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TomTom Annual Report and Accounts 2011
20
Corporate Governance
As a listed company, TomTom is subject to the Dutch Corporate
Governance Code, which came into force on 1 January 2009
(the Code). Our Management Board and Supervisory Board have
strived to comply with the guidelines laid down in the Code and
will continue their efforts to do so. Any substantial change in
TomTom’s corporate governance structure shall be explained to
the shareholders at an Annual General Meeting of Shareholders.
The Corporate Governance Code
—
We apply all of the relevant provisions of the Code with two
deviations which we explain below.
– Options granted to members of the Management Board under
the 2005 Share Option Plan prior to 31 December 2005 vest
unconditionally and can be exercised after a three-year period
following the grant date. No predetermined performance
criteria were established for these share options, as the
industry of portable navigation was at a relatively nascent
stage and we believed that setting credible (pre-determined)
performance criteria was not practical at that time. This is not
in line with best practice provision II.2.4, which provides that
the number of options granted shall be dependent on the
achievement of challenging targets specifi ed beforehand.
Options granted to Management Board members in 2009 and
2010 under the TomTom Management Board Stock Option
Plan 2009 vest as follows: one third of the options granted
vest after one year, another one third vest after two years and
the fi nal one third vest after three years following the grant
date. This vesting timeline is not in line with best practice
provision II.2.4. At the time the plan was introduced, we were
operating in a rapidly changing environment that was highly
competitive. The plan was designed to attract and retain key
talent to the company in order to safeguard its human capital
and aligning TomTom’s long-term incentives with common
practices within international companies operating in the
technology sector. To ensure that the plan fulfi lled this aim,
the company opted for this vesting timeline in 2009 and
2010. To emphasise the long-term retention element of the
plan and move this in line with the Code, the vesting timeline
of the plan was amended at the Annual General Meeting
of Shareholders in 2011. As a result, all options granted in
TomTom takes its commitments to all stakeholders seriously – consumers, shareholders,
employees and business partners. In all of its corporate transactions its aim is maximum
transparency and accountability and, consequently, TomTom is committed to and closely
monitors its corporate governance structure.