Governing bodies

The authority and governance of the Company are divided among the annual general meeting, the Board of Directors, and the President and CEO. The President and CEO implements the operative business with the help of the Corporate Management Group. Internal audit subordinate to the Board of Directors is responsible for internal auditing and auditors are responsible for external auditing.

The general meeting

The general meeting of the shareholders is SATO’s supreme decision-making body. The annual general meeting is to be held once a year within six months of the end of the financial year. An extraordinary general meeting is held when it is necessary according to the consideration of the Board of Directors or the Finnish Companies Act.

The annual general meeting decides on the matters due to it under the Finnish Companies Act and the articles of association. These include the adoption of the Company’s financial statements and consolidated financial statements, the use of profit indicated on the balance sheet, discharging the members of the Board of Directors and the President and CEO from liability, electing the members and Chair of the Board of Directors and an auditor, and determining the remuneration to be payable to them. The meeting may also handle other matters to be dealt with at a general meeting in accordance with the Finnish Companies Act, such as share issues, acquisition of the Company’s own shares and changes to the articles of association. The meeting also deals with matters which a shareholder has requested to be dealt with at a general meeting in accordance with the Finnish Companies Act.

SATO has a single series of shares. Each share confers entitlement to one vote at a general meeting. Entitlement to attend the general meeting is held by a shareholder who has been entered in the register of shareholders maintained by Euroclear Finland eight working days before the general meeting. The Finnish Companies Act also contains regulations concerning nominee-registered shareholders.

In order to ensure dialogue between shareholders and Company bodies and shareholders' entitlement to ask questions, the President and CEO, Chair of the Board of Directors and the Board members must attend the general meeting. Persons proposed as Board members must be present at a general meeting deciding on their election.

The Company’s annual general meeting was held on 3 March 2016. A total of 14 shareholders attended the meeting, representing 95.7 per cent of the Company’s shares and votes. The minutes of the annual general meeting can be found on the Company’s website.

Shareholders' Nomination Committee

On 3 March 2015, the annual general meeting decided to establish a shareholders' Nomination Committee and approved its rules of procedure. The Committee's task is to prepare proposals concerning the Board's composition and the remuneration of its members to the annual general meeting. The committee’s rules of procedure can be found on the Company’s website.

The shareholders' Nomination Committee includes representatives of SATO's four largest shareholders, which had been entered in the book-entry system on 1 October and which accept the position. The Chair of the Company's Board of Directors serves as an expert member of the Committee. The Committee elects one of its members to serve as Chair.

The Committee's term of office begins in October each year, when the largest shareholders have named their representatives, and ends at the closing of the next annual general meeting. A shareholder shall name as a member of the Committee a person independent of the Company.

The composition of the Committee is determined based on ownership on 1 October and includes Erik Selin (Balder), Hans Spikker (APG), Hanna Hiidenpalo (Elo) and Matti Harjuniemi (Finnish Construction Trade Union). The composition of the Nomination Committee responsible for preparing the 2016 general meeting included Erik Selin (Balder), Andrea Attisani (APG), Hanna Hiidenpalo (Elo) and Reima Rytsölä (Varma). Chair of the Board of Directors, Esa Lager, also participated in the work of the committee.

Board of Directors

The general meeting elects between five and nine members of the Board of Directors and one member of the Board of Directors to serve as Chair of the Board. The Board of Directors elects one of its members to serve as Deputy Chair. The term in office of the members of the Board of Directors lasts until the closing of the annual general meeting following the one at which they were elected. The Board of Directors assesses the independence of its members and declares which of the members of the Board of Directors are considered independent of the Company, and which independent of the significant shareholders.


The Board members elected in the annual general meeting on 3 March 2016
Chair  
Erik Selin Managing Director, Fastighets Ab Balder
b. 1967, degree in business economics
- no shareholdings
- no shareholdings in controlled corporations
Members  
Andrea Attisani Snr Portfolio Manager, APG Asset Management B.V.
b. 1971, degree in business economics
- no shareholdings
- no shareholdings in controlled corporations
Marcus Hansson CFO, Fastighets AB Balder
b. 1974, degree in business economics
- no shareholdings
- no shareholdings in controlled corporations
Jukka Hienonen professional board member
s. 1961, M.Sc. (Econ.)
- no shareholdings
- no shareholdings in controlled corporations
Esa Lager professional board member
b. 1959, LL.M., M.Sc.(Econ.)
- no shareholdings
- no shareholdings in controlled corporations
Tarja Pääkkönen professional board member
b. 1962, D.Sc. (Corporate strategies), M.Sc. (Construction)
- no shareholdings
- no shareholdings in controlled corporations
Timo Stenius Director, Unlisted investments (real estate, infrastructure, private equity and
private debt), Elo Mutual Pension Insurance Company
b. 1956, M.Sc. (Constr. Eng.)
- no shareholdings
- no shareholdings in controlled corporations

Until the general meeting held on 3 March 2016, Chief Investment Officer Ilkka Tomperi, D.Econ. (b. 1975) was a member of the Company’s Board of Directors. On 11 July 2016, Andrea Attisani has announced his resignation from his position on the Board of Directors.

