Statement from the Supervisory Board

Presentation of annual report

Dear DELA stakeholder, dear reader

The Supervisory Board hereby presents the annual report, which includes statements from the Executive Board and Supervisory Board as well as the financial statement. The statement from the Executive Board was drawn up by the Board and discussed with the Supervisory Board. The financial statement was audited by the external accountant and approved in the audit statement. The Supervisory Board confirms the financial statement.

Client and market
Customer satisfaction, expressed in NPS figures, has gone up. The net growth of people insured in the DELA UitvaartPlan (funeral plan) and the autonomous growth in the number of insured in Belgium are satisfactory. DELA also made a start in Germany. The sale of life insurance here exceeded expectations, both in insured capital and the number of insured persons. The gross margin of the funeral company in the Netherlands is not yet sufficient and the market share in funeral services in Belgium is shrinking.

Investments
Mainly due to the considerable drop in share prices, a major net loss was realised in 2018. Nonetheless, the business model remains robust. The solvency ratio in accordance with Solvency II and the coverage rates are stable. This means that an adequate profit share to the members can be realised and the premium increase limited.

Organisation
All in all, the Supervisory Board is satisfied with the steps made by the organisation. While the digital transformation has been started, the governance involved with these change trajectories will need to be enhanced. New systems and processes also require greater investments in people, methods and technologies.

The health percentage recovered somewhat in 2018, but should be raised further. Employee satisfaction increased, as shown in the excellent results of the Great Place to Work (GPtW) evaluation in the Netherlands and Belgium.

A change in the method for taking fingerprints led to negative feedback from clients and a critical report from a consumer radio programme. DELA immediately changed the way it handled these fingerprints. The policy was reversed to what it was before 1 September 2018, which means that DELA only takes prints upon request and with explicit permission from the bereaved. We also amended the mails in which descendants are informed of the options for tangible mementos. Independent research did not show any indications that the fingerprints had been used for fraud.

Tasks and responsibilities of the Supervisory Board
The tasks and responsibilities of the Supervisory Board comprise supervising the Executive Board and the general course of affairs in the cooperative and the associated companies. In addition, the Supervisory Board provides the Executive Board with advice, weighing all the relevant interests, including those of its members and employees. In addition to its supervisory and advisory role, the Supervisory Board functions as the employer of the Executive Board members. These members also act as the Supervisory Board of DELA Holding NV and of the principal company DELA Natura- en levensverzekeringen NV.

Supervisory and advisory role
In 2018, the Supervisory Board was kept regularly informed about the realisation of the cooperative goals, strategy and risks related to the company activities, the setup and functioning of internal risk management and control systems, the financial reporting process, compliance with legislation and regulations and the risk policy. The Supervisory Board assessed whether the capital allocation, investment policy and liquidity position were in line with the risk appetite at a strategic level. Moreover, it exchanged ideas with the Executive Board and the Board of DELA Netherlands in a special strategy session in the autumn of 2018 to discuss major economic, technological and social trends & developments that could have implications for DELA’s business model.

The Supervisory Board as employer
The Supervisory Board evaluates the functioning of the Executive Board members at least once a year. It also supervises the policy of the Executive Board with regard to the selection criteria and the appointment procedure for senior management. The variable remuneration for the Executive Board is determined based on financial and non-financial result-oriented agreements derived from DELA’s long-term strategy, risk appetite, multi-year goals and annual plan. Based on the performance of the Executive Board in 2018, the remuneration and appointment committee proposed that the Supervisory Board award a variable remuneration. The committee received advice from the governance remuneration policy committee and the audit and risk committee on this matter.

Composition of the Supervisory Board
The Supervisory Board agrees with the principle that the composition of its members should be such that they are able to be critical, and act independently from each other, the Executive Board and any special interests. DELA’s Supervisory Board aims for a well-balanced and diverse composition. It believes that the members in 2018 can guarantee a good balance of knowledge, expertise and competences. Due to the scheduled stepping down of two members in 2019, preparations for new appointments in 2019 have been started based on the Supervisory Board profile. Every year, it is re-assessed whether the profile is still in line with the current and future tasks and interests of the Supervisory Board.

On 31 December 2018, the Supervisory Board was composed as follows:

  • W.M. van den Goorbergh, chair
  • C.J.H. Jansen, interim chair
  • J.P. de Pender, secretary
  • W.A.P.J. Caderius van Veen RA (stepped down and re-appointed on 13 January 2018)
  • J.J.A. Leenaars RA
  • C.P.V. van der Weg

Supervisory Board meetings
During the reporting year, the Supervisory Board supervised and presented advice to the Executive Board on a continuous basis. In 2018, it had six regular meetings with the Executive Board. As usual, there were also two meetings with the general meeting. There was regular contact between the Supervisory Board chair and the Executive Board chair throughout the year. The Supervisory Board met with the confidential committee twice. In addition, the members each attended one or more meetings of the Dutch works council together with the chair of the Executive Board. There was also a strategic session with the Executive Board and Board members of DELA Netherlands in 2018.

