Information On The Board Of Directors
1.1. Structure and Formation of the Board of Directors
The Company is governed and represented by a Board of Directors consisting of 12 members elected in the General Assembly. CCI Board of Directors consists of a total of 12members, with 7 of such members being Group A shareholders, 1 being a Group B shareholder and 4 being independent members.
At the General Assembly held on April 29, 2021, board members were elected to serve for a period of 1 year, until the next Ordinary General Assembly which will be held to discuss 2022 outcomes. At the same General Assembly, the Chairperson and board members were authorized to perform the activities specified in Articles 395 and 396 of the Turkish Commercial Code.
Since the Corporate Governance Committee may fulfill the duties of a separate Nomination Committee in case such committee cannot be formed for building the Board of Directors in accordance with the Corporate Governance Guidelines, the Corporate Governance Committee evaluated the proposed candidates for management and shareholders as well as independent members, which include İzzet Karaca, Ali Galip Yorgancıoğlu, Uğur Bayar and Tayfun Bayazıt, by taking into account whether these candidates meet the criteria for independent membership, and submitted the relevant evaluation to Board of Directors’ approval on February 3, 2021.
Candidates for independent membership in the Board of Directors also submitted their written statements to the Corporate Governance Committee at the time of their nomination, declaring that they were indeed independent in accordance with the criteria specified in the Legislation, Articles of Association and the Communiqué. Member résumés for Board of Directors, including their declaration of independence and duties outside the Company, are available both in the 2021 Integrated Annual Report and on the Company website.
Although board members are not restricted from accepting other duties outside the Company, they are required to obtain a written approval from the Chairperson of the Board of Directors to serve as a director or member in any other profit-making company’s board of directors and such approval must be renewed each year, as clearly stated in the Company Code of Ethics. Individual selected as independent members to the Board of Directors are not registered and declared on behalf of the legal entity
In 2021, no events occurred which would violate the independence status of the independent members serving in the Board of Directors. Mrs. Sedef Salıngan Şahin is the only current female member our Board of Directors, however a recommendation has been communicated to our Board of Directors by the Corporate Governance Committee to increase the number of female members in our Board of Directors in the upcoming years to at least 25%, as specified in Article 4.3.9 of the Corporate Governance Communiqué issued by the Capital Market Board, and we continue our work towards this goal.
1.2. Operating Principles of the Board of Directors
The procedures and frequency for Board of Directors meetings, meeting and decision quorum, method of filing appeals to Board decisions and the validity of Board decisions are clearly described in the Articles of Association. The duties and authorities held by the Board of Directors are specified in the Internal Directive on Authorization for Coca-Cola İçecek A.Ş. Activities prepared in accordance with Articles 367, 371 and other relevant provisions of the Turkish Commercial Code. The agenda of Board of Directors meetings consists of re-discussion topics from the previous Board meeting as well as the topics determined by the Company senior management. Any board member can add other topics to the agenda by notifying the senior management. The topics that need to be discussed by the Board are communicated to the Chief Financial Officer and compiled to prepare an agenda for the next meeting. Board of Directors meeting dates are determined at the beginning of each year and communicated to the members.
In general, the Board of Directors hold five regular meetings during a year, however board members may also convene in case of extraordinary events and to make decisions on important agenda topics. The Chairperson, Vice-Chairperson and each board member have the right to call a Board meeting and/or to add topics of interest to the relevant meeting agenda by notifying each board member at least fifteen (15) days before the meeting. Invitations to such meetings must be sent by fax, followed by the original invitation which will be sent by a courier service providing written proof of receipt or registered mail service. Board members may waive their right to receive invitations in writing.
Board meetings are held at the Company HQ or elsewhere in Turkey or abroad as may be decided by the Board during a regular meeting with quorum. The Board of Directors may take decisions without holding a meeting in accordance with Article 390/4 of the Turkish Commercial Code. The meeting and decision quorum specified in Company’s Articles of Association shall also apply to such decisions. 5 Board Meetings were held in 2021.
