Corporate governance is about promoting corporate fairness, transparency and accountability. EDPR’s corporate governance structure specifies the shareholders, board of directors, managers and other stakeholders’ rights and responsibilities and spells out the rules and procedures for making decisions on corporate affairs. It also incorporates the organization’s strategic response to risk management.

EDPR’s corporate governance model is designed to ensure transparency and accountability through a clear separation of duties between management and supervision of the company’s activities.

The corporate governance structure adopted is the one in effect in Spain. It comprises a General Meeting of Shareholders and a Board of Directors that represents and manages the company. As required by the law and established in the company’s articles of association, the Board of Directors has set up four specialized committees. These are the Executive Committee, the Audit and Control Committee, the Nominations and Remunerations Committee and the Committee on Related-Party Transactions.

This governance structure and composition was chosen to adapt the company’s corporate governance model also to the Portuguese legislation and it seeks, insofar it is compatible with the Spanish law, to correspond to the so- called “Anglo-Saxon” model set forth in the Portuguese Commercial Companies Code, in which the management body is a Board of Directors, and the supervision and control duties are of the responsibility of a separate body, a Supervisory Board.

EDPR’s model attempts then to establish compatibility between two different systems of company law, through a Nominations and Remunerations Committee and Audit and Control Committee of independent members, although not exclusively separate from the Board of Directors (“BoD”).

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GENERAL SHAREHOLDERS’ MEETING

General Shareholders’ Meeting is the body where the shareholders participate, it has the power to deliberate and adopt decisions, by majority, on matters reserved by the law or the articles of association.

 

BOARD OF DIRECTORS

 

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BOARD OF DIRECTORS

EDPR’s BoD shall consist of no less than 5 and no more than 17 Directors, including a Chairperson. Currently it is composed by 16 board members, out of which 9 are independent. BoD members are elected for 3 years period and may be re-elected for equal periods.

EDPR’s BoD has the broadest power for the administration, management and governance of the company, with no limitations other than the responsibilities expressly and exclusively invested in the General Shareholders Meeting, in the company’s articles of association or in the applicable law. Its members must meet at least 4 times a year, preferably once a quarter. Nonetheless, the Chairperson, on his own initiative or that of 3 Directors, shall convene a meeting whenever he deems fit for the company’s interests.

EXECUTIVE COMMITTEE

EDPR’s Executive Committee (EC) is composed by five members, including a Chief Executive Officer (CEO). The CEO coordinates the implementation of the BOD decisions and the Corporate and General Management functions, partially assigning those to the other executive officers, namely: the Chief Financial Officer (CFO), the Chief Operating Officer for Europe and Brazil (COO EU & BR) and the Chief Operating Officer for North America (COO NA).

The CFO proposes and ensures the implementation of the financial policy and management, including financial negotiation, management and control, cash management optimization and financial risk management policy proposal; he also coordinates and prepares the business plan and the budget, manages the financial statements reporting analyses the operational and financial performance and coordinates procurement function and relations with key suppliers while ensuring the implementation of the procurement strategy and policy.

The COO EU & BR and the COO NA coordinate their platforms by developing, establishing and implementing the strategic plan for the renewable energy business in their respective platforms, in accordance with the guidelines set by the BOD; they are also responsible for planning, organizing and managing resources, controlling, measuring and improving the management of projects and subsidiary companies to achieve expected results to make EDPR a leader in the renewable energy sector in their respective platforms.

NOMINATIONS AND REMUNERATIONS, RELATED-PARTY TRANSACTIONS AND AUDIT AND CONTROL COMMITTEES

In addition to EC referred above, EDPR governance model contemplates permanent bodies with an informative, advisory and supervisory tasks independently from the BoD, such as:

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REMUNERATION POLICY

EDPR governance model is reinforced by an incentive structure with transparent remuneration through variable remuneration based on key performance indicators.

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For further detailed information regarding the responsibilities and roles of the different social bodies, as well as 2015 activity, please refer to the Corporate Governance section, at the end of this report. The company also posts its up-to-date articles of association and regulations at www.edprenovaveis.com.