Public Disclosure Policy
This Procedure has been adopted for the purpose of ensuring that a fair market exists for securities in Mondi Turkey Oluklu Mukavva Kağıt ve Ambalaj Sanayi Anonim Şirketi (‘‘MCT’’) and that an equal distribution of reliable information to all investors is established.
It is also designed to avoid the creation of a false market in which a benefit can be derived by those dealing in securities on the basis of information that has not been made generally available.
2. GENERAL RULES
According to Turkish regulations, no persons are allowed to make use of inside information or make or give false or misleading statements or impressions regarding the Company, its securities or any of its transactions. Within this scope;
- Insider dealing means dealing in securities (or encouraging another person to deal in securities) while in possession of inside information relating to those securities or disclosing inside information to another person other than in the proper performance of his or her duties.
- False or misleading statements mean making false or misleading statements relating to investments in order to induce anyone to deal or refrain from dealing in investments or to exercise or refrain from exercising rights attached to investments.
- False or misleading impression means creating a false or misleading impression as to the price or value of any investment.
- Inside information means information which:
- is precise, relating to something actual or expected to happen – not assertions or possibilities,
- relates, directly or indirectly, either to MCT or Mondi
- is not generally available to the public, and
- would, if generally available to the public, be likely to have a significant effect on the price of MCT securities.
Such information includes, but is not limited to, new developments, changes in MCT’s financial condition or business performance, or changes in MCT’s expectation of its performance. Communiqué Serial:VII No:54 of the Capital Market Boards anticipates that certain information would always require announcement to the market, such as dividend declarations, board changes, profit warnings, share dealings by persons discharging managerial responsibility, changes in major interests in shares, acquisitions and disposals of a certain size, annual and interim results, rights issues and details of other offers of securities.
Within the scope of the Turkish Criminal Code and the Capital Markets Law; listed companies are required to take reasonable steps to establish and maintain adequate procedures, systems and controls to enable them to comply with their obligations. In particular, to ensure that all relevant information is released to the market on a timely basis.
This document sets out the key internal procedures, systems and controls of MCT that are in place to ensure that MCT complies with its obligations in Türkiye.
The Board has agreed the guidelines, procedures and controls within this document for the timely dissemination of inside information to all investors and other external parties.
The procedures must be adhered to. Should MCT be found to be in breach of Turkish regulations, the regulatory bodies have the power to impose sanctions on MCT and/or Mondi and the directors. These could include financial penalties and/or public censure.
Disciplinary action may be taken against any employee found to have failed to comply with these procedures. Also, depending on the circumstances, non-compliance by an employee may amount to a criminal offence.
Information classified as trade secrets shall not be disclosed to any unrelated third party without prior written approval of the authorized person(s) unless otherwise requested by law or the relevant public authority, in which case only authorized person(s) shall disclose such information to public authorities.
Within the scope of the Procedure, “Trade Secret” shall mean non-public information including, but not limited to, customer lists; goods pricing; raw materials pricing; production or operating costs; agreements or arrangements relating to the purchase, supply, financing, lease or hire of equipment; details of and agreements with customers; proposals to customers; know-how; licences; product development and business expansion plans; market information; financial information; tax incentives; employee records and management contracts; computer printouts and other such information classified as trade secrets by the relevant Turkish regulations.
Within the scope of this Procedure all references to inside information will also be understood as a reference to “Trade Secret” since there is a close connection between the two definitions.
4. PROHIBITION FOR DIRECTORS, MANAGERS AND OTHER EMPLOYEES
The Directors upper level and middle level managers and related employees who are in possession of inside information or trade secrets,
- Shall refrain from transacting or dealing with the securities of MCT either for their own account or for the account of a third party.
- Shall not share or communicate inside information or trade secrets with third parties
- Shall not provide any advice to third parties in relation to the securities.
The prohibition imposed on directors, managers and related employees includes the spouses, children, and relatives of the directors, managers and employees governed by this Procedure.
5. SYSTEMS AND CONTROLS TO MEET DISCLOSURE OBLIGATIONS
Controls over and identification and escalation of, inside information
As a member of Mondi Group, MCT will comply with Mondi’s procedures to ensure the prompt identification, confidentiality and escalation of inside information, and the timely and accurate release of information to the market.
The procedures are outlined below:
- There are well defined reporting lines within the key corporate offices with regard to escalation and consideration of events/actions that may result in the requirement to make an announcement.
