Swedish Code of Corporate Governance

Swedish Code of Corporate Governance (“the Code”) is based on the “comply or explain” principle. According to the principle, a company that applies the Code may deviate from individual rules but is required to explain why. The Code states, among other things, that a company shall issue, in connection with the annual report, a special report on corporate governance issues in which the company states if and how the Code has been applied within the most recent fiscal year. Investor's Corporate Governance Report has been prepared in accordance to the Code’s recommendations.

The Swedish Corporate Governance Board

The Swedish Corporate Governance Board (Kollegiet för Svensk Bolagstyrning) is responsible for the promotion and development of the Swedish Code of Corporate Governance. The Swedish Corporate Governance Board has produced an information brochure, “Special Features of Swedish Corporate Governance”, to facilitate a good understanding among international investors of specific Swedish corporate governance provisions and practices.

For further information, visit The Swedish Corporate Governance Board's website (see link to the right - Bolagsstyrningskollegiet).

Corporate governance within Investor

Investor’s corporate governance practices are regulated partly by Swedish legislation, above all the Swedish Companies Act, and partly by the Swedish Code of Corporate Governance.

In addition to legislation, regulations and recommendations, Investor’s Articles of Association constitute a central document for the company’s governance. The Articles of Association establish, for example, the company’s name, where the board is registered, the focus of Investor’s business activities and information concerning the share capital.

The company’s highest decision-making authority is the Annual General Meeting (AGM), where Investor’s shareholders exercise their influence over the business. The AGM is convened no less than once a year to decide how the Nomination Committee is to be appointed, among other matters. The Nomination Committee proposes, for example, the composition of the board for resolution by the AGM.

On behalf of Investor’s owners, the board oversees management of the company’s affairs. Investor’s board is headed by Jacob Wallenberg, who is chairman. The board appoints the president, who is responsible for day-to-day management of the company in accordance with the directions of the board. The division of responsibilities between the board and president is detailed clearly in instructions and formal work plans approved by the board. To increase the efficiency and depth of the board’s work on certain issues, the board has established three committees: the Audit Committee, the Remuneration Committee and the Finance and Risk Committee.

Major support functions are Internal Control, Risk Control and Compliance. The Internal Control function serves as an objective support function for the board in verification of
internal control. The role of Risk Control is to provide support in identifying and managing risks. The Compliance function identifies legal risks and ensures that laws and regulations are observed.

Internal policies and guidelines constitute important control documents in all parts of the company, since they clarify responsibilities and powers within particular areas, such as
information security, compliance and risk.

External auditors, appointed by the AGM, audit the board and the president’s administration of the company, as well as the company’s financial reports.

The management group is made up of the president and the heads of Core Investments, Operating Investments, Investor Growth Capital, Active Portfolio Management, Operations and Legal, Corporate Governance and Compliance.

The actions of management and personnel are also governed by Investor’s corporate culture. A strong, clearly defined corporate culture plays an important role in enabling the company to achieve its vision and goals. The management group focuses actively on engaging all employees in developing the corporate culture and living by the values expressed through it. Our corporate culture is based on four core values: Create value, Continuous improvement, Contribute your view and Care for people. For more information, see the section on “Employees and Network” in the 2007 annual report.

Information updated 2008-06-18 08:55:22