Annual Report 2012
Contents
The Chairman’s Remarks Special Events in 2012 Working Groups Member Meetings, Roundtables & Partner Seminars Chinese Delegations Prospects for 2013 Strategy Members Management Founding Members Financial Statement
The Chairman’s Remarks Dear members, 2012 was an extraordinary year in the history of Danish-Chinese relations. The historic visit by President Hu Jintao was an absolute highlight, but also the launch of the China Growth Market strategy, the Danish Prime Ministers visit to China and the numerous ministerial bilateral meetings are of great importance. Danish-Chinese Business Forum hopes the government will continue this pace and calls for more investments to fulfill the promising strategy for China despite the rough economic times. China is the country of challenges but China still does and will continue to offer great growth opportunities for Danish companies. Many of our members have created significant results in China in 2012. To mention a few: Rockwool International expanded its operations by investing EUR 110 million in a new factory in China. Arla Foods established the China-Denmark Milk Technology and Cooperation Centre with COFCO/Mengniu and aims to export organic milk to China. The cities of Copenhagen and Beijing signed a partnership agreement, and SAS expanded with a new direct route to Shanghai which is another indication of the increased interaction between our countries. In spring, H.E. Li Ruiyu was appointed Ambassador of China to Denmark. His valuable insights and strong promotion of deepening relations are highly appreciated. H.E. Xie Hangsheng, former Ambassador to Denmark, and our honorary member, is now Vice-Minister of Foreign Affairs. Already in September, the Danish Prime Minister Helle Thorning-Schmidt was re-visiting China upon Hu Jintao’s visit in June. The Prime Minister promised to make this a yearly tradition. Danish-Chinese Business Forum welcomes this initiative and hopes that the Prime Minister will bring large business delegations to China in the future and hereby actively support these companies’ endeavours in China. In November, a successful leadership transition began with the election of Xi Jinping as General Secretary of the Communist Party and Chairman of the CPC Central Military Committee. Xi Jinping will succeed Hu Jintao as China’s President in March 2013. At the same time, Li Keqiang will succeed Wen Jiabao as Premier of the State Council. Danish-Chinese Business Forum welcomes the new leadership and has high expectations for the new leadership’s handling of the Chinese economy and social development although we realize the challenges that China faces. For Danish-Chinese Business Forum 2012 was a year with record many new members. We welcomed 35 new members and ended the year with 170 members. The financial result in 2012 ended at a small surplus of DKK 135,295 and the balance sheet showed equity of DKK 839,821. In 2012, Danish-Chinese Business Forum held 17 member meetings and partner events, 13 high-level delegation visits and a number of working group session. It has been a pleasure to see so many active and committed members participate in our events. I would like to express my appreciation for all members’ active cooperation and support to the network in 2012. I am also thankful for the fruitful dialogues we have had with the Danish ministries and for the extensive collaboration with the Danish Embassy and Consulates General in China, and our important cooperation with Danish Chamber of Commerce in China. A special thanks to the Chinese Embassy in Denmark for excellent cooperation, which is of great importance to Danish-Chinese Business Forum. In 2013, we look forward to continue to work for the interest of our members through increased dialogue with members, intensified policy advocacy and targeted member activities. Thorkil K. Christensen, March 2013
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Special Events in 2012 Nordic country. The visit symbolise the strong ties between Denmark and China. President Hu Jintao was accompanied by an impressive delegation of key players in the Chinese political elite.
Annual Meeting 28 March 2012, Danish-Chinese Business Forum held its Annual Meeting, hosted by Grundfos Holding in Bjerringbro. More than 90 members participated. The key notes speakers were Carsten Bjerg, Group President & CEO, Grundfos Group, Pia Olsen Dyhr, Minister for Trade and Investment, and Han Xiaodong, Economic & Commercial Counsellor, Embassy of the People’s Republic of China in Denmark.
Besides the political dialogue, the agenda included meetings with business executives, the Queens gala dinner, and a lunch hosted by the Prime Minister. On behalf of Danish-Chinese Business Forum, Chairman, Thorkil K. Christensen, and Secretary General, Tom Jensen, participated in political as well as social events representing the members of the Forum.
In her speech, the Minister emphasised some of the challenges that China faces – challenges which the Danish society and business community can help the country resolve. The Minister also stressed the importance of attracting Chinese investments to Denmark in order to develop a sustainable trade balance between the two countries, as well as to generate growth in Denmark.
Impressive new agreements were signed during the historical visit. Both commercial agreements, among which some were signed by members of the Forum, as well as bilateral governmental agreements were concluded.
Danish Prime Minister Visits China
New Chairman of the Board
In September 2012, the Danish Prime Minister visited China as a follow-up on the President’s state visit. It was the Prime Minister’s first visit to China since she took office in 2011. As a central theme was the Sino-Danish commercial relations, and the Prime Minister was accompanied by a small highlevel Danish business delegation.
2012 was the year where Danish-Chinese Business Forum had a new chairman. Co-founder Nils Foss resigned after almost eight years as chairman and was appointed honorary member of the Forum. Vice chairman, Thorkil K. Christensen, CFO at Novo A/S, and also among the Forum’s founders, took over as chairman. The new chairman expressed his expectations for the dedicated work of the Forum, continuing to promote commercial relations between Denmark and China as well as the interests of the members.
