Independence of the board in 2006

The composition of Investor’s board meets the independence criteria of the Stockholm Stock Exchange. However, the composition of the board deviates from the rule in the Swedish Corporate Code of Governance which states that a majority of the directors elected by the AGM are to be independent of the company and its management. For details see Corporate Governance Report - link to the right.

Board work in 2006

During the year, the board had 19 meetings, of which seven regular meetings, one statutory meeting and 11 extraordinary board meetings. The secretary at the board meetings was attorney Hans Wibom. Before meetings, board members were provided with comprehensive written information on the issues that would be discussed.

During the year, the board’s work was concentrated mainly on two strategically important items of business, as well as a number of complex business matters. One wasInvestor’s and EQT’s joint public offer to acquire the total shares outstanding in Gambro AB. The offer, the largest cash bid made by a Swedish company to date, was preceded by comprehensive work and the preparations and implementation of the offer were discussed by the board.

The second item of business that the board had reason to carefully analyze and discuss was MAN’s unsolicited bid for Scania. Based on information from Investor’s management, the board discussed a number of financial and strategic issues related to the bid.
 
The sale of Investor Asia Limited to EQT Partners, as well as Investor’s capital commitments in EQT’s new funds – EQT Greater China II and EQT V – were other issues that the board decided on. The board also discussed LogicaCMG’s offer for WM-data and questions concerning the spin-out of Husqvarna from Electrolux. In addition, a number of value creation plans were discussed for Core Investments.

The board and the Remuneration Committee in particular were involved in the development of the new longterm remuneration program consisting of variable and share-based payment for management and other employees. The program, which was also discussed with a number of major shareholders, requires personal investments on the part of employees and requires the fulfillment of certain goals. The board also decided that the exposure that might arise in connection with an increase in the value of the Investor shares in the program shall be eliminated through repurchases of the company’s shares, which was also decided and approved by the 2006 AGM.

As proposed by the company’s management, and after in-depth discussions about Investor’s long-term strategy and ability to adapt to the new conditions in the acquisitions market, the board decided that Investor’s operations are to be divided into four business areas: Core Investments, Operating Investments, Private Equity Investments and Financial Investments. As a result of changes in the market, there is also an increased requirement to discuss corporate governance issues related to companies in the different business areas.

In the Operating Investments business area, the board was also given a number of detailed presentations and discussed a number of potential acquisitions in addition to the implemented Gambro buyout.

The financial reports presented at each regular board meeting are an important part of the board’s work, such as those before the year-end report and the company’s quarterly reports. The board also receives monthly reports on the company’s financial position. At regular board meetings, the ongoing operations of the four business areas are reported on. In-depth analyses and proposed action plans are also presented for one or more associated companies at each board meeting.

Committee work is an important part of board work and at each meeting the board receives reports from the Remuneration Committee, Audit Committee and Finance and Risk Committee concerning decisions and recommendations that the committees have made about remuneration, tax and accounting questions, and risk policies.

During the year, one of the company’s auditors participated in a board meeting during which board members had the opportunity to pose questions to the auditor without representatives for the company’s management being present. In 2006, the board’s work was evaluated to provide information as a basis for the work of the Nomination Committee and the board’s continuing its work.

Information updated 2008-06-19 10:14:26