Supervisory Board report

Dear shareholders and other stakeholders, dear reader,

The Supervisory Board of DELA Natura en levensverzekeringen NV presents the annual report for 2023, which includes statements from the Management Board and Supervisory Board as well as the financial statements. The statement from the Management Board was drawn up by the Board and discussed with the Supervisory Board. The financial statements were audited by the external accountant and approved in the audit statement. The Supervisory Board approves the financial statements.

The meetings of the Supervisory Board of DELA Natura generally take place at the same time as the meetings of the DELA Group Supervisory Board. This report is therefore just a summary of the spearheads and other focal areas that specifically applied to DELA Natura in 2023. The various dialogues are also outlined along with the efforts made in relation to the ongoing education of board members.

Strategy
The Supervisory Board was well briefed on the company’s strategy, course and goals throughout 2023. The innovation teams introduced in the summer were discussed in detail by the Supervisory Board and we provided the Management Board with related advice.

Digital transition and controlled business
In 2023, the Supervisory Board also had an ongoing dialogue with the Management Board about the digital transition of the insurer and the ‘Controlled Business’ programme which is aimed at consolidating internal control. The Supervisory Board monitored these issues closely due to their impact on the continuity and solidarity of the cooperative, and regularly requested more in-depth information via presentations.

The Supervisory Board also provided advice in this framework where necessary. We see the establishment of the controlled business programme as a major step and a sign that significant progress was made in 2023. And while the digital transition is yet to be completed and will run until 2025, major advances were made in this area too.

Risk management
Risk management has been under increased scrutiny from the supervisors for years. Moreover, it is essential to ensure that ambitions are met and the course taken is a success. The Supervisory Board received regular updates from the Executive Board about risks related to the company’s activities, the tight labour market, and its impact on employees, employee satisfaction, developments related to turnover and costs, the (financial and non-financial) reporting process and compliance with legislation and regulations. Additional focal points for the Supervisory Board on which it consulted with the Management Board involved compliance with sanctions legislation, outsourcing policy, information security policy, investments, and the set-up and functioning of the internal risk management and control systems. The Supervisory Board believes there is sufficient resilience in place to face a wide range of scenarios.

In addition, the Supervisory Board determined and adopted that the capital allocation, investment policy, cash and cash equivalents position were in line with the risk appetite on a strategic level. The risk appetite was also discussed with the Management Board and then readopted.

Audit committee – focal points in 2023
The audit committee prepares the supervision of the Supervisory Board with regard to the functioning of the internal risk management and control systems, compliance with recommendations and the follow-up of the internal audit function and external accountant, the financing of the companies and the financial reporting.

As in previous years, in 2023 the audit committee discussed the annual report of DELA Natura and prepared them for the Supervisory Board. They were also extensively evaluated with the external accountant. Other topics discussed in the audit committee included the progress report for the Audit Plan and the Audit Report from the Internal Audit department. Preparations for the change of accountant for book year 2025 were also discussed in detail by the audit committee.

The main subjects discussed with the external accountant included the management letter, engagement letter, Solvency II Longform report 2022 and the plan of approach for the annual audit.

The audit committee meetings focused on the monthly and quarterly accounting reports, the quality of which was deemed to have improved. In addition, the audit committee discussed several times whether a transfer could be made to reporting on Solvency II principles in the financial statements with regard to the technical provisions. There are still too many objections in the short term due to the number of changes required and the associated administrative load. Further research on this subject will be carried out in the coming book year.

Several presentations took place related to the ‘Controlled Business’ programme, which were attended together with the risk committee.

The audit committee met five times in 2023, with an extra meeting required to deal with the management letter from the external accountant. The attendance of each member was 100 percent.

Risk committee – focal points in 2023
The risk committee prepares the Supervisory Board’s supervision of the functioning of the internal risk management and control systems, including supervision of compliance with the relevant laws and regulations and applicable codes of conduct, the set-up and effectiveness of the internal risk management system, and the management of the cooperative’s financial and non-financial risks.

In 2023 the risk committee discussed issues such as the functioning and quarterly reports of second-line functions (actuarial, operational, financial and compliance) and the risk management policy. The developments in capital management and investment policy were also discussed on many occasions, especially in relation to geopolitical unrest such as the wars in Ukraine and Gaza and the rise in inflation, all of which had a major impact on the investment results.

In addition, the risk committee discussed the SFCR DELA 2022 and in November 2023 carefully prepared the ORSA annual reports (static and dynamic) for approval by the Supervisory Board.

The risk appetite statements of DELA Group mention a greater focus on sustainability risks. The statements were enhanced in various ways.

Other important items on the agenda of the risk committee included the organic analysis and various studies by DNB in the field of outsourcing, the Sanctions Act and information security. The committee also had to pay considerable attention to digitisation within the insurance chain.

The risk committee met four times in 2023, and the attendance of each member was 100 percent.

Remuneration and appointment committee – focal points in 2023
The remuneration and appointment committee prepares the decisions of the Supervisory Board related to the employer role, such as the assessment and remuneration of the Supervisory Board and Management Board. The committee monitors the developments of key positions and forms an opinion about the organisational culture.

In 2023 the committee focused on the personnel succession and the approach taken related to the future composition of the Management Board. A thorough analysis of the management and key functions, including possible development trajectories, was discussed several times, including a focus on the development potential from within the organisation.

The committee will remain responsible for the progress of the remuneration policy via evaluation and risk analyses. The committee is provided with overviews of the progress with regards to the education of the Supervisory Board, Management Board and second line. It also monitors the additional functions held by this specific group.

There were three formal meetings of the remuneration and appointment committee in 2023 and the committee members had a 100 percent attendance.

Permanent educationThe members of the Supervisory Board held two internal education sessions in 2023 aimed at updating and increasing their expertise where necessary. At a session on 23 June DELA Natura’s data manager provided detailed clarification of issues such as the data management strategy, data governance, data architecture, quality and legislation. The second session on 10 November focused on how the dedicated innovation and operational teams work together to realise customer needs. Both sessions were found to be highly valuable and have resulted in useful insights. In addition, Supervisory Board members attended various DELA-wide educational sessions, including in the field of sustainability. They did so partly due to the increased focus on the subject and the related requirements in legislation and regulations.