Her visit was only one of many occasions in 2012, where official representatives from Denmark and China met. Throughout the year, 12 Danish ministers visited China. In addition, the Royal couple, H.R.H. Crown Prince Frederik and H.R.H. Crown Princess Mary paid an official visit to China and Hong Kong in December.
China Strategy
In May 2012, the Danish government launched a Growth Market strategy for China. Danish-Chinese Business Forum provided proposals and input to the Danish government and it was a pleasure to see so many of the inputs included in the strategy.
Government Relations Throughout the year, Danish-Chinese Business Forum has increased its public affairs activities in order to promote the interests of the members. During 2012 the Forum had a dialogue with a number of ministries as well as other political actors.
The China strategy includes interesting elements and provides a better basis for further developing the Sino-Danish commercial relations. The focus on strategic sectors and the search for matching Danish key competences with the Chinese demand is very valuable. Following the launch of the strategy, many initiatives have already been implemented and this will hopefully benefit Danish companies.
Danish-Chinese Business Forum is very pleased with the results and will therefore continue to offer advice to the authorities in order to enhance the commercial focus on the Danish-Chinese relations. Members of the Forum are welcome to come forward if help is needed in raising issues towards the Danish and Chinese authorities.
Chinese President Visits Denmark The visit in June 2012 was a historic visit as this was the first visit ever by a Chinese President to a
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Working Groups Danish Chinese Business Forum comprises 8 working groups which are established with the purpose of generating and benefitting from network synergies and sharing best practices. The working groups engage in activities, which are specifically directed at their individual focal areas, and target concrete issues and solutions. The working groups are initiated by members, thereby ensuring the relevance of the groups’ activities.
Health Care
Chinese Investments in Denmark
Renewable Energy & Cleantech
The group works with challenges that health care companies face on the Chinese market. This group meets at an ad hoc basis, e.g. when Danish ministers visit China or when Chinese health care delegations visit Denmark. With the increased focus on elderly care in China and the launch of the nursing home project D’Care in Western China, there is potential for the group to increase its activity in 2013.
In 2012 Danish-Chinese Business Forum launched a working group aimed at attracting Chinese investments to Denmark. The Forum aims to facilitate a political platform for cooperation between the group and official investment promotion organisations from both China and Denmark in order to attract Chinese investments. The group consists of member companies, such as banks, law firms, audit firms and private equity funds. At the last meeting in 2012, the group met with the Chinese Ambassador Li Ruiyu.
The aim of the group is to implement the strengths of Danish technology and knowledge into the field of Chinese energy and climate challenges. The group seeks to provoke Chinese interest in Danish technology and know-how in relation to the energy and climate challenges in China with an objective of creating new business opportunities for our members. The group meets at an ad hoc basis.
Retail The working group deals with the possibilities and challenges facing Danish companies on the Chinese retail market. The group consists of member companies that sell to the Chinese consumers. Some have established their own shops, while others sell through agents or by franchise. Meetings are centred on expert presentation and cases from within and outside the group followed by roundtable discussions on key themes of interest, such as branding, marketing, customer segmentation, market adaption, local management and staff, distribution channels and intellectual property rights.
Corporate Social Responsibility
CSR in a Chinese context differs from how CSR is perceived in Denmark and the CSR working group focuses on the challenges that arise from this. The meetings are centred on round-table discussions supported by expert presentation and cases from within and outside the group. Topics include sustainable community impact, consumer protection, strategy and implementation, standards and audits, business opportunities, business ethics, employment practices, stakeholder management and culture.
Sourcing & Import
Education & Research
The group’s intention is to establish a network for knowledge sharing and learning from the best practices of other companies. The topics discussed in the group include supplier relations and evaluation, customs regulations, cost levels, export & import taxes, VAT, logistics, negotiation and quality control.
At the centre of this working group is establishing and extending collaboration between China and Denmark in the areas of education and research. Furthermore, the group works to improve the possibilities for talented Chinese graduates from Danish educational institutions to pursue a career in Denmark after graduation. The group meets at an ad hoc basis.
New Working Groups in 2013 In 2013, working groups on governmental relations and on tourism will be established.
Food Safety The objective for the group is to improve food safety in China and ensure a fair payment to the Chinese farmers. The group works with challenges that companies within the agricultural industries face on the Chinese market. This group meets at an ad hoc basis, e.g. when Danish ministers visit China or when Chinese delegations visit Denmark.
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Member Meetings & Partner Seminars In 2012, Danish-Chinese Business Forum organised 11 member meetings and 6 partner seminars. Through member meetings and partner seminars, executives and specialists shared up-to-date information that touched upon a wide range of activities related to doing business in China.
Zhang Jun is one of China’s leading economists with a long record of academic contributions in both Chinese and English. Zhang Jun is also a respected financial commentator and his view on the Chinese economy has often been quoted in well-reputed domestic and international media
Danish-Chinese Business Forum would like to express gratitude towards the members and partners who hosted the events during the year, and towards those who shared their expertise and presented their views at these events. A few examples:
17 April: HR in China; Up-dates, Experiences and Pieces of Advice In April, a roundtable meeting concerning HR in China was held in Copenhagen. Year after year, western companies in China experience that HR presents one of the main challenges of doing business in China. To address this issue, Senior Account Manager at DirectHR, Chun Liew, was invited to share his experiences on HR in China.
