company’s registered number of shares and votes for each share class at the time of the proposal. The consideration to be paid for the repurchased shares with respect to both class A and class B shares will be determined based on the trading price determined for class B shares on public trading on the date of repurchase.
Class A shares will be repurchased in proportion to holdings of class A shareholders at a price equivalent to the average price paid for the company’s class B shares on public trading on the date of repurchase. Any shareholder wishing to offer their class A shares for repurchase by the company must state their intention to the company’s Board of Directors in writing. The company may deviate from the obligation to repurchase shares in proportion to the shareholders' holdings if all the holders of class A shares give their consent. Class B shares will be repurchased at a price determined on public trading at the time of the repurchase.The Board of Directors proposes that the authorization will be valid until the conclusion of the following annual general meeting, however, at the latest until 30 June 2024. The authorization terminates the authorization to decide on the repurchase of the company’s own shares given to the Board of Directors by the General Meeting on 1 March 2022.
19. Authorizing the Board of Directors to decide on the issuance of shares as well as the issuance of options and other special rights entitling to shares
The Board of Directors proposes to the General Meeting that the Board of Directors be authorized to decide on the issuance of shares as well as the issuance of options and other special rights entitling to shares referred to in Chapter 10, Section 1 of the Limited Liability Companies Act as follows:The number of shares to be issued based on this authorization shall not exceed 7,620,000 class A shares and 45,310,000 class B shares. The Board of Directors decides on all the conditions of the issuance of shares and of special rights entitling to shares. The authorization concerns both the issuance of new shares as well as the transfer of treasury shares. The issuance of shares and of special rights entitling to shares may be carried out in deviation from the shareholders’ pre-emptive rights (directed issue).
The Board of Directors proposes that the authorization will be valid until the conclusion of the following annual general meeting, however, at the latest until 30 June 2024. The authorization terminates the authorization to decide on the issuance of shares given to the Board of Directors by the General Meeting on 1 March 2022.20. Closing of the meeting
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Adoption of the annual accounts
Resolution on the use of the profit shown on the balance sheet and the payment of dividends
The Board of Directors proposes that for the financial year 2022 a dividend of EUR 1.7475 is paid for each class A share and a dividend of EUR 1.75 is paid for each class B share. The date of record for dividend distribution is 2 March 2023 and the dividend is paid on 9 March 2023.
Resolution on the discharge of the members of the Board of Directors and the President and CEO from liability for the financial period of 1 January – 31 December 2022
Consideration of the Remuneration Report for governing bodies
The Remuneration Report for governing bodies is available on the company’s website at https://www.kone.com/en/investors/annual-general-meetings/.
Resolution on the remuneration of the members of the Board of Directors
The Nomination and Compensation Committee of the Board of Directors proposes to the General Meeting that the board members’ annual compensation is kept unchanged: Chairman of the Board of Directors EUR 220,000, Vice Chairman EUR 125,000 and board members EUR 110,000 per year. According to the proposal, 40 percent of the annual compensation will be paid in class B shares of KONE Corporation and the rest in cash. The Nomination and Compensation Committee proposes in addition that a separate annual compensation is paid to the members of the board committees: Chairman of the Audit Committee: EUR 20,000 and members of the Audit Committee: EUR 10,000, and Chairman of the Nomination and Compensation Committee: EUR 20,000 and members of the Nomination and Compensation Committee: EUR 10,000. The annual compensation of the members of the board committees is proposed to be paid in cash. In addition, it is proposed that annual compensation is not paid to a board member who is employed by the company. Possible travel expenses are proposed to be reimbursed according to the travel policy of the company.
Resolution on the number of members of the Board of Directors
The Nomination and Compensation Committee of the Board of Directors proposes to the General Meeting that nine board members are elected.
