Corporate Governance Policy
1. Introduction to the Corporate Governance policy
The Board of Directors of Axactor AB (publ) (the “Company”) has prepared this corporate governance policy document (the “Policy”).
As the Company is a Swedish private limited liability listed on the Oslo stock exchange, the Norwegian Recommendation for Corporate Governance (the “Recommendation”) does not apply directly to the Company. However, with due regard to the fact that the Company is listed in Norway and to a substantial degree approaches the Norwegian investor market, and considering that Company wishes to place emphasis on sound corporate governance, the Company has prepared this policy document on the basis of the Recommendation, but made certain necessary adjustments given the Company’s Swedish domicile.
This Policy addresses the framework of guidelines and principles regulating the interaction between the Company’s shareholders, the Board of Directors (the “Board”), the Chief Executive Officer (the “CEO”) and the Company’s executive management team (the “Executive Management Team”).
2. Business activity
The Company’s business as set out in the Articles of Association is: “The Company shall, directly or through subsidiaries or via co-operations with others, conduct debt collection work, extend financial and administrative services, legal and invoicing services, acquire debt, investment operations, as well as therewith associated activities”.
3. Objectives and strategies
Engaging in the activities described in Section 2 above, the Company’s long term objective is to establish itself as a leading European player within the areas of its operations as defined by the articles of association.
The Company will pursue the following main strategies to reach its overall objective:
- Putting emphasis on loyal and satisfied customers;
- Being an innovative player that takes full advantage of available technologies to achieve competitive advantages;
- Identifying and securing access to attractive debt portfolios and other opportunities in the marketplace;
- Being an attractive employer, with a focus on creating an environment for professional and personal growth, with respect and due regard for each employee
- Being a profitable company with a focus on organic and structural growth; and
- Putting emphasis on becoming and sustaining a position as a leading European player in the Company’s market.
4. Ethical guidelines and values
The Company will maintain a high ethical standard in its business concept and relations with customers, suppliers, employees and other stakeholders. The following ethical guidelines shall be practiced in the Company, and shall apply to all employees of the Company:
- Personal conduct: All employees and representatives of the Company shall behave with respect and integrity towards business relations and partners, customers and colleagues. The Executive Management Team has a particular responsibility to promote openness, loyalty and respect.
- Conflict of Interests: The Company’s employees and representatives shall avoid situations wherein a conflict between their own personal and/or financial interests and the Company’s interests may occur.
- Confidential Information: Employees and representatives of the Company possessing confidential information related to the Company, shall conduct themselves and safeguard such information with great care and loyalty, and comply with any and all signed confidentiality statements.
- Influence: The Company’s employees or representatives shall neither directly nor indirectly offer, promise, request, demand or accept illegal or unjust gifts of money or any other remuneration in order to achieve a commercial benefit.
- Competition: The Company supports fair and open competition. The Company’s employees or representatives shall never take part in any activities that may constitute a breach of competition legislation.
- Breach of Ethical Guidelines: Any breach of these ethical guidelines may inflict severe consequences for the Company, and any breach may imply consequences for the person in question.
5. Company capital and dividend
The Board aims to maintain a satisfactory equity ratio in the Company in light of the Company’s goals, strategy and risk profile, thereby ensuring that there is an appropriate balance between equity and other sources of financing. The Board shall continuously assess the Company’s capital requirements in light of the Company’s strategy and risk profile.
The Board’s authorities to increase the share capital and to buy own shares shall be granted under Swedish legal framework, and not for periods longer than necessary.
The Company’s objective is to generate return to the shareholders at a level which is at least equal to other investment possibilities with comparable risk. The Company does not distinguish between such return in the form of dividends or in the form of capital appreciation. The Company is in a phase of growth, and does not foresee declaring dividends during the initial growth phase of the Company.
6. Share classes
The Company’s share capital is in one class only.