5 January: Economic & Political Update In January, an economic and political update on the Chinese economy was on the agenda. The theme is an annually recurrent theme and the meeting is seen as one of the most important member meetings of the year. In 2012, the meeting was hosted by Handelsbanken in Copenhagen and included presentations from experts from Handelsbanken and Copenhagen Business School.
Chun Liew shared some of his experiences and views on HR in China and gave an update on central issues such as social security, housing funds, labour contracts, termination of employment, salary levels, common salary add-ons, income taxes etc. Chun Liew furthermore addressed some of the key challenges concerning HR in China, i.e. the unwillingness of talents to relocate, limited number of professional with proficiency in English, and high career growth expectations of talents.
Thomas Haugaard, Senior Economist, Emerging Markets, Handelsbanken presented the latest development and trends in the Chinese economy with particular focus on overinvestment, possible slow-down, and whether or not the Chinese economy would experience a hard or soft landing. Johan Andrén, General Manager, Handelsbanken Shanghai gave an update on banking in China, especially regarding the possibilities of using CNY currency.
10 May: Transfer Pricing in China and the Tax Case of AVK Group In May, a member meeting on transfer pricing and tax was held in Galten. At this meeting, the participants not only heard expert views on the more formal aspects of transfer pricing in China, but also had the chance of digging in to how a reallife case had unfolded, and more importantly, how it was solved.
Kjeld Erik Brødsgaard, Director of Asia Research Centre, Copenhagen Business School gave an introduction to the Chinese political system and the upcoming leadership change and its possible implications for China and the Chinese business environment. The seminar was concluded with a panel debate.
Niels A. Kjær, CEO, Jacob Kjær, General Counsel, and Bo U. Madsen, International Controller, AVK Holding shared their experiences concerning transfer pricing in China, as well as presenting a tax case.
1 February: Professor Zhang Jun, Head of China Centre for Economic Studies, Fudan University
Kasper Toftemark, TP Partner and Nanchun He, TP Consultant, Deloitte presented their views on transfer pricing in China and elaborated on several issues concerning tax audits, focus areas of authorities, tax adjustments, transfer pricing documentation, tax incentives and cultural aspects.
At this roundtable meeting, Danish-Chinese Business Forum had invited Professor Zhang Jun to present his view on the Chinese economy. At the meeting, the participants had the pleasure of hearing the Professor’s view on the future sources and challenges of China’s economy. After the presentation, the participants had the opportunity to discuss the subject with the professor.
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Member Meetings, Roundtables & Partner Seminars on distribution systems, partner selection, retail development, as well as presenting their advices for doing business in China. Furthermore, ECCO presented an elaborate marketing on China and how these findings are utilized in ECCO’s marketing and branding strategies.
30 August: Retail in China – The case of ECCO In August, ECCO in Tønder hosted member meeting concerning the aspects of selling to the Chinese consumers. Here, Michael Hauge Sørensen, Group COO and Margit Gosau, Vice President, Global Brand Management, ECCO went into detail Date
Type of event
5 Jan.
Member Meeting
1 Feb.
Roundtable
2 Feb.
Member Meeting
16 Mar.
Partner seminar with the Confederation of Danish Industry
28 Mar.
Member Meeting
17 Apr.
Roundtable
10 May
Member Meeting
24 May
Member Meeting
7 Jun.
Partner seminar with Danish-American Business Forum
12 & 13 Jun.
Partner seminar with Dagbladet Børsen
30 Aug.
Member Meeting
31 Aug.
Member Meeting
4 Sep.
Partner seminar with Hong Kong Trade Development Council & Zhuhai Municipal People's Government
20 Sep.
Member Meeting
2 Oct. 6 Nov. 8 Nov.
Theme & Venue Economic & Political Update Handelsbanken, Copenhagen Prof. Zhang Jun, Head of China Center for Economic Studies at Fudan University Danish-Chinese Business Forum, Copenhagen Cross-Cultural Leadership Danish-Chinese Business Forum, Copenhagen The Chinese Market for Cleantech and Green Energy solutions Confederation of Danish Industry, Copenhagen Annual Meeting Grundfos Holding, Bjerringbro HR in China: Up-dates, Experiences and Pieces of Advice by Chun Liew, Manager at DirectHR Danish-Chinese Business Forum, Copenhagen Transfer Pricing - The case of AVK Holding A/S AVK Holding, Galten Sourcing and Supplier Relations Nordisk Røntgen Teknik, Hasselager Political Changes in the USA and China Nordea, Copenhagen China Conference Crowne Plaza Copenhagen Towers, Copenhagen Retail in China - The Case of ECCO ECCO Sko, Tønder Public Affairs & Government Relations Danish-Chinese Business Forum, Copenhagen Trend Spotting Hong Kong and Zhuhai Radisson BLU Scandinavia Hotel, Copenhagen IPR – Registration and Protection Bech-Bruun, Copenhagen E-commerce on the Chinese consumer market Copenhagen Business School, Copenhagen Retail in China - Opportunities & Challenges Dagbladet Børsen, Copenhagen Legal & Tax Update KPMG, Aarhus
Partner seminar with Copenhagen Business School Partner seminar with Danish Chamber of Commerce & Eversheds Law Firm Member Meeting
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Chinese Delegations Each year Danish-Chinese Business Forum receives several high-level Chinese governmental and business delegations, giving members the possibility to meet high-ranking Chinese officials and company leaders, such as ministers, vice ministers, director generals, mayors and business executives. In 2012, Danish-Chinese Business Forum received or cohosted thirteen Chinese delegations:
province within areas including cleantech and mining.
