Right, we are on, and it is a great pleasure for us to welcome all those present to our annual general meeting. My name is Stein Erik Hagen, and I'm the chair of the board, and I would now like to declare this annual general meeting open. This is the first time that we've invited shareholders to an annual general meeting, while at the same time asking our shareholders to stay at home if possible. We thank all shareholders for complying with our request, so that we are able to conduct this annual general meeting within the applicable infection control regimen, while at the same time hope that many follow us via webcast. The annual general meeting has been scheduled by the board pursuant to Article eleven of the Articles of Association.
The notice dated 26/03/ 2020 , was sent to all shareholders with a known address. It was also announced in a stock exchange bulletin and on our website, that same day. The board of directors decided, in line with the Article twelve, second subsections, of our articles, that the documents to be dealt with at this general meeting would not be sent out along with a convening letter, but instead be made available to the shareholders on the corporate website. The corporate website also features the financial statements, along with the directors' report and the auditors' report, the enclosures to agenda items three, four, five, and six, as well as the Nomination Committee's list of nominees.
The financial statements and the directors' report, and the Nomination Committee’s list of nominees was announced on March 28th, while the other enclosures were announced together with the notice dated March 26th. Any shareholders who nevertheless prefer hard copies of the documents have been able to get them at no charge by requesting them from the company. Are there any objections to the notice? That does not seem to be the case, so the Annual General Meeting is hereby declared to have been convened legally. I would now like to introduce those present. It is me, Chair of the Board of Directors, Stein Erik Hagen, and also the proposed moderator, Ida Espolin Johnson, and the Annual General Meeting secretariat, represented by Camilla Teljesdal Robstad, Director of Legal Affairs. CEO, Jan Ivar Semlitsch, and CFO, Harald Ullevoldsæter, will be physically present here during the presentations.
The company's auditor, Erik Mamelund, participates digitally, and he will also participate later. I now want to introduce the company's board of directors. It is me. Well, I mean, you can read it yourself. There's some information about the individual board members. Next is Grace Reksten Skaugen, Deputy Chair. Next is Ingrid Jonasson Blank. Next is Lars Dahlgren, who we see there, and Nils Selte. Liselott Kilaas. Peter Agnefjäll. And Deputy Board Member Caroline Hagen Kjos. We also have those elected by and from among the representatives, Terje Udstrand and Sverre Josvanger, and Roger Vangen and Karin Hansson. We have a list of shareholders here present, the proxies and absentee ballots, and we are waiting for it to be delivered to us. We have to wait another moment, it seems. All right, this is the list of shareholders present.
The secretariat has prepared a list of the number of shareholders who have voted in advance or who have met by proxies, 505 persons. Those who have been here, 1 ,000,588,000 shares; 48.7% of the total share capital. 48.79% of the share capital who were eligible for votes. You're able to vote for all shares represented at the general meeting, and this is signed by DNB and also our external auditor. The interpreter is not quite sure of the exact number of shareholders registered. Next, item on the agenda is that the annual general meeting was opened by the chair of the board. And the first item on the agenda is the election of a moderator.
The board moves that Ida Espolin Johnson be elected moderator. Ida Espolin Johnson is independent of the company's board of directors and group executive board. She herself is not a shareholder in Orkla. Is there anyone who does not vote in favor of the motion? That does not seem to be the case. A shareholder is also to be appointed to co-sign the minutes along with the chair, and Camilla Teljesdal Robstad, who is in attendance, is proposed. Are there any other proposals? The nomination is hereby approved. I will now give the floor to our moderator, Ida Espolin Johnson.
Thank you, Chair. Before we start, I would like to say a few words about the way we are conducting this year's annual general meeting. As the chair mentioned, we find ourselves in a special situation, and for the first time, we have advised shareholders not to attend in person.
The attendance of representatives of the Board of Directors and the group executive board are also kept to a minimum, and as a result, only a few people are present in this auditorium today, and consequently, dialogue with other attendees will be limited. Under the Norwegian Coronavirus Act, interim regulations relating to the conduct of Annual General Meetings have been laid down, aiming to facilitate so that CEOs and auditors can participate without being present in person. The CEO and CFO will hold their presentations in this room, but will follow the rest of the Annual General Meeting digitally. The auditor will also participate digitally, and comment on this auditor's report via video link. We hope that many shareholders will follow the Annual General Meeting by webcast.
You will not be able to ask questions the same way as you would have been able to do if you attended in person. If you do have any questions to any of the items presented, please put them through the company through regular channels. They will then be replied to, but outside of the general meeting. Shareholders were encouraged to exercise the shareholder rights by casting advanced votes or use proxies, which many people have done. We see that the number of votes represented are on par with previous years' annual general meetings. A detailed list of advanced votes and proxies for each item will be attached to the minutes of this annual general meeting, and I will also read out the registered votes against each motion for the individual item on the agenda.
Next is agenda item two, approval of the financial statement for 2019 for Orkla ASA and the Orkla Group, and the directors' report, including approval of a share dividend for 2019 of NOK 2.60 per share, except for treasury shares. The directors' report and the proposed annual accounts and balance sheet for 2019 for Orkla ASA and for the group, and the auditors' report, have been made available on the company's website and have been sent to all shareholders who have requested them. I assume that those of you who follow the AGM have familiarized yourselves with the contents so that it's not necessary for me to read all the documents aloud. Under this item, the procedure will be as follows: Chief Executive Officer of Orkla, Jan Ivar Semlitsch, will first give us a briefing on the group's development and strategic position.
