Modulight Corporation is a public limited liability company registered in Finland and its shares are listed on the Nasdaq First North Growth Market Finland marketplace maintained by Nasdaq Helsinki Ltd. The Company’s domicile is in Tampere.
Modulight’s administration and management is based on the Finnish Limited Liability Companies Act, the Finnish Securities Markets Act, the Company’s Articles of Association and the rules and guidelines of First North. Modulight complies with the Finnish Corporate Governance Code (Corporate Governance 2020) prepared by the Securities Market Association (www.cgfinland.fi).
The Company will prepare the first Corporate Governance Statement for the financial year 2022. The Corporate Governance Statement will be issued as a separate report and published together with the financial statements, the report of the Board of Directors and the Remuneration Report on the Company’s website.
1. The name and domicile of the company
The name of the company is Modulight Oyj and in English Modulight Corporation. The company is domiciled in Tampere
2. Line of business of the company
The line of business of the company is to conduct business mainly in the healthcare sector. The company is engaged in the development, manufacturing, marketing, rental and trade of services, equipment, components, software, as well as consulting and other business supporting these activities. The company conducts its operations both directly itself and through its subsidiaries and joint ventures. The company may own real estate and securities, as well as engage investment and financing activities that support the company’s business.
3. Board of directors
The company has a Board of Directors, consisting of a minimum of three (3) and maximum of six (6) ordinary members. The Board of Directors elects a Chair from among its members for its term. The term of office of the members of the Board of Directors expires at the closing of the Annual General Meeting following their election.
4. Chief executive officer
The company has a Chief Executive Officer who is appointed by the Board of Directors of the company.
5. Representation of the company
The Chair of the Board of Directors and the Chief Executive Officer of the company, each alone, may represent the company. The Board of Directors may grant the right to represent the company to a designated person. The Board of Directors shall decide on granting of procurations.
6. Book-entry securities system
The shares of the company belong to the book-entry securities system after the expiry of the registration period decided by the Board of Directors.
The company shall have an auditor that is an audit firm approved by the Finnish Patent and Registration Office.
The term of office of the auditor shall expire at the closing of the Annual General Meeting following their election.
8. Notice to general meeting
The notice to General Meeting shall be delivered to the shareholders no earlier than three (3) months and no later than three (3) weeks prior to the General Meeting, however, no later than nine (9) days before the record date of the General Meeting.
The notice shall be delivered to the shareholders by means of a notice published on the company’s website or in at least one national daily newspaper designated by the Board of Directors.
In order to be entitled to attend and exercise their right to speak at the General Meeting, a shareholder must notify the company of its attendance by the date specified in the notice convening the General Meeting, which date may not be earlier than ten (10) days prior to the General Meeting.
In addition to the domicile of the company, General Meetings may be held in Helsinki, Espoo or Vantaa.
9. Annual general meeting
The Annual General Meeting shall be held annually on a date decided by the Board of Directors within six (6) months from the end of the financial year.
At the Annual General Meeting, the following shall be
- the financial statements, which include the consolidated financial statements, and the annual report;
- the auditor’s report; and
- the adoption of the financial statements, which in the parent company also includes theadop-tion of the consolidated financial statements;
- the use of the profit shown on the balance sheet;
- the discharge from liability of the members of the Board of Directors and the Chief Executive Officer;
- the remuneration of the members of the Board of Directors and the auditor;
- the number of the members of the Board of Directors
- 8.the members of the Board of Directors;
- the auditor;
- other matters potentially included in the notice to the Annual General Meeting.
10. Financial period
The financial period of the company is the calendar year.
The Annual General Meeting is the highest decision-making body of Modulight. The Annual General Meeting is held at the company’s domicile in Tampere and convened by the Board of Directors. The Annual General Meeting is held annually on a date determined by the Board of Directors within six (6) months of the end of the financial year. An Extraordinary General Meeting may be convened to discuss a specific matter when the Board of Directors deems it appropriate or otherwise required by law.
The Annual General Meeting decides on matters required by the Companies Act and the Articles of Association.
The Annual General Meeting decides on:
- Approval of the financial statements
- Distribution of profits
- Discharging the Board of Directors and the CEO from liability
- Electing the members of the Board of Directors and the auditor and deciding on their remuneration
The competence of the General Meeting also includes amending the Articles of Association, deciding on the purchase of the company’s own shares, share issues and stock option programs, and authorizing the Board of Directors to decide on such.