5 July: Beijing Investment Promotion Bureau A delegation from the Beijing Investment Promotion Bureau met with members of the Forum. The purpose was informal networking between Beijing Investment Promotion Bureau and Danish companies interested in doing business in China. Several member companies participated in the breakfast meeting in Copenhagen.
27 January: Tianjin Wuqing Development Area The delegation from Tianjin Wuqing Development Area was headed by Guo Junli, Director of Tianjin Commission of Commerce. During the meeting at the secretariat, possibilities for strengthening the commercial ties between Tianjin and Denmark were discussed. In relation to the visit, a number of members participated in a reception banquet in Copenhagen, hosted by Vice Mayor of Tianjin Municipal Government Ren Xuefeng.
18 July: Beijing Chaoyang District Danish-Chinese Business Forum was pleased to receive the delegation from Chaoyang District, Beijing, in cooperation with the City of Copenhagen. In June 2012, Beijing and Copenhagen signed a Sister City Agreement, which demonstrated clear shared interests in further collaboration within the area of sustainable urban development.
3 April: China Investment Promotion Agency and the Provincial Government, Hunan Province
23 July: Municipality of Nanjing Danish-Chinese Business forum received a VIP delegation from Nanjing. The delegation was headed by Yang Weize, Party Secretary of the CPC Nanjing Committee. At the event, Mayor of Aarhus, Jacob Bundsgaard Johansen and City Director, Niels Højberg presented Aarhus’s focus on China, and Finn Mortensen, Executive Director at State of Green Consortium presented the climate goals of Copenhagen. Furthermore, a visiting program was organised for the delegation. After the visit, Party Secretary Yang has asked some of the participating Danish companies to assist the city on several construction and urban development projects in Nanjing.
The delegation, which was headed by Deputy Director General of CIPA, Yang Yihang, had the purpose of strengthening the cooperation and investments between Denmark and China. CIPA is in charge of FDI in and outbound investments from China. Zhang Shouping, Deputy Director of Investment Promotion Division in Hunan, furthermore introduced the province of Hunan and the Central China Expo 2012.
6 May: Yixing Industrial Park for Environmental Science and Technology, Wuxi Danish-Chinese Business Forum received a delegation from Yixing Industrial Park for Environmental Science and Technology, who was interested in sustainable solutions to their science and technology park. The delegation was introduced to Danish cases and sustainable solutions.
27 August: Municipality of Tianjin
Danish-Chinese Business Forum received a highlevel delegation from Tianjin, in cooperation with the Chinese embassy in Denmark. The delegation was headed by Xing Yuanmin, Chairman of Tianjin Municipal Committee of CPPCC and included both representatives from the Chinese public sector as well as from private Chinese companies.
9 May: CCPIT, Gansu Province Danish-Chinese Business Forum received a highlevel delegation from the China Council for the Promotion of International Trade Gansu Sub-council, led by Xiao Qingping, DirectorGeneral, Department of Commerce of Gansu Province. The purpose of the visit was to strengthen the commercial cooperation and investment between Denmark and the Gansu
13 September: The People’s Government of Jiangxi Province The delegation was headed by Hu Youtao, Vice Provincial Governor of The People’s Government of Jiangxi Province. The purpose of the visit was to explore opportunities for cooperating with local partners in financial areas. 6
Chinese Delegations of China (SFDA). He was accompanied by several deputy directors from the provincial SFDAs, and they were in Denmark to study the processes concerning Danish Food Safety. At a seminar, experts on food safety from the Technical University of Denmark (DTU) and University of Copenhagen held presentations. During the delegation’s 3 weeks long visit, they also visited several member companies within the food and agricultural sector.
14 September: Haiyan County, Zhejiang Province Danish-Chinese Business Forum received a highlevel delegation headed by Lu Ying, Chairman of Haiyan Chinese People's Political Consultative Conference (CPPCC). He was accompanied by top executives from three Chinese companies. The purpose of the visit was to promote investments opportunities in the county of Haiyan and to investigate possibilities for cooperation with the three companies. Members of the Forum participated in the meeting and good contacts were established.
15 October: Shaoxing City General Chamber of Commerce Danish-Chinese Business Forum received a highlevel delegation from Shaoxing City General Chamber of Commercial and the purpose of the visit was to strengthen the commercial cooperation between Shaoxing City and Denmark as well as exchange of experience regarding management of business organisations and activities.
25 September: Food Safety Seminar with delegation from State Food and Drug Administration of China The delegation was headed by Fan Xuehui, Deputy Director General at the Department of Food Safety Supervision, State Food and Drug Administration
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Prospects for 2013 Awaiting political reforms
Economic Forecasts
2012 was in China a year of tension with neighbours, political scandals, leadership transition, and new calls for fighting the corruption. It is still to be seen how Xi Jinping, General Secretary of the Communist Party and Chairman of the CPC Central Military Committee, Li Keqiang, Vice Premier of the State Council, and the new leadership as such, will manage the challenges that China faces. Economists and academia discuss whether China will have a hard or soft landing.
