The company has a two-tier management structure consisting of the Board of Directors and Executive Management.
The Board of Directors supervises the performance of the company, its management and organisation on behalf of the shareholders. It also participates in determining the company strategy.
Executive Management, in turn, has responsibility for the company's daily operations.
The two bodies are separate, and no person serves as a member of
On behalf of the shareholders, the Board determines the company’s overall strategy and actively contributes to developing the company as a focused, sustainable, global pharmaceutical company. The Board supervises Executive Management in its decisions and operations. The Board may also issue new shares or buy back shares in accordance with authorisations granted by the general meeting and recorded in the meeting minutes.
The guiding principle in composing the Board is that it should comprise individuals whose particular knowledge and experience enables the Board as a whole to attend to the interests of shareholders, employees and other stakeholders.
The Board has 12 members, eight of whom are elected by shareholders at general meetings, and four are Novo Nordisk employees from Denmark, elected by Danish employees.
Shareholder-elected board members are elected by the shareholders at the general meetings. Such board members are nominated by either the Board or a shareholder.
Shareholder-elected board members serve a one-year term and can be re-elected at the general meeting. Board members must retire at the first general meeting after reaching the age of 70.
At the Annual General Meeting in March 2018 six shareholder-elected board members were re-elected. One shareholder-elected board member did not to seek re-election. Thus, two board members were elected by the shareholders for the first time.
The Board has determined which competencies should be present at the Board. The competence profile is reviewed annually by the Board.
A proposal for nomination of shareholder-elected board members is presented by the Nomination Committee to the Board taking into account required competences as defined by the Board’s competence profile and reflecting the result of the self-assessment process and the need for integration of new talent and diversity. In nominating candidates, the Nomination Committee seeks to achieve a balance between renewal and continuity, and it is Novo Nordisk’s aspiration that a person is not nominated for election or re-election if such board member has been a Novo Nordisk board member for 12 years at the time of the general meeting.
To ensure that discussions include multiple perspectives
representing the complex, global pharmaceutical environment, the Board
aspires to be diverse in gender and nationality. On this background,
it is the aim that by 2020 the Board consists of at least two
shareholder elected Board members with Nordic nationality and at least
two shareholder elected Board members with another nationality than
Nordic - and at least three shareholder elected Board members of each
Executive search has helped identify board members who meet the above criteria.
Descriptions of the candidates' qualifications accompany the agenda of the general meeting.
In March 2018, the Board determined that six of the eight
shareholder-elected board members are independent as defined by the
Danish Corporate Governance Recommendations, while two
shareholder-elected board members are related to the majority
shareholder Novo Holdings A/S through either a board position or
membership of executive management and thus are not deemed
profile of board members.
According to the Danish Companies Act the employees of Novo Nordisk are entitled to be represented by half of the total number of board members elected by the shareholders. At the time of election in 2018 there were seven board members elected by the shareholders, and consequently, the employees elected 4 board members. Board members elected by the employees serve for a four year term and have the same rights, duties and responsibilities as shareholder-elected board members. Employee elected board members may be re-elected. All employees in Novo Nordisk A/S in Denmark, who are employed on the day the election date is made public as well as on the day of election, can vote on the candidates. To be eligible for election the employee has to have been employed by the company for at least one year and be at least 18 years of age. The election is carried out by an election committee that is responsible for ensuring that the election is done correctly. The election committee amongst other things handle the distribution of voting form and counting of votes. In 2018, the election was conducted by electronic voting. Candidates are elected by simple majority. If there are no more candidates than seats, the candidates are elected automatically. When the election has been completed the election committee publishes the result and ensures that the employee elected board members are registered as board members of the company with the Danish Business Authority. The employee elected board members take office on the day of the Annual General Meeting.
New board members undergo an induction programme equivalent to two full days during their first year on the Board and subsequently participate in educational activities as required to update and refresh their competences and knowledge, including issues related to environmental and social risks and opportunities.
The Board ordinarily meets seven times a year, including a strategic session over two to three days. In 2017, the Board conducted seven Board meetings. All members attended all meetings within the member’s term. Please refer to the Annual Report 2017 on pp 54-55 for a detailed attendance overview, including attendance at committee meetings. By means of a fixed annual calendar, the Board ensures that it addresses its main tasks in a timely manner.
With the exception of agenda items reserved for the Board's internal discussion at each meeting, executives attend and may speak, without voting rights, at board meetings to ensure that the Board is adequately informed of the company’s operations. Executives' regular feedback from meetings with investors allows board members an insight into major shareholders' views of Novo Nordisk.
Novo Nordisk has issued rules on board members' and executives'
trading in Novo Nordisk shares. Consequently, trading is only
permitted within a 15-calendar day open window period after each
quarterly financial release. Novo Nordisk shall be notified
immediately after such trading and Novo Nordisk will publish such
trading via the stock exchanges. The rules apply also to persons
associated with a board member or an executive (i.e. family) as well
as their companies.