Independence of the Board in 2005

With the adoption of the new Swedish Code of Corporate Governance, new definitions and recommendations were introduced to determine the independence of the board and board members. The Code recommends that the majority of the board members are independent of the company and its management. In addition, at least two of the board members who are independent of the company should also be independent of the company’s major owners.

At the time of the 2005 AGM, the Code had not come into force and Investor’s Nomination Committee did not decide on the independence of individual board members.

Board work 2005

During 2005, the board had five regular meetings and one statutory meeting after the election of the board. 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.

The two most important issues that the board must decide on are the appointment of the President and CEO and the strategy for the company’s business. Thus, the recruitment and appointment of Börje Ekholm as President and CEO after Marcus Wallenberg was an important item on the board’s agenda in 2005. A substantial part of the board’s ordinary work was devoted to discussing longterm and short-term strategy issues. In this context, corporate governance issues in core investments were also taken up by the board, as well as the activities of the Private Equity Investments business area, for which the board approved Investor’s participation in the EQT Opportunity Fund. The board also decided to propose to the 2006 AGM that 50 percent of the shares in Novare Human Capital be sold to senior executives in Novare Human Capital.

Investor’s management presented analyses of the performance of core investments and the markets and business areas in which the companies operates. These analyses and their consequences were discussed and assessed by the board. The board was also involved in Investor’s role in connection with Scania’s offering to shareholders in Ainax. The operations of 3 Scandinavia were analyzed thoroughly.

One subject of board work was to strengthen the company’s balance sheet, which was achieved by making the decision to reduce Investor’s ownership stake marginally in a number of core investments. As a result of these share sales and successful exits of companies in the Private Equity Investments business area, Investor was basically debt-free at the end of the year.

At each meeting, the board received reports on the company’s financial position and reports from the Audit Committee, Compensation Committee and Finance and Risk Committee. The board discussed issues that these committees have dealt with, such as questions related to accounting, costs, taxes, financing structures, employment terms and compensation issues. The effects of introducing the new International Financial Reporting Standards (IFRS) were analyzed by the board. One of the company’s auditors attended a board meeting where board members had the opportunity to pose questions to the auditor without representatives for the company’s management being present.

Presentations were made to the board on the World Business Council for Sustainable Development and the new Swedish Companies Act, Corporate Governance Code and Market Abuse Penal Act. The board also performed an evaluation of board work as a basis for continuing its work.

Information updated 2008-06-19 09:40:02