Private consumption 9.7 % Government consumption 8.9 % Gross fixed investments 8.6 % Export of goods and services 8.4 % Import of goods and services 10.1 % Inflation (consumer prices) 5.3 %
2014
8.2 % 8.5 %
8.5 % 7.8 %
9.5 % 9.1 % 7.8 % 7.7 % 9.4 % 4.5 %
Inflation and Monetary Policy China has proven that it can control the inflation. The RMB has become less overrated in the process of making the exchange rate floating. The RMB may soon be a competing international currency and the Chinese capital markets will be more open. The People's Bank of China and the Chinese political leadership have re-confirmed that China will accelerate the pace of the liberalizing the exchange rate reform. The strategy is to further deregulate the exchange rate in order to realise the goal of a free floating rate. China will consequently have the opportunity to take monetary and fiscal measurements to stimulate growth. Hence, China will have a soft landing if taking the right precautions.
China is expected to continue with high growth rates in the years to come. Soon to-be former Premier of the State, Wen Jiabao has announced that the Chinese government would reduce the high speed of economic growth and plan for an average growth of 7 percent during the period of the 12th Five-Year Plan (2011-2015), though international forecasts suggest slightly higher estimates: 2013
2014
Source: Economist Intelligence Unit’s Data and Forecast (Y/Y)
Maintain solid growth rates
GDP growth projections IMF EIU
2013
Growth rates above even 7 percent are still considerable above alternative growth markets such as Brazil, Russia, Vietnam and South Africa.
Great possibilities for Danish companies The implementation of the 12th Five Year Plan (2011-2015) at province and municipal levels offer great possibilities for bidding on projects for foreign companies. The many new partnerships agreements between Denmark and China will be beneficial for business. China has enhanced its focus on sustainable growth which gives Danish companies with green solutions an advantage. China is a difficult market to operate in but Danish companies could make successful business in China with the right strategy, the right timing, and attractive solutions.
In 2012, the World Bank, in collaboration with the Chinese Ministry of Finance and the Development Research Center of the State Council, published a notable report “China 2030 Building a Modern, Harmonious, and Creative High-Income Society”. The report discusses the further development of China and estimates that the growth in GDP will be decrease slowly from about 8.6 to 5.0 percent in 2030. It also predicts that 59.0 percent of the employment force in China will work in the service industry in 2030.
Towards a demand driven economy China’s remarkable growth in the last decades has built on infrastructure investments and exportdemand and has been production-driven. Time has come to make growth based on an investment and demand-driven economy, where the growing Chinese middleclass becomes the world’s largest consumer group. China is determined to create a more harmonious society with means investment in social welfare.
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Strategy Mission
Goals
Danish-Chinese Business Forum is an independent, non-political, executive non-profit organisation. Its purpose is to strengthen commercial and economic relations between Denmark and China for the benefit of Danish-Chinese Business Forum members.
Danish-Chinese Business Forum strives to add value for its members and specifically aims to: y Facilitate match-making between members and business contacts within and outside the network and official agencies. y Provide members with access to business leaders, top governmental officials and experts. y Present the latest knowledge, experience, and visions of leading experts to the members. y Maintain strong ties to the Danish government and the official Danish representations in China, and to the Chinese government and the official Chinese representation in Denmark. y Be a strong voice and influencer of Danish commercial and trade policy in relation to China. y As the primary lobby organisation in DanishChinese relations, carry forward members’ issues, requests or problems to relevant bodies such as governmental authorities, organisations or business contacts.
Danish-Chinese Business Forum is an executive network association with an informal and direct style of interaction. Danish-Chinese Business Forum is building and maintaining active participation and exchange of knowledge among top executives and managers from large and small companies, educational and research institutions, and municipal, regional and central government bodies.
Vision Danish-Chinese Business Forum is known as the best executive networking forum for top management of Danish companies and institutions with interests in China as well as for top management of Chinese companies and institutions with interests in Denmark.
Growth During the past year, Danish-Chinese Business Forum has continued to expand the network and increase the number of members. By the end of 2012, the Forum counted 170 members, reflecting the increasing interest of Danish companies in doing business with China. Danish-Chinese Business Forum continues to grow at a steady pace and covers a broad spectrum of highly competitive sectors having thereby created a base for knowledge-sharing possibilities for any type of company or institution operating in China. The growth objective for 2013 is to reach 185 members.
