Corporate Governance guides companies

The goal is that companies are managed sustainably, responsibly and as effectively as possible. This creates the conditions for the company's success, and delivers long-term sustainable returns. This contributes to safeguarding pensions.

Corporate governance is an explicit part of AP4's strategy to increase returns. Areas often covered include a company's strategy, sustainability activitites, board composition, capital structure, compensation and transparency.