Supervisory Board

The Supervisory Board Chairperson convenes Supervisory Board meetings and presides over them, and if the Chairperson is unable to convene a meeting, his/her Deputy Chairperson or a person named by the Chairperson does so. The first meeting of a newly elected Supervisory Board shall be convened and opened by the President of the Management Board. The Supervisory Board holds meetings at least once every two months. The Supervisory Board Chairman is obligated to convene a Supervisory Board meeting at the written request of a Supervisory Board member or at the written request of the Company’s Management Board. The meeting should be held within two weeks after submission of the request. The Supervisory Board adopts resolutions by an absolute majority of votes present at the meeting, in the presence of at least half of the Supervisory Board, provided that all Supervisory Board Members have been invited to attend the meeting. An absolute majority of votes means more than one half of the votes cast. In the event of a tie vote the Supervisory Board Chairperson’s vote prevails. Supervisory Board members may participate in adopting Supervisory Board resolutions by casting their vote in writing through another Supervisory Board member. Voting in writing cannot apply to matters introduced to the agenda in the course of the Supervisory Board meeting. Supervisory Board members may adopt resolutions by following a written procedure or via remote means of direct communication. A resolution is valid if all Supervisory Board Members have been notified of the content of the draft resolution and no Supervisory Board Member has requested that the resolution be adopted at the next meeting of the Supervisory Board. Supervisory Board members may also participate in the meeting via tele-conference or video-conference on the rules prescribed in the Supervisory Board Regulations.

Supervisory Board resolutions are adopted in an open ballot. Secret ballots are ordered in personnel matters or at the request of at least one of the persons eligible to vote. Resolutions adopted by the Supervisory Board are minuted.

Pursuant to § 26 of the Company’s Articles of Association, a General Meeting resolution is required to determine the Supervisory Board’s remuneration.

Since the date on which JSW’s shares were introduced to regulated-market trade, whenever the State Treasury, including State Treasury subsidiaries, holds JSW’s shares carrying voting rights of at least 34% of the total number of votes in the Company plus one vote, the State Treasury is entitled to appoint and dismiss Supervisory Board Members of a number equal to half the total number of Supervisory Board members set by the General Meeting (in the event this number is fractional, it shall be rounded down to a whole number) plus one, with the reservation that the State Treasury is excluded from General Meeting vote on appointing or dismissing the remaining Supervisory Board Members; however, the State Treasury retains voting rights in the event of electing Supervisory Board Members by voting in separate groups and in the event of the votes referred to in art. 385 § 6 of the Commercial Companies Code as well as in the event of votes on appointing or dismissing Supervisory Board Members elected by employees and in the event the Supervisory Board is unable to act because the number of its members is smaller than that required by the Articles of Association and the shareholders present at the General Meeting, other than the State Treasury, fail to supplement the composition of the Supervisory Board in the part which is subject to election by the General Meeting.  Supervisory Board members are appointed and dismissed by the State Treasury by way of a statement delivered to the Company.

The General Meeting appoints and dismisses Supervisory Board members, with the exception of the situations described in the Articles of Association. A Supervisory Board member resigns by submitting a resignation letter to the Management Board at the Company’s address. Requirements for candidates for the Company’s Supervisory Board Members are described in the Act on Rules for Managing State Property.

At least one Member of a Supervisory Board consisting of up to twelve Members or at least two Members of a Supervisory Board consisting of thirteen or more Members should satisfy the independence requirements for a Supervisory Board Member within the meaning of Commission Recommendation of 15 February 2005 on the role of non-executive or supervisory directors of listed companies and on the committees of the (supervisory) board (2005/162/EC), in consideration of additional requirements arising out of the Code of Good Practices for WSE-Listed Companies.

According to the Articles of Association, JSW employees have the right to elect to the Supervisory Board: two members in a Supervisory Board composed of up to 6 members, three members in a Supervisory Board composed of between 7 and 10 members and four members in a Supervisory Board composed of 11 or more members.

At the written request of at least 15% of all JSW employees, a vote is held on dismissal of a Supervisory Board member elected by the employees. Such dismissal, death or any other important reason that decreases the number of Supervisory Board members elected by employees requires supplementary elections.

A candidate for independent Supervisory Board member submits to the Company, before his or her appointment to the Supervisory Board, a written representation on satisfying the prerequisites for independence. If a situation arises causing failure to satisfy the prerequisites for independence, the relevant Supervisory Board member promptly informs the Company of this fact. Information on the current number of independent Supervisory Board members is made public by the Company.

In a situation when no Supervisory Board member meets the independence requirement, the Company’s Management Board is obligated to convene a General Meeting immediately and place an item on the agenda concerning changes in composition of the Supervisory Board. Until changes to the Supervisory Board composition are made with the aim to adjust the number of independent members of the Supervisory Board to the requirements prescribed in the Articles of Association, the Supervisory Board acts in the previous composition.

No Supervisory Board member may perform any activities contradicting his or her duties or potentially leading to a suspicion of partiality or pursuit of self-interest.

The powers of the Supervisory Board include in particular:

1. approving the Management Board Regulations and issuing an opinion on the Organisational Regulations defining the organisation of the Company’s enterprise,
2. appointing and dismissing members of the Company’s Management Board, subject to §11 sec. 5 of the Articles of Association,
3. suspending a Management Board member or the entire Management Board from performing its duties for important reasons by secret ballot,
4. delegating any Supervisory Board member or members to temporarily perform the duties of those Management Board members who are unable to perform their functions,
5. signing, terminating and amending agreements with Management Board Members, establishing rules for hiring and remuneration and setting their remuneration, without prejudice to the powers of the Company’s General Meeting arising from the mandatory provisions of law,
6. selecting an entity authorised to audit financial statements to audit the Company’s financial statements,
7. evaluating financial statements for compliance with accounting books, documents and facts,
8. evaluating the report on the Company’s operations and the Management Board’s motions on distribution of profit or coverage of loss,
9. submitting written reports on results of the activities referred to in items 7 and 8 above to the General Meeting,
10. submitting to the General Meeting an annual concise evaluation of the Company’s situation, taking into account an evaluation of internal audit system and risk management system, as well as an annual report on Supervisory Board’s work,
11. issuing opinions on matters submitted to the General Meeting,
12. approving the Company’s operational strategy,
13. providing opinions on the Company’s annual plans,
14. approving regulations governing internal control system operations,
15. issuing opinions on reports prepared by the Management Board on representation expenditures, expenditures on legal services, marketing services, public relations and social communication services and management consulting services,
16. providing opinions on rules for disposal of non-current assets set forth in § 29¹ of the Articles of Association,
17. approving the Group’s remuneration policy,
18. issuing opinions on rules for sponsorship activity conducted by the Company and evaluating efficiency of such sponsorship activity.

In addition, the Supervisory Board’s powers include giving consent to the Management Board for:

1. setting up another company, subscribing for, purchasing or selling shares in other companies, without prejudice to §26 sec. 3 items 3 and 4 of the Articles of Association, with the stipulation that the Supervisory Board’s consent referred to in this item 1 is not required for the following:
   • subscription for or acquisition of shares in another company in an amount lower than 1/10 of such company’s share capital,
   • sale of shares in another company in which the Company holds less than 1/10 of share capital,
   • subscription for or acquisition of shares in another company in return for the Company’s accounts receivable as part of proceedings ended with a composition or settlement with creditors,
   • selling shares acquired or subscribed for by the Company in return for the Company’s accounts receivable as part of proceedings ended with a composition or settlement with creditors,
   • subscription for, acquisition or sale of shares in another company whose shares are listed on a regulated market, unless the value of such shares exceeds PLN 20 million,
2. establishment of foreign branches,
3. purchase and sale of tangible assets exceeding PLN 20 million, subject to § 26 sec. 3 items 1 and 2 of the Articles of Association,
4. contracting contingent liabilities, including the Company’s granting financial guarantees and sureties in excess of PLN 20 million,
5. disbursement of interim dividends,
6. issuance of promissory notes exceeding PLN 20 million,
7. purchase or sale of real property or right of perpetual usufruct or share in real property or in right of perpetual usufruct the value of which exceeds PLN 20 million,
8. voting instructions for the general meetings of companies in which the Company holds at least 50% of all shares, in the following matters:
   • the company setting up another company,
   • amending the company’s articles of association and the company’s line of business,
   • merger, transformation, de-merger, dissolution or liquidation of the company,
   • increase or decrease of the company’s share capital,
   • sale or lease of the company’s business or an organised part thereof or establishment of a limited right in rem thereon,
   • purchase and sale of real property or right of perpetual usufruct or interest in real property or in right of perpetual usufruct, their encumbrance, lease and release for use against payment or free of charge, if their value exceeds 1/10 of that company’s share capital,
   • purchase, sale, encumbrance, lease and release for use against payment or free of charge of non-current assets other than those listed in the previous sub-item, if their value exceeds 1/10 of that company’s share capital, excluding companies with share capital lower than PLN 5 million,
   • the company entering into a credit facility, loan agreement, guarantee agreement or similar agreement, if its value exceeds 1/10 of the company’s share capital but no less than PLN 5 million,
   • issue of any type of bonds,
   • purchase of treasury shares in the situation set forth in art. 362 § 1 item 2 of the Commercial Companies Code and purchase of shares in the situation defined in art. 200 § 1 of the Commercial Companies Code,
   • compulsory redemption of shares pursuant to art. 418 of the Commercial Companies Code,
   • retirement of shares,
   • decisions on claims to remedy damages incurred when setting up a company or in its management or oversight,
   • contribution of non-current assets by the company as contribution in a company or a cooperative if their value exceeds 1/10 of that company’s share capital,
   • setting remuneration for Members of Management Boards and Supervisory Boards,
   • in the matters referred to in art. 17 sec. 1 of the Act on Rules for Managing State Property of 16 December 2016 (Journal of Laws of 2016, item 2259), subject to § 30 sec. 6 of the Articles of Association,
9. conclusion of agreements on legal services, marketing services, public relations and social communication services and management consulting services, if the total fee for such services exceeds PLN 500 000 net per annum,
10. amendment to an agreement on legal services, marketing services, public relations and social communication services and management consulting services increasing the fee above the amount referred to in item 9 above,
11. conclusion of agreements on legal services, marketing services, public relations and social communication services and management consulting services in which the maximum fee is not defined,
12. conclusion of a donation agreement or other agreement with similar effect, with value exceeding PLN 20 000 or 0.1% of total assets within the meaning of the Accounting Act of 29 September 1994, determined on the basis of the most recent approved financial statements,
13. release from debt or other agreement with similar effect, with value exceeding PLN 50 000 or 0.1% of total assets within the meaning of the Accounting Act of 29 September 1994, determined on the basis of the most recent approved financial statements,

At the request of the Management Board, the Supervisory Board permits Management Board Members to hold positions in the corporate authorities of companies in which JSW has an ownership interest and to receive remuneration for such work.

The following JSW Supervisory Board Audit Committee member holds expertise and skills in accounting or audit of financial statements:

• Halina Buk – economics professor at the University of Economics in Katowice. Specialist, researcher and practitioner in the fields of corporate accounting and finance. She has authored or co-authored numerous published monographs, scientific articles and academic handbooks, more than 70 scientific, research and commissioned papers on economics, and corporate organisation, restructuring programs and financial planning. Academic lecturer in graduate, post-graduate and doctoral studies, on subjects such as financial accounting, management accounting, financial analysis, financial reporting, consolidated reporting, controlling.

The JSW Supervisory Board Audit Committee members who hold expertise and skills in the mining industry are:

• Paweł Bieszczad – graduate of the AGH University of Science and Technology. In 2004, he gained the title of mining engineer majoring in Automation and Robotics. Since 2005 he has been associated with JSW, gaining professional experience initially as intern in the Power Engineering Department, in the ICT unit at KWK “Pniówek.” Currently employed as senior foreman for ICT equipment. He has completed numerous specialist courses in the area of mining.
• Robert Kudelski – graduate of a secondary mining school in Jastrzębie-Zdrój with the title of underground mining machinery and equipment technician. He has been associated with JSW since 1993. He is currently head of the Investments and Mine Development Division at KWK Borynia-Zofiówka-Jastrzębie. Completed a number of development courses and seminars in the area of: quality management systems, application of public procurement law and controller education program.

All members of the Audit Committee meet the independence requirements for Audit Committee members specified in the Act of 11 May 2017 on statutory auditors, audit firms and public oversight.

The main tasks of the Audit Committee include in particular the following:

• monitoring of:
  • financial reporting process,
  • effectiveness of internal control systems, risk management systems and internal audit, including in the area of financial reporting,
  • performance of financial audit activities, in particular audits conducted by an audit firm, taking into account all conclusions and findings of the Audit Supervision Commission resulting from inspections performed at the audit firm,

• inspecting and monitoring the independence of statutory auditor and audit firm, especially in cases where the audit firm provides non-audit services to JSW,
• provision of information to JSW’s Supervisory Board or other supervisory or control body on the outcome of audit and explanation of how the audit contributed to the integrity of the Company’s financial reporting and what the role of the audit committee was in that process,
• assessment of the independence of the statutory auditor and consent to the auditor’s provision of permitted non-audit services (at JSW’s justified request),
• preparation of a policy governing the selection of an audit firm to perform audit,
• preparation of a policy governing the provision of permitted non-audit services by the audit firm performing audit, by its related parties and by a member of the audit firm’s network,
• development of procedure for selecting an audit firm by JSW,
• presentation to the Supervisory Board or another supervisory or control body or the body referred to in art. 66 sec. 4 of the Accounting Act of 29 September 1994 of recommendations on the appointment of statutory auditors or audit firms, in accordance with the said policies,
• submission of recommendations intended to ensure the reliability of JSW’s financial reporting process.

The Committee submits its findings, positions and recommendations prepared in the course of its work with due notice to enable the Supervisory Board to immediately take relevant action. The Committee submits annual written reports on its activity to the Supervisory Board.

In 2018, the Audit Committee at JSW’s Supervisory Board held seven meetings, which were dedicated to discussing performance of the Committee’s tasks. The Committee’s work also included resolutions on the use of direct means for long-distance communication.

During the analysed reporting period, the audit firm auditing JSW’s financial statements did not provide non-audit services.

A detailed description of the Audit Committee’s activities in the past financial year is presented in a Supervisory Board report on activities, which is submitted to the General Meeting each year and published on this website.

The Nomination and Remuneration Committee has in particular the following tasks:

• recruiting and hiring Management Board members by drafting and preparing draft versions of documents and processes to be submitted to the Supervisory Board for approval,
• preparing draft versions of contracts and other model documents in connection with employing Management Board members and overseeing the performance of contractual obligations taken by the parties,
• overseeing implementation of the Management Board’s remuneration system, in particular preparing settlement documents concerning variable and bonus elements of remuneration for the purpose of submitting recommendations to the Supervisory Board,
• monitoring and periodically analysing the remuneration system for JSW’s management and, if necessary, formulating recommendations for the Supervisory Board,
• overseeing provision of additional benefits for the Management Board stemming from their employment contracts such as: insurance, cars, apartments and others.

The Committee submits to the Supervisory Board its findings, positions and recommendations prepared in the course of its work with due notice to enable the Supervisory Board to immediately take appropriate actions. The Committee submits written annual reports on its activity to the Supervisory Board.

The Committee’s basic tasks include in particular the following:

• evaluating the Group’s Corporate Strategy and presenting results to the Supervisory Board,
• recommendations on the scope and dates for the JSW Management Board to submit strategic annual and long-term plans to the Supervisory Board,
• evaluating the impact of strategic investments, planned and undertaken, on JSW’s assets,
• monitoring fulfilment of strategic investments,
• evaluating actions related to the management of JSW’s material assets,
• issuing opinions on strategic documents submitted to the Supervisory Board by JSW’s Management Board.

The Committee is authorised to review all of JSW’s activity from the perspective of its duties and demand from JSW’s Management Board and employees any and all information, reports and explanations required to perform the Committee’s duties. JSW’s Management Board is obligated to provide information on an ongoing basis about all planned and taken actions and changes in the law and regulatory environment subject to the Committee’s scope of activity.