He will then give the floor to the Group CFO, Harald Ullevoldsæter, who will then present key items from the financial statements for 2019 and give us a briefing on the share dividend proposal. The Chair of the Board will also give some comments on the proposal for share dividend. We will then open... After, sorry, after that, we will be presented with the auditor's report. I now give the floor to CEO Jan Ivar Semlitsch.
Thank you, Ida Espolin Johnson, and good morning to everybody. My name is Jan Ivar Semlitsch, and I am the Group CEO of Orkla. Firstly, I would like to thank you for the commitment you show by taking part in Orkla's annual general meeting under slightly different circumstances than we are accustomed to. As you may be aware, my first day at work in Orkla was on the fifteenth of August last year, and I must say that it has been eight very eventful months. Today, I'd like to give you a brief summary of the year of 2019 , and say a little about the situation we're facing with COVID-19. CFO 2019.
Our portfolio of strong local brands form the core of our operations, and our strengths lie in adapting local consumer preferences based on unique customer and consumer insights. In 2019, Orkla's delivered organic growth. By responding to consumer trends, we are focused more on sustainability and have experienced progress for plant-based products. An increasing number of our launches respond to demands for more environmentally friendly goods and healthier food. Over the last year, we have also made acquisitions. In line with our strategy of growing in new channels, we've strengthened our position in food service through the acquisition of Lecora and Easyfood.
Within health drinks, we've purchased 43.5% of the brand, Captain Kombucha, and we acquired 20% of the Iceland chocolate and candy manufacturer, Nói Síríus, which has several number one positions in the local market. Orkla Food Ingredients have made acquisitions which have strengthened our position as a supplier of ingredients and sundry items for bakery and the ice cream market through the acquisition of Vamo, Zeelandia, Kanakis, Risberg Import AB , and Confection by Design Limited. In 2019, we also implemented Project Future, purpose of which was to strengthen Orkla's competitive power. Changes in the organization of concerned functions will ensure that we are flexible, we can rapidly adapt to changes and new trends in the market, and secure that innovative processes and commercial decisions can be made closer and more closely following the market.
One important key point took place in March of this year, when the head office was finally finished, Orklahuset at Skøyen in Oslo. More than 900 people work here, and I, myself, was very pleased to have Orklahuset as my new place of work in August, when I began as Group CEO in Orkla. The first months, I gave a lot of priority to and spent a lot of time in visiting so many of our operations as possible. I've appreciated these visits, where I become better known with various parts of the group, and in particular, I have become well known with many of the competent and committed coworkers. I've also tried and tasted a large part of our portfolio. In addition to skilled individuals and strong brands, Orkla is facing exciting opportunities.
For me, it's important that we continue to take a role as a challenger in addition to defending our positions. One example can be within plant-based foods and opportunities that are present there. We also have several local brands, which I believe have the potential in a larger geographical catchment area. Further, I am genuinely concerned about sustainability. As a major player in the market, I believe that Orkla has a responsibility to make a difference, and this may be a crucial competitive advantage for us. I believe that Orkla has a sound fundament and foundation, and several opportunities on which to build. And my experiences from these last months form a useful basis for facing the current situation.
At the beginning of the 2020 , I was looking forward to taking on board new tasks and facing new opportunities. We had just put in place the last members of my group management team, and my team was complete when COVID-19 was defined as a serious pandemic by the World Health Organization, and most of our markets introduced stringent restrictions in society in order to limit the spread of infections. Our main priority is to secure health and safety for our employees. And high on our list of priorities is also to ensure that our products do reach out to our customers and to the consumers. In most countries, Orkla has been defined as having a critical role in society as a supplier of foodstuffs.
At present, we have eight employees who have the coronavirus infection among over 18,000 employees in Orkla. We are constantly working on contingency plans and measures in order to limit negative effects, and to continue to supply critical products in the market. I'm impressed by our employees in this situation. Many people have worked through the Easter in order to deliver the goods. Others are going to work, and there is a great deal of uncertainty about what the next days may bring for their roles and their tasks. In addition to handling an extreme contingency situation, our operations will also focus on how we will get out of this in a stronger manner. I'm nervous about how the next months will be.
I don't think we will ever get back to the world the way it was before COVID-19. Consumer habits will be changed, but Orkla will also be present in the new daily life of everybody. For this reason, I think it's good, in conclusion, to dwell on our vision. Your friend every day, as also on this day with many uncertain factors, is highly topical. We will be where the consumer is. We will be a friend they can trust in and adapt to new consumer habits and needs. And now, I'd like to hand over to CFO Harald Ullevoldsæter. Thank you very much for your attention.
Thank you, Jan Ivar. My name is Harald Ullevoldsæter, as he said, and I've been CFO in Orkla since the first of March this year, but I have a long history in Orkla. I also served as CFO in Nortura for five years. This is my first annual general meeting, and I would have liked to take this opportunity to meet more of Orkla's shareholders in person, but this year, we'll have to meet via the screen only. Let's go through some of the 2019 highlights. The Orkla group's turnover increased by approximately 7% in 2019. This increase was driven by organic growth in the branded consumer goods and contributions from mergers and acquisition and positive foreign currency effects. EBIT adjusted grew by 6.5%, driven by profit improvement for Branded Consumer Goods, including contributions from acquired activities.
