SWX Swiss Exchange issues reprimand against UMS Schweizerische
Metallwerke Holding AG
The SWX Swiss Exchange has determined that UMS Schweizerische Metallwerke Holding AG,
Dornach, has violated the provisions of the Listing Rules and the Corporate Governance
Directive. The company provided false information in its 2005 Corporate Governance report with
regard to the highest total compensation paid, as well as described incompletely the tasks and
areas of responsibility of the Audit Committee. In addition, it failed to disclose the minimum
amount of information concerning the supervisory and control instruments pertaining to the
external audit. The Executive Committee of the Admission Board of SWX has therefore issued a
reprimand with related publication against UMS Schweizerische Metallwerke Holding AG. The
company lodged an appeal of this decision with the Disciplinary Commission of SWX, which in
turn dismissed the appeal and affirmed the decision of the Executive Committee.
The 2005 Corporate Governance report of UMS Schweizerische Metallwerke Holding AG (UMS) was not
drawn up in full compliance with the Listing Rules and the Corporate Governance Directive (DCG):
Issuers are obligated to disclose separately the total compensation of the member of the board who
received the highest total sum of overall compensations. In its 2005 corporate governance report,
UMS indicated the amount of CHF 62,500 as being the highest total compensation paid to a member
of the board of directors. The highest total compensation correctly amounted to CHF 549,319.
Listed companies must disclose the composition of all board committees, as well as the tasks and
areas of responsibility of those committees. The company's 2005 Corporate Governance report
indicated that the Audit Committee is a committee of the board of directors. As to the tasks and areas
of responsibility of that committee, UMS stated merely that the Audit Committee works in close
collaboration with the external auditors. However, as evidenced by its Audit Committee Rules, the
company has a highly detailed and comprehensive set of rules that govern the tasks and areas of
responsibility of the committee, a fact that was not disclosed in the company's 2005 corporate
The company must disclose the supervisory and control instruments that the board of directors has at
its disposal to assess the external audit. Included in that requirement is at least the disclosure of
information on how the external auditors report to the board of directors, or on the number of
meetings of the audit committee in which representatives of the external auditors participated.
Accordingly, as a minimum requirement, UMS should have disclosed how the external auditors report
to the board of directors, as well as the fact that the Audit Committee held six meetings with the
external auditors. The information associated with these minimum requirements must be clearly and
explicitly presented in the Corporate Governance report.
Due to these violations of the provisions of DCG and the Listing Rules, the Executive Committee of the
Admission Board issued a reprimand with related publication against UMS. The company's appeal of that
decision was dismissed by the Disciplinary Commission of SWX and the decision of the Executive
Committee was affirmed.
Periodic reporting in compliance with applicable Directives forms an integral part of the information that
contributes to a properly functioning market in accordance with the provisions of the Stock Exchange Act
and the Listing Rules. One of the tasks of SWX is to enforce the transparency provisions that apply to
Information on the corporate governance regulations is available at:
Previous sanctions imposed by SWX in the area of corporate governance are available at:
Should you have any questions, please feel free to contact Mr. Werner Vogt, Spokesman SWX Swiss Exchange.
Phone: +41(0)58 854 26 75
Fax: +41(0)58 854 27 10
SWX Swiss Exchange
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