Company’s General Counsel fulfills the duties of the Board of Directors secretary. All queries and topics discussed during a meeting are recorded in a meeting report. While the board member attendance rate of in five meetings held during 2021 financial year is 78%, members take care to attend each meeting and share their opinions. If a member fails to attend a meeting but submits his/her opinion in writing, the relevant opinion is notified to other members.If any information recorded in a meeting report constitutes a trade secret, such information is not disclosed to the public. However, all important topics of decision are made public through a material disclosure. Board members do not have voting and/or veto rights in the event of a tie. Including the Chair person of the Board of Directors, each board member has only one vote, and the principle of weighted voting is not practiced.
All related party transactions and Board of Directors decisions require the approval of the majority of independent members in accordance with the Corporate Governance Guidelines. Although no transactions in 2021 fell under the significant category as described in the Corporate Governance Guidelines, the majority of the independent board members participated in the decisions taken by the Board of Directors. Our Company holds an insurance against any damages to the Company possibly arising from misconduct of any board members during their duty and the policy coverage exceeds 25% of the Company capital in accordance with Article 4.2.8 of the Corporate Governance Communiqué issued by the Capital Market Board. The limit of total annual liability is determined in accordance with the decision of the Company Management. For the time being, the limit is expected to remain at the current levels.
1.3. Number, Structure and Independence of Committees Established under the Board of Directors
There are three committees working under the CCI Board of Directors.
1.4. Board Evaluation on the Working Principles and Performance of the Board of Directors Committees
Following the completion of chairperson and member elections in accordance with the Corporate Governance Guidelines and pursuant to the Board of Directors decision dated May 3, 2021;
- Independent board member İzzet Karaca, was appointed as the Audit Committee Chairperson while independent board member Tayfun Bayazıt was appointed as the committee member,
- Independent board member Uğur Bayar, was appointed as the Corporate Governance Committee Chairperson while board members Mehmet Hurşit Zorlu, Kamil Ömer Bozer, Recep Yılmaz Argüden and Çiçek Özgüneş Uşaklıgil were appointed as committee members,
- Independent board member Ali Galip Yorgancıoğlu, was appointed as the Early Risk Detection Committee Chairperson while board members Tuğban İzzet Aksoy and Agah Uğur were appointed as committee members.
Regulations governing the duties and working principles of these three committees were also updated in accordance with the new Corporate Governance Guidelines and approved by the Board of Directors on April 30, 2014. Regulations are made available to the public through the Company website. In 2021, all Committees under the Board of Directors fulfilled their duties and responsibilities in an effective manner in accordance with the Corporate Governance Guidelines as well as their own Regulations.
In alignment with the annual meeting plans specified in their own regulations and as required for effective performance in 2021;
The Audit Committee
convened fourtimes on
- February 24, 2021,
- May 20, 2021,
- September 28, 2021 and
- and December 21, 2021,
The Corporate Governance Committee
convened four times on
- February 24, 2021,
- May 20, 2021,
- September 28, 2021 and
- and December 21, 2021,
The Early Risk Detection Committee
convened six times on
- March 10, 2021,
- May 5, 2021,
- July 2, 2021,
- August 31,2021,
- October 27, 2021 and
- December17, 2021; and submitted their reports containing information about their performance and yearly meeting outcomes to the Board of Directors. The Early Risk Detection Committee submitted information about its performance to the Board of Directors for six times during the year.
Being responsible for effective implementation of an internal control system as well as taking all necessary measures to ensure all internal and independent audits are conducted in an adequate and transparent manner, the “Audit Committee” submitted all recommendations it had on its areas of responsibility to the Board of Directors, including opinions and recommendations regarding internal audits and internal control system.
Established to monitor Company’s compliance with Corporate Governance Guidelines, implementim provements and submitre commendations to the Board of Directors, the “Corporate Governance Committee” determined the compliance status for Corporate Governance Guidelines across the Company along with the rationale of possible non-compliance issues and confl icts of interest culminated due such non-compliance, madere commendations to the Board of Directors for improving corporate governance practices, and supervised the shareholder relations unit. The Committee also monitored the performance of Investor Relations Department.
Working to identify the risks that may pose a threat to Company’s existence, growth and future sustainability at an early stage, to implement necessary measures for identified risks and to manage these kinds of risks, the “Early Risk Detection Committee” also reviewed Company’s risk management systems in accordance with the Corporate Governance Guidelines and the Early Risk Detection Committee Regulation.