The result from associates joint ventures also consist of mainly Orkla's 42.6% stake in Jotun. Jotun delivered an all-time high contribution in 2019, totaling 625 million NOK, up from 258 million NOK in 2018. This was driven by strong sales growth and increased gross margins. In total, this gave earnings per share of 3.84 NOK, up 19% from the previous year. For the financial year 2019, the Board of Directors proposed a dividend of 2.60 NOK per share, on a par with last year's. The proposal for a dividend payout will be dealt with later on our agenda. As was mentioned, Orkla made good progress in terms of turnover and EBIT adjusted in 2019, both in the range of 7%.
The group's other income and expenses of a negative NOK 561 million was greatly attributed to amortization of goodwill, linked to our activities from Paint Tools in the UK, and writedowns related to Gerimax and Colon brands in Orkla Health. We have also incurred costs related to mergers and acquisitions and integrations, as well as improvement processes in the group. Gains, among other things related to the sale of property and companies, had a positive effect. The biggest gain came from the sale of Treschows gate 16, which totaled NOK 294 million. Adjustment in the reported EBIT for the group was 5.4%. As I said, good progress in Jotun contributed to profit growth from associates and joint venture companies.
Orkla reported NOK 255 million in interest and financial costs, and approximately NOK 1 billion in taxes in 2019. The tax rate was 24% if one disregards the profits from associates which had already been booked after taxes. Net profit after taxes was 3.9 billion Norwegian kroner, compared with 3.4 billion kroner in 2018. Earnings per share was 3.84 kroner, up from 3.24 kroner the previous year. Adjusted for other income and expenses, after estimated tax, earnings per share was 4.24 kroner, which is an increase of 17%. These were the highlights for the group, and I will now go into more details about Orkla's consume- Branded Consumer Goods developments.
The Branded Consumer Goods total turnover increased by over 7% in 2019, and as you can see from the left-hand chart, organic growth accounted for 1.3% of this increase. Furthermore, turnover from foreign activities, converted to Norwegian kroner, increased by 1.2% as a result of the weakened Norwegian kroner in 2019. Turnover growth from mergers and acquisition total almost 5% in 2019. The acquisitions we have done in recent years have mainly been outside of Norway, and this has resulted in a more international Orkla, with a significantly stronger position in the Baltics and Central Europe. Norway is still our biggest market, but, 70% of our turnover is now from activities outside of Norway. Let's look at the profit and profitability in the Consumer Branded Goods segment.
A left-hand chart shows the developments in adjusted EBIT for the Branded Consumer Goods, including headquarters from 2018- 2019. As you will see, growth was approximately 9% and consisted of an underlying improvement of 4.1%, plus foreign currency effects and contributions from acquisitions totaling 5%. The right-hand chart shows the profit margin for Branded Consumer Goods activities, including headquarters, and came to 11.2%, an underlying progress of 0.3 percentage point. The increase was mainly driven by increased focus on revenue management, as well as an advantageous mix effect. Let's look at the developments broken down by business area. We start by looking at organic growth, turnover growth, which is a key value driver for our types of activities.
Organic top-line growth for the Branded Consumer Goods was 1.3%. We note that three of our business areas reported growth, while one was on a par with the previous year and one area saw a decline. Our biggest business area, Orkla Foods, made a broad-based progress in most markets. A lot of this growth came from plant-based products, which is a focus area. And Confectionery & Snacks could also report good growth in all companies. The reversal of the sugar tax in Norway, effective from first of January, 2019, resulted in strong growth for the categories affected because of the change in the consumers' buying patterns. Outside of Norway, sales growth was good in Sweden, Denmark, and Finland, while the Baltic countries saw a moderate growth. In Care, organic growth was flat.
Organic growth in Orkla Home and Personal Care and Orkla Wound Care were offset by the decline for Orkla Health, among other things, which saw the decline in both Norway and Sweden. Orkla Food Ingredients also reported good growth in bakery ingredients in several markets, and we also saw a good growth in plant-based products under the Naturli' brand. Consumer Investments are also part of our Orkla Consumer and Financial Investments business area, established in 2019. Consumer Investments consist of our activities in paint tools, Orkla House Care, basic textiles, the Pierre Robert Group, professional cleaning and detergents under Lilleborg brand, and out of home restaurant in terms of Kotipizza and Gorm's. And the organic decline in Consumer Investments can be attributed to the decline for the Pierre Robert Group, among others.
If we move on to the reported profit trend per business area, we see that all areas contributed to improvement from 2018 to 2019. Foods saw profit growth in all markets in 2019, mainly driven by higher sales and an improved mix, but also due to cost improvements. Increased sales prices to customers and a more active portfolio management compensated for increased raw material costs and negative effects from a weakened Swedish and Norwegian kroner in 2019. Confectionery & S nacks reported profit growth in all markets, except from in Denmark, driven by good turnover growth. Implemented cost improvement projects also compensated for higher raw material costs and negative foreign currency effects. In Care, the profit was positively affected by mix effects and revenue management, but these effects were offset by increased advertising costs and depreciations.
In Food Ingredients, profit improvement was generated by a combination of structural growth, organic improvements linked to bakery ingredients, as well as a somewhat more profitable product mix. Profit growth in Consumer Investments was driven by the acquisition of Kotipizza, a weakened result in Pierre Robert was offsetting this. Increased costs at headquarters was mainly attributable to. Let me take a moment to get the slide up. All right, as I said, increased headquarters costs can be attributable mainly to higher bonus costs as a result of increased market value for the Orkla share throughout the year, a change of principle for costing of Orkla's long-term incentive scheme in the previous years, and costs linked to pension obligations. Let's now take a look at Orkla's activities outside the branded consumer goods segment.
