Corporate Governance

“The Board of Directors forms Swiss Re’s corporate governance to support Swiss Re’s positive contribution to society.”

Walter B. Kielholz

Chairman of the Board of Directors

Corporate governance developments and trends are changing rapidly and are based on enhanced regulation and evolving political parameters representing a comprehensive topic for the Board of Directors to deal with. A company’s corporate governance does not only need to incorporate legal and regulatory requirements but also has to respond to increasing stakeholder expectations. Measuring a company’s corporate governance based on environmental, social and governance (ESG) criteria gains in importance. The Board of Directors regularly assesses Swiss Re’s corporate governance against regulatory developments, relevant best practice standards and new stakeholder demands. The Board of Directors closely monitors Swiss and global corporate governance developments and considers relevant studies and surveys. The Board of Directors adapts Swiss Re’s corporate governance where it deems it appropriate and beneficial for Swiss Re, its shareholders and further stakeholders. The Board of Directors values feedback on Swiss Re’s corporate governance by its stakeholders and engages in a dialogue with its shareholders, proxy advisors and corporate governance consulting firms.

The Board of Directors ensures that Swiss Re’s corporate governance takes into account all mentioned aspects and that the company’s corporate governance is ready to respond to upcoming needs.

Swiss Re’s corporate governance framework

Swiss Re Ltd’s Board of Directors is responsible for oversight, while the Group EC is responsible for managing operations. This structure maintains effective mutual checks and balances between these top corporate bodies. Our corporate governance principles and procedures are defined in several documents governing the oversight, organisation and management of the company. These include at the Group level:

• the Group Code of Conduct, outlining our compliance framework and setting out the basic ethical and legal principles and policies we apply globally;
• the Corporate Governance Guidelines (Guidelines), setting forth the Group’s governance framework, principles, processes and requirements, ensuring consistent and fitted corporate governance across the Group;
• the Articles of Association of Swiss Re Ltd (SRL), defining the legal and organisational framework of the Group’s holding company SRL, (available at www.swissre.com/about_us/corporate_governance/corporate_regulations.html);
• the SRL Bylaws, defining the governance framework of SRL and the Group including the responsibilities and authorities of the Board of Directors, Chairman, Vice Chairman, Lead Independent Director, Board committees, Group EC, Group CEO and other individual Group EC members including the Regional Presidents, as well as the relevant reporting procedures; and
• the Board Committee Charters, outlining the duties and responsibilities of the Board committees.

Swiss Re’s governance documents

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In addition, they include at the Business Unit level:

• the Articles of Association of Swiss Reinsurance Company Ltd (SRZ), Swiss Re Corporate Solutions Ltd (SRCS) and Swiss Re Life Capital Ltd (SRLC), defining the legal and organisational framework of the Business Unit (BU) top-level companies SRZ, SRCS and SRLC;
• the SRZ, SRCS, SRLC Bylaws, defining the governance framework of the legal entities SRZ, SRCS and SRLC, their interactions with the respective BU Reinsurance, Corporate Solutions and Life Capital from a functional responsibility point of view, including the responsibilities and authorities of the SRZ, SRCS and SRLC Board of Directors, the SRZ, SRCS and SRLC Board Committees and the SRZ, SRCS and SRLC Executive Committees, as well as the relevant reporting procedures; and
• the Board Committee Charters, outlining the duties and responsibilities of the board committees of SRZ, SRCS and SRLC.

2017 key focus areas

Corporate Bylaws revised in 2017 to anticipate developments and trends

The SRL, SRZ, SRCS and SRLC Bylaws were revised in 2017 to incorporate stakeholder feedback as well as to anticipate corporate governance, legal and regulatory developments and trends. It is our goal to constantly develop further our corporate documents in order to align them to changing company needs, the evolving regulatory landscape as well as stakeholder feedback.

Enhanced conflicts of interest framework

Conflicts of interest may arise where personal interests or relationships might interfere with those of Swiss Re. They may improperly influence judgement, objectivity or loyalty and expose Swiss Re to material adverse reputational and financial risks. We are committed to conducting business in a manner that ensures that we act in the best interests of Swiss Re without actual or perceived influence by our personal interests or relationships. We act with integrity at all times and foster an open and fair environment by being transparent in disclosing our conflicts of interest. We define our conflicts of interest standards and procedures in a series of documents such as in our Group Code of Conduct as well as in the Bylaws. In the reporting year we have implemented the “Global Standard on Conflicts of Interest” (the Standard) throughout the Group with the aim to enhance the existing processes with respect to conflicts of interest across the Group. The improvements also address FINMA’s general requirements to have defined principles for a process and structure to identify and avoid and/or resolve conflicts of interest.

Board of Directors educational sessions and trainings

In line with the Board of Directors’ aim to constantly broaden its know-how on important business and new emerging topics, the Board of Directors held several educational sessions and trainings in 2017. The following topics were among the ones discussed:

• Asset Liability Management (ALM) and Minimum Risk Benchmark (MRB)
  The Board members deepened their knowledge on the scope and objective of the ALM and on the processes and governance underlying the ALM and the MRB. The Board members were presented with the structure and the main components of the MRB and its limitations and challenges.
• P&C Reserving
  The Board members deepened their know-how on Swiss Re’s reserving (methodology, strength as well as uncertainties) and the link between P&C reserving and MRB. The Board members also got insights on recent feedback on Swiss Re’s reserving provided by analysts and investors.
• Swiss Re’s internal risk model
  The Board of Directors appraises the internal risk model’s central role in core risk management activities. It is therefore key to understand the internal risk model and its outputs. During that training session, the Board members received a refresher on the basic principles of the techniques applied, generic modelling approaches as well as statistical measures that are being used. Furthermore, the Board members were provided with insights on the interpretation of the results, the linking of the business view to the risk view and the input of risk figures into other reports and processes (eg EVM).

Highlights 2017/2018

Board of Directors

Group EC