Election of members of the Board of Directors
The Nomination and Compensation Committee of the Board of Directors proposes that following persons are elected to the Board of Directors so that in case of possible election each candidate shall be considered separately:
a) Matti Alahuhta (present member)
b) Susan Duinhoven (present member)
c) Marika Fredriksson (new member)
d) Antti Herlin (present member)
e) Iiris Herlin (present member)
f) Jussi Herlin (present member)
g) Ravi Kant (present member)
h) Marcela Manubens (new member)
i) Krishna Mikkilineni (present member)The proposed new member of the Board of Directors, Ms. Marika Fredriksson, M.Sc. (Econ), born 1963, a Swedish citizen, has previously served as CFO and Group Executive Vice President of Vestas Wind Systems A/S 2013–2022, CFO of Gambro AB 2009–2012, CFO of Autoliv Inc. 2008–2009, and has held various positions, including CFO and Senior Vice President Finance and Strategy at Volvo Construction Equipment Corporation 1996–2008. Current key positions of trust are member of the board of A.P. Møller - Maersk A/S, member of the board of AB Industrivärden, member of the board of Sandvik AB, member of the board of Saxo Group, member of the board of Ecolean AB, chairman of the board of emagine Consulting, and advisory board member of Axcel. Based on the evaluation of KONE Board of Directors, Marika Fredriksson is independent of both the company and of significant shareholders.
The proposed new member of the Board of Directors, Ms. Marcela Manubens, MBA in International Business, University of Bridgeport, USA, Certified Public Accountant and Master's equivalent degree in Finance and Economic Science, Universidad de Belgrano, Argentina, Foreign Policy and Economic Affairs Program, American University, Washington DC, USA, born 1958, a US citizen, a founder and principal of Roxbury Global, LLC, USA, Executive Advisory services on Sustainable Business and ESG since 2021. Previously served as Global Vice President for Integrated Social Sustainability 2016–2021 and Global Vice President for Social Impact 2013–2016 at Unilever PLC, United Kingdom and in different positions at PVH Corp., USA 1991–2012 (Corporate Responsibility Officer 2012, Senior Vice President Global Human Rights and Social Responsibility Program 2006–2012, Vice President Global Human Rights Program 2000–2005, Director of Human Rights Program 1997–2000 and Global Consultant International Affairs 1991–1997). Previous key positions of trust: Member and Vice Chair of World Economic Forum - Human Rights Council; Member of the Integrity Advisory Committee at Sir Kensington’s; Member of the Board of Fair Labor Association, both Executive and Audit Committees, and Chair of the Board at Global Social Compliance Programme at Consumer Goods Forum. Current key positions of trust are Member of the Responsible Investment and Business Advisory Board at Sierra Global Management; and Member of the Advisory Board at Geneva Center for Business and Human Rights, Geneva School of Economics and Management. Further, Ms. Manubens is an educator and international speaker on sustainable business and global ESG. Based on the evaluation of KONE Board of Directors, Marcela Manubens is independent of both the company and of significant shareholders.
Jennifer Xin-Zhe Li does not stand for re-election to the Board of Directors, but she will remain as a consultant to the company.
Of the proposed members of the Board of Directors, Matti Alahuhta, Susan Duinhoven, Iiris Herlin, Ravi Kant and Krishna Mikkilineni are independent of the company. With the exception of Antti Herlin, Iiris Herlin and Jussi Herlin, the other Board members are independent of the company’s significant shareholders.
The proposed new members of the Board of Directors are presented on the company’s website at https://www.kone.com/en/investors/annual-general-meetings/.
Resolution on the remuneration of the auditors
The Audit Committee of the Board of Directors proposes to the General Meeting that the auditor to be elected is reimbursed as per their invoice.
Resolution on the number of auditors
The Audit Committee of the Board of Directors proposes to the General Meeting that one auditor is elected for the company for a term ending at the conclusion of the following annual general meeting.
Election of auditors
The Audit Committee of the Board of Directors proposes to the General Meeting that audit firm Ernst & Young Oy be elected as the auditor of the company for a term ending at the conclusion of the following annual general meeting.