Orkla has some investments, linked to the branded consumer goods, organized under the Industrial and Financial Investments business area. Well, I apologize. I will pause a moment to sort out some, technical difficulties there. We'll try again. Orkla has some investments outside of the branded consumer, goods, organized under Industrial and Financial Investments. It comprises, the associates, Jotun, and the consolidated, joint ventures of Hydro Power and Orkla Financial Investments. As mentioned, Jotun saw an historically high turnover and operating profit in 2019. Revenue growth was reported in all regions and segments, and the marked growth in the operating profit is mainly due to a solid, sales growth, as well as improved growth margins due to increased sales prices and somewhat lower raw material costs.
Profit decline in Hydro Power can be attributable to a lower production volume and also somewhat lower, power prices throughout the year. Financial Investments consists mainly of Orkla's property engagements, which had a book value of 1.8 billion NOK as at the 31/12/ 2019, where the most important asset is Orkla's new headquarters. The EBIT, profit from financial investment was 10 million NOK in 2019, compared with, - 3 million NOK in 2019. Let's take a closer look at the cash flow statement, for the previous years. This chart shows development in the group's net interest-bearing debt, net expansion CapEx increased mainly as a result of, ongoing investments in new ERP systems. Cash flow from operations, still amounted to almost 5 billion NOK.
The increase compared to previous years was almost NOK 1.5 billion, mainly related to reduced OpEx and improved operating profit. The improvement in the OpEx was driven both by an improvement in trade payables and reduced inventories. And as we see, an overall CapEx was approximately NOK 1.5 billion higher than cash flow from operations. An ordinary dividend of NOK 2.60 per share was paid out in dividend for the financial year 2018, and in total, dividends came to NOK 2.6 billion. Expansion CapEx and also net acquisitions total just over NOK 3 billion. The growth in expansion investments was related to a high investment in Orkla Foods, especially linked to the investment program for the Stranda Pizza production in Norway.
The investments mainly related to the companies of Treschow Street number 16, and Oslo Business Park. The acquisition of Kotipizza Group was the biggest share of acquisitions. The net interest bearing debt, including leasing effects related to IFRS 16, and came to NOK 6.6 billion, which is equivalent to the operating profit or EBITDA for 2019. Orkla has a sound balance sheet, and with a net interest bearing debt the level with 1x EBITDA, we are still well within our long-term ceiling of 2.5 times EBITDA. The average maturity of our debt is 3.7 years, and we don't have any major maturity that falls due in the next few years.
And, as you will see, from the right-hand pie chart, we also had unused credit facilities of almost NOK 6 billion at year-end. By way of conclusion, I would also make some comments regarding the dividend, which will be dealt with later on the agenda. Orkla's dividend policy implies an ambition to increase the dividend payouts. And as the chart shows, Orkla has never reduced the dividend throughout the past 27 years. Dividend will normally be within the 50%-70% range of earnings per share, and the company also has a target of maintaining a high credit worthiness. Orkla's Board of Directors has proposed to pay a dividend for 2019 of NOK 2.60 per share. This is at the same level as the previous year, and is equivalent to 68% of earnings per share.
These are special days, and many activities experience great amount of uncertainty linked to the coronavirus outbreak. We've seen examples of companies who reduce, cancel, or postpone the decisions regarding dividends to later this year. The Orkla administration considers that the proposed dividend payout can be justified based on Orkla's strong financial position and a cash flow that is only moderately affected by the COVID-19. With the proviso that dividend for 2019 will be approved during today's annual general meeting, Orkla will have paid out NOK 40 billion to shareholders over the past 10 years. Taking into consideration the fact that the Orkla share gave a yield of 36% in 2019. And with these words, I would like to give the floor back to Stein Erik Hagen, the Chair of the Board. Thank you.
Orkla's shareholders are to receive a competitive return on their investments through a combination of dividends and growth in the value of their shares over time. Orkla's dividend strategy attaches importance to predictability and stability. Orkla has never reduced its ordinary dividend compared with previous years. The Board of Directors have deemed it right to maintain dividend payout, even in such times of crisis as the present. As we heard Harald Ullevoldsæter say in his presentation, Orkla has a strong balance sheet and a financial capability which enable us to do this in a way we can fully justify.
Orkla has a large shareholder base, ranging from small savers to larger investors and pension funds, and we believe it is important for the country's economy that companies such as Orkla pay dividend and contribute to keep the ball rolling during times that are taking a difficult toll on many people. Thank you. I now thank you for your presentations, and I now invite State Authorized Public Accountant Erik Mamelund to present the auditor's report submitted by the elected accountant, Ernst & Young AS. You will find it in our annual report on pages 215 to 217. Erik Mamelund, are you following us?
I hope you can hear me.
Yes, we hear you excellently. Thank you.
All right, thank you.
As mentioned by the moderator, our auditor's report is presented on pages 215-217 of the annual report, and the conclusions are shown on screen. Our auditor's report is addressed to the general meeting and is signed and dated 11/03/ 2020 . Our auditor's report concluded that, in our opinion, the financial statements of the parent company and the group give an accurate account of the financial position of the parent company. And, as at thirty-first of December, of the comprehensive income and cash flows during the year. And also, the information disclosed in the directors' report, the report on corporate governance, and the allocation of the profit, are consistent with the financial statements and in compliance with legislation and regulations. In other words, we have given Orkla a clean auditor's report.
With these words, I will now give the floor back to you, Ida.