7. Transactions with related parties
Any transactions, agreements or arrangements between the Company and its shareholders, members of the Board, members of the Executive Management Team or close associates of any such parties shall only be entered into as part of the ordinary course of business and on arms-length market terms. With respect to any material related party transactions, the Board shall arrange for a valuation to be obtained from an independent third party unless the transaction, agreement or arrangement in question must be considered to be immaterial or the arrangement is subject to approval by the shareholders’ meeting.
No person or company mentioned in the above paragraph shall vote or otherwise participate in any decision by the Company regarding a transaction, agreement or arrangement with such person or company as a counterparty.
Board Members and members of the Executive Management Team shall forthwith notify the Board if they have any material direct or indirect interest in any transaction entered into by the Company.
8. Transfer of shares
The shares in the Company are not subject to any transfer restrictions.
9. The General Meeting
All registered shareholders have the right to participate in the General Meetings of the Company, which exercise the highest authority of the Company. The Company shall summon the shareholders to any General Meeting with the notice required by law, and otherwise with such advance notice as practicable. The person chairing a General Meeting should be independent of the Company and the Board.
The notices for such meetings shall include documents providing the shareholders with sufficient detail in order for the shareholders to make an assessment of all the cases to be considered as well as all relevant information regarding procedures of attendance and voting. Representatives of the Board and the Company’s auditor, as well as the nomination committee, shall be present at annual General Meetings.
Notices for General Meetings shall provide information on the procedures shareholders must observe in order to participate in and vote at the General Meeting. The notice should also set out: (i) the procedure for representation at the meeting through a proxy, including a form to appoint a proxy, and (ii) the right for shareholders to propose resolutions in respect of matters to be dealt with by the General Meeting.
Any cut-off for confirmation of attendance shall be set as short as practicable and the Board will arrange matters so that the shareholders, who are unable to attend in person, will be able to vote by proxy. The form of proxy will be distributed with the notice.
10. The board – composition
In appointing members to the Board, it is emphasised that the Board shall have the requisite competency to independently evaluate the cases presented by the Executive Management Team as well as the Company’s operation. It is also considered important that the Board can function well as a body of colleagues. Board Members shall be elected for periods not exceeding two years at a time, with the possibility of re-election. Board Members shall be encouraged to own shares in the Company.
11. Sub-committees of the board
The Company does not currently have a remuneration sub-committee nor an audit sub-committee, but shall continuously evaluate the need for establishing such sub-committees.
12. RESPONSIBILITY OF THE Board
The Board shall prepare an annual plan for its work with special emphasis on goals, strategy and implementation. The Board’s primary responsibility shall be (i) participating in the development and approval of the Company’s strategy, (ii) performing necessary monitoring functions and (iii) acting as an advisory body for the Executive Management Team. Its duties are not static, and the focus will depend on the Company’s ongoing needs. The Board is also responsible for ensuring that the operation of the Company is in compliance with the Company’s values and ethical guidelines. The Chairman of the Board shall be responsible for ensuring that the Board’s work is performed in an effective and correct manner.
The Board shall ensure that the Company has a good management with clear internal distribution of responsibilities and duties. A clear division of work between the Board and the Executive Management Team shall be maintained. The CEO is responsible for the executive management of the Company.
All members of the Board shall regularly receive information about the Company’s operational and financial development. The Company’s strategies shall regularly be subject to review and evaluation by the Board.
The Board shall prepare an annual evaluation of its work.
13. Risk management and internal control
The Board shall ensure that the Company has sound internal control and systems for risk management that are appropriate in relation to the extent and nature of the Company’s activities. The objective of the risk management and internal control shall be to manage exposure to risks in order to ensure successful conduct of the Company’s business and to support the quality of its financial reporting.
The Board shall carry out an annual review of the Company’s most important areas of exposure to risk and its internal control arrangements.
The Board shall provide an account in the annual report of the main features of the Company’s internal control and risk management systems as they relate to the Company’s financial reporting.