If possible, the Annual General Meeting will be attended by the Board of Directors as a whole and any person nominated as a member of the Board for the first time.
The notice shall be delivered to the shareholders by means of a notice published on the Company’s website or in at least one national daily newspaper designated by the Board of Directors.
Modulight publishes the minutes of the General Meeting on the company’s website and keeps them available to shareholders for at least five (5) years after the General Meeting.
Shareholders’ rights at the General Meeting
Modulight has one series of shares and each share carries one vote at the Annual General Meeting. A shareholder may personally attend the General Meeting or they may exercise the rights of a shareholder by way of proxy representation. At the General Meeting, all shareholders have the right to ask questions and propose resolutions on matters under consideration.
Shareholders’ Nomination Board
The Shareholders’ Nomination Board is a shareholder body responsible for preparing proposals to the General Meeting regarding the election and remuneration of the members of the Board of Directors.
The main task of the Nomination Board is to ensure that the Board of Directors and its members have sufficient knowledge and experience to meet the company’s needs, and to prepare well-founded proposals for the Annual General Meeting regarding the election and remuneration of the members of the Board of Directors. In order to ensure sufficient expertise, the Nomination Board must take into account the legislation and the recommendations of the Corporate Governance Code. In addition to the above, the Nomination Board must take into account the independence requirements in the Corporate Governance Code and the rules of First North concerning the Company.
Each shareholder of the Company may also submit their own proposal directly to the Annual General Meeting.
The process for electing the members and the Chair of the Shareholders’ Nomination Board, as well as the composition and the duties of the Nomination Board have been specified, in more detail, in the Charter adopted for the Nomination Board.
Pursuant to the Companies Act and the Articles of Association, the Board of Directors is in charge of the Company’s administration and the proper organization of operations, and represents the Company.
The Company’s Board of Directors comprises of 3-6 ordinary members. The members of the Board of Directors are elected by the Annual General Meeting for a term of office that ends at the close of the Annual General Meeting that first follows their election.
The Board of Directors has drawn up a written charter, which defines its main tasks and operating principles. The responsibilities of the Board of Directors include:
- Adopting the Company’s strategy and monitoring its implementation
- approving the Company’s financial statements and interim reports and supervising the appropriateness of the accounts and the Company’s financial affairs
- deciding on significant individual investments as well as corporate and real estate acquisitions and strategically significant business expansions and reductions, confirms the Company’s long-term strategic and financial objectives and approves budgets and risk management principles
- approving and confirming the charters of Board committees, as well as the Company’s internal guidelines and remuneration policy, and decides on incentive schemes for the CEO and the personnel
- electing the CEO of the Company and decides on the terms of his/her employment
Self-assessment and independence assessment
The Board of Directors evaluates its operations and working methods annually. This assessment is carried out as a combination of internal self-assessment and external assessment. The Board of Directors also assesses the independence of its members from the Company and significant shareholders annually and as required.
In order to increase the efficiency of its work, the Board of Directors has established a Remuneration Committee. The Board of Directors annually elects the members and the chair of the committee from among its members and approves the written charter of the committee.
The Remuneration Committee prepares the remuneration and appointment matters of the CEO and other senior management of the Company, as well as the incentive schemes for other personnel. The Remuneration Committee comprises of at least three (3) members of the Board of Directors. The committee meets as necessary, but at least two (2) times a year.
The Board of Directors appoints the CEO and decides on the terms of his/her employment, which are defined in a written CEO agreement. The CEO is responsible for implementing the goals, plans, policies and objectives in the Company set by the Board of Directors. According to the Companies Act, the CEO is responsible for ensuring that the Company’s accounting complies with legislation and that the management of the Company’s assets is arranged reliably. The Board of Directors evaluates the work of the CEO and the achievement of the goals set for them.
Seppo Orsila has been Modulight’s CEO since 2019.
Modulight’s Management Team, which supports the CEO, is responsible for the development and operational activities of the Company and the business activities in accordance with the objectives set by the Board of Directors and the CEO. The Management Team assists the CEO in preparing the strategy, operating principles and other business operations and the Company’s common affairs among other things. The CEO acts as a chair of the Management Team.