The Supervisory Board supervised the general policy of DELA and its associated companies in the Netherlands and Belgium. The goals for 2018 and the projects from the growth strategy were discussed in every meeting. The programme for structural cost savings was given the necessary attention while developments in the field of risk management and the activities and results of capital management were recurring topics. As usual, the December agenda included the Own Risk and Solvency Assessment (ORSA) and capital policy. There was also a focus on developments in the supervision by the Netherlands Authority of the Financial Markets and DNB as well as developments in legislation and regulations. As is the case each year, the Executive Board regulations were updated and approved. The changed portfolio diversification (as of 1 July 2019) was also approved. In addition, the regulations of the Supervisory Board and committees were evaluated and determined, as they are every year. In September 2018 the Supervisory Board had a joint meeting with the investment advice committee to discuss the developments in investments, including the choice for the asset mix and the vision of the committee.

Evaluation of the Supervisory Board
The Supervisory Board discusses its own functioning at least once a year and once every three years with independent external support. The latter was the case in 2018. The reference framework of the evaluation is based on the Dutch Code of Conduct for Insurers as well as prevailing insights into good governance. The evaluation showed that the Supervisory Board is functioning adequately; it is well-informed, focused on content, well-balanced and enjoys significant engagement from its members. The chair of the Supervisory Board plays a constructive role in this regard. The audit and risk committee and the remuneration and appointment committee are functioning well and properly prepare matters for the Supervisory Board. The overall impression is that the Supervisory Board has been composed in a complementary and pluriform way. In the coming period, there will be a focus on further strengthening the Supervisory Board in the field of ICT. The Supervisory Board makes sufficient careful and well-balanced consideration of the interests of all those involved in DELA. The board room dynamics are good and there’s a pleasant, open and positively critical atmosphere. The relationship between the Supervisory Board and the Executive Board is characterised by mutual trust, which facilitates an open and in-depth dialogue.

Meetings and composition of the committees in 2018
Audit and risk committee

The audit and risk committee supports the Supervisory Board in supervising the activities of the Executive Board in areas such as financial reporting, internal risk management and control, compliance, audits, the risk policy, risk management and any risks resulting from the remuneration policy. A more detailed description of tasks is available in the section on Corporate Governance. There were four meetings of the audit and risk committee with the Executive Board in 2018.

The composition of the audit and risk committee on 31 December 2018 was:

  • W.A.P.J. Caderius van Veen RA, chair
  • J.J.A. Leenaars RA
  • J.P. de Pender

Remuneration and appointment committee
The remuneration and appointment committee supports the Supervisory Board in preparing decisions about issues such as the composition and (re)appointment to the Supervisory Board and Executive Board, remuneration of the Executive Board and the remuneration policy of the company. In 2018, the committee had three meetings with the Executive Board.

The composition of the remuneration and appointment committee on 31 December 2018 was:

  • W.M. van den Goorbergh, chair
  • C.J.H. Jansen
  • C.P.V. van der Weg

Ongoing education
The members of the Supervisory Board followed an education programme in 2018, aimed at updating and increasing the members’ expertise where necessary. The first session revolved around ‘Cost insights at DELA Netherlands’, explaining how different typologies and principles result in different perspectives on cost types and cost centres within DELA. The second session involved exponential thinking, in which the first half focused on developments in the rapidly accelerating or ‘exponential’ technologies and the associated theories, and the second part on new insights in the field of health & life expectancy – both major issues to DELA. The sessions were plenary and all members of the Supervisory Board took part.

Proposal to the general meeting of DELA Coöperatie U.A. in Eindhoven
In accordance with that determined in the statutes of DELA Coöperatie U.A., the Supervisory Board has studied the annual report and financial statement of DELA Coöperatie U.A. and approved the supplemented data. The Supervisory Board discussed the documents with the Executive Board, the internal accountant and the external accountant (Deloitte), and was informed about Deloitte’s audit statement for the 2018 DELA Coöperatie U.A. financial statement. The Supervisory Board proposes that the general meeting confirms the 2018 financial statement of DELA Coöperatie U.A. and discharges the members of the Executive Board for the applied policy in the reporting year. We also propose discharging the members of the Supervisory Board for their supervision.

In conclusion
Frans Andriessen passed away on 22 March 2019. Frans had been a member and chair of the Supervisory Board and was an honorary member of the DELA cooperative. He believed in the importance of solidarity, cared deeply about the cooperative and meant a great deal to DELA.

The Supervisory Board thanks the clients of the DELA cooperative for the trust they’ve shown in the company. We also thank all DELA employees for their efforts and involvement in the interests of the members, the insured, clients and all other stakeholders.  

Eindhoven, 17 April 2019

DELA Cooperative

The Supervisory Board

W.M. van den Goorbergh, chair J.J.A. Leenaars RA
C.J.H. Jansen, vice-chair G.H.C. de Méris RA FCA
J.P. de Pender, secretary C.P.V. van der Weg
W. A. P. J. Caderius van Veen RA