The Board of Directors has a central role in Industrivärden’s business model for long-term asset management and active ownership. It is responsible for, among other things, issues related to major purchases and sales of listed stocks, the design and execution of active ownership, and overarching ownership matters concerning the portfolio companies. The Board has ultimate responsibility for Industrivärden’s organization and administration.
The Board’s duties are laid out in the Board’s Rules of Procedure and follow a yearly plan. Every board meeting follows an agenda that has been distributed to the board members supported by relevant background documentation.
In addition to the statutory board meeting, which is held in conjunction with the Annual General Meeting, the Board normally meets eight times per year (regular meetings, including meetings in connection with the publication of interim and yearend reports). Extra meetings are convened when necessary. In 2017 the Board held a total of nine meetings.
The statutory meeting deals with adoption of the Board’s Rules of Procedure, designation of the Company’s signatories, appointment of persons to check the minutes of board meetings, and appointment of committee members.
Each year the Board evaluates Industrivärden’s financial reporting and makes demands on its content and structure to ensure it maintains a high level of quality. In connection with the board meeting that deals with the annual financial statements, the Board of Directors’ Report, the proposed distribution of earnings and the year-end report, the Company’s auditor submits a report on the auditors’ observations and assessments from their audit.
The regular board meetings cover a number of set items of business. These include, among other things, a report on the financial result of operations, the development of net asset value and performance of the equities portfolio, and on equity transactions that have been carried out. Reporting also includes a description of the portfolio companies’ performance and macroeconomic conditions. In addition, a special review is normally conducted of one or more of the portfolio companies and of potential investments or divestments. At several board meetings during the year, the CEO from a portfolio company make a presentation on the company’s development.
All board decisions are based on extensive documentation and are made following a discussion that is led by the Chairman. The Board’s work is evaluated yearly in a structured process conducted under the direction of the Chairman of the Board. The 2017 evaluation was conducted by means of a questionnaire that each board member was requested to complete, in the aim of gaining an idea about the directors’ views on, among other things, how the board work has been conducted and which measures could be taken to improve the board work as well as which matters the directors feel should be given more attention and in which areas it could possibly be suitable to have additional expertise on the Board. The results of this evaluation were reported on by the Chairman, followed by a discussion within the Board. In addition, the Chairman’s work on the Board was evaluated with him not being present. The Chairman of the Board gave an oral report to the Nominating Committee on the conclusions of these evaluations and discussions.