14. Board compensation
The General Meeting shall annually determine the Board’s remuneration. Remuneration of Board Members shall be reasonable and based on the Board’s responsibilities, work, time invested and the complexity of the enterprise. The compensation shall be a fixed annual amount. The Chairman of the Board may receive a higher compensation than the other Board Members. The Board shall be informed if individual Board Members perform other tasks for the Company than exercising their role as Board Members. Work in sub-committees may be compensated in addition to the remuneration received for Board membership.
The Company’s financial statements shall provide further information about the Board’s compensation.
15. Compensation to employed management
The Board decides the salary and other compensation to the CEO. The CEO’s salary and bonus shall be determined on the basis of an evaluation with emphasis on specific factors determined by the Board. The Board shall annually carry out an assessment of the salary and other remuneration to the CEO.
The Company’s financial statements shall provide further information about salary and other compensation to the CEO and the Executive Management Team.
The CEO determines the remuneration of executive employees. The Board shall issue guidelines for the remuneration of the Executive Management Team. The guidelines shall lay down the main principles for the Company’s management remuneration policy. The salary level should not be of a size that could harm the Company’s reputation, or above the norm in comparable companies. The salary level should, however, ensure that the Company can attract and retain executive employees with the desired expertise and experience.
16. Information and communication
The Board and the Executive Management Team assign considerable importance to giving the shareholders quick, relevant and current information about the Company and its activity areas. Emphasis is placed on ensuring that the shareholders receive identical and simultaneous information.
Sensitive information will be handled internally in a manner that minimises the risk of leaks. All material contracts to which the Company becomes a party shall, where appropriate, contain confidentiality clauses.
The Company shall have clear routines for who is allowed to speak on behalf of the Company on different subjects, and who shall be responsible for submitting information to the market and investor community. The CEO and the CFO shall be the main contact persons of the Company in such respects.
The Board must be aware of matters of special importance to the shareholders. The Board must therefore ensure that the shareholders are given the opportunity to make known their points of view at and outside the General Meeting.
17. Nomination committee
The Company shall have a nomination committee whose members are elected by the General Meeting. The General Meeting will select the leader of the committee, and its members, and determine its remuneration based on the character of duty and time consumed.
The duties and responsibilities of the nomination committee are set forth in the instructions of the nomination committee. The committee’s responsibilities are to propose candidates to be elected to the Board and to recommend remuneration for members. Reasonable rationale should be provided for the committee’s recommendations and include relevant information about the candidates and their independence. The recommendations of the nomination committee shall generally be made available to the shareholders at the time of the notice of the annual General Meeting. Efforts must be made to ensure that the composition of the nomination committee is broadly representative of shareholder interests and necessary expertise. Further, a maximum of one member should be a Board member and shall then not repeatedly be put forward for election. No member of the Executive Management Team should serve on the nomination committee. An overview of nomination committee members shall be are available on the Company’s website.
Each year the auditor shall present to the Board a plan for the implementation of the audit work and a written confirmation that the auditor satisfies established requirements as to independence and objectivity.
The auditor shall be present at Board meetings where the annual accounts are on the agenda. Whenever necessary, the Board shall meet with the auditor to review the auditor’s view on the Company’s accounting principles, risk areas, internal control routines etc.
The auditor may only be used as a financial advisor to the Company provided that such use of the auditor does not have the ability to affect or question the auditors’ independence and objectiveness as auditor for the Company. Only the Company’s CEO and/or CFO shall have the authority to enter into agreements in respect of such counselling assignments.
At the Annual General Meeting the Board shall present a review of the auditor’s compensation as paid for auditory work required by law and remuneration associated with other concrete assignments.
In connection with the auditor’s presentation to the Board of the annual work plan, the Board should specifically consider if the auditor to a satisfactory degree also carries out a control function.
The Board shall arrange for the auditor to attend all General Meetings.