Executive Board

Composition

Until 30 June 2009, the Executive Board consisted of three members: Mr W. Dekker, CEO,  Mr J.B. Steinemann, COO, and Mr C.J.M. van Rijn, CFO. Mr. J.B. Steinemann’s employment was terminated per 30 June 2009. At an EGM held on 30 June 2009, the Executive Vice-Presidents of the Company’s Agriculture Division, Mr J.A. Vergeer, Aquaculture Division, Mr K. Nesse, and Specialties Division, Mr F.J. Tielens, were appointed to the Executive Board.

The Executive Board is appointed by the General Meeting of Shareholders on the proposal of the Supervisory Board, with the latter indicating whether or not the proposal is binding. This binding character can be waived by a simple majority of the votes cast at the General Meeting of Shareholders. At the AGM of 2002, the Supervisory Board agreed not to use the option of making a binding proposal for appointments unless in exceptional circumstances, such as a threatened takeover.

Approval of operational and financial objectives and strategy

As is standard practice within the Company, the Executive Board presented to the Supervisory Board (a) the strategic plan of the Company, (b) the objectives to implement the agreed strategy and (c) the parameters to be used for measuring performance.

Strategy

Nutreco’s strategy is to strengthen its leading global and regional positions in the global animal nutrition and fish feed markets. Nutreco aims for a balanced portfolio of geographies, species and products for a profitable growth, both organic and through acquisitions. The Company pursued its strategy of growth in its animal nutrition and fish feed businesses through acquisitions in its important market of compound feed in Spain and Portugal and in Brazil. Significant savings were realised through central purchasing of key ingredients by the Nutreco Sourcing and Procurement organisation, which started operating in 2007, and by a major working capital reduction initiative, which was launched early 2009 and included workshops with local management and controllers throughout the organisation.

Operational and financial objectives – Budget
The operational and financial objectives of Nutreco are laid down in the budget. The Executive Board sets the framework and key objectives of the budget. Budgets of Nutreco’s operating companies are constructed bottom-up, challenged by the Executive Board and adjusted top-down where necessary to meet Nutreco’s objectives. The 2010 budget was submitted for approval to the Supervisory Board, who approved it at its December 2009 meeting.

Corporate Social Responsibility

Since the year 2000, the Company publishes a separate Corporate Social Responsibility Report on the social responsibility issues that are relevant to the enterprise of the Company. Reference is therefore made to the Sustainability Report 2009. In line with the best practices of the Code, certain sustainability objectives were included in the 2009 performance contracts with the Executive Board. For 2010 certain specific sustainability objectives have been set as performance targets. A visible step was taken showing the importance attached by the Executive Board and the Supervisory Board by installing a new Committee of the Supervisory Board, the Innovation & Sustainability Committee, headed by Mr A. Puri and with Mr Y. Barbieux and Mr J.A.J. Vink as members. The report on this Committee’s work in 2009 is included in the report of the Supervisory Board.

Internal risk management and control systems

Nutreco maintains operational and financial risk management systems and procedures and has monitoring and reporting systems and procedures. It has a Code of Ethical Conduct, which is published in the Company’s Sustainability Report and on the Nutreco website (www.nutreco.com). The Code includes a ‘whistleblower policy’ paragraph. In order to facilitate the reporting of irregularities, if any, with the Code of Ethical Conduct, it was translated in all 19 local languages in use within the Group. A Nutreco Integrity Line was set up, which is operated by an external service provider. Any employee who wishes to report non-compliance with the Code of Ethical Conduct can do so, whether directly to management or anonymously by using the Nutreco Integrity Line, without jeopardising his or her employment with the Company. A limited number (9) of complaints were received through the Nutreco Integrity Line. These complaints mainly related to labour relations and none were of a material nature. These complaints were all investigated by management and a management reaction was posted on the Nutreco Integrity Line in order to inform the complainants of the Company’s position and, where relevant, of any corrective actions taken to avoid repetition. Compliance with the Code is monitored by the Compliance Officer of the Company.

Management review and reporting

The ‘Management review and report’ statement of the Executive Board as well as more details on the risk management and internal monitoring and reporting systems and procedures are given under the ‘Risk management’ paragraph of this report (page 52).

Sensitivity of the results to external factors and variables

Reference is made to the ‘Risk profile’ chapter of this report (page 52). In the ‘Risk profile’ chapter, an explanation is given on the Company’s ‘risk appetite’. In summary, the Company’s ‘risk appetite’ is conservative and measures are in place to mitigate any business risks which are inherent to the Company’s operations.

Mandates with third parties

Acceptance by the Executive Board of no more than two mandates as a Supervisory Board member of a listed company requires the prior approval of the Supervisory Board to prevent conflicts of interest and reputational risks. Chairmanship of such Supervisory Board position is excluded. Other appointments of material importance need to be notified to the Supervisory Board. Members of the Executive Board are also appointed to the Board of a number of Nutreco operational entities.

No conflicts of interest reported

All members of the Executive Board are currently employed by Nutreco Nederland B.V., a subsidiary of Nutreco Holding N.V. As part of the terms of their employment contract, they have undertaken not to compete with Nutreco activities. Nutreco’s Code of Ethical Conduct prevents employees and directors to accept gifts of commercial value for themselves or their relatives, to provide advantages to third parties to the detriment of the Company or to take advantage of business opportunities to which Nutreco is entitled. None of the members of the Executive Board is a supplier of goods or, in any way other than necessary for the performance of their job, of services to the Company or its subsidiaries. During the year under review, no conflicts of interest were reported between members of the Executive Board and Nutreco or its subsidiaries.

Loans or guarantees

As a matter of policy, Nutreco does not extend any loans or guarantees to the members of the Executive Board.

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