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Members Honorary Members: Nils Foss, Former Chairman of Danish-Chinese Business Forum Xie Hangsheng, Former Ambassador of the People’s Republic of China to Denmark Zhen Jianguo, Former Ambassador of the People’s Republic of China to Denmark
Danske Bank A/S DEIF A/S Deloitte A/S DesignIt Ditlev Consulting dnp denmark as y E.Phil & Søn A/S ECCO Sko A/S EKF – Eksport Kredit Fonden Embassy of the People’s Republic of China in Denmark Envision Energy Denmark ApS Eversheds Law Firm y Fiberline Composites A/S Fischer & Company Flensby & Partners A/S Fleye Flexa4Dreams A/S FLSmidth A/S Flügger A/S FOSS A/S Fossfill ApS Frederiksdal Kirsebærvin FT Company Fritz Schur Technical Group y Galleri Faurschou Georg Jensen A/S GN Otometrics A/S Gorrissen Federspiel Grundfos Holding A/S y H. Lundbeck A/S Hagens Fjedre A/S Haldor Topsøe A/S Handelsbanken House of Amber ApS y ICE A/S IDEAS Denmark A/S IFU Intertrust Scandinavia InterPartner Invactor Invest ApS ISS World Services A/S y J. Lauritzen A/S Jebsen & Co. A/S JYSK Nordic
Members 1:1 Architects y A.P. Moller-Maersk A/S AH Industries Albatros Travel A/S Andritz Feed & Biofuel A/S AP Trading ApS Arla Foods amba Arrin A/S Asia Base A/S Attention Design ApS AVK Holding A/S Axcel y B2B Link China A/S Baltic Asiatic Holding A/S Bech-Bruun Benedikte Utzon A/S Berrifine A/S Bondo & Schultz Brüel & Kjær y C&P Inspection A/S C3 Consulting ApS Central Denmark Region Chamber of Commerce and Industry of Southern Sweden China Club China Experience Cimi ApS City of Aarhus City of Copenhagen Coloplast A/S Compfitt A/S Copenhagen Airport A/S Copenhagen Business School Copenhagen Malmö Port AB COWI A/S Crowne Plaza Copenhagen Towers CSR Capital A/S y Dako A/S Danfoss A/S Danish Export Association 10
Members Kamstrup A/S Kelsen Group A/S kk-electronic a/s Kopenhagen Fur KPMG A/S Kromann Reumert Kvadrat A/S y Lassen Ricard LEGO Group Lithium Balance A/S Living Institute y Mercuri Urval A/S Michael Buur Trærup Ministry of Business and Growth of Denmark Ministry of Foreign Affairs of Denmark Municipality of Ballerup Møller Jensen & Co. ApS Mørkegaard Design A/S y Navisino (Beijing) Advisors Ltd. NCO China Consult ApS Nic. Christiansen Holding A/S Niels Brock Nilfisk-Advance A/S Nordea A/S Nordisk Dæk Import A/S North East Holdings Norvidan Overseas A/S Novo A/S Novo Nordisk A/S Novozymes A/S y Ole Wolff Elektronik OPTi ApS y Penta Shipping Group A/S Plougmann & Vingtoft A/S Plus 7 ApS PMC Technology A/S PSU AB y Radiometer Medical ApS Reeslev Copenhagen ApS Region of Southern Denmark Rockwool International A/S Ronald A/S Rosendahl Design Group A/S Roskilde University Royal Greenland A/S
SAS – Scandinavian Airlines Denmark Sauer-Danfoss ApS Scan Global Logistics A/S Scandinavian Branding Scandinavian DesignLab Scan Speak A/S Sinex Rejser ApS Sjølund A/S SmithStreetSolutions SP Group A/S Struers A/S Sunarc Technology A/S Svendborg Brakes A/S Svend Kloster y Tajco Group A/S TannerMedico A/S Technical University of Denmark Thermo King Container-Denmark A/S The Bridge The Universe Foundation Topsil Semiconductor Materials A/S TP Management ApS Tue Tyge Møller Tytex A/S y Unibio A/S Unigraphic Scandinavia A/S Universal Robots A/S University of Copenhagen University of Southern Denmark y Vestas Wind Systems A/S VIA University College Vink Plast ApS Visit Denmark VKR Holding A/S y Wrist Group A/S y Zastrow & Co. Zenith Advisory ApS y Aalborg Portland A/S Aalborg University Aarhus University
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Members Board of Directors
Thorkil K. Christensen Senior Vice President and CFO, Novo A/S (Chairman)
Claus V. Hemmingsen Partner, A.P. Møller-Mærsk A/S (Vice-chairman)
Tom Behrens-Sørensen Partner, Navisino (Beijing) Advisors Ltd.
Kjeld Erik Brødsgaard Ph.D., Professor, Director of Asia Research Centre, Copenhagen Business School
Henrik Busch Chairman & Co-owner, House of Amber ApS
Brian Seeberg Larsen Senior Vice President, Industry & Energy, COWI A/S
Humphrey Lau Group Senior Vice President & CEO China, Grundfos Holding A/S
Vibeke Rovsing Lauritzen Ambassador, Under Secretary, the Trade Council, Ministry of Foreign Affairs
Hans Henrik Pontoppidan Partner, Corporate Finance, Deloitte A/S
Hans B. Schlaikier Managing Director, Rhederi M. Jebsen A/S
Li Ruiyu Ambassador, Embassy of the People’s Republic of China in Denmark (Observatory Status)
Secretariat
Tom Jensen Secretary General
y
Bonnie Dræby Lind, CRM Manager & Executive Assistant
y
Nicolaj Brandt-Møller, Project Manager
y
Hanne Hjortby Sørensen, Administrative Officer
y
Henrik Bøgesvang Basse, Assistant Marketing Manager
y
Bjørg Ilsø Klinkby, Research Assistant & Speech Writer
y
Søs Boysen, Assistant Project Manager
y
Camilla Jeppesen, Assistant Communication Manager
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Management
China Club Christian Frigast CEO
Peter J. Kielgast President
Lars Rasmussen President, CEO
Lars Peter Søby CEO
Niels B. Christiansen CEO Per Have Senior Vice President
Hans Henrik Pontoppidan Partner
Niels Hermansen CEO
Nils Foss Founder
Carsten Bjerg Group President, CEO
Hans B. Schlaikier Managing Director Jebsen & Co. A/S
Claus V. Hemmingsen Partner
Michael Rasmussen Member, Group Executive Management Poul Drusebjerg Vice President
Thorkil K. Christensen Senior Vice President, CFO
Peter H. Kürstein President
Ditlev Engel President, CEO
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e Contents Organisation's details
14
Statement by the supervisory and executive Boards on the Annual Report
15
Independent auditor's reports
16
Management's review
17
Financial statement Accounting policies
18
Income statement
20
Balance sheet
21
Notes Notes
60789640/2012/MTM
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e Organisation's details
Danish-Chinese Business Forum Robert Jacobsens Vej 76A-1, st. 2300 København S www.dcbf.dk Tel: +45 33 32 97 78 Fax: +45 33 32 97 75 Board of directors Thorkil Kastberg Christensen, Chairman Claus V. Hemmingsen Tom Behrens-Sørensen Brian Seeberg Larsen Humphrey Lau Vibeke Rovsing Lauritzen Hans B. Schlaikier Kjeld Erik Brødsgaard Henrik Busch Hans Henrik Pontoppidan Li Ruiyu, observatory status Secretary general Tom Jensen Auditors Ernst & Young Godkendt Revisionspartnerselskab 2860 Søborg, Denmark Tel: +45 70 10 80 50 Fax: +45 35 87 22 00 Bankers Nordea Bank Danmark A/S Sydbank
