CORPORATE GOVERNANCE

Alm. Brand A/S regularly reviews its corporate governance standards.

We believe good corporate governance is key to achieving our goals, which in addition to a number of specific financial targets and growth targets include targets for customer satisfaction and employee satisfaction.

We believe in maintaining a good and constructive dialogue with the external community as a prerequisite for the right pricing of the Alm. Brand share.

The Board of Directors and Management Board of Alm. Brand believe good corporate governance should be based on an overall view that considers the interaction with all stakeholders, including shareholders, employees, creditors, suppliers, customers and the local community.

The belief that good corporate governance is based on an overall view also follows from the Nørby Committee's definition of good corporate governance. Alm. Brand has therefore chosen to base its future efforts in corporate governance on that definition.

The committee for good Corporate Governance regularly reviews its specific recommendations for good Corporate Governance and Alm. Brand considers each of these following the comply or explain principle. The recommendations are classified under eight main headings which are stated below followed by Alm. Brand's position as to each recommendations and Alm. Brand Bank's position as to the main headings IV - VI of the recommendations:

 

I The role of the shareholders and their interaction with the management of the company
Each share carries one vote at general meetings. Alm. Brand A-shares were abolished in connection with the merger in 2001, and there is proportionality between capital investments and voting rights. There are no restrictions on voting rights.

The shareholders in general meeting elect the members of the Board of Directors of Alm. Brand. Alm. Brand A/S has a principal shareholder: Alm. Brand af 1792 fmba, which holds some 60% of the shares.

In 2003, a new member who had no affiliation to the principal shareholder was elected to the Board of Directors. After the number of Board members was reduced in the spring of 2004 and the introduction of an audit committee in the spring of 2009, Alm. Brand A/S now has seven Board members elected by the shareholders, two of whom has no affiliation to the principal shareholder. Adding three Board members elected by the employees of the Alm. Brand Group (from the spring of 2010 four), the Board of Directors comprises a total of ten members (from the ordinary general meeting af 2010 eleven).

In order to maximise shareholder participation and influence, all registered shareholders receive a personal invitation to general meetings. The notice convening the meeting is also published in national Danish newspapers. The notice given must not be less than 14 days.

Shareholders may vote by proxy. Proxy forms apply to a specific general meeting only. If the agenda comprises of more than one extraordinary item for consideration, shareholders will be able to differentiate their votes on the proxy forms. We will also continue to consider other methods to enhance shareholders' access to exert their influence.

Alm. Brand is continuously seeking to enhance the contact to shareholders and the equity market in general. To this end, we use a number of sources of communication, with the Internet becoming increasingly important.

II The role of stakeholders and their importance to the company
Alm. Brand believes that the company's core values and the way we conduct ourselves in relation to all stakeholders are key to the future development of the company. We are fully aware that an open and constructive dialogue with our stakeholders is in everyone's interest. In our corporate values,

• Ordinary common sense
• Mutual respect
• Holism and proximity
• Will to succeed

we have therefore defined a set of rules applicable to the interaction with Alm. Brand stakeholders. Management has also approved a number of communication policies towards shareholders, employees, the press, and others.

The corporate values apply to all matters throughout the group, and Alm. Brand management continuously monitors compliance with these values. Furthermore, it focuses on ensuring that the communication policies adopted are implemented.

III Openness and transparency
Alm. Brand wishes to maintain openness and transparency in all matters relating to Alm. Brand. We intend to achieve this against the background of ongoing contact with investors, the equity market, the press, and the public in general.

Alm. Brand publishes quarterly and half-year interim reports.

We intend to apply IFRS/IAS to our annual reports as and when these standards are implemented and ammended.

IV The tasks and responsibilities of the Board of Directors
The Board of Directors handles the overall strategic management of Alm. Brand and continuously evaluates the work of the Management Board. Alm. Brand is subject to supervision by the Danish Financial Supervisory Authority, and rules have been established with respect to responsibility, distribution of responsibilities and risk management.

Negotiations take place and decisions are made when all Board members are present. Apart from the audit committee Alm. Brand has no Board committees.

There is an ongoing dialogue between the Board of Directors and the Management Board, and guidelines have been established for the Management Board's reporting to the Board of Directors.

V Composition of the Board of Directors
When nominating candidates for Board membership, the Board of Directors ensures that the nominees have the necessary qualifications. New members are offered a tailored introduction process.

Alm. Brand believes that the factor determining whether Board members have sufficient time to perform the duties involved in their office is their work load, not the number of directorships held. Therefore, we do not intend to define a maximum number of directorships for any one Board member. Rather, we will continuously ensure that all Board members can allocate sufficient time to perform their duties. This depends on an individual assessment.

An age limit of 70 years has been set for each Board member.

Members of the Management Board of the Alm. Brand Group cannot also be members of the Board of Directors.

VI Remuneration to members of the Board of Directors and members of the Management Board
The remuneration to the members of the Board of Directors and the Management Board must be competitive and reasonable relative to the tasks to be performed and the responsibility involved.

Board members are not remunerated by way of incentive plans.

There is a bonus scheme for the Management Board, which is designed to promote long-term behaviour and a stable financial performance. The bonus scheme is not based on shares or options.

VII Audit
Alm. Brand continuously monitors its exposure to market risks, operational risks and risks related to the capital markets. Further details are available in the Annual Report.

VIII Risk management
Alm. Brand continuously considers the auditors' independene and competence etc. Alm. Brand A/S has established an audit committee compricing of the chairman and the vice-chairman of the board of directors and of an independant member of the board of directors with special skills in the field of accounting and auditing.