Ahold Annual Report 2003 11
Corporate Governance
As we are an international retailer, the rules of the
Supervisory Board provide that the composition of
the Supervisory Board should reflect knowledge of
European and American market conditions, financial
institutions and corporate governance. In addition, the
rules of the Supervisory Board state that at least one
member of the Audit Committee of the Supervisory
Board must be an "Audit Committee financial expert"
as defined under the Sarbanes-Oxley Act.
The rules of the Supervisory Board also provide
that the duties and/or the number and nature of other
supervisory board memberships held by any member of
our Supervisory Board should not interfere with a proper
exercise of the duties as a member of our Supervisory
Board. A member of the Supervisory Board must
promptly notify us of any changes in his or her duties
and other Supervisory Board memberships.
Independence of Supervisory Board members
The rules of the Supervisory Board provide that no more
than one member may not be "independent" as defined
by the rules. However, for a limited time until the June
2004 General Meeting, the rules permit up to two
members not to be independent. Under the rules, a
member of the Supervisory Board will not be considered
independent if he or she, or if one of his or her
"immediate family members":
is, or during the five years prior to his/her
appointment, was an employee or member
of our Corporate Executive Board or certain
of its subsidiaries;
receives personal financial compensation from us
or our subsidiaries other than the compensation
received for service on the Supervisory Board;
has had an important business relationship with
us or our subsidiaries at any time prior to his
or her appointment, including as an employee,
shareholder, partner, associate or advisor of a
company that has acted as advisor to us, such
as a consultant, external auditor, civil notary or
lawyer or as an executive board member or an
employee of any bank with which the Company
has a lasting and significant relationship;
is a member of the executive board of a company
of which a member of Ahold's Corporate Executive
Board is a supervisory board member;
is a beneficial holder of more than 10% of our
shares;
is a member of the executive or supervisory
board, or is a representative in some other
capacity, of a legal entity that beneficially holds
more than 10% of our shares, unless such entity
is a member of the Ahold group of companies; or
has temporarily served as a member of the
Corporate Executive Board during the preceding
12 months in replacement of a member of the
Corporate Executive Board.
An immediate family member under the rules of
the Supervisory Board means a Supervisory Board
member's spouse, registered partner or other life
companion, as well as such member's relative by blood
or marriage up to the second degree or foster child.
The Supervisory Board must affirmatively determine
whether a member is independent and must also
disclose which member, if any, is not independent. Such
disclosure will be done on our website, if applicable.
Responsibilities of Supervisory Board members
The rules provide that the Supervisory Board shall
be responsible for the following:
supervising and monitoring our performance;
supervising and monitoring our strategy and risks
inherent to our business activities;
supervising and monitoring the structure and
management of the internal risk management
and control systems; and
selecting and recommending the members
of the Corporate Executive Board.
3. Supervisory Board Committees
We have established the following Supervisory Board
committees:
Audit Committee
The Audit Committee is comprised of a minimum of
three Supervisory Board members and must meet at
least four times a year. The Audit Committee currently
is chaired by Jan Hommen and its other members
are Karel Vuursteen and Lodewijk de Vink. Among
other things, the Audit Committee is responsible for
pre-approving all audit and permitted non-audit services
and reviewing our overall risk management and control
environment, financial reporting arrangements and
standards of business conduct. Our Supervisory
Board has determined that Jan Hommen is the Audit
Committee financial expert.
Selection and Appointment Committee
The Selection and Appointment Committee is comprised
of a minimum of three Supervisory Board members
and must meet at least once a year. The Selection and
Appointment Committee is chaired by Karel Vuursteen
and its other members are Sir Michael Perry and
Cynthia Schneider. It recommends to the Supervisory
Board candidates for service on the Corporate Executive
Board and the Supervisory Board.
Remuneration Committee
The Remuneration Committee is comprised of three
Supervisory Board members and must meet at least
twice a year. The Remuneration Committee currently
is chaired by Sir Michael Perry and its other members
are Karel Vuursteen and Roland Fahlin. Following
Sir Michael Perry's and Roland Fahlin's retirement,
a new chairman shall be appointed and two new
members shall be appointed. Our Remuneration