Information For Stakeholders
2.1. Stakeholder Notification
Coca-Cola Contact Line (0800 261 1920) is open to all consumers. Consumers, customers and shareholders can also contact us using the communication forms on our website at
www.cci.com.tr. Information exchange with distributors and other customers is maintained through regular distributor meetings as well as field meetings organized by authorized staff in a number of regions. In addition, customers and supplier sare able to submit their opinions to the Company management through oral or written communication. In order to improve procured material and service quality and keep up with other industry developments and pilot activities performed under joint projects, several supplier meetings are organized.
The extensive information network established between our Company and the customers allow for real-time exchange of information. Changes implemented through e-sales system on the Internet are immediately notified to our customers, and in necessary cases training and satisfaction surveys are provided. Necessary mechanisms have been established by the Corporate Governance Committee for stakeholders to communicate Company’s unlawful or unethical transactions to the Corporate Governance or Audit Committees. On the other hand, the Corporate Governance Committee is obliged to follow up with the management to make sure a system is established by the management for business codes of conduct and ethical principles in accordance with the Company statute. The Audit Committee also checks if the management monitors Company compliance with business codes of conduct and ethical principles, misconduct risk assessments are made and training is provided for misconduct & business codes of conduct as well as ethical principles.
2.2. Stakeholder Engagement in Governance
All individuals, groups or organizations that are affected by our activities orthat have an effect on our activities are defined as stakeholders. The following communication platforms are employed to engage stakeholders in governance and their opinion is taken into account indecision-making processes.
Mechanism For Risk Management And Internal Control
At CCI, Company Management is responsible and in control of the Risk Management and Internal Control System. The Corporate Risk Management function, which provides reassurance and advise to management on relevant issues, reports directly to the Early Risk Detection Committee.
CCI’s Senior Management identifies significant opportunities and threats in terms of achieving Company targets within the Corporate Risk Management framework and manages them in accordance with Company’s risk appetite. Corporate Risk Management is a systematic and disciplined process created to identify CCI’s business strategies, which is influenced by all Company employees and covers all Company practices. Any risks that may occur in terms of achieving Company targets are communicated to the management for evaluation and priority risks are identified with the coordination of the Corporate Risk Management function. Priority risks and action plans to mitigate such risks are shared with the Early Risk Detection Committee in order to be submitted to the Board of Directors.
Integrated with strategic business plans, this process is managed and maintained with the support of Corporate Risk Management software. Some of the methods employed for risk management are described below:
Performance and risk indicators are used as early warning system formonitoring risks and taking necessarymeasures in a timely manner. SAP system, which is integrated into all processes across the Company and contains all instantly-produced data,is an effective technology system to support decision making which allows monitoring of basic performance and risk indicators. In addition to these, the ERM (Enterprise Risk Management) system, which defines and evaluates corporate risks, ensures that risks are monitored effectively.
This method allows for instant monitoring of activity outcomes and eliminates human errors while improving the effectiveness of early risk detection and internal control system. At the same time, the internal communication system, which uses cutting-edge technology, allows for providing rapid response to any issues and generating solutions.
Business continuity and crisis management studies are performed and supported with effective insurance management to prevent and mitigate any loss arising from risks that may cause interruptions in the business and production, such as natural risks and supply chain issues.
In order to ensure unaffected system operation and data integrity in case of emergencies, a number of investments are being made in cyber security warning and protection systems as well as backup systems.
In alignment with our Global Waste Free World Strategy, we strive to identify risks associated with our packaging, implement sustainable and innovative packaging & waste solutions, and work in coordination with local authorities on waste collection and recycling.
The Internal Audit Department regularly reviews Company’s risk management and internal control systems in accordance with its risk-based audit plan to achieve the following targets, and reports the relevant results to the Audit Committee and Company Management:
Effectiveness and efficiency of operations
Protection of company assets
Accuracy and reliability of financial and operational information
Ensuring compliance with laws, regulations and conventions
Strategic Company Targets
Targets and critical performance indicators that are in line with Company’s vision and mission are identified as a part of the annual Strategic Operation Plans. These targets and critical performance indicators are approved by Board of Directors during budget meetings at the end of the previous year. Board of Directors reviews operational results during regular meetings by comparing them with previous year’s performance and target indicators.
Financial Rights
At the CCI Ordinary General Assembly on April 29, 2021, it was decided to pay a net total of annual compensation worth 168,000 TL on a monthly basis to each Independent Member of the Board of Directors for the period between 01.04.2020 and 31.03.2021.
