organization regulations of ubs group
TRANSCRIPT
The Organization Regulations of UBS
Group AG and UBS AG
Corporate Governance system
Prepared by Ksenia Udovitskaya
Company overview UBS Group AG is a Swiss global financial services companyFounded: 1862sHeadquarters: Zurich and Basel
Area served: Worldwide, more then 50 countries No of employees: 60K Products: wealth management, asset management, investment banking services for private, corporate, and institutional clients worldwide. Financial services focused on the needs of specific target groups – rich people, young people, students,
career beginners, families.
Type of company: public (SIX, NYSE)Guided by: SIX Swiss Exchange’s, Swiss Code of Best Practice, New York Stock Exchange (NYSE) standards
Legal entity structureLegal entities: UBS Group AG (parent company, listed on stock exchange), UBS Group, UBS AG (fully-owned subsidiary), UBS Switzerland AG (fully-owned subsidiary of UBS AG)Changes in a mid of 2015: (after squeeze-out procedure) • UBS Group AG became the sole owner of all shares of UBS
AG.• Swiss-booked business of Wealth Management and Personal
& Corporate Banking were transferred to UBS Switzerland AG.
• Completed the implementation of a revised business and operating model for UBS Limited in the UK.
• Established subsidiaries: (1) UBS Business Solutions AG (to act as the Group service company), (2) UBS Americas Holding LLC (to intend to designate as intermediate holding company in the US), (3) UBS Asset Management AG (plan to transfer the majority of the operating subsidiaries of Asset Management during 2016).
CG elements of UBS Group AG
CG elements of UBS AG
UBS Group ownership structure
(1) 250,000 shareholders are directly registered, some 150,000 US shareholders via nominee companies. (2) Anyone holding UBS shares must notify UBS and the SIX Swiss Exchange if the holding reaches, falls below or exceeds 3, 5, 10, 20, 25, 331/3, 50 or 602/3 of voting rights according to share capital calculations.(3) Shareholder approval is mandatory if equity based compensation plans require an increase in capital. No shareholder approval is required if shares for such plans are purchased in the market. (4) Dividend of CHF 0.60 per share (20% increase
from the previous year’s)(5) No cross-shareholdings in excess of a reciprocal ownership of 5% of capital or voting rights with any other company. (6) AGM offers shareholders the opportunity to raise any questions to the Board of Directors (BoD) and Group Executive Board (GEB), as well as to our internal and external auditors.
Management structure
GEB roles: • Developing the Group and business division strategies • Strategy implementation • Management of the business, contracts• Implementation risk framework. CEO is responsible for risk authority over
transactions, positions and exposures, allocate portfolio limits approved by the BoD
Changes in Operational Group structure
Personal & Corporate Banking (formerly Retail & Corporate)Asset Management (formerly Global Asset Management)Corporate Center (Services, Group Asset and Liability Management, Non-core and Legacy Portfolio)
Group Executive Board
BoD structure: chairman and committees
BoD roles: • decide on the strategy of the Group upon recommendation of the CEO • direction, supervision and control of the Group and its management • supervising compliance with applicable laws, rules and regulations• determining risk principles, risk appetite and major portfolio limits of the
Group• deliver sustainable shareholder value within a framework of prudent and
effective controls• approve financial statements • appoint and remove all Group Executive Board (GEB) members
Some facts about BoD • 6-12 members • Individual nominated to be Chairman • Expected time of serve min 3 years• BoD appoint 1+ Vice Chairmen, Senior
Independent Director, BoD committee members, Group Company Secretary
• Compensation Committee members elected by the shareholders
• 24 BoD meetings and calls were held, 13 of which were attended by GEB members (2015). 97% of members were present at all meetings
• CEO partly attended most meetings of the BoD without GEB participation
• Meetings duration - 2 hours. • At meeting, each committee chairperson
provides the BoD with an update on current activities of his or her committee ad important committee issues.
Audit Committee: 5 fully independent BoD members that monitors the work of the external auditors, (EY), check financial documents and
report to the BoD about its discussions with auditors Compensation Committee: 4 independent BoD members that set guidelines on compensation and benefits, approve compensation for the Chairman and non-independent BoD members, establish financial targets for CEO Group, evaluate the performance of the GEBCorporate Culture and Responsibility: supports the BoD in fulfilling its duty to safeguard and advance the Group’s reputation for responsible and sustainable conductRisk Committee: overseeing and supporting BoD in fulfilling its duty to supervise and set appropriate risk management and control principles
Risk management structure
Internal control: types of risks
Ethical standards Code of Business Conduct and Ethics: the principles and practices that employees and BoD members are required to follow.
- Total rewards principles based on individual’s efforts and ethical behavior
It sets out in UBS and Society policy, which governs UBS’s interaction with society and the environment, and supersede environmental and human rights policy
The business divisions are responsible for developing and executing the UBS and Society program and annual objectives related to client relationship, product development, investment management, distribution and risk management. Corporate Center is responsible for annual objectives related to in-house environmental and responsible supply chain management.
Reporting & Disclosure
Scope of external reports are defined by general accounting law and principles, relevant stock and debt listing rules, specific legal and regulatory requirements, own financial reporting policies.External reporting documents: • Annual Reports • Quaterly reports• Form 20-F• International Financial Reporting Standards (half a year)• Annual General Meeting (annually)Management’s discussion and analysis complements annual financial statements by providing information on (i) strategy and the environment in which company operates, (ii) the financial and operating performance of our business divisions and Corporate Center, (iii) risk, treasury and capital management and (iv) corporate governance, corporate responsibility and compensation frameworks.
