Board of Directors

The Board consists of ten members elected by the AGM. It also includes two employee representatives and their deputies in accordance with special agreements with the Financial Sector Union of Sweden and  Akademikerföreningen. The bank’s Board meets the requirements of the Code with respect to its members’ independence. All members except Göran Hedman are considered independent in relation to the bank, its excecutive management and the major shareholders.

An even gender distribution on the Board is desirable over time. The current distribution is 40 per cent women and 60 per cent men. In 2010 it was 50/50. The 2011 AGM elected one new member: Olav Fjell. Lars Idermark was re-elected as Chair.

Swedbank’s Articles of Association state that the Chair of the Board is appointed by Annual General Meeting for a period of one year, but otherwise do not have any special provisions on the appointment/dismissal of Board members.

Neither the CEO, the CFO, the Company Secretary nor the Chief Legal Officer is a member of the Board. They attend Board meetings, however, except when issues are discussed where they could have a vested interest or it is otherwise unsuitable for them to attend, e.g. when the CEO’s work is evaluated. The deputy employee representatives normally do not attend Board meetings. The Board’s composition is presented on pages 64–67.

The Board’s responsibilities and delegation of responsibilities

The Board sets operational goals and strategies; appoints, dismisses and evaluates the CEO; ensures that effective systems are in place to monitor and control operations and that laws and regulations are followed; and ensures that the information released to the public is transparent and accurate.

The Board makes the final decision on the appointment/ dismissal of the CFO and the CRO.

The Chair of the Board has specific responsibilities, including:

• Oversee the CEO’s work and be a discussion partner and support for him or her, as well as monitor that the Board’s decisions and instructions are implemented.
• Organise and manage the Board’s work, encouraging an open, constructive dialogue within the Board, and develop the Board’s competence on issues of importance to operations,
• including the evaluation of the Board’s work

The overall responsibility of the Board cannot be delegated. However, the Board has committees that monitor, prepare and evaluate issues within their respective areas for resolution by the Board. The division of work between the Board, the Chair of the Board and the CEO is determined annually in the Board’s instruction for the CEO.

Special instructions are also in place for the Board’s committees. The Board appoints the members of the committees at its statutory meeting following the AGM. Changes in the members of the committees can be made at any time during the year.

The Board and committees can, at the bank’s expense, engage outside experts if deemed necessary to fulfil its assignment or to obtain information on market practices.

More information on the work of the committees can be found on pages 58 and 59. Internal Audit reports directly to the Board. During the year a new head of Internal Audit was appointed after the previous executive became head of the Baltic Banking business area.

Evaluation of the Board and the Chair of the Board

Each year the Chair of the Board initiates an evaluation of the Board’s work. This was done in 2011 through a written questionnaire and in-depth interview with each Board member without hiring an outside consultant. The results were compiled and presented to the Board.

The Board’s work

In 2011 the Board held 20 meetings, two of which were by telephone and four per capsulam. The Board also conducted two workshops on liquidity, among other issues. All the meetings except one were held in Stockholm. The Board was unanimous in its decisions, and no dissenting opinions were noted on any issue during the year. For information on attendance at the Board meetings during the year, see pages 64–67. Each year the Board establishes a plan for its work, where it decides which issues to treat in depth. This is based on the processes used in the bank as shown below.

Other major issues in 2011 included the following:

• The European crisis and its effect on the bank, its limits and exposures
• Capital and liquidity goals
• Share repurchase
• Liquidity strategies and funding issues
• Stress tests
• Remuneration issues
• The ongoing risk and capital situation, including the Internal Capital Adequacy Assessment Process (ICAAP)
• Credit decisions where the total Group credit limit exceeds 10 per cent of the capital base (corresponding to SEK 9.3bn as of 31 December 2011) for the Swedbank financial companies group, as well as on limits for credit risk concentrations
• Evaluation of the CEO
• Business intelligence

During the autumn the Board travelled throughout Sweden to obtain greater insight into the retail operations and local market conditions, challenges and opportunities. During the trip a number of study visits were made to the bank’s branches , where discussions were held with employees, regional managers, customers, decision-makers and analysts.

Prior to each Board meeting the proposed agenda is distributed together with detailed material. This is normally done a week in advance through an electronic data room, where members can view the documents. The Chief Auditor
also has access to the system, which has mail, chat, and voting functions, and shows when the documents were accessed on an individual basis. The material for the meetings is saved electronically, including documents not enclosed with minutes. In addition to committee members, the minutes from all committee meetings are distributed to the other members of the Board, the CEO, the Head of Internal Audit and the external Auditor. The Board is informed about issues addressed by the committees at its subsequent meeting.

New Board members attend the bank’s own introductory training. This applied to Olav Fjell, who was elected by the 2011 AGM. He has also attended the stock exchange’s training. The purpose of the internal training is to quickly become familiar with the organisation and operations and better understand Swedbank’s values and culture.

Board work 2011