The SB has three committees that discuss specific issues and prepare items on which the full SB takes decisions. The Chair of each committee reports on the main points of discussion and the resulting recommendations are discussed at the subsequent SB meeting. The minutes of the committee meetings are available to the members of the SB. The three committees are:
The Audit & Risk Committee;
The Remuneration Committee;
The Nomination & ESG Committee.
Audit & Risk Committee
The committee advises the SB and prepares decision-making on matters such as supervision of the integrity and quality of financial reporting and the effectiveness of internal risk management and control systems. This explicitly also includes the application of information and communication technology, including cyber security risks.
The composition of the committee is such as to represent the specific business know-how, financial, accounting and actuarial expertise relating to the activities of a.s.r.
The committee held seven regular meetings and one extra meeting in 2023. In accordance with the Audit & Risk Committee (A&RC) Rules of Procedure, committee meetings are also attended by the CFO, the CRO, the Director of Group Risk Management, the Director of Group Finance & Risk Reporting, the Manager of Compliance, the Director of Audit and the independent external auditor.
After each financial quarter, the committee discussed the financial results based on detailed financial, risk, compliance and internal and external audit reports and analyses. Progress on the recommendations of the internal and external auditor as well as of the Audit Function was monitored. The full 2023 reporting year was discussed in the first quarter of 2024, based on the quarterly internal finance report, the press release, the Annual Report, the financial statements, the Board report and the actuarial report.
The committee issued positive opinions on the Annual Report and on the financial statements to the SB. It discussed and adopted the external auditor’s letter of engagement and the audit plan for 2023. The external auditors’ independence and additional fees were reviewed each quarter. The management letter of the external auditor highlighting key internal control observations was discussed. The audit results report of the external auditor was also discussed and special attention was given to the reported key audit matters. The A&RC approved the updated charters and annual plans for 2024 of the Actuarial and Risk Management Function and the Compliance Function. It advised the SB to approve the updated charter and the audit plan 2023 of the internal Audit Function; this advice was followed.
Specific topics discussed in the committee included:
Preparation and progress on the integration activities as a result of the transaction to combine a.s.r. and Aegon NL, specifically the impact on financial reporting;
Areas of attention as a result of the initial application of IFRS 17/9;
Progress on implementing the partial internal model as a result of the Aegon transaction;
Cyber risks and IT security;
Compliancy with rules and regulations.
a.s.r.’s solvency position was reviewed and discussed each quarter. Specific attention was paid to the impact of the Aegon transaction, inflation and interest rates and the development of operating costs. The A&RC discussed the risk scenarios and the outcomes of the Own Risk Self-Assessment (ORSA). In all the ORSA risk scenarios, the solvency ratio remains within the boundaries set by a.s.r., demonstrating the robustness of a.s.r.’s solvency and the effectiveness of certain management actions.
a.s.r.’s risk appetite is based on a prudent approach to risk management, which is translated into qualitative business guidelines for NFR matters and requirements for solvency, liquidity and returns for the FR matters. a.s.r.’s updated capital and dividend policy was also discussed, after which the SB approved the updated policy.
The A&RC regularly monitored the status of the risk appetite during the year through a.s.r.’s Integrated Risk Dashboard and the status report on the management of risk priorities. At the end of the year, the A&RC was informed of the outlines of the reinsurance programme for 2024.
Remuneration Committee
The Remuneration Committee (RC) advises the SB on matters including the remuneration policy for the EB and SB and the terms and conditions of employment of the EB, and reviews the remuneration of senior management.
The RC held five regular meetings and four extra meetings in 2023. Its meetings were also attended by the CEO (except when issues relating to the EB were discussed), the CHRO and the company secretary. The committee solicits support and advice from departments, including Group Risk Management, Investor Relations & Communications, Compliance, Audit and Human Resources. Where needed, it consults independent legal and pay & benefit experts.
In line with the policy, the committee advised the SB on target-setting and performance appraisals; and the yearly Remuneration Disclosure was also prepared.
The 2022 Remuneration Report was submitted to the AGM for an advisory vote; 96.8% of the votes cast were for the report and 3.2% were against. The results demonstrate the shareholders’ continued broad support for a.s.r.’s remuneration policy.
In 2023, the RC finalised its comprehensive analysis of the remuneration policy for the EB. Based on the results of this analysis and the advice of the Works Council, the RC proposed a revised remuneration policy to the SB, which was adopted by the 2023 AGM with 99.2% votes in favor. The remuneration for EB and SB members was also evaluated and a proposal in this respect was also adopted by the AGM.
Nomination & ESG Committee
The Nomination & ESG Committee (N&ESGC) advises the SB on its duties and prepares the SB’s decision-making in this respect. The Committee advises the SB on ESG topics, selection and appointment procedures and the composition of the EB and SB; it also prepares the (re)appointment of its members. The N&ESGC met five times in 2023. Its meetings were also attended by the CEO (except when issues relating to the EB were discussed), the CHRO and the company secretary.
In 2023, the N&ESGC undertook a selection process of the MB and senior management for the new combination.
The retirement schedule of the SB was also discussed, including the search of a successor of Herman Hintzen. Bob Elfring is nominated to succeed Herman Hintzen, who will complete his second term by the end of the AGM 2024. Bob Elfring has a broad knowledge of the financial sector and capital markets and is an experienced supervisor. Further, Joop Wijn, Chairman of the Supervisory Board of a.s.r., is nominated for a second term of appointment until the AGM 2028.
Other topics discussed by the N&ESGC were the evaluation of the DEI policy and the results of the Cultural Diversity Barometer. The committee also discussed the annual appraisals of senior management. A nine-box grid was used to evaluate senior managers and to discuss their individual development and possible successors. The committee was also informed of the results of the Denison scan, a tool used to measure the success of the organisation. For more information, please refer to section 3.3.
With regard to ESG, the N&ESGC discussed the various developments in this field and related legislation and what this means for a.s.r. as a sustainable insurer, such as progress on the targets of the various themes, with a focus on the strategic pillars from the strategic framework for sustainability and internal and external developments in this area such as climate change and biodiversity. Progress on the non-financial targets was also discussed and advice was given on new medium-term targets in that area.
Financial statements and dividend
The EB prepared the 2023 Annual Report and discussed it with the SB in the presence of the external auditor. The 2023 financial statements will be submitted for adoption by the AGM on 29 May 2024. a.s.r. will propose a dividend of € 2.89 per ordinary share (including the interim dividend paid).
Appreciation
The SB wishes to express its gratitude to all the employees of a.s.r., including the employees of Aegon Nederland, for their dedication in 2023, and in particular for their continued efforts and support for the integration of the two companies. Together, we are creating a strong and sustainable insurance leader in the Netherlands that helps customers to share risks and build capital for the future. The SB also wishes to express its gratitude to the members of the EB, MB, and senior management for their impressive leadership of a.s.r. and for achieving a good operational result and increased customer satisfaction.
Utrecht, The Netherlands, 2 April 2024
Joop Wijn (Chair)
Herman Hintzen
Sonja Barendregt
Gisella van Vollenhoven
Gerard van Olphen
Daniëlle Jansen Heijtmajer
Lard Friese