There are no other fees or rights granted to the members of the Board of Directors. Fees and other benefits entitled to members of the Board of Directors are not set according to performance. All board members and managers are entitled to an Executive Liability Insurance. CCI has not provided any loans or credits to any board member as well as any personal loans to any person whatsoever through a third party or any assurance or guaranty to the benefit of a third party, such as an indemnity.
Corporate Governance Policies
6.1. CCI Profit Distribution Policy
Our company distributes profits inaccordance with the provisions of the Turkish Commercial Code, Capital Market Regulations, Tax Regulations and other relevant regulations as well as the provision of our Articles of Association regarding profit distribution. Our Company targets to distribute up to 50% of distributable profitsas cash and/or bonus shares each year.
The profit distribution policy is subject to investment and other fund requirements associated with the long-term company growth as well as any special circumstances brought by extraordinary economic conditions. A separate decision is taken by the Board of Directors regarding the dividends for each financial year and this decision is submitted to General Assembly’s approval. Profit distribution begins on the date determined by the General Assembly, no later than the end of the year in which the General Assembly is held. Company may opt for distributing the dividend as advance payments or paying it in equal or different amounts as installments in accordance with the provisions of the applicable legislation. The Board of Directors reserves the right to submit a distribution model with a higher rate than specified to General Assembly’s approval as long as such model does not violate investment plans or business requirements. No concessions are granted to shareholders regarding profit sharing.
6.2. CCI Compensation Policy
Provisions of the applicable Labor Law No. 4857, surviving Article 14 of the annulled Labor Law 1475 and provisions of Coca-Cola İçecek A.Ş. Human Resources Policy are takenin to account when determining the compensation policy for Company employees. For employees who work under the Collective Labor Agreement, the relevant Agreement provisions on severance and notice pay are taken as basis to determine and execute the compensation policy.
Severance Pay
A severance pay is granted to employees (or their legal heirs in case of death) who are terminated according to one of the conditions requiring severance pay as specified by the provisions of the surviving Article 14 of the Labor Law No. 1475 as repealed by Labor Law No.4857 for their duration of service, on the condition that such employees have completed at least a full working year. The actual number of days subject to severance pay is calculated in accordance with Company Regulations, and the Collective Labor Agreement for unionized employees.
Notice Period and Pay
In cases requiring a notice period, Article17 of the Labor Law No. 4857, or for unionized employees, provisions of the Collective Labor Agreement are taken into account. Moreover, an employee may also be terminated by paying his/her full wages up to the end of the relevant notice period in cash. In cases where a notice period is granted, a job-seeker allowance is provided to the employee.
6.3. CCI Human Resources Policy
CCI Human Resources Policy is established to secure CCI’s position as a preferred employer by building a competent organization which consists of highly committed employees. From this perspective, the policy is based on the principle of continuous development on the following strategic priorities:
Development of main organizational competencies on a corporate level to boost competitiveness
Acquiring and developing talent to ensure succession of leadership positions
Promoting employee loyalty and performance
Building a corporate culture which values diversity and uses it as aleverage
At CCI, all human resources systems, such as workforce planning, recruitment and placement, performance management, talent management, training and development management, compensation and benefits management and rewards management, are based on the principle of ensuring, promoting and rewarding continuous development and superior performance. Employee development is a part of annual individual goals for all managers and employees, and in this context their performance is measured accordingly.
Competence development is also seen as an important element of employee development and superior performance, in addition to know-how and skills development. At CCI, we have defined our Leadership Behaviors as “Impress and convince, Inspire, Win with the customer, Be inclusive, Always raise the bar, Think of the future”. We aim to align our recruitment and employee development programs within this behavior framework. For continuous development and high performance, we believe in the importance of being an open, fair, responsive and constructive company from an employee point of view who protects material and moral employee rights and pays attention to their opinion.
To achieve this goal, we publish all policies and procedures related to human resources on a platform that is available to all employees, announce vacant internal positions to our employees, regularly collect employee opinions and suggestions through regular internal customer satisfaction and employee loyalty surveys, create and implement action plans for new development areas, offer all employees access to an e-learning platform so that they can receive necessary training on their respective development areas, and maintain communication between employees and the management through a number of methods such as open meetings and human resources briefings.
