Corporate Governance

Nord Pool is a trading exchange and clearing house for physical and financial electricity contracts, EUAs and CERs.

Price formation for the products traded is accordingly very important for key aspects of European society. The political debate in Europe over the environment, emission allowances and future energy supplies represents a direct extension of the power exchange’s operations.

Trading on Nord Pool sends direct and clear signals about conditions under discussion in society. Nord Pool’s corporate governance must therefore be based on a clear understanding of its social role.

This is reflected by the corporate governance principles, which aim to ensure that:

• the companies facilitate transparent price formation
• the exchange is efficient and valuable
• the regulatory authorities are confident that the companies fulfil the roles assigned by its licences employees comply with the companies’ ethical guidelines control bodies in the organisations are adequate for ensuring that all elements of the businesses are subject at all times to systematic risk analysis
• the players want Nord Pool as the preferred marketplace.
  

Building trust

The object of the code of practice issued by the Norwegian Corporate Governance Board (NUES) is confined to ensuring that listed companies provide a clarification of the division of roles between shareholders, the board of directors and the executive management which goes beyond legal requirements.

Where the code issued by the NUES is concerned, Nord Pool is subject to additional regulations and legal requirements through its licences. The NUES code is intended for listed companies, so many of its 14 main points are not relevant for Nord Pool, where two owners hold equal shares in the company.

With regard to building further trust in the market through its corporate governance, Nord Pool has several bodies which handle risk management and member compliance with the rules.

Among legislation and statutory regulations which supplement the recommendations in the NUES code, Chapter 3 of the Norwegian Exchange Act and regulation 18/1997 from the Financial Supervisory Authority of Norway on clarifying control responsibility, documentation and confirmation of internal control are particularly important.