The board has the overall responsibility for the company’s organisation and management by continuously following up the operations and internal control.
The board of directors is the second-highest decision-making body of the company after the general meeting. According to the Swedish Companies Act, the board of directors is responsible for the company’s organisation and management, which means that the board of directors is responsible for, inter alia, setting targets and strategies, securing routines and systems for evaluation of set targets, continuously assessing the company’s financial condition and profits, and evaluating the operational management. The board of directors is also responsible for ensuring that the annual report and interim reports are prepared in a timely manner. The board of directors also appoints the company’s CEO.
Members of the board of directors are normally appointed by the annual general meeting for the period until the end of the next annual general meeting. According to the Company’s articles of association, the members of board of directors elected by the general meeting shall be not less than one (1) and not more than ten (10) members with not more than three (3) deputy board members.
According to the Code, the chairman of the board of directors is to be elected by the annual general meeting and have a special responsibility for leading the work of the board of directors and for ensuring that the board of directors’ work is well-organised and conducted efficiently.
The board of directors applies written rules of procedure, which are revised annually and adopted by the inaugural board meeting every year. Among other things, the rules of procedure govern the practice of the board of directors, functions and the division of work between the members of the board and the CEO. At the inaugural board meeting, the board of directors also adopts instructions for the CEO, including instructions for financial reporting.
The board of directors meets according to an annual predetermined schedule. In addition to these meetings, additional board meetings can be convened to handle issues which cannot be postponed until the next ordinary board meeting. In addition to the board meetings, the chairman of the board of directors and the CEO continuously discuss the management of the company.
The Company has an audit committee consisting of four members:
Pernilla Valfridsson (committee chair), Hans Stråberg, Björn Lenander and Ola Carlsson. The audit committee shall, without it affecting the board’s other responsibilities and tasks, monitor the Company’s financial reporting and the effectiveness of the Company’s internal controls, internal auditing and risk management. The audit committee shall also stay informed of the auditing of the annual reports and sustainability reports, review and monitor the impartiality and independence of the auditor, paying close attention to whether the auditor provide the Company with services other than audit services, and assist in the preparation of proposals for the general meeting’s resolution on the election of auditors. In 2022, the audit committee held 14 meetings, attended as specified in the table below.
The internal controls system is also designed to monitor compliance with Company and Group policies, principles and instructions. Internal control also includes risk analysis and monitoring of the implementation of information and business systems.
The Group identifies, assesses and manages risks based on the Group’s vision and objectives. Risk assessments of strategic, compliance, operational and financial risks are performed annually and presented to the audit committee and the board of directors.
Through the audit committee, the board of directors monitors internal controls and the reliability of financial reporting and reviews recommendations for improvement. The audit committee regularly reports on its work to the board of directors. In 2022, the audit committee evaluated the need for an internal audit function and determined that there is currently no such need due to the size and structure of the Company and the Group, and because of other factors. The audit committee makes proposals on matters requiring a decision by the board of directors.
The Company has a remuneration committee consisting of three members: Hans Stråberg (Chairman), Michael Forsmark and Johan Menckel.
The remuneration committee shall prepare proposals regarding remuneration principles, remuneration and other terms of employment for the CEO and the executive management. In 2021, the committee held seven committee meetings, attended as specified in the table below. The remuneration committee also regularly reports on its work to the board of directors.
The remuneration committee shall prepare proposals regarding CEO and executive management remuneration for the board’s review. Proposed new guidelines shall be submitted at least every four years for approval by the annual general meeting. The guidelines shall remain in force until new guidelines are adopted by the general meeting.
The remuneration committee shall also monitor and evaluate variable remuneration programmes for senior management, the application of the guidelines for remuneration of executive management and the current remuneration structures and levels in the Company.
The members of the remuneration committee are independent of the Company and its management. Insofar as the Chief Executive Officer or other members of senior management are impacted by a remuneration related matter, they will not be present when the board of directors discusses and decides on such a matter.
Internal control comprises the control of the company’s and the group’s organisation, procedures and supporting measures. The objective is to ensure that reliable and accurate financial reporting takes place, that the company’s and the group’s financial reporting is prepared in accordance with law and applicable accounting standards, that the company’s assets are protected and that other requirements are fulfilled. The system for internal control is also intended to monitor compliance with the company’s and the group’s policies, principles and instructions. Internal control also comprises risk analysis and follow-up of incorporated information and business systems. The group identifies, assesses and manages risks based on the Group’s vision and objectives. Risk assessment of strategic, compliance, operational and financial risks shall be performed annually by the CFO and presented to the audit committee and the board of directors.
The board of directors and the board’s audit committee are responsible for internal control. Processes managing the business and delivering value shall be defined within the business management system. The CEO is responsible for the process structure within the Group.
A self-assessment of minimum requirements of defined controls mitigating identified risks for each business process shall be annually performed and reported to the audit committee and the board of directors. The CFO is responsible for the self-assessment process, which is facilitated by the internal control function. In addition, the internal control function performs reviews of the risk and internal control system pursuant to the plan agreed with the board of directors and Group management.