Modulight’s remuneration supports achieving strategic targets, profitability, and increased shareholder value. Well-functioning and competitive remuneration is an essential tool for engaging competent directors and executives for the company. This, in turn, contributes to the financial success of the Company, and the implementation of good corporate governance.
The Board of Directors decides on the remuneration of the CEO and the members of the Management Team and the grounds for remuneration in accordance with the company’s approved remuneration policy. The remuneration of the CEO and the members of the Management Team consists of a fixed salary and a separate variable salary component (operational short-term and long-term bonuses) and long-term stock-based incentives. Modulight’s Board of Directors decides on the incentive bonus annually. Operational bonuses for the CEO and the Management Team are paid based on the achievement of the targets set for the financial year.
The proposal for remuneration of the members of the Board of Directors is prepared by the Shareholders’ Nomination Board. The General Meeting decides on the remuneration to be paid for the Board’s work and the grounds for it.
Modulight’s Remuneration Policy will be presented in the Company’s Annual General Meeting in 2022, and following that at least every fourth year and always if significant changes are proposed to it. A report on the remuneration will be annually presented in the Company’s Annual General Meeting, starting from the Annual General Meeting of 2022.
Risk management objectives and scope
The purpose of internal control is to ensure the efficiency and productivity of the Modulight’s operations, the reliability of financial and operational management reporting, and compliance with applicable legislation and regulations and internal guidelines within the Company.
Internal control is an essential part of the company’s business management and in ensuring the achievement of its business objectives. The company strives to organize internal control effectively so that deviations from the company’s targets are detected as early as possible or so that they can be prevented.
Modulight’s internal controls comprise of the internal control policy approved by the Board of Directors, and the decision-making and approval procedures, control points defined in a uniform manner in the various processes, as well as their monitoring and undertaking of corrective measures. Risk assessment forms the basis for effective internal control. Control functions ensure that the realization of identified risks is minimised.
Modulight’s risk management is guided by the risk management policy. The objective of the risk management is to create operational conditions in which business-related risks are managed comprehensively and systematically at all levels of the organisation. The principle is to identify risks, assess their magnitude and significance, define risk mitigation measures and decide on their implementation and monitor of their effects.
Modulight uses a group-level risk assessment and monitoring model and conducts a comprehensive risk assessment annually, in which the most significant risks to the company’s strategy and other objectives are assessed, as well as their probability and impact on business, and risk management measures are mapped. If necessary, the risk assessments are updated, for example, for the risk assessments in the interim reports.
Modulight’s Board of Directors is responsible for defining the company’s risk-taking level, decides on taking strategic risks and is responsible for monitoring the results of risk management and evaluating its effectiveness.
Risks relating to Modulight’s business
- Decreased availability of the Company’s materials or loss or decreased performance of the Company’s material suppliers or substantial price increase in their services may adversely affect the Company;
- The Company operates complex, hard-to-replace machinery within a single production plant, any disruption of which could adversely affect the Company’s business;
- The Company’s production and business are affected by the ongoing global shortage of semiconductors;
- The Company may be unable to obtain or maintain international regulatory qualifications or approvals for its current or future products and indications, which could harm its business;
- The Company’s ability to compete depends upon its ability to innovate, to develop and commercialize new products and product enhancements, and to identify new markets for its technology;
- Increased competition or new technologies may adversely affect the Company’s results;
- The Company’s business is exposed to financial, social and political developments in countries across the world which may adversely affect the Company’s results;
- Within the medical and biomedical sectors, the Company’s business strategy depends on the success of its customers;
- The Company may suffer interruptions or failures of its information technology (“IT”), network or communications systems and/or cyber security breaches;
- If the Company is unable to guard its intellectual property rights (“IPRs”) and trade secrets, its competitive advantage could be eroded; and
- If the Company or the Company’s customers fail to obtain or maintain necessary U.S. Food and Drug Administration clearances for its products and indications, these clearances may be delayed and there may be federal or state level regulatory changes in the United States that may harm the Company’s business operations.
Risks and associated changes are reported to the company’s Board of Directors. Modulight’s Board of Directors discusses the most material risks, their management and evaluates the effectiveness of risk management at least once a year.
Financial and operational risks and the related risk management actions are regularly reported to the management team. Strategic risks are discussed by the Board of Directors annually in connection with the company’s strategy discussion.
Central risks and risk management actions are reported annually in the annual report and interim reports, and on a case by case basis as necessary.
