TOTVS

Investor Relations

Overview

Corporate Governance at TOTVS:

The Company adopted the "Code of Best Corporate Governance Practices" developed by the Brazilian Institute of Corporate Governance - IBGC, to affirm the good practices of governance, marketing, professional ethics and business.

TOTVS is also listed in the "Novo Mercado", the highest level of corporate governance for companies listed on the BM&FBovespa, and adopts practices that exceed requirements of legislation with respect to corporate governance and the rights of shareholders, according to the “Novo Mercado Listing Rules”.

Novo Mercado rules require the following main practices, in addition to those laid down by Brazilian legislation:

  • Only common shares can be issued;
  • Tag-along rights to be given to all shareholders upon sale of the company‘s control, and the acquirer must hold a public tender offer for the remaining shares at the same price paid for the controlling block;
  • At least 25% of TOTVS shares should be free float;
  • Adopt share offering procedures that promote dispersed share ownership;
  • Comply with minimum quarterly disclosure standards;
  • Follow stricter disclosure policies with respect to negotiations made by controlling shareholders, directors and officers relating to the Company’s securities;
  • Submit any existing shareholders‘ agreements and stock option plans to the BM&FBovespa;
  • Provide the corporate event schedule to shareholders;
  • Limit the term of office of the Board of Directors, composed of at least five members, to one year;
  • Starting from the second year after joining the Novo Mercado, prepare annual financial statements, including cash flow statements, in English and according to such international accounting standards as the U.S. GAAP or IFRS;
  • Adhere exclusively to BM&FBovespa‘s arbitration rules by which BM&FBovespa, the company, the controlling shareholder, management and members of the fiscal council (if installed) agree to resolve by arbitration any dispute or issue related to the listing rules;
  • Hold public meetings with analysts and other stakeholders at least once a year to present information about its financial and economic position, projects and prospects; and
  • In case of delisting from the Novo Mercado, the controlling shareholder must make a public tender offer for all the outstanding shares at the economic value to be ascertained by a specialized independent firm in its valuation report.

​Among the main other corporate governance practices adopted by the Company, it is important to highlight the following:

  • The creation of  the Code of Ethics and Conduct with adhesion of 100% of employees;
  • The adoption of specific policies of Disclosure of Relevant Information and Trading Securities;
  • The adoption of Specific policies for Internal Controls, Strategic Risks and Audit;
  • The Company has a Board of Directors of 9 members, of which 8 are independent;
  • The installation of Audit, Personnel and Compensation and Strategy and Technology Committees.
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