Urs SchwallerChairman of the Board of Directors

What message does good corporate governance convey?

By adopting a clear, systematic approach, corporate governance establishes the basis for the good management and efficient supervision of a company. It is a way of telling our customers, employees, partners and the owner that Swiss Post is working transparently, openly and honestly for the benefit of all.

What makes good corporate governance?

It takes courage and perseverance to constantly question the corporate governance currently in force, to identify weaknesses and to develop the system in a targeted manner wherever necessary and useful. Reference to best practice is not sufficient.

How does the Board of Directors reinforce corporate governance?

The Board of Directors has tasked a project team with the targeted development of corporate governance. Aspects which have proven successful are verified and maintained. In 2019, the Board of Directors will approve the revised organization regulations. They will subsequently be implemented at all levels.

Corporate governance

Corporate governance – a task for the Board of Directors

By implementing systematic, active corporate governance, the Board of Directors lays one of the foundations for the success of the company and establishes the prerequisites for a corporate culture based on trust at Swiss Post, both internally and externally.

For the fulfilment of corporate governance, the Board of Directors takes into account the legal framework (e.g. the Postal Services Organization Act and the provisions of the Swiss Code of Obligations on the subject of corporate law) as well as strategic decisions for the development of the company. In order to complete its task, it sets organizational rules, defines duties and responsibilities for the individual business units and uses the correct instruments to monitor the achievement of strategic goals and compliance with rules, regulations and values. The Board of Directors can thereby establish the framework for corporate management and control.

Framework for corporate management

The Board of Directors takes the following points into account when designing this framework:

Pooling of responsibility

The legal provisions require the uniform management of Swiss Post for the implementation of corporate governance. In other words, overall responsibility for the company must be held by a central, uppermost unit. The Board of Directors therefore pools strategic tasks together in its own hands and takes responsibility for the performance mandates issued to Swiss Post (universal service).

Four markets

In implementing corporate governance, the Board of Directors must take into account the fact that Swiss Post operates in the four markets of communication, logistics, finance and passenger transport, and that the regulatory requirements in these four markets are fundamentally different.

Strategic goals set by the owner

In its corporate management and control, the Board of Directors must pursue the strategic goals set by the Federal Council. The Federal Council verifies whether its goals have been met on the basis of Swiss Post’s annual reports to the owner and the reports on management salaries.

Swiss Post’s corporate structure

As part of its duty to define the framework for corporate management and control, and taking into account the various requirements, the Board of Directors determines the corporate structure and regulates the key aspects of corporate governance:

A company limited by shares subject to a special statutory regime

Since 26 June 2013, Swiss Post has been a company limited by shares subject to a special statutory regime. It is solely owned by the Swiss Confederation and consists of Post­Finance as well as the other companies managed directly or indirectly by Swiss Post. The Board of Directors determines the strategic subsidiaries; these are Post CH Ltd, PostBus Ltd, PostFinance Ltd and Post Real Estate Ltd. The Board of Directors assigns the other companies in Switzerland and abroad to the above companies.

Swiss Post as a communication, logistics and passenger transport company

The subsidiaries or the business and function units operating within these companies are managed directly by the Board of Directors. It appoints Executive Management, to which it transfers the operational management of Swiss Post (excluding PostFinance). Executive Management can delegate the fulfilment of certain tasks to the units. Tasks, competencies and responsibilities are documented in a standard policy and procedure.

PostFinance as a bank and securities dealer

PostFinance was granted a banking licence as a bank and securities dealer on 26 June 2013 and is subject to regulation by the Swiss Financial Market Supervisory Authority (FINMA). In its corporate governance, the Board of Directors ensures coordination between postal and banking regulations.

To meet the licensing requirements of FINMA, the Board of Directors manages PostFinance via an independent Board of Directors (indirect model). This Board of Directors is made up of seven members. Swiss Post must appoint four of its own representatives to conserve its majority. At the end of 2018, Swiss Post was represented on the PostFinance Board of Directors by one member of the Swiss Post Board of Directors, the Head of Finance at Swiss Post and two external representatives; they are mandated and protect the interests of Swiss Post. The Board of Directors also determines which Swiss Post provisions must be adopted by PostFinance. The activities of Swiss Post and PostFinance are coordinated wherever it is necessary and useful to do so for operational business purposes. The Head of PostFinance therefore participates in Executive Management meetings.

Implementation of controls

The Board of Directors has established an appropriate system for implementing controls. Controls that are part of everyday work should be carried out principally by the unit man­agers at line management level. The Board of Directors uses specialized bodies or appropriate instruments to perform additional controls. To name a few examples:

–Group Audit conducts risk-based audits in accordance with the schedule approved by the Board of Directors.

–Risk Management collects data on risks and assesses them at Swiss Post and defines the measures needed to minimize the probability of such risks occurring.

–The Finance Internal Control System ensures that financial reporting is carried out correctly.

–Compliance operates a management system to prevent potential breaches of legal provisions and internal regulations.

Reporting

The Board of Directors receives regular reports on the attainment of strategic goals and on the course of business. Based on these reports, it takes the appropriate measures at any time.

Corporate governance

refers to the entirety of all international and national rules, provisions, values and principles that apply to a company and determine how it is managed and monitored. Corporate gover­nance thereby establishes a framework for corporate management and control.