Modulight does not have a separate internal audit function, and internal audit responsibilities have been divided inside the company among different bodies and functions as described below. The Board of Directors may use external experts to conduct separate evaluations of the control environment or control functions. The audit plan of the company’s external auditor must take into account the fact that the company does not have an internal audit function.
Modulight complies with the EU Market Abuse Regulation ((EU) 596/2014 as amended) and with the lower-level regulations issued pursuant thereto as well as with the Finnish Securities Markets Act (746/2012 as amended), regulations and guidelines issued by the competent authorities, and Nasdaq First North Growth Market – Rulebook and the Guidelines for Insiders by Nasdaq Helsinki Ltd).
The company’s insider guidelines consist of the Nasdaq Helsinki Ltd’s insider guidelines in force at the time, with the company-specific specifications. Modulight’s Insider Policy has been approved by the Board of Directors. Modulight has appointed an insider manager, who is responsible for maintaining insider lists in the company, handling trading restrictions and the obligation to report and disclose transactions, internal communication and training related to insider matters, and the supervision of insider matters. The company has internal procedures for disclosing inside information, possibly postponing the disclosure of inside information and maintaining project-specific insider lists.
The company has defined, as persons discharging managerial responsibilities, the members and deputy members of the Board of Directors, the CEO and its deputy, as well as the members of the Group Management (“Managers”). Managers and their closely associated persons must report their own transactions conducted with the company’s financial instruments or financial derivatives to the company promptly and no later than three business days after the date of the transaction.
Modulight shall publish the transaction announcements made by the Managers and their closely associated persons in accordance with Article 19 of the MAR in a company release without delay and no later than two (2) business days after receiving the notification.
The company complies with the trading restriction on managers under Article 19 (11) of the MAR Regulation (closed period) of 30 days before the announcement of an interim financial report or a year-end report. In addition, the company has separately identified certain persons who participate in the preparation of financial statements or who have access to the relevant information and who are subject to a trading restriction of similar length and content (closed period).
Notification of transactions
The Managers and their close associates are obliged to notify the company and the Financial Supervisory Authority of the transactions made with the company’s financial instruments without delay and no later than within three working days from the date of the transaction.
The company and the Financial Supervisory Authority must be notified of at least all transactions that exceed the annual threshold of EUR 5,000. Notifications are made using the Financial Supervisory Authority’s electronic form and sent to the company by e-mail to and to the Financial Supervisory Authority using a secure e-mail connection: https://securemail.bof.fi to firstname.lastname@example.org.
The Disclosure Policy describes the key principles that Modulight, as a listed company, complies with in its investor communication and financial reporting and when communicating with its shareholders and other capital market parties, media and other stakeholders. The key principles of the communication and disclosure of the Company are timeliness, consistency, impartiality, transparency, and responsibility.
The Company adheres to a 30-day silent period before the publication of a half year report or financial statements release.
Modulight has a Whistleblowing Channel through which any suspected abuse of the regulations and provisions can be reported. The whistleblowing channel is a specialized service, designed to protect a whistleblower’s identity when a report is made. If the whistleblower does not disclose his/her identity when making the report, he/she will stay anonymous throughout the whole process.
All received reports are handled confidentially.
Read our Whistleblowing Policy here.
According to the Articles of Association, the Company must have an auditor, which is an audit firm approved by the Finnish Patent and Registration Office. The auditor’s term of office ends at the end of the first Annual General Meeting following the election.
The statutory audit includes the audit of the Company’s accounts, financial statements and administration. In addition to the annual auditor’s report, the auditors regularly report to the Board of Directors on their audit findings and participate annually at least in one Board meeting.
The Board of Directors prepares a proposal for the election of the auditor and the auditor’s fee for the General Meeting, and the General Meeting elects the Company’s auditor and decides on the auditor’s fee.
Moore Rewinet Oy Ab, acts as the Company’s Auditor with Jari Paloniemi, Authorised Public Accountant, as the auditor with principal responsibility. Jari Paloniemi is registered in the register of auditors referred to in Chapter 6, Section 9 of the Auditing Act (1141/2015, as amended).
Danske Bank A/S, Finland Branch will act as the Company’s Certified Adviser referred to in the Nasdaq First North Growth Market Rulebook.
Contact details of the Certified Adviser:
Danske Bank A/S, Finland Branch
Tel. +358 40 414 5358