Audit and Sustainability Committee Charter – Borregaard ASA

The scope of the Audit and Sustainability Committee’s responsibilities

The Audit and Sustainability Committee (ASC) is a committee of the Board that supports the Board in fulfilling its responsibilities with respect to financial and sustainability reporting, internal accounting controls and auditing matters, cf. paragraphs 6-12 and 6-13 of the Norwegian Public Limited Companies Act. The ASC is required to comply with laws and regulations and stock exchange requirements for any exchange on which the Company’s shares are listed. The ASC shall also identify, understand and assess operational and financial risks and review sustainability matters. The establishment of the ASC does not alter the Board’s legal responsibilities or tasks.



The ASC shall be comprised of maximum four members of the Board, whereof one is an employee representative Board member. Any member elected by the Board shall be predetermined to be “independent” as required by applicable rules and regulations. The Board shall appoint one member as chairman of the ASC. The ASC shall collectively have the competence which is necessary from the perspective of the organisation and operation of the company in order to fulfil its tasks. At least one of the members of the ASC shall be independent of the operations and shall also have qualifications within accounting or auditing.



The ASC shall meet quarterly as a minimum, but may meet more frequently if deemed necessary. Meetings may be held in the form decided by the ASC. Notice of the meetings shall be given in writing, if possible, and minutes shall be taken. The CFO and VP Finance shall be present at the ASC meetings. The VP Finance shall act as secretary of the ASC. The CEO may attend the meetings; the ASC may request the CEO and other representatives of management to attend the meetings as necessary. The external auditor shall attend the meetings.


Further details of the Audit and Sustainability Committee’s tasks

The ASC’s tasks include the following (cf paragraph 6-43 of the Norwegian Public Limited Companies Act and relevant sustainability matters):

a) inform the Board of the result of the statutory audit and explain how the audit contributed to the accounts being reported with integrity and the ASC's role in that process,

b) prepare the Board's follow-up of the financial reporting process and make recommendations or proposals to ensure the integrity of the process,

c) as regards the company's financial reporting, monitor the internal-control, risk-management and internal-audit systems without this contravening the ASC's independent role,

d) have regular contact with the company's appointed auditor concerning the auditing of the annual accounts, including especially monitoring the conduct of the audit in light of issues Finanstilsynet (The Financial Supervisory Authority of Norway) has pointed out in relation to article 26 no. 6 of the Audit Regulation, see section 12-1 of the Auditors Act.

e) assess and monitor the auditor's independence pursuant to chapter 8 of the Auditors Act and article 6 of the Audit Regulation, see section 12-1 of the Auditors Act, including especially that services other than auditing are provided in accordance with article 5 of the Regulation,

f) be responsible for preparing the company's election of an auditor, and make a recommendation in accordance with article 16 of the Audit Regulation, see section 12-1 of the Auditors Act.

g) monitor and evaluate how sustainability matters are integrated in the company’s business plan, risk evaluation and reporting.


Description of how to comply with the tasks above:

Regarding a)

The ASC informs the Board of Directors of the topics discussed after each ASC meeting. The external auditor is present in all ASC meetings.


Regarding b)

Relevant financial reporting topics such as:

  • Estimates
  • New accounting standards
  • Internal control related to financial reporting (in a separate Corporate Governance meeting)


are discussed in the ASC meetings and also in the Board. The last two topics are also covered by the external auditor in the ASC meetings.


Regarding c)

The risk picture is presented and discussed quarterly in the ASC meetings. There is an annual ASC meeting regarding Corporate Governance (risk management, internal control and internal audit) where the ASC is informed of the work related to these topics the past year and also informed about suggested focus areas in the coming year where the ASC can suggest additional focus areas.


Regarding d)

The external audit is assessed by the ASC twice a year, in connection with the presentation of the audit plan and in connection with the summary of the audit. External auditor participates in all ASC meetings and has a separate session with the Board where the administration is not present.


Regarding e)

The ASC approves an annual limit and what services the external auditor may provide in addition to the statutory audit. The VP Finance pre-approves the requests from the external auditor on such services within the limits given by the ASC. The pre-approved services are presented to the ASC on a quarterly and annual basis.


Regarding f)

The ASC approves the plan that is set up related to an external auditor proposal process. The ASC is involved in the process and gives its recommendation to the Board.


Regarding g)
The ASC:

  • Reviews the risks associated with sustainability matters
  • Reviews that the sustainability reporting/disclosures are reliable and accurate and relevant for the main stakeholders (including investors) and assess the scope of the independent assurance
  • Reviews the Company’s benchmark scores on selected sustainability benchmarks.


Other tasks for the Audit and Sustainability Committee

  • Reviewing these instructions and making suggestions to the Board regarding amendments to these instructions when necessary.
  • The ASC may carry out matters it deems necessary to fulfil its tasks with appropriate funding and may use independent counsel and other advisors in this connection unless otherwise decided by the Boards of Directors
  • The CFO of Borregaard is the owner of this document and also responsible for its implementation.