Swedish corporate governance and value creation: owners still in the driver's seat

The purpose of the article is to outline some key characteristics of the Swedish corporate governance system and to highlight some of its important historical roots. The ambition is also to relate and compare Sweden in that respect to some other countries. Hopefully, this article will also help the international corporate governance community to better understand some of the Swedish particulars. The Swedish corporate governance system deviates in several respects from its Anglo-Saxon and continental counterparts. A large majority of Swedish households owns shares. Swedish industry, not least many of the large Swedish multinational corporations, is dominated by private owners, particularly by a number of large professional owners. The leading private owner, the so-called Wallenberg Sphere will be presented to illustrate what such an ownership role is all about. Swedish corporate governance features a clear-cut division of roles and responsibilities at three levels: owners/the AGM, the Board of Directors and the executive management. The AGM plays a key role in Swedish governance, e.g. by discharging and appointing the board. The nomination procedure is another characteristic. A nomination committee, made up of owner representatives reviews the performance of the board and nominates new candidates to the AGM. The board, which is non-executive (the CEO is a member in some boards), plays an active and increasingly important role. The article ends by outlining recent developments and outlook for Swedish corporate governance.