Thank you, Auditor. Excellent. Are there any questions or comments after the presentations we have heard? I now open the floor for any such questions and answers, but there seems to be none. We put item two to the vote. The board puts the following motion and recommendations before the AGM: approval of the financial statements for 2019 for Orkla ASA and the Orkla Group, as well as the directors' report, including approval of a share dividend for 2019 of NOK 2.60 per share, except for treasury shares.
Is there anyone who does not vote in favor of approving the income statement and balance sheet for 2019 for Orkla ASA and for the group, as well as the director's report, including approval of a share dividend of NOK 2.60 per share? I would like to remind you that under the law, there is no opportunity for the general meeting to resolve payout of a dividend higher than the proposed. Are there anyone voting against? That does not seem to be the case. Any abstentions? That does not seem to be the case. And I will now refer to votes against the, that we have received by the company and registered in connection with the AGM. 486,252,129 votes in favor, and 613,007 votes against.
Going forward, I will only mention the votes against, but I would like to also indicate that the votes against is a very small proportion of total amount of votes cast. So here, 613,007 votes against. That is a combination of advanced votes and votes by proxies. Next, we move to Next, the addendum program.
To item three, and the Board of Directors is required, pursuant to Section 16 A of the Norwegian Public Limited Companies Act, to prepare a statement of guidelines for pay and other remuneration for senior executives. The statement consists of four segments: salary and other remuneration of the general manager and other key management personnel, guidelines for stipulation of pay and other remuneration in the upcoming financial year, explanation of the executive salary policy pursued in the preceding fiscal year, and finally, new or amended agreements with the CEO and other leading employees during the past fiscal year. General meetings shall discuss the board's statement, Section 5-6 of the Norwegian Public Limited Companies Act, and the general meeting shall conduct an advisory vote on the board's guideline for the upcoming financial year, approve the guidelines for share-based incentive schemes. That's what we will do.
I'll now give the floor to Stein Erik Hagen, who will take you through the Board of Directors' statement. Thank you. Orkla's terms and conditions policy is the total of instruments available to attract, further develop, and retain the expertise we need. Monetary part is divided into two elements: fixed remuneration, that's fixed salary and accrual of pension, and variable components, annual bonus, and long-term bonus program. The guidelines recommend being competitive in respect to the fixed salaries based on the market median for comparable enterprises, while the potential inherent in the bonus schemes is to exceed the median. Orkla's senior management are part of the group's central bonus program, STI. This program has a maximum limit of 100% of regular salary as of thirty-first of December in the accrued year.
With effect from 2020, the scheme will focus on the achievement of ambitious predefined goals that can provide a bonus of around 50% of one's regular salary, as of 31st of December of the year of accrual. The annual bonus scheme for 2020 for group functions, including the Group CEO, contains an element relating to the yield on the Orkla share, weighted by 25%, and this part of the program is therefore being presented for approval by the annual general meeting. Since 2012, Orkla has had a cash-based long-term incentive program, LTI, for managers and key personnel. The board of directors proposes to replace this cash-based program with a program based on share options.
The proposed new program has been described in detail in the statement of guidelines for the pay and other remuneration of senior management in note five, and supplemental information about the program has also been posted on Orkla's website. I will therefore restrict myself here to underscoring the guiding principles of the new program, which are: to create a closer alignment of interest between shareholders and executives, base awards on performance criteria that support long-term value creation, create a strong retention element, allowing Orkla to retain its best-performing leaders, and to avoid excessive rewards by capping maximum payout participants can receive, require that participants invest proceeds in Orkla shares and that these are held over time.
For several years, the group has offered a program that gives employees the opportunity to buy a limited number of shares at a discount in relation to the market price of the share. For the year 2019, three different alternatives were offered: NOK 28,000, NOK 15,000, and NOK 8,000 rebated amounts given. The Board of Directors recommends that the general meeting resolves to continue the share scheme for employees, but that the purchase options be adjusted to NOK 30,000, NOK 15,000, and NOK 10,000 rebated amounts, that the discount be maintained at the current level, 25%, and that the lock-in period be increased from two to three years. I now give the floor back to the moderator.
Thank you. The floor is now open for questions and/or comments.
... appear to be none, then we will then move to item three two, which is the advisory vote on Orkla's terms and conditions policy, and approval of the share of related items. Proposed resolution is the general meeting endorses the board's statement on remuneration to key management, plus, as described in Note 5.2 to the accounts for Orkla. Would anyone care to vote against this? If not, then, this has then been adopted, against, with votes against 7,630,960. If we now move on to item three three, agenda item three three, approval of guidelines for share-related schemes.
The proposed motion here is the Annual General Meeting approves the Board of Directors' proposal for share-related remuneration, as described in Note 5.3, relating to, one, that part of the short-term incentive program for group functions, including the group's CEO, relating to the yield of the Orkla share. Two, and a share option-based long-term incentive program for executives and key personnel. And three, the sale of shares at 25% discount to employees with a three-year lock-in period. Would anyone care to vote against this proposal? Question, group functions, could you explain this in further detail? Would the group CEO like to define this term, group functions? Yes, I can do. Group functions is part of the key staff in Orkla ASA, which includes the HR director, human relations, and also some important critical support functions. It's a limited number of individuals.
That was the response to your question. That's a defined group. Then I would ask, would anyone care to vote against this proposal? Appears not to be the case, and here we have received advanced votes and voting instructions against 8,897,663 which are registered as voting against, and the proposal has been adopted with an overwhelming majority. Then to item four, report on the company's corporate governance, and we talk about the concept known in English as corporate governance. The Norwegian rules are listed, among other places, in the Norwegian Code of Practice for Corporate Governance, which is referred to as the Code of Practice.
