Governance Structure

GOVERNING BODIES

The ACGR describes how the group’s management bodies and the decision-making process work, highlighting the roles of the General Shareholders’ Meeting and Board of Directors as the company’s most senior governance bodies.

Board of Directors

The Board performs its duties with unity of purpose and independent judgment. It treats all shareholders equally and works towards the company’s interests, meaning the need to secure a profitable business that is sustainable in the long term, while supporting its continuity and seeking optimal economic value for the company.

It comprises 12 members, thus ensuring an efficient and participative functioning of the board. Its members are re-elected.

Each year, the Board appraises the quality and efficiency of its own functioning and that of its various committees. For the fourth straight year, it has been aided in this process by a widely respected external consultant. As part of the action plan in place to improve upon those aspects, the Board has agreed to continue strengthening its role in discussing and shaping group strategy, in supervising innovation, technology and digital transformation and in permanently monitoring the projects and issues that matter the most to each business unit.

Executive Committee

This committee has all delegated powers of the Board of Directors, except for those that cannot be delegated for legal reasons or because the bylaws say so. The committee comprises seven members. Among other duties, it monitors the performance of key business indicators and the status of the most pressing corporate matters, while also approving the operations of its competence as a delegated body of the Board of Directors.

Audit and Control Committee

It comprises three independent directors, who have been appointed in consideration of their knowledge and experience in accounting, auditing or risk management. Between them, they possess the requisite technical knowledge and expertise in relation to the sector in which the company operates. To increase the diversity of its members, Australian board member Philip Bowman was awarded a seat on the committee in 2018.

Their main duties resulting from the adoption of the recommendations contained in the Good Governance Code of Listed Companies are described below, without prejudice to any others prescribed by law.

• Supervising the generation and presentation of mandatory financial information and ensuring that the Board seeks to present accounts to the General Shareholders’ Meeting without any limitations or qualifications contained in the audit report.
• Remaining fully apprised of any structural and corporate changes planned by the company, while reporting previously to the Board of Directors on the financial terms and accounting impact of such changes, particularly in relation to the proposed exchange ratio such one exist.
• Ensuring that the company and the financial auditor adhere to rules governing the rendering of non-audit services, limits on the concentration of auditor services and other general regulations governing the independence of the financial auditor.
• Ensuring that the remuneration of the financial auditor does not compromise its quality or independence.
• Receiving regular information on activities from the Internal Audit Department.
• Ensuring the independence of the Internal Audit Division.
• Establishing and supervising a system that allows employees to confidentially and anonymously report any irregularities with potentially serious implications that may be detected at Ferrovial, particularly regarding financial and accounting matters.
• Supervising compliance with internal corporate governance and standards of conduct in the securities markets, and suggesting improvements.
• Coordinating the process of reporting non-financial information according to applicable law and benchmark international standards.

The committee held five meetings in 2018, with all members in attendance at each such meeting. The activities performed by the committee during the year are described in the report regarding its operation, available on the Ferrovial website. The Audit and Control Committee takes into account the recommendations of the CNMV Technical Guide on Audit Committees for Public-Interest Entities when going about its business.

Appointments and Remunerations Committee

The committee comprises four non-executive directors, the majority of whom are independent, including its Chairman. They all possess the knowledge, aptitude and experience needed to perform the functions entrusted to them. To increase the diversity of its members, Danish board member Hanne Sørensen was awarded a seat on the committee in 2018.

Their main duties resulting from the adoption of the recommendations contained in the Good Governance Code of Listed Companies are described below, without prejudice to any others prescribed by law.

• Proposing the basic terms of the contracts signed with members of the senior management.
• Ensuring that all non-executive directors have sufficient time to duly perform their duties.
• Ensuring compliance with the remuneration policy established by the company.
• Verifying information on remuneration for executives and senior managers contained in the various corporate documents, including the Annual Report on Director Remuneration.
• Ensuring that any conflicts of interest do not impair the independence of the advice provided to the committee.
• Reporting on the appointment of the members that are to sit on each of the committees, in view of the knowledge, skills and experience of directors and the duties of each committee.

The committee held six meetings in 2018, with all members in attendance at each such meeting. The activities performed by the committee during the year are described in the report regarding its operation, which is available on the Ferrovial website.