Code of Good Governance

Introduction

Pursuant to the provisions of article 19.3.e of its articles of association, the Board of Trustees of the AMANCIO ORTEGA FOUNDATION (hereinafter "AOF") is empowered to approve and implement all those codes of good governance and internal regulations it deems fit in order to ensure the good governance of the institution and the effective fulfilment of the Foundation’s objectives. Accordingly, the AOF Board of Trustees has approved this Code of Good Governance which determines the values, principles and behaviour guidelines that its trustees, officers and employees must abide by, and which the AOF shall pass on to its suppliers and collaborators.

Foundation object and key action areas

The overall object of the AOF is to promote, foment, develop, implement and fund activities of all types that contribute to the dissemination and spreading of all forms of culture, education, research, social action, care and science.

Guided by the experience of its founder and his wish to contribute to building a better society, the Amancio Ortega Foundation works to generate opportunities in two key sectors in order to enable individuals to enjoy quality of life: Education and Social Welfare.

  • In the field of education, this institution provides its program beneficiaries with resources which allow them to grow and enrich their environment through comprehensive training.
  • In the area of social assistance, the Amancio Ortega Foundation carries out both self-managed activities as well as collaborations with institutions which have consolidated their labor thanks to the constant dedication for the benefit of the underprivileged people and their environments.
The governing body

The Board, as the Foundation’s governing and representative body, must fulfill the foundational purposes and manage the assets and rights which are part of the Foundation’s equity, preserving them at full capacity in the terms provided in the regulations on foundations.

The Board of Trustees shall carry out its functions, as stipulated in the legal regulations and the Foundation’s articles of association. Specifically, section FOUR of said articles includes full details of its composition, responsibilities and procedures.

The Board of Trustees must act in accordance with the founder’s wishes, as stipulated in the articles of association and pursuant to the legislation in force.

The Board of Trustees shall be made up of a minimum of five members. The founder shall be an ex-officio and lifelong member of the Board of Trustees and can appoint trustees either on a permanent basis or for a limited period.

Any other people appointed to form part of the Board will have the condition of elective trustees and they will carry out their term during a five year period, and may be re-elected.

The Board of Trustees must include the offices of Chair and Secretary, and there may also be one or more Vice-Chairs and a Vice-Secretary:

  • The Chair of the Board of Trustees is the Foundation’s most senior representative, and must also perform the functions assigned to this office in the AOF’s articles of association. The founder shall hold the office of Chair of the Foundation ex-officio by public deed or any form of attestation.
  • Should the office of Chair be vacant, or in the event of absence or sickness, the Vice-Chairs by order, or in their absence the oldest member of the Board of Trustees, shall carry out the functions of Chair, as well as all others as determined by the Board of Trustees. In the event of the death of the Chair prior to the appointment of his successor in accordance with the provisions of the articles of association and until the office is filled, the Vice-Chair corresponding by order shall chair the Board of Trustees.
  • The Secretary is responsible for safeguarding the Foundation documents, recording the minutes of the Board of Trustee meetings, issuing all necessary certificates and reports as well as all other functions included in the articles of association or that are expressly assigned thereto.
  • The Vice Secretary shall provide the Secretary with all necessary support, acting on his/her behalf in the event of illness, absence or vacancy of the post, as well as all other functions included in the articles of association or that are expressly assigned thereto.

Without prejudice to the rights assigned to the Founder, the members of the Board of Trustees shall be appointed on the proposal of the Chair or two thirds of the members thereof by means of an agreement adopted with the votes in favour of two thirds of those present, provided that this also represents an absolute majority of the Board of Trustee members.

In the event of a vacancy, the Board of Trustees shall meet within a maximum of thirty days in order to appoint a replacement or to amortise the vacancy, which shall require an agreement adopted with the quorum defined above.

The termination and suspension of the Foundation’s trustees will occur for the reasons provided in the regulation of foundations and, in addition, except for ex-officio and for life members, at the age of 68 years. The founder or the Board of Trustees, through a resolution passed with the favorable vote of two thirds of the attendees, as long as, in addition, it involves the absolute majority of its members, may agree to suspend or terminate elective trustees without the need of calling upon any other reason than the Foundation’s best interest.