14
e Statement by the board of directors and the secretary general on the annual report
Today, the board of directors and the secretary general has discussed and approved the annual report of Danish-Chinese Business Forum for the financial year 1 January - 31 December 2012. The annual report is prepared in accordance with the Danish Financial Statements Act . In our opinion, the financial statements give a true and fair view of the organisation's financial position at 31 December 2012 and of the results of its operations for the financial year 1 January - 31 December 2012 In our opinion, the management's review includes a fair review of the matters dealt with in the management's review. Copenhagen, 13 March 2013 secretary general:
................................................ Tom Jensen
Board of directors: ................................................ Thorkil Kastberg Christensen chairman
................................................ Claus V. Hemmingsen
................................................ Tom Behrens-Sørensen
................................................ Brian Seeberg Larsen
................................................ Humphrey Lau
................................................ Vibeke Rovsing Lauritzen
................................................ Hans B. Schlaikier
................................................ Kjeld Erik Brødsgaard
................................................ Henrik Busch
................................................ Hans Henrik Pontoppidan
15
e Independent auditor's reports
To the members of Danish-Chinese Business Forum Report on financial statements We have audited the financial statements of Danish-Chinese Business Forum for the financial year 1 January - 31 December 2012, which comprise a summary of significant accounting policies, income statement, balance sheet and notes. The financial statements have been prepared in accordance with the Danish Financial Statements Act. Management's responsibility for the financial statements Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the Danish Financial Statements Act. Further, management is responsible for such internal control as it determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's responsibility Our responsibility is to express an opinion on the financial statements based on our audit. We conducted our audit in accordance with international standards on auditing and additional requirements according to Danish audit regulations. This requires that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including an assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation of financial statements that give a true and fair view. The purpose is to design audit procedures that are appropriate in the circumstances, but not to express an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used, the reasonableness of accounting estimates made by management as well as the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Our audit has not resulted in any qualification. Opinion In our opinion, the financial statements give a true and fair view of the organisation's financial position at 31 December 2012 and of the results of its operations for the financial year 1 January - 31 December 2012 in accordance with the Danish Financial Statements Act. Statement on the management's review In accordance with the Danish Financial Statements Act, we have read the management's review. We have not performed any further procedures in addition to the audit of the financial statements. On this basis, it is our opinion that the information provided in the management's review is consistent with the financial statements.
Copenhagen, 13 March 2013 Ernst & Young Godkendt Revisionspartnerselskab Christian Friis Olsen state authorised public accountant
16
e Management's review
Business activities and mission Danish-Chinese Business Forum is an independent, executive, non-profit organisation that aims to strengthen commercial ties between Denmark, southern Sweden and China. Business review The Organisation's income statement for the year ended 31 December 2012 shows a net profit of DKK 135,295, and the balance sheet at 31 December 2012 shows equity of DKK 839,821. Post balance sheet events No events have occurred after the financial year-end, which could significantly affect the Organisation's financial position.
17
e Accounting policies
The Annual Report of Danish-Chinese Business Forum has been prepared in accordance with the provisions of the Danish Financial Statements Act as regards reporting class A enterprises. The accounting policies are consistent with those of last year. Foreign currency translation Transactions denominated in foreign currencies are translated into Danish kroner at the exchange rates at the date of the transaction. Monetary items denominated in foreign currencies are translated into Danish kroner at the exchange rates at the balance sheet date. Realised and unrealised exchange gains and losses are recognised in the income statement as financial income/expenses.
Income statement Members fee Income from members fee is included in the income statement in the period it concerns. Other external expenses Other external expenses include expenses related to sale, administration and office. Amortisation/depreciation and write-downs Amortisation/depreciation and write-downs include amortisation/depreciation and write-downs of intangible assets and property, plant and equipment. Fixed assets are amortised/depreciated using the straight-line method, based on the cost, measured by reference to the below assessment of the useful lifeof the assets: Useful life
Other fixtures and fittings, tools and equipment
3-10 years
Gains or losses on the sale of fixed assets are recognised in the income statement under 'Amortisation/depreciation'. Net financials Financial income and expenses are recognised in the income statement at the amounts that relate to the reporting period. Net financials include interest income and expenses.