The code entails that the board must ensure that the company implements sound corporate governance, and provides a report on the company's corporate governance in the annual report. If the company does not fully comply with this code of practice, this must be explained in the report, which is comply or explain. Further, it states the company should clarify its basic corporate values and formulate ethical guidelines in accordance with these values. Listed companies that have corporate governance must make a clear internal allocation of responsibilities and duties between the shareholders or directors in the day-to-day management, must give an overall report in the annual report or in a document referred to in the annual report. The report will be dealt with at the general meeting as an information item, so the general meeting need not approve the report.
This ensues from Section five, six, fourth subsection of the Public Limited Liability Companies Act. Orkla reports in compliance with Section 3-3b of the Norwegian Accounting Act, as well as the Code of Practice. Detailed report can be found on pages 43- 54 of the annual report. As indicated in this report, Orkla is largely in compliance with the Code of Practice for the most part. Orkla has reported two minor departures from the Code of Practice, and for the sake of order, these are explained in a separate enclosure to the notice of meeting, in addition to what is evidenced from the report. Since the report has been made available to the shareholders in advance of the AGM, I assume that we do not need to reiterate the contents in detail. Are there any questions or comments regarding this report?
That appears not to be the case. I would then invite the general meeting to take this report under advisement. That's now been done, and then we move to item five.
Item five, authorization for the board to acquire treasury shares. At the annual general meeting on the 25/04/ 2019, the board was authorized to acquire treasury shares up until the annual general meeting in 2020. That is now. Each year, the general meeting has authorized the board of directors to buy back treasury shares, and these authorizations have been used for moderate buybacks. The aggregate holding of treasury shares, as of the date of the notice of the meeting, was 1,125,182 shares. The board of directors has proposed that the authorization be renewed. An account outlining the justification for this item has been included in an attachment to the notice of meeting, and I will hereby highlight only a few elements of.
One, buyback of Treasury shares for amortization is one of several means that the company has to transfer values to the shareholders, in that the value of the remaining shares will increase, and the Board of Directors wishes to have this means at its disposal. Number two, in addition, the company has a certain need for its own shares in order to meet obligations under the currently applicable incentive programs, adopted at various general meetings and share purchase programs for employees. For this reason, the proposal assumes, as in previous years, that any shares acquired by the company under the terms of this authorization may only be used for one of two purposes.
One is amortization that is stricken, and any motion for amortizations will then be put before the general meeting, or they can be used to fulfill the company's obligations under incentive programs for employees, such as general meetings previously, and this general meeting have decided. Are there any comments or questions about the report? No questions. The Board of Directors has specified two special purposes for which the authorization can be used. It cannot be used for other purposes. We will vote on each of the individual purposes. So I will read the entire recommendation.
One, the general meeting of Orkla ASA hereby authorizes the board of directors to permit the company to acquire shares in Orkla ASA with a nominal value of up to NOK 125 million, divided among a maximum of 100 million shares, provided that the company's holding of treasury shares does not exceed 10% of shares outstanding at any given time. The amount that may be paid per share shall be no less than NOK 20 and no more than NOK 120. The board of directors shall have a free hand with respect to methods of acquisition and disposal of treasury shares. This authorization shall apply from 17/04/ 2020, until the date of the annual general meeting in 2021.
Number two, the authorization can be used to fulfill current incentive programs adopted for employees and incentive programs for employees adopted by the general meeting under item three three on the agenda. Number three, the authorization may be used for the acquisition of shares for amortization. Are there any votes against the proposal for an authorization and the use of the same as specified under two? Let me see. Actually, there are 2,172,817 advance votes and proxy votes against this proposal, so this has to hereby being approved. Are there any votes against the proposal for an authorization and the use of same as specified in three?
That does not seem to be the case, and we have 3,404,869 votes, and advance votes and proxy votes, against. So this has also been approved. Next is item six, amendment of Orkla's Articles of Association. New draft Articles of Association for Orkla have been proposed, and the complete draft was attached to the notice convening the meeting, and a version showing the current articles and the new draft articles may also be found on Orkla's website. I now give the floor to Stein Erik Hagen, Chair of the Board, who will account for the background for this draft. The board of directors proposes new draft Articles of Association to the annual general meeting.
The most important amendments proposed are described in an attachment to the notice of the meeting, but I would like to highlight the following. The amendments are mainly a simplification and updating of the Articles of Association. The aim has generally been to delete from the Articles of Association what already derives directly from law or should instead be regulated in the rules of procedure for the Board of Directors, et cetera. In terms of contents, I would like to point to the amendment of the objects clause, which it is proposed be amended so as to better reflect the current activities and strategic direction, and I'll give the floor back to the moderator.
Are there any comments or any questions to the new draft Articles of Association? That does not seem to be the case.
A complete set of new Articles of Association has been submitted, and we put the motion in its entirety up for a vote. I would like to call your attention to the fact that any amendments of the Articles of Association requires a two-thirds majority of both votes cast and capital represented. Are there anyone who does? Any votes against the proposal for an amendment of the articles? That does not seem to be the case. We have received 7,796 advance and proxy votes against, so it is hereby approved. Next is item seven, amendments of the instructions for the Nomination Committee in Orkla ASA. Today, the board of directors comprises the function of deputy chair. There is no mandatory requirement for such a function, and it's therefore a question of what the board deems practical.