The Board of Directors elected Jukka Hienonen as its Deputy Chair.

All Board members are independent of the Company, and Jukka Hienonen, Esa Lager and Tarja Pääkkönen are also independent of the major shareholders.

The Company’s Board of Directors is responsible for the proper organisation of the Company’s governance and its operations. It is the duty of the Board of Directors to promote the interests of the Company and all its shareholders.

In 2016, the Board of Directors convened on 13 meetings. An average of 96.5 per cent of the members of the Board of Directors attended the Board meetings. Members of the Board of Directors participated in the meetings as follows: Erik Selin 12/13, Andrea Attisani 8/8, Marcus Hansson 10/10, Jukka Hienonen 11/13, Esa Lager 13/13, Tarja Pääkkönen 13/13, Timo Stenius 13/13 and Ilkka Tomperi 3/3.

SATO's Board of Directors has confirmed the rules of procedure applied to the duties, meeting procedures and decision-making practices of the Board of Directors. These rules of procedure are explained on the Company’s website. In addition to matters for decision, the Board of Directors receives up-to-date information on the Company's operations, economy and risks at its meetings.

In 2016, the Board of Directors convened on 13 meetings.

In addition to the duties specified by the Companies Act, the Board of Directors decides on matters which, taking into account the extent and size of the Group’s operations, have considerable importance for the Group’s business. The duties of the Board of Directors include the following:

1. confirmation of the Group's business strategy and monitoring its implementation

2. confirming and monitoring the annual budget and the business plan

3. dealing with the financial statements and report of the Company’s Board of Directors as well as the interim reports

4. confirming the Company’s dividend policy

5. supervision of risk management and internal control as well as supervising the effectiveness of the internal audit.

The Board of Directors also appoints the Company’s President and CEO and his/her deputy, and the members of the Corporate Management Group, and determines the terms of their employment and of their posts.

The Board of Directors performs an annual, internal self-assessment of its activities and its working methods. The purpose of the self-assessment is to verify how the Board’s activities have been performed during the year and to serve as a basis for assessing the Board’s method of operating.

Diversity of the Board of Directors

Purpose of the diversity of the Board of Directors

The diversity of the Board of Directors supports the Company’s business and its development Diversity strengthens the work of the Board of Directors by emphasising the views of people of different ages, different educational backgrounds and different experience concerning the Company’s development and the steering of its operations. Diversity increases open discussion and strengthens the decision-making of the Board members.

Taking diversity into account in the election of Board members

The shareholders’ Nomination Committee prepares a proposal for the annual general meeting concerning the number of Board members, the persons to be elected as members and Chair, and the remuneration to be paid to Board members. The Nomination Committee must take the requirement for diversity into account when preparing its proposal for the general meeting. In this preparation, the committee must evaluate the requirements set for the competence of Board members in any given situation in the Company, and must also evaluate what sufficient diversity in the Board of Directors is, taking into account, among other things, the experience of the Board members, their knowledge of SATO’s business, their education and their distribution of age and gender. A member of the Board of Directors must have sufficient education to support SATO’s operations and the achievement of its objectives, competence and the possibility to spend sufficient time on Board work, taking into account the Company’s present and planned needs. There must be a sufficient number of Board members. Board members must have different skills, which support the implementation of the Company’s current strategic targets.

The majority of the Board of Directors must be independent of the Company. At least two Board members who are independent of the Company must also be independent of significant shareholders in the Company.

Realising diversity in SATO

The requirement for diversity has been implemented in the composition of SATO’s Board of Directors. Each member of Sato’s Board either has a Finnish higher education degree or a degree in business economics taken somewhere other than Finland. Of the members, two have a degree in the field of technology, three in business or economics and one of the members is both a Master of Laws and a Master of Economics. The Chair of the Board is the main shareholder and CEO of a property investment company quoted on the Stockholm Stock Exchange and operating in many countries. Several of the Board members have experience of management functions in significant Finnish companies, and most of the members have experience of companies operating internationally. Both genders are represented on the Board of Directors and the span of ages ranges from 42 to 60. The term of office of the Board members has lasted two years on average.

