General Information
The Board has overall responsibility for operations pursued in the company and the Group, and reaches decisions in respect of the company’s organization, management, strategy, framework and objectives. The Board establishes guideline for the company’s operations. The Board is also responsible for following up and evaluating company operations based on strategies, objectives and guidelines established by the Board.
The Chairman of the Board organizes and manages the work of the Board and convenes Board meetings, decides on the agenda and prepares matters for Board meetings in consultation with the President and CEO. Board members are appointed by the shareholders at the Annual General Meeting for a period in office of one year, expiring at the end of the following Annual General Meeting.
In accordance with the provisions of the Code, the Chairman of the Board was also elected at the 2008 Annual General Meeting. Five members were elected at the 2008 Annual General Meeting. The composition of the Board and details concerning Board members are presented on page 59 in the Annual Report. See Note 6 for information about directors’ fees.
All Board members are regarded as independent in relation to the company and corporate management. With the exception of Chairman of the Board, Staffan Persson, who is not regarded as independent in relation to Zimbrine Holding BV (one of the company’s shareholders), all Board members are regarded as independent in relation to the major shareholders in the company.
The President and CEO is not a member of the Board, but he participates in all meetings, apart from business that he is disqualified from such as meetings when the work of the President and CEO is to be evaluated. Other officials also participate in Board meetings as and when required in order to provide the Board with information or upon request of the Board or President and CEO. During the year, the Board has held sixteen minuted meetings; one held immediately after elections and four meetings held by correspondence. Board meetings follow a pre-approved agenda. The agenda and supporting materials are distributed to Board members before each meeting. Decisions are reached following an open and constructive discussion led by the Chairman. In order for the Board to be quorate, more than 50% of the members must be present. During the year, the recorded minutes were not disputed at any meeting. Important issues addressed during the year include:
• Organization and strategic focus for Group operations, including IT strategy and structure
• Budget and budget follow-up, capital structure and financial objectives
• New graphic profile
• New laws and regulations, including MiFID, Reg NMS, the Code, etc.
• Continual follow-up of the development of the business in respect of customer inflow and profitability per customer, personnel, results, strategy and risks
• Cost control
• Policies and instructions
• Remuneration to the President and CEO and other senior executives
• Short and long-term incentive programs
• Interim reports and the annual report
• Follow-up of internal and external audits, as well as Group compliance activities, including site visits undertaken by the Swedish Financial Supervisory Authority
• Evaluation of Management and CEO performance
• Conversations with other parties concerning possible forms of collaboration
• Group risks and risk management
• Internal control
Attendance at Board Meetings
Board meetings were held on February 5 and 8, March 16, April 4 and 21 (plus the statutory meeting), May 18, June 25, July 18, September 8, October 17 and December 9, 2008.
In addition, meetings were held by correspondence on January 30, March 7, June 30 and October 28, 2008. All members were present at all meetings, except for the meeting held on September 8, 2008 when Hans Karlsson was not present.
Governance and Reporting Principles
The work of the Board is governed by procedures that contain rules and guidelines that set out the distribution of work between the Board and the CEO, as well as instructions concerning the form and content of Board meetings. This basic documentation is revised every year. The Board’s governance procedures regulate the work of the Board and address the following areas:
• Meetings: statutory Board meeting, annual meeting frequency, conditions for unscheduled meetings, procedures for setting dates and issuing notice
• Agenda: Confirmation and distribution
• Matters to be addressed at scheduled and statutory Board
meetings
• Procedures for ongoing reports and other information provided to the Board and auditors
• Distribution of work between Board and CEO
• Quoracy and attendance
• Minute taking procedure
• Disqualification issues and other issues
• Committee work: procedures for the institution of the various assignments and the right for remuneration and/or audit committees to make decisions (see below)
• Procedure for Board and CEO evaluation (see below)
• Internal audits
In addition, the CEO also complies with instructions regulating obligations and authorities governing Neonet’s operating activities. The instruction for the CEO is revised and agreed annually, with the current instruction agreed by the Board at
the statutory Board meeting held on April 21, 2008. The CEO produces the necessary information and decision-making documentation prior to Board meetings, gives presentations and justifies proposed decisions. The CEO also provides Board meetings with a monthly written report. The report contains information about the Group’s operations and trading status, results for the preceding month with comments on budget deviations, as well as the HR situation.
The CEO manages the day-to-day work of the Group and corporate management. The composition of the management team is shown on page 58 in the Annual Report.
Evaluation of Management and CEO Performance
The Chairman of the Board initiates an evaluation of the performance of the Board and CEO based on a questionnaire and series of one-to-one appraisal meetings at least once annually. The evaluation is compiled, reported and discussed with the entire Board. No member of the corporate management team is present during the evaluation process. Relevant parts of the evaluation results are reported to the
Nomination Committee.