In order to allow some flexibility for the board in this regard, we propose to amend Article three two in the instructions for the Nomination Committee. Are there any votes against the proposal for an amendment of the instructions for the Nomination Committee in Orkla ASA? That does not seem to be the case. 7,796 votes have been cast against this motion, and therefore it is approved.
This brings us now to agenda items eight to 12, elections and decisions concerning the remuneration of the Board of Directors and the Nomination Committee. The agenda items eight through 12 concern the election of members of the Board of Directors and deputies, the election of members for and the chair of the Nomination Committee, and remuneration of the Board of Directors and the Nomination Committee. The Nomination Committee's roster of nominees is dated 20/03/ 2020. That's hardly likely to be a coincidence, and it's been available to the shareholders on the company's website. We will deal with these items as follows. First, I will give you a brief account of the work and recommendations of the Nomination Committee, and then we will go back and vote on each individual item.
The Nomination Committee has consisted of Anders Christian Stray Ryssdal as Chair, and Leif Askvik, Nils-Henrik Pettersson, and Karin Bing Orgland as other members. In addition, the committee is supplemented with an employee representative, Vidar Dahl, at the recommendation of the Chair of the Board of Directors, and his views are heard in connection with the determination of remuneration. The composition of the Nomination Committee takes into account the community of shareholders and fulfills the criteria listed in the Norwegian Guidelines for Corporate Governance. The Annual General Meeting has provided its own set of instructions for the Nomination Committee. These instructions, which are available on Orkla's website, contain rules concerning composition elections, remuneration, the task of the Nomination Committee, requirements concerning composition and independence, and administrative procedures.
The Nomination Committee's recommendations contain a description of the work of the Nomination Committee, and I will therefore not detail this now. I'd now like to present to you the Nomination Committee's recommendations regarding the election of members of the Board of Directors and one deputy, election of members too, and the chair of the Nomination Committee, and proposals regarding remuneration of the Board of Directors and the Nomination Committee. Let's begin with the Nomination Committee's recommendation for the election of members for the Board of Directors and one deputy. Members of the Board of Directors and one deputy were elected at the Annual General Meeting on 25/04/2019 , for a term of office lasting one year. All of the shareholder-elected Board members and the deputy are therefore up for election. Board of Directors currently consists of seven shareholder-elected members and one deputy.
Grace Reksten Skaugen and Lars Dahlgren are not seeking re-election, and the nomination committee proposes Anna Mossberg and Anders Kristiansen as new members. Anna Mossberg has experience from telecoms and digitization, from a career in TeliaSonera, Deutsche Telekom, and most recently, from her position as industry leader of Google. She will contribute considerable insight, particularly within the field of digitization. Anders Kristiansen has experience from the retail trade in the field of office supplies, and in recent years, from the fashion industry. He will contribute considerable insight as well, particularly within the areas of consumer understanding and branding. Both of these are relevant competencies for Orkla. The nomination committee recommends re-election of the other members of the Board of Directors, Stein Erik Hagen, Ingrid Jonasson Blank, Nils Selte, Liselott Kilaas, and Peter Agnefjäll.
In addition, the Nomination Committee recommends the re-election of Caroline Hagen Kjos as a personal deputy for Stein Erik Hagen and Nils Selte. Term of office for members of the Board of Directors and deputy, pursuant to Article four-third subsection of the Articles of Association, term of office may be set at a period of up to two years. In the opinion of the Nomination Committee, an annual review of the Board of Directors composition will provide greater flexibility, and it is therefore proposed that the term of office be set at a period of one year.
As regards the Nomination Committee's recommendation for the election of the chair of the board of directors, the following is said: At the annual general meeting on 25/04/2019 , Stein Erik Hagen was re-elected as chair of the board of directors, and Grace Reksten Skaugen was re-elected as deputy chair. In line with current practice, the term of office was set at one year. The nomination committee proposes the re-election of Stein Erik Hagen as chair of the board of directors. Pursuant to the system outlined in the Norwegian Public Limited Companies Act, the election of the chair of the board of directors is the task of Orkla ASA, and for this reason, the recommendation will not be presented for a vote by the annual general meeting. The Nomination Committee's recommendation concerning the election of members of the nomination committee.
Anders Christian Stray Ryssdal, Leif Askvik, and Karin Bing Orgland were elected in 2018 for a period of two years and are up for re-election this year. Nils-Henrik Pettersson was last year elected for a period of two years and is therefore not up for election this year. It follows from the annual general meeting's instructions that recommendations for the election of members of the Nomination Committee shall be presented by a unanimous Nomination Committee. The unanimous Nomination Committee recommends that Anders Christian Stray Ryssdal be re-elected, and that Kjetil Houg and Rebekka Glasser Herlofsen be elected as new members. Kjetil Houg is the CEO of the Norwegian National Insurance Fund, Folketrygdfondet, and he represents Norwegian institutional shareholders. Rebekka Glasser Herlofsen is the Chief Financial Officer of Wallenius Wilhelmsen ASA, and she represents, in this context, international institutional shareholders.
The Nomination Committee recommends the election of a term of office for a period of two years. Then to the Nomination Committee's recommendation for the election of the chair of the Nomination Anders Christian Stray Ryssdal was elected chair of the Nomination Committee in 2014, was re-elected as chair in 2018. The Nomination Committee recommends Anders Christian Stray Ryssdal be re-elected as chair of the Nomination Committee. The Nomination Committee's proposed remuneration of members of the Board of Directors. The Nomination Committee is of the opinion that the current rate of remuneration is at a satisfactory level, given the current situation, and has therefore proposed that the rates of remuneration remain unchanged. The rates of remuneration are shown here on screen.