Both genders are represented on the Board of Directors and the span of ages ranges from 42 to 60.

The committees of the Board of Directors

At the organisational meeting held annually after the annual general meeting, the Board of Directors appoints an Audit Committee and a Nomination and Remuneration Committee. The Audit Committee and the Nomination and Remuneration Committee comprise three to five members elected by the Board of Directors, one of whom serves as Chair.

The Board of Directors has confirmed the rules of procedure for the committees. The committees have no independent decision-making authority. Their mission is to prepare matters for decision by the Board of Directors and the annual general meeting and they report constantly on their actions to the Board of Directors. The rules of procedure can be seen on the Group’s website.

Until 3 March 2016, serving on the Audit Committee were Ilkka Tomperi as Chair and members Tarja Pääkkönen and Timo Stenius. Since 3 March 2016, Marcus Hansson has served as Chair with members being Esa Lager and Timo Stenius. All members have been independent of the Company. Ilkka Tomperi, Tarja Pääkkönen, Esa Lager and Timo Stenius are also independent of the significant shareholders.

Serving on the Nomination and Remuneration Committee in 2016 were Chair Erik Selin and members Andrea Attisani (until 11 July 2016), Jukka Hienonen and Tarja Pääkkönen. All the members are independent of the Company and Esa Lager and Jukka Hienonen are also independent of the major shareholders.

The Audit Committee convened three times and the Nomination and Remuneration Committee convened twice during the 2016 financial year. The members of both committees participated in all committee meetings.

President and CEO

The President and CEO is responsible for managing the Group’s business operations, their planning, and the attainment of its goals. He/she is responsible for preparing matters for the Board of Director’s attention and for executing the decisions of the Board. The President and CEO is responsible for the ongoing management of the Company in accordance with the rules and regulations supplied by the Board of Directors. The President and CEO serves as Chair of the Corporate Management Group.

The Board of Directors appoints and discharges the Company’s President and CEO and his/her deputy.

SATO’s President and CEO is Saku Sipola (b. 1968), M.Sc. (Tech.) and his deputy is Tuula Entelä (b. 1955), LL.M., B.Sc. (Econ.) (until the expiry of her employment 31 December 2016).

The Corporate Management Group

The Corporate Management Team assists the President and CEO in the planning and management of operations and decision-making. The Corporate Management Team deals with all key issues for the management of the Group, such as matters related to the strategy, budgeting, investments, business planning, and financial reporting. The Corporate Management Team’s duties include the implementation of the decisions of the Board of Directors under the leadership of the President and CEO. The Corporate Management Team has no authority under law or the articles of association; it serves as a body to assist the President and CEO.


The Corporate Management Group in 2016
Saku Sipola President and CEO, Chair of the Management Group
b. 1968, M.Sc. (Tech.)
- no shareholdings
- no shareholdings in controlled corporations
Antti Aarnio Vice President, Investments (since 17 February 2016)
b. 1972, M.Sc. (Tech.)
- no shareholdings
- no shareholdings in controlled corporations
Monica Aro Director, Marketing and Communications (until 28 November 2016)
Vice President, Development (since 28 November 2016)
b. 1954, B.Sc. (Econ.), LL.M., MBA
- shareholding 44 000 shares
- no shareholdings in controlled corporations
Antti Asteljoki Vice President, Rental Housing Business (since 16 May 2016)
b. 1974, M.Sc. (Econ.)
- no shareholdings
- no shareholdings in controlled corporations
Miia Eloranta Director, Marketing and Communications (since 28 November 2016)
b. 1973, M.Pol.Sc.
- no shareholdings
- no shareholdings in controlled corporations
Tuula Entelä Vice President, Business Development (until 28 November 2016) 
Member of the Corporate Management Group (until 31 December 2016)
Deputy to President and CEO
b. 1955, LL.M., B.Sc. (Econ.)
- shareholding 179,000 shares
- no shareholdings in controlled corporations
Markku Honkasalo CFO (since 1 December 2016)
b. 1964, LL.M., eMBA
- no shareholdings
- no shareholdings in controlled corporations

M.Sc. (Tech.) Pasi Suutari (b. 1969) has conducted as Vice President, Regional Operations, Construction and Renovations until 16 February 2016 and M.Sc. (Econ.) Esa Neuvonen (b. 1967) as CFO until 6 November 2016.

The Corporate Management Group convenes once a week. The Corporate Management Group convened 45 times in 2016.