ForTheDoers Blog

Holding the Annual General Meeting enables dividend payment and helps to keep the economy running

Sirpa-Helena Sormunen  ·  30 March 2020

The Annual General Meeting has an important role because payment of dividends can be decided only by the Annual General Meeting. Fortum’s dividend payment benefits the Finnish State, Finnish mutual pension insurance companies, and more than 100,000 small investors. Fortum’s biggest shareholders have critically important social duties that are partially financed with dividends. Dividends are important also for individual shareholders of Fortum.

Sirpa-Helena Sormunen

Only the Annual General Meeting can decide on the distribution of dividends – this is stipulated in the Limited Liability Companies Act. To ensure the important payment of dividends to shareholders and Finnish society, Fortum has decided to hold the Annual General Meeting on Thursday, 23 April 2020, during these exceptional circumstances and with exceptional arrangements.

As Fortum’s largest shareholder, the Finnish State benefits significantly when the Annual General Meeting is held and a decision on the distribution of dividends is made. Fortum’s Board of Directors has decided to keep the dividend proposal unchanged and proposes that Fortum pays to its shareholders a dividend totalling about EUR 977 million for the 2019 financial period. About half of the dividends, i.e. close to half a billion euros, would be paid to the State at a time when the State’s finances are facing an unprecedented challenge.

A significant share of Fortum’s dividends is paid to mutual pension insurance companies and to more than 130,000 other investors. With economic activity quickly weakening, we, as a stable dividend payer, are shouldering our responsibility also for the Finnish mutual pension insurance companies and small investors. Mutual pension insurance companies play a key role in securing the pension system. The dividends paid to more than 100,000 small investors, in turn, enable consumer and investment decisions to be made also this spring.

Advance voting and refraining from in-person attendance make it possible to hold the Annual General Meeting

Fortum takes the coronavirus pandemic and the measures taken to limit it seriously; we aim to make every effort to do what we can to mitigate the harm it causes.

Holding the Annual General Meeting in exceptional circumstances requires special cautionary measures from the company. Under normal circumstances, it would sound highly unusual to convene an Annual General Meeting and at the same time urge the participants to not attend. This, however, is what we have to do in order to hold the meeting. The safety of shareholders and personnel as well as compliance with all instructions from authorities is of vital importance.

We have urged shareholders to vote in advance or by proxy representation. The Annual General Meeting can be followed via video link.

For safety reasons related to the coronavirus, the aim is to keep the meeting brief. To ensure this, Fortum has received advance notification from the largest shareholders forming a majority, including the Finnish State, that they support the proposals of the Board of Directors and the Shareholders’ Nomination Board made to the Annual General Meeting.

In the midst of these exceptional circumstances, we at Fortum are continuing our responsible work to reshape energy production and to generate significant value for our shareholders. The distribution of dividends is one of the ways we are securing the functioning of society.

Sirpa-Helena Sormunen
General Counsel