- The Managing Director of MCT shall have responsibility for determining, on a timely basis, the disclosure treatment of material information and seek the approval of the BU CEO and the CEO E&I (Mondi Europe &International Division).
- In no event shall material information be made available to the public without the prior approval of the BU CEO & the CEO E&I. This includes, but is not limited to leak / cautionary announcements where a major project is in progress.
- A Trading Statement will be prepared and published as soon as MCT’s Board is satisfied that a reasonable degree of certainty exists that the financial results for the next reporting period will be more than 20 per cent different from (i) the financial results for the previous corresponding period; and/or (ii) forecast projections and indications previously provided to the market in relation to such period. The Trading Statement must include a statement advising holders of MCT’s securities that the forecast financial information has not been reviewed and reported on by the company’s auditors.
- The Board meets four times per year and it has a regular cycle of agenda items including financial reviews, strategy reviews and project evaluation. The Board also receives regular updates on regulatory changes and corporate governance best practice.
- MCT’s Chief Financial Officer will monitor the share price, press comment and analysts’ expectations and have responsibility for escalating relevant information to the BU Chief Executive Officer.
- The Company Secretary has responsibility for the maintenance of insider lists and communicating MCT’s and/ or Mondi’s dealing rules and open periods, as well as for the market announcements of dealings by persons discharging managerial responsibility. The insider list will include the spouse, the children, and any other person acting on behalf and in the interest of the person on the insider list.
- The Company Secretary monitors regulatory, legal and governance developments as they may impact MCT or Mondi.
- The Company Secretary monitors the share register and movements on the register and undertakes enquiries on a regular basis in conjunction with reports provided by MCT’s brokers and the Turkish Registrars. This information is regularly reported to Tire’s Board and the E&I Chief Financial Officer. The Company Secretary and the Managing Director have responsibility to escalate relevant information to the Board and the E&I Chief Financial Officer.
- There are established procedures for regular processes such as the release of the financial results and the production and issue of the annual report and associated documents. This will involve a limited number of employees, detailed procedural checklists to ensure strict adherence to established processes and procedures, restricted access to system drives, and password protected documents. There is a formal review by the Audit Committee and Board to sign off before public release in order to ensure accuracy of content.
- The consolidated results of MCT, together with a business commentary, are presented on a quarterly basis to the Board and to the Audit Committee.
Delaying an announcement
As far as the related communiqué of the Capital Markets Board permits, MCT may protect its legitimate interests by delaying an announcement – normally involving negotiation or impending developments – but delaying an announcement is permitted only if it does not mislead the public. A holding statement must be prepared for such situations. When delaying an announcement, MCT will ensure the confidentiality of the information.
Any decision to delay will be taken by E&I and the decision minuted and reported to the Board.
Dealing with market rumour
Where such rumours are largely accurate it would suggest that inside information has been leaked and is likely to trigger the requirement for an announcement. This may need to be a holding announcement if there would be a delay in issuing a detailed announcement.
Any decision whether or not to respond to a market rumour needs the approval of the CEO and the CEO E&I.
This option will be available only if allowed by the relevant communiqués of the Capital Markets Board. Recipients must be subject to confidentiality provisions and need the information in order to perform their employment, profession or duties. Inside information will only be disclosed if there is a legitimate purpose for the disclosure.
Dealing with analysts and the press
The Mondi Communications Manual sets out the parameters and protocols for dealing with analysts and the press. The Manual identifies those persons who have responsibility for these dealings.
No public release shall be made by MCT unless agreed by the Chief Executive Officer E&I and CEO.
Drafting and verification of an announcement and trading statements
Any financial or business related announcement or trading statement needs the prior approval of the CEO and the CEO E&I.
All announcements will contain all detailed information about the issue being communicated and will be accurate in all respects and not misleading, false or deceptive. The announcement should give the full story and not omit any material facts or anything likely to affect the import of the information. The procedures above are designed to ensure that those closest to the issue or event make certain that the announcement is accurate and not misleading. The announcement is to provide details of the following:
- any circumstance(s) or event(s) that has/have or is/are likely to have a material effect (either positive or negative) on the financial results or cash flow of such issuer and/or any of its material subsidiaries, and/or information necessary to enable holders of such issuer’s securities and the public to avoid the creation of a false market in such issuer’s listed securities;
- any development(s) in such issuer’s sphere of activity that is/are not public knowledge and which may, by virtue of its/their effect(s), lead to material movements of the reference price of such issuer’s listed securities.