All cases of resignation shall be considered effective following notification to this effect to the Board of Trustees.

The Board of Trustees shall meet at least twice a year, and as many times as necessary in the interests of the Foundation. Said meetings may be convened at the personal initiative of the Chair or at the request of half plus one of its members. The meetings may be held anywhere in Spain or abroad.

Notwithstanding the preceding paragraph, there is no need for a prior calling and the Board of Trustees will be validly constituted to deal with any issue when all the trustees are present and agree unanimously on holding the meeting and on its agenda.

The Board’s meetings are validly constituted when attended, in person or by representation, in the manner provided by the law, by at least half plus one of its trustees.

Except in those cases where the regulations governing foundations or the articles of association require a specific forum, agreements shall be adopted by a majority of those present. In the event of a tied vote, the Chair shall hold the casting vote.

Key deliberations and the agreements adopted at Board of Trustee meetings must be included in the minutes recorded in the corresponding log and signed by the persons acting as Chair and Secretary.

The minutes may be approved at the same or the following meeting held by the Board of Trustees. Certificates corresponding to these minutes and Board of Trustees agreements shall be issued by the Secretary with the approval of the Chair, or, where appropriate, by the persons acting on his behalf.

Should the Board of Trustees fail to appoint the person or persons responsible for executing the agreements, this task shall be understood to correspond to the Chair.

Although the Secretary and Vice-Secretary do not hold the office of trustee, they shall be entitled to record Board of Trustee agreements as public documents.

Appointment as a trustee of the AOF requires the strict compliance with a number of obligations:

  • To be duly informed and comply fully with all actions in accordance with the legal provisions applicable to the AOF.
  • To attend the Board of Trustee meetings convened, duly prepare the issues to be addressed and participate actively in said meetings. When unable to attend, trustees must delegate their vote to another person, providing them with all necessary instructions.
  • To carry out their office with the due diligence of a loyal representative.
  • To maintain the strictest confidentiality regarding all issues dealt with, as well as the decisions taken by the Board of Trustees.
  • To guarantee the independence of the Board of Trustees, by not accepting any gifts of a value that may compromise them and reporting any conflicts of interest that may arise.
  • To duly protect the Foundation’s public image, particularly before those institutions and organisations where the Board of Trustees is acting on behalf of the AOF, disseminating the Foundation’s work and achievements.
  • To maintain the Foundation’s assets and review its financial situation, ensuring that the Foundation has the necessary resources in order to fulfil its mission.
  • To provide all due consideration for the Foundation’s objectives, articles of association and this Code, as well as all other regulations approved by the Board of Trustees when considering all proposals, decisions or actions.

The trustees hold joint and several liability before the Foundation for all damages caused by actions that breach the law or the articles of association, or those carried out without the due diligence their office requires. Those trustees that voted against the agreement and those that can prove that, not having intervened in the adoption and execution thereof, were unaware of its existence or, being aware of it, took all necessary action to prevent said damage or at least expressly opposed it, shall be exempt from liability.

The trustees will exercise their position free of charge without being able to receive remuneration for the performance of their duties, without prejudice to their right to be reimbursed for duly justified expenses incurred by the performance of their duties.

Guiding principles for the good governance of the Amancio Ortega Foundation (AOF)

The decisions and actions of AOF trustees must be based on the following guiding principles, which must also be passed on to the management team, collaborators and suppliers:

  • Strict compliance with the legislation in force and the internationally acknowledged ethical principles included in the Universal Declaration of Human Rights.
  • A professional approach of respect, trust and mutual cooperation towards employees, collaborators and beneficiaries, firmly rejecting all forms of harassment and intimidating or offensive behaviour towards the rights of individuals.
  • No discrimination of any form attributable to the race, ethnicity, colour, nationality, marital status, sexual orientation, ideology, trade union membership, religion, family situation, disability or any other condition of its employees.
  • Transparency when reporting on the Foundation’s activity and its sources of funding.
  • The ongoing assessment of AOF resources and investments in order to guarantee the feasibility and optimum efficiency of institution operations and the execution of all planned actions.
  • Institutional independence, based on adopting decisions and actions that objectively safeguard the interests of the AOF and not personal ones. All efforts must also be made to avoid any conflict of interests.
  • Solidarity, promoting the exchange of know-how and proximity between people; contributing to joint ventures, participation and responsibility.
  • Understanding of the needs and enthusiasm of others, transferred into an approach based on shared social values within a healthy environment characterised by a sense of generosity, team spirit and comradeship.
  • A commitment to achieving optimum levels of personal performance, based on dedication and determination.
  • Hard work and effort when contributing innovative information to others, characterised by tenacity, enthusiasm and resolve.
  • Authenticity, accepting personal limitations in a modest and honourable manner.
Relations with stakeholders
Relations with donors

In those instances where the AOF receives and accepts donations, the Board of Trustees and the Management Team must display maximum transparency towards their donors, guarantee that their contributions will be used for the agreed purposes and respond at the earliest possible opportunity to all requests for information regarding the use to which the funds have been put.

Likewise, due compliance with donors’ right to confidentiality, respecting their wish for anonymity and not disclosing information about them, except for the details required by law, particularly those related to the prevention of money laundering.

Relations with volunteers

In those cases where the AOF enlists volunteers, their participation shall be of an altruistic nature and in accordance with the legislation in force.

Their participation shall be subject to the signing of a Volunteer Agreement that defines the volunteers’ functions, rights and obligations. Following the signing thereof, the AOF undertakes to train the volunteers and to take out insurance policies that will cover all risks of accident and illness whilst carrying out the volunteer activity, as well as civil liability claims for damage to third parties lodged against the volunteers or the AOF.

Relations with employees

The AOF will encourage its employees’ professional development and offer equal career opportunities. In this sense, the AOF applies ethical standards in all recruitment and selection processes (both for internal staff or third parties).

The AOF provides its employees with the necessary means to carry out their activity. Likewise, the AOF adopts all preventive measures contemplated by the applicable legislation in order to guarantee its employees’ health and safety.

Public information

Each year, AOF officers are required to present the annual accounts and action plan before the Trusteeship.

Furthermore, the AOF website hosted at the following URL: www.faortega.org, shall provide the public with information about its projects, collaborations and beneficiaries, as well as its annual accounts. This same channel must also include updated details of the Foundation’s objectives, articles of association and information about the Board of Trustees and good governance included in this document.

Account audits and reporting

The AOF Foundation shall draw up a Code of Conduct for marketable securities investments and shall apply internal financial auditing devices to safeguard the Foundation’s assets, based on the principles of coherence, security, liquidity, diversification, profitability and transparency.

The effectiveness of the investments made shall also be monitored by introducing social impact indicators and measuring the effective results of each project or action. In the case of donations to beneficiaries, mechanisms will be introduced to guarantee the correct application of economic resources or materials donated in accordance with the agreed objectives.

The annual accounts will be audited by an external body.

Performance appraisal

The Board of Trustees shall carry out an annual appraisal of the AOF’s performance, based not merely on compliance with the objectives set and the use of Foundation resources, but also on criteria that include commitment, dedication, creativity, and innovation, control of its management and HR resources as well as the satisfaction of its beneficiaries.

Validity

This Code shall be included in the AOF’s internal regulations and shall remain in force until an agreement is reached regarding its cancellation or modification.

Any modifications made to this Code require the approval of the AOF’s Board of Trustees.

Acceptance and compliance

All members of the Board of Trustees are required to comply with this Code of Good Governance, and must provide written acceptance and commitment to their professional compliance with the values, principles and rules of conduct contained herein.

Failure to comply with the Code of Good Governance compromises the Foundation’s good name and corporate image, and therefore all trustees are required to inform the Chair, or in his absence one of the Vice Chairs, of any actions they may be aware of that breach or may constitute a breach of the Code, thereby allowing for the corresponding actions to be adopted in the light of the aforementioned breach.

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