Proposal by the Board of Directors to amend the Articles of Association
The Board of Directors proposes that the Articles of Association are amended by updating the article concerning the line of business of the company (2§) and changing the article concerning the general meeting (10§) so that the general meeting can be held completely without a meeting venue as a so-called remote meeting. The Board of Directors’ proposal for amending the Articles of Association with respect to articles 2§ and 10§ is presented in Annex 1 of this notice convening the General Meeting.
Authorizing the Board of Directors to decide on the repurchase of the company’s own shares
The Board of Directors proposes to the General Meeting that the General Meeting authorizes the Board of Directors to decide on the repurchase of no more than 52,930,000 treasury shares with the company’s unrestricted equity, so that a maximum of 7,620,000 class A shares and a maximum of 45,310,000 class B shares may be repurchased. The proposed maximum number of shares corresponds to approximately 10 percent of the company’s registered number of shares and votes for each share class at the time of the proposal. The consideration to be paid for the repurchased shares with respect to both class A and class B shares will be determined based on the trading price determined for class B shares on public trading on the date of repurchase.
Class A shares will be repurchased in proportion to holdings of class A shareholders at a price equivalent to the average price paid for the company’s class B shares on public trading on the date of repurchase. Any shareholder wishing to offer their class A shares for repurchase by the company must state their intention to the company’s Board of Directors in writing. The company may deviate from the obligation to repurchase shares in proportion to the shareholders' holdings if all the holders of class A shares give their consent. Class B shares will be repurchased at a price determined on public trading at the time of the repurchase.
The Board of Directors proposes that the authorization will be valid until the conclusion of the following annual general meeting, however, at the latest until 30 June 2024. The authorization terminates the authorization to decide on the repurchase of the company’s own shares given to the Board of Directors by the General Meeting on 1 March 2022.
Authorizing the Board of Directors to decide on the issuance of shares as well as the issuance of options and other special rights entitling to shares
The Board of Directors proposes to the General Meeting that the Board of Directors be authorized to decide on the issuance of shares as well as the issuance of options and other special rights entitling to shares referred to in Chapter 10, Section 1 of the Limited Liability Companies Act as follows:
The number of shares to be issued based on this authorization shall not exceed 7,620,000 class A shares and 45,310,000 class B shares. The Board of Directors decides on all the conditions of the issuance of shares and of special rights entitling to shares. The authorization concerns both the issuance of new shares as well as the transfer of treasury shares. The issuance of shares and of special rights entitling to shares may be carried out in deviation from the shareholders’ pre-emptive rights (directed issue).
The Board of Directors proposes that the authorization will be valid until the conclusion of the following annual general meeting, however, at the latest until 30 June 2024. The authorization terminates the authorization to decide on the issuance of shares given to the Board of Directors by the General Meeting on 1 March 2022.
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Matters relating to the Annual General Meeting
KONE Corporation's Annual General Meeting was held in Helsinki on February 28, 2023. The meeting approved the financial statements, considered the Remuneration Report for governing bodies and discharged the responsible parties from liability for the financial period January 1-December 31, 2022.
The General Meeting approved dividends in line with the Board of Director's proposal of EUR 1.7475 for each of the class A shares and EUR 1.75 for each of the outstanding class B shares. The date of record for dividend distribution is March 2, 2023 and dividends will be payable on March 9, 2023.
The number of Members of the Board of Directors was confirmed as nine. Re-elected as Members of the Board were Matti Alahuhta, Susan Duinhoven, Antti Herlin, Iiris Herlin, Jussi Herlin, Ravi Kant and Krishna Mikkilineni. Marika Fredriksson and Marcela Manubens were elected as new Members to the Board of Directors.
The General Meeting confirmed an annual compensation of EUR 220,000 for the Chairman of the Board, EUR 125,000 for the Vice Chair and EUR 110,000 for Board Members. Of the annual remuneration, 40 percent will be paid in class B shares of KONE Corporation and the rest in cash. In addition, the General Meeting confirmed a separate annual compensation to the members of the board committees: Chair of the Audit Committee: EUR 20,000 and members of the Audit Committee: EUR 10,000, and Chair of the Nomination and Compensation Committee: EUR 20,000 and members of the Nomination and Compensation Committee: EUR 10,000. The annual compensation of the members of the board committees is paid in cash. In addition, it was resolved that compensation is not paid to a Board Member who is employed by the company.