The procedures above are designed to ensure that those closest to the issue or event make certain that the announcement is accurate and not misleading.
Release of an announcement
As MCT’s securities are listed on the Borsa İstanbul and related announcements might also have impacts on the Mondi securities which are listed on the London and Johannesburg Stock Exchanges, all reasonable care will be taken to ensure that whenever appropriate any disclosure of inside information to the public will be synchronized as closely as possible between Istanbul, Johannesburg and London.
- All rules and related documentation are available to MCT’s employees.
- Regular notices regarding the open periods are issued to all designated employees together with references to the location of further information on the intranet.
- Copies of the Guide for Dealing in Securities of MCT for Designated Employees, as well as the dealing consent and notification of dealing forms, are provided to each designated employee upon appointment.
- Avoidance of insider trading and market abuse are supported through the MCT Employment Manual.
- Insider Lists – employees
MCT will maintain a list of persons employed and working on its behalf who have access to inside information relating directly or indirectly to MCT. The categories of insiders – termed ‘designated employees’ – are reviewed periodically by the Company Secretary. Whilst the list will comprise those who have regular access to inside information, additional project-specific lists will also be maintained as required.
- Persons with access to inside information are identified by the Company Secretary, the Managing Director and the BU CEO. These are the persons who will always be treated as designated employees or involved in a major project / transaction.
- A list of persons and categories of persons who should always be classified as ‘designated employees’, together with the advisers’ lists, are maintained by the Company Secretary. Any project-related lists are also maintained by the Company Secretary.
- Those persons who become ‘designated employees’ either on joining MCT or when change roles, receive a pack from the Company Secretary explaining the procedures and are provided with a copy of the MCT dealing rules and forms together with a note of the location of further relevant documentation and information on the intranet.
- Written acknowledgement is requested from each person who becomes a designated employee, or who is added to a project list, to confirm that they have read and understood the rules and penalties.
Regular reminders are issued to all designated employees regarding the ending of an open period. These are issued two weeks before the close period commences, in order to give people time to consider and complete any transactions. Copies of the required consent and notification forms are included together with details of the location of further information on the intranet.
6. GENERAL CONTROLS
In addition to the specific controls over inside information, there are a number of other general controls within MCT that assist in maintaining the confidentiality of inside information:
- restricted access to separate system drives is maintained particularly for the holding of announcements pending release and for financial and Board information;
- restricted access to both hard and soft copies of Board papers;
- password protection of key documents, in particular draft annual report and related documents;
- half yearly reporting of financial results and interim management statements means that the market is regularly updated and therefore the likelihood of speculation is reduced;
- MCT has a clear desk policy
- MCT has an e-mail policy;
- MCT has an Employees Manual detailing the conduct expected of employees by the Group;
- project names are used to aid confidentiality;
- there are well defined and known reporting lines;
- general building security is maintained.
MCT’s dividends policy complies with Türkiye’s Commercial Code, capital markets legislation, Capital Markets Board (CMB) regulations and decisions, tax law, all other relevant legislation and our own Articles of Association.
Key policy principles include:
- The net distributable profit for the accounting period – calculated in accordance with Article 27 of the Articles of Association and using financial statements as stipulated in the relevant capital markets legislation and as per IFRS – shall be distributed in cash or as gratis shares which shall be issued by adding the appropriate amount to the share capital, subject to resolutions passed by the General Assembly (general meeting of shareholders).
- Long-term corporate strategy including investment and financial policies, earnings status, and extraordinary economical and political circumstances must be taken into account when determining dividends.
- A sustainable dividends policy is one of the basic aims of the company.
- Dividends are distributed, based on shareholding percentages, to all existing shares in the accounting period, regardless of issue and acquisition dates.
- There shall be no privileges associated with participation in the company’s profit.
- Subject to proposals from the board of directors regarding when and in what form the annual profits are to be distributed to the shareholders, the General Assembly shall make decisions in accordance with Türkiye’s Commercial Code and CMB decisions.
- If the necessary reserves have not been set up as per the Commercial Code and the first dividend has not been distributed in cash and/or as shares as per the Articles of Association, it is not permitted to set up other reserves, transfer the profits to the next year, or distribute dividends to privileged shareholders, owners of participation shares or founders’ shares, simple usufructuaries, members of the board of directors, employees, foundations or institutions of any kind, or other individuals (see Article 27 of the Articles of Association).