Corporate Governance Policies

The Icelandic Securities Depository places emphasis on good and responsible corporate governance based on transparency, trust and a clear division of responsibilities. Sound corporate governance is a cornerstone of the company’s operations, helping ensure a healthy working environment and trust in VBM.

The Companies Act and the Act on Central Securities Depositories, Settlement and Electronic Registration of Financial Instruments are available on www.althingi.is.

The overall rules governing VBM’s Board are set out in the company’s Articles of Association, which are published on its website.       Detailed information on VBM’s corporate governance is submitted to the Financial Supervisory Authority. Owners, clients and prospective clients may also request access to more detailed information.

Verðbréfamiðstöð Íslands hf. (VBM) is licensed under Act No. 7/2020 on Central Securities Depositories, Settlement and Electronic Registration of Financial Instruments, which applies throughout the European Economic Area and therefore significantly expands VBM’s area of operation. This is a major milestone for the company. VBM will take advantage of these market conditions by establishing links with central securities depositories in Europe. Once these links are in place, they will increase access to the Icelandic market and make it easier for Icelanders to trade in securities issued in the European Economic Area. VBM is a public limited company. Under the Companies Act, its governance structure consists of the shareholders’ meeting, the board of directors and the managing director. There is a defined division of authority and balance between these bodies. Shareholders’ liability is limited to the capital they contribute to the company, and they are therefore not personally liable for the company’s obligations beyond that amount. Under Article 80 of the Companies Act, the shareholders’ meeting is the company’s highest authority. Article 63(2) of the same Act provides that the shareholders’ meeting elects the board, while Article 65(1) provides that the board appoints the managing director. Article 68(1) states that the board and managing director are responsible for managing the company. At the company’s shareholders’ meeting, shareholders exercise the highest authority in the company’s affairs, cf. Article 80(1) of the Companies Act. Shareholders participate in the company’s decision-making in accordance with Act No. 2/1995 on Public Limited Companies. Under Article 4.1 of VBM’s Articles of Association, the annual general meeting elects three directors and two alternate directors each year. Under Article 4.10, the newly elected board elects a chair at its first meeting and otherwise determines the division of responsibilities. Article 4.15 provides that the board has supreme authority over the company’s affairs between shareholders’ meetings and represents the company’s interests in dealings with third parties. It must ensure that the company’s structure and operations are always sound and appropriate. The role and duties of the managing director are also addressed in the Companies Act. The managing director is responsible for the company’s day-to-day operations and must follow the policies and instructions set by the board, cf. Article 68(2). The third sentence of Article 70(2) provides that the managing director attends board meetings and has the right to speak and make proposals, unless the board decides otherwise in a particular case. Article 70(5) further provides that the board must adopt rules of procedure setting out in greater detail how it conducts its work. Article 4.17 of the company’s Articles of Association provides that the board must adopt rules of procedure setting out in greater detail how it conducts its work. The VBM Board’s rules of procedure are reviewed annually. They address the relationship between the board and managing director, among other matters, and set out how the board conducts its work, its main responsibilities, the division of responsibilities within the board, and the interactions between the board, the chair and the managing director. Performance assessments are intended to improve working practices, increase the board’s efficiency and identify areas for improvement. Compliance with the policies, plans and procedures established by the board is ensured through regular reports from the managing director to the board, the board’s review of operations, risk management processes, internal control reporting and other established monitoring measures. VBM will hold regular meetings with the Central Bank of Iceland’s Financial Supervisory Authority (FME). VBM is owned by Innviða fjárfestinga slhf, Arion banki, Íslandsbanki, Lífeyrissjóður verslunarmanna, Lífeyrissjóður verkfræðinga, Gildi lífeyrissjóður, Birta lífeyrissjóður, Almenni lífeyrissjóðurinn, Festa lífeyrissjóður, Tplús vörslu og uppgjörsþjónusta and private investors.