Audit firm Ernst & Young Oy was nominated as the auditor for the term 2023.
Other decisions by the General Meeting
The General Meeting approved the authorization for the Board of Directors to repurchase KONE's own shares. Altogether no more than 52,930,000 shares may be repurchased, of which no more than 7,620,000 may be class A shares and 45,310,000 class B shares. The authorization will be valid until the conclusion of the following annual general meeting, however, at the latest until 30 June 2024.
Furthermore, the General Meeting authorized the Board of Directors to decide on the issuance of shares as well as the issuance of options and other special rights entitling to shares referred to in Chapter 10, Section 1 of the Limited Liability Companies Act. The number of shares to be issued based on this authorization shall not exceed 7,620,000 class A shares and 45,310,000 class B shares. The Board of Directors decides on all the conditions of the issuance of shares and of special rights entitling to shares. The authorization concerns both the issuance of new shares as well as the transfer of treasury shares. The issuance of shares and of special rights entitling to shares may be carried out in deviation from the shareholders' pre-emptive rights (directed issue). The authorization will be valid until the conclusion of the following annual general meeting, however, at the latest until 30 June 2024.
The General Meeting decided to amend the Articles of Association by updating the article concerning the line of business of the company (2§) and changing the article concerning the general meeting (10§) so that the general meeting can be held completely without a meeting venue as a so-called remote meeting.
Decisions taken by KONE Corporation’s Board of Directors
At its meeting held after the General Meeting today, on February 28, 2023, the Board of Directors of KONE Corporation elected from among its members Antti Herlin as its Chairman and Jussi Herlin as Vice Chair.
Susan Duinhoven was elected as Chair and Matti Alahuhta, Marika Fredriksson and Jussi Herlin as members of the Audit Committee. Susan Duinhoven, Matti Alahuhta and Marika Fredriksson are independent of both the company and of significant shareholders.
Jussi Herlin was elected as Chair and Matti Alahuhta, Antti Herlin and Ravi Kant as members of the Nomination and Compensation Committee. Matti Alahuhta and Ravi Kant are independent of both the company and of significant shareholders.
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Important dates
Notice convening General Meeting published and registration begins 26 January 2023
Record date of the General Meeting 16 February 2023
Registration ended 23 February 2023 at 3:00 p.m. EET
Deadline for proxy documents 23 February 2023 at 3:00 p.m. EET
General Meeting 28 February 2023 at 11:00 a.m. EET
Proposed date of record for dividend distribution 2 March 2023
Proposed payment date for dividend distribution 9 March 2023
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Changes in the withholding taxation of dividends paid to holders of nominee registered shares entered into force in 2021. As a starting point, withholding tax of 35% will be withheld from dividend payments made on nominee registered shares. In case the custodians are registered with the Finnish Tax Administration’s Register of Authorised Intermediaries, lower withholding tax can be applied based on the required additional information collected. Any tax withheld in excess can be reclaimed after the year of the dividend payment by submitting a refund application to the Finnish Tax Administration, either on paper (form for corporate entities here, and for individuals here), or electronically. You may also be able to receive a refund already during the year of dividend payment via your registered custodian. Please contact your custodian for further information.
Additional information on withholding tax reclaims can be obtained from the Tax Administration either by e-mail whtreclaims@vero.fi (for corporations only) or via the Tax Administration general telephone and chat helplines (for both individuals and corporations). Please note that KONE does not process withholding tax reclaims.
Dividends paid to Finnish tax resident holders of nominee registered shares may as of 2020 have been subject to withholding of 50% tax prepayment (ennakonpidätys). Any excess tax prepayment will be credited in the normal tax assessment process where the shareholder reports their dividend income to the Finnish Tax Administration.
