Corporate governance

Corporate governance refers to the structures and processes that are used to manage and lead the operations of a company in an efficient and controlled manner. Ultimately, the aim of corporate governance is to serve the shareholders’ interests regarding value growth in the company.

ElektronikGruppen BK AB is a Swedish public limited company whose class B share is listed on NASDAQ OMX Nordic in Stockholm. For ElektronikGruppen, corporate governance is regulated by both external rules and regulations, primarily the Swedish Companies Act, the stock market's rules and the Swedish Code of Corporate Governance and internal steering instruments, such as the Articles of Association, the Board's rules of procedure and instructions for the President.

Below is an overview of corporate governance in the ElektronikGruppen Group, and its division between the General Meeting of Shareholders, the Board of Directors, the CEO and the Executive Management. 

General Meeting of Shareholders
The General Meeting of Shareholders is the highest decision-making body through which ElektronikGruppen’s shareholders exercise their influence over the company, for example, through the election of a Board of Directors and the Nomination Committee, as well as decisions on guidelines for remuneration to senior executives. A General Meeting of Shareholders is held at least once a year, and the yearly meeting at which the annual report is presented is called the Annual General Meeting (AGM).

Board of Directors
The primary task of the Board of Directors is to be responsible for the company’s organisation and the conduct of the company’s business on behalf of the shareholders. The Board is elected by the General Meeting of Shareholders, which also appoints the Board Chairman. The Board can delegate tasks to individual members or non-members of the Board but may not disclaim its liability for the company’s organisation and management or its obligation to ensure satisfactory control of the company’s financial circumstances.

The work of the Board is governed by rules of procedure which are revised and adopted yearly. Among other things, these rules regulate the division of roles and responsibilities within the Board and between the Board and CEO, the Board's meeting agendas and schedule and the framework for financial reporting. Furthermore, the auditors report to the Board once a year to present their observations from the audit and their assessment of the company’s internal control. Each Board meeting follows an agenda that has been prepared in advance. The Group’s CFO serves as Board Secretary. The CEO and other executives in ElektronikGruppen take part in Board meetings in an advisory or reporting capacity.

The AGM on 27 April 2010 re-elected Catharina Lagerstam, Kenneth Lindqvist, Magnus Norman and Thomas Wernhoff as regular Board members and re-elected Lindqvist and Wernhoff as Board Chairman and Vice Chairman, respectively. The Board also includes Madeleine Denker, who has been appointed by and represents the employees.

Within the Board, a Remuneration Committee has been appointed for more in-depth handling of matters related to remuneration and other terms of employment for the CEO and other members of the Executive Management. The members of this committee are Kenneth Lindqvist and Catharina Lagerstam. Furthermore, the Board has found it appropriate for the Board as a whole to function as the Audit Committee.

Board Chairman
The Chairman has special responsibility for ensuring that the Board carries out its duties in a responsible and efficient manner and in compliance with the Swedish Companies Act and other relevant laws and regulations. The Chairman closely monitors the operations of the company in dialogue with the CEO and is responsible for ensuring that the other Board members are provided with the information necessary to support high quality discussions and decisions. The Chairman is also responsible for evaluating the performance of the Board members and making these assessments available to the nomination committee. The Chairman represents the company in matters related to corporate governance.

Nominating Committee
The Nominating Committee is a body of the General Meeting of Shareholders whose task is to put forward proposals for resolution by the AGM regarding election of and remuneration to the Board of Directors and auditor and, when appropriate, matters of procedure regarding the upcoming Nominating Committee. The AGM can either appoint the members of the Nominating Committee directly or resolve on a procedure by which the Nominating Committee is to be appointed.

Auditor
The company’s auditor is appointed by the General Meeting of Shareholders to audit the annual accounts, consolidated accounts and accounting practices and to review the management of the company by the Board and CEO.

The 2008 AGM elected Ernst & Young AB, represented by Authorised Public Accountants Stefan Hultstrand and Ola Wahlqvist, to serve as the company’s independent auditor until the end of the 2012 AGM.

Executive Management
The Board of Directors has delegated responsibility for day-to-day management of the company to the CEO, who is assisted by the other members of the Executive Management. The division of responsibilities between the Board and the CEO is regulated by instructions and rules of procedure that are adopted yearly by the Board.

ElektronikGruppen’s Executive Management currently consists of eight individuals. Of these, one is the President and CEO, four are business area/unit managers and three are heads of staff. The members of the Executive Management maintain close contact and meet around ten times per year, according to a pre-established meeting schedule, for discussion of the company’s business situation and development.

Swedish Code of Corporate Governance
As of 1 July 2008, ElektronikGruppen complies with the Swedish Code of Corporate Governance. The Code serves as a complement to laws and other rules by establishing a norm for good corporate governance in Swedish exchange listed companies. However, the Code is based on the "comply or explain" principle, which means that a company may deviate from individual provisions in the Code provided that it explains the reasons for doing so and describes how it has chosen to act instead. As a consequence of Code application, the company must attach to its annual report a separate corporate governance report on the company’s application of the Code during the past financial year. ElektronikGruppen’s second corporate governance report in accordance with the Code was presented in the 2009 annual report and can be downloaded via the link at the top left corner of this page.