I will say that the chair of the Board has a fee of NOK 843,000 and NOK 537,000 for shareholder-elected Board members. This is shown on screen. The Annual General Meeting resolved in 2017 at the Board of Directors shareholder-elected members must each year spend one-third of their gross Board members' remuneration to purchase shares in Orkla ASA, until such time as they own shares in Orkla at a value corresponding to twice their Board members' remuneration. Then the Norwegian Nomination Committee's recommendation concerning remuneration to the members of the nomination committee. The Nomination Committee proposes an adjustment to the rate of remuneration in order to bring this more in line with levels in other comparable companies.
Following the proposed adjustment, these rates of remuneration will be at the lower end of the scale compared with other comparable companies. So the proposed rate is then an increase from NOK 65,000 for the committee chair, from NOK 65,000 to NOK 80,000, for a member, from NOK 47,000 to NOK 60,000, and the employee elected representative NOK 7,000 per meeting from, up from NOK 6,500. The proposed remuneration rate should apply until such time as a new decision is made, is taken. Let's now move to the discussion and voting on each of the agenda items 8 through 12, and we'll begin with agenda item 8 and the election of members of the Board of Directors.
I therefore propose the election of members of the board, recommending the re-election of Stein Erik Hagen as Chair of the Board, Ingrid Jonasson Blank, Nils Selte, Liselott Kilaas, and Peter Agnefjäll as members of the Board of Directors, and the election of Anna Mossberg and Anders Kristiansen as new members of the Board of Directors. In addition, the Nomination Committee recommends the re-election of Caroline Hagen Kjos as a personal deputy for Stein Erik Hagen and Nils Selte. There is now an opportunity for questions and comments, and to open for alternative candidates. Are there any questions, comments, or alternative candidates? That does not appear to be the case. Then we move to the ballot.
There are no alternative proposals for the recommendation of the nomination committee as regards candidates, therefore propose that we vote on the Nomination Committee's nominations for members of the Board of Directors, and we vote them on these together. Is there anyone who does not vote in favor of the motion? That appears not to be the case. As regards the received advanced votes and voting instructions, they are rather different for each of these. I propose that I don't need to read these for each individual, but that it will appear in the minutes, from today's Annual General Meeting. Then, if we can go to item eight- three. No, rather eight- four. Eight-t hree has been adopted. Eight- four, which is the nomination committee. It says item eight, but it should be item nine.
We go to the election of members for the nomination committee. The nomination committee proposes the re-election of Anders Christian Stray Ryssdal, and the election of Kjetil Houg and Rebekka Glasser Herlofsen as new members of Orkla's nomination committee. Are there any other proposals? That does not appear to be the case. And as regards 91,02 5,022 advance votes and voting instructions against. As regards the term of office, it is proposed to be two years. Is there a need to vote on this, or can we assume this is okay? This appears to be okay. Then agenda item ten, election of the chair of the nomination committee. The nomination committee then proposes the re-election Anders Christian Stray Ryssdal as chair of the nomination committee.
Anyone who does not vote in favor of the motion? That appears not to be the case. There, we have received 23, 513 instructions and advance votes Anders Christian Stray Ryssdal has now been voted then as Chair of the Nomination Committee. And then, remuneration to the directors. Anyone who would not? Here we've received 620, 904 advance votes and voting instructions against. And then item twelve, which is remuneration of the Nomination Committee's members. Anyone who does not vote in favor of the motion? That appears not to be the case. And here, then, we have received 622, 989 advance votes and voting instructions against that proposal.
That takes us through the agenda, which takes us then to agenda item 13, approval of the auditors' remuneration. Cost of statutory auditing services for Orkla ASA for 2019 is subject to the approval of the general meeting, and amounted to NOK 3,437,736. The aggregate remuneration to Ernst & Young AS for the group in 2019 totaled around NOK 38.4 million. These fees essentially relate to auditing of the group companies, NOK 31 million, but also includes some advisory service, services, NOK 7 million. Auditing fees to other auditors come to about, NOK 2.3 million. Reference is made to note five of the accounts of Orkla ASA.
For a more detailed description, I propose the auditor's fee of NOK 3,437,736 be approved. Any other proposals? Anyone votes against? That appears not to be the case. Here we have received 162,177 votes from advance votes and voting instructions against. So there are no other items that require discussion or votes on the agenda that require a decision by the general meeting. I would ask Camilla Teljesdal Robstad to remain in the venue to co-sign the minutes, all votes been counted and the results announced. I will then finally thank you for those of you who are here present and also attending digitally.
I'll give the floor to the Chair of the Board, Stein Erik Hagen, to round off today's annual general meeting.
Thank you, Ida, for chairing this rather uncommon annual general meeting, but we have managed. And I would like to thank Grace Reksten Skaugen and Lars Dahlgren, both members of the board, who are not standing for re-election, for and have been sitting on the board for respectively eight and six years. They have contributed extremely well to the work of the board of directors. I'd also like to thank the management here, the group CEO and the 18,000 coworkers here in Norway and in many other countries, who every day make sure that there is value creation for Orkla.
And also, given the current situation we are in, I'd like to thank all of you who are working in the factories, in our offices, in our plants, who are really working hard in these rather demanding times and are keeping the wheels turning for us as you are doing. So thank you. I'd like to thank all of you who are both here present and who have followed us, and thank you very much for a good annual general meeting. Thank you.