18
e Accounting policies - continued
Balance sheet Property, plant and equipment Property, plant and equipment comprise land and buildings, leasehold improvements, production equipment, machinery and other fixtures, fittings, tools and equipment. Property, plant and equipment are measured at cost less accumulated depreciation and write-downs. Investments Securities and investments are measured at the market value at the balance sheet date if they are listed, or at an approximate fair value if they are not listed. Receivables Receivables are measured at amortised cost, which usually corresponds to the nominal value. The value is reduced by write-downs for bad debts. Prepayments Prepayments recognised under 'Assets' comprise prepaid expenses regarding subsequent reporting years.
19
e Income statement
for the year ended 31 December
Notes
Members fee
2012 DKK
2011 DKK
4,016,750
3,774,200
Other external expenses
1
966,196
821,109
Staff costs
2
2,835,955
2,746,153
5,004
0
145,954
0
Profit before net financials
63,641
206,938
Other financial income
73,150
20,031
1,496
1,698
135,295
225,271
2012 DKK
2011 DKK
504,526
479,254
to retained earnings
200,000
0
Net profit for the year
135,295
225,271
Available for appropriation
839,821
704,525
0
200,000
Retained earnings
839,821
504,525
Total appropriation
839,821
704,525
Amortisation/depreciation and write-downs of intangible assets and property, plant and equipment Other operating expenses
Other financial expenses
Net profit for the year Appropriation of profit Profit to be appropriated:
Retained earnings Transfer from Reserves for refurbishment of new office facilities
the board of directors recommends the following appropriation of the profit: Refurbishment of new office facilities
20
e Balance sheet at 31 December
2012 DKK
2011 DKK
19,994
24,998
19,994
24,998
19,994
24,998
13,500
0
161,095
237,002
0
20,763
Receivables
174,595
257,765
Other investments
681,490
0
Investments
681,490
0
Cash
302,815
945,845
Total current assets
1,158,900
1,203,610
Total Assets
1,178,894
1,228,608
Notes
Assets Fixed assets Other fixtures and fittings, tools and equipment Other fixtures, fittings, tools and equipment
3
Total fixed assets Current assets Trade receivables Other receivables
4
Prepayments
21
e Balance sheet at 31 December
2012 DKK
2011 DKK
0
200,000
839,821
504,525
839,821
704,525
20,250
63,500
318,823
460,583
Short-term liabilities
339,073
524,083
Total liabilities other than provisions
339,073
524,083
1,178,894
1,228,608
Notes
Equity and liabilities Equity Reserve for refurbishment of new office facilities Retained earnings Total equity
5
Liabilities other than provisions Membership fees 2013 Other payables
6
Total Equity and liabilities Other financial obligations
7
22
e Notes 2012 DKK
2011 DKK
Total sales cost
118,388
125,674
Total administration cost
549,747
373,587
8,957
10,788
275,492
302,859
13,612
8,201
966,196
821,109
2,815,235
2,722,934
20,720
23,219
2,835,955
2,746,153
47,829
22,831
Additions in the year
0
24,998
Disposals in the year
0
0
47,829
47,829
22,831
22,831
5,004
0
Depreciation and write-downs at 31/12
27,835
22,831
Carrying amount at 31/12
19,994
24,998
Note 1.
Other external expenses
Total entertainment expenses Total office expenses Total staff charges
Note 2.
Staff costs
Wages and salaries Other social security costs
Note 3.
Other fixtures, fittings, tools and equipment
Cost Balance at 1/1
Cost at 31/12 Depreciation and write-downs Balance at 1/1 Depreciation in the year
23
e Notes 31/12 2012 DKK
31/12 2011 DKK
Deposits
98,900
197,181
VAT receivable
60,541
39,821
1,654
0
161,095
237,002
200.000
0
-200.000
0
0
200.000
0
200.000
Balance at 1/1 2012
504.526
479.254
Transfer from Reserve for refurbishment of new office facilities
200.000
0
Change in opening balance at 1/1 2012
704.526
479.254
Transfer this year
135.295
25.271
Total equity
839.821
704.525
34,717
163,861
4,320
5,350
274,296
285,249
5,490
6,123
318,823
460,583
Note 4.
Other receivables
Interest receivable
Note 5.
Statement of changes in equity
Reserve for refurbishment of new office facilities Balance at 1/1 2012 Transfer to Retained earnings Refurbishment of new office facilities
Retained earnings
Note 6.
Other payables
Accrued charges Outstanding salaries Vacation pay obligation Owed vacation pay
24
e Notes
Note 7.
31/12 2012 DKK
31/12 2011 DKK
0
32,795
745,975
856,810
Other financial obligations
Rent payments concerning a contract which has a termination of 6 month The contract has been terminated. The obligation as per 31/12 2011 cover the remaining 2 month. Rent payments concerning a contract which has a termination of 5 years
25
Danish-Chinese Business Forum Robert Jacobsens Vej 76 A, st. 2300 Copenhagen S Tel.: +45 3332 9778 Fax: +45 3332 9775
[email protected] www.dcbf.dk
