Internal controls and Risk management

Internal controls

The company has strict procedures for internal controls. The Board of Management and Executive Committee have established an Internal Control Committee to facilitate and oversee aspects of these procedures. The Internal Control Committee is responsible for maintaining the company’s internal control framework. In 2015, the committee continued work on the reduction of the number of key IT systems in order to facilitate the implementation of system-embedded, automated controls. The committee also further enhanced the quality and transparency of processes and controls through the global introduction of standard ways of working, and the consolidation of activities in both outsourced and captive shared service centers.

The AkzoNobel internal control framework provides reasonable assurance in achieving business goals, including strategic, operational and reporting goals, in addition to those covering compliance. Internal control is not only about policies and procedures, but also relates strongly to people, culture and behaviors.

Share Dealing Rules and Rules on Disclosure Control

In accordance with Dutch law and regulations, the company maintains insider lists and exercises controls around the dissemination and disclosure of potentially price sensitive information. The Disclosure Committee monitors the disclosure procedures established by the company and advises the Executive Committee to ensure adequate and timely disclosure of material financial and non-financial information.

All employees and the members of the Board of Management, the Executive Committee and the Supervisory Board, are subject to the AkzoNobel Share Dealing Rules, which limit their opportunities to trade in AkzoNobel securities. Transactions in AkzoNobel shares carried out by Board of Management, Executive Committee and Supervisory Board members are, as and when required, notified to the Dutch Authority for the Financial Markets.

The Board of Management, Executive Committee and Supervisory Board members require authorization from the General Counsel prior to carrying out any transactions in respect of AkzoNobel securities, even in a so-called open period. In relevant cases, the General Counsel can prohibit carrying out transactions in respect of other companies’ securities.

Risk management

Our risk management system is explained in more detail in the Strategic performance section. Reference is made to the Statement of the Board of Management in the Leadership section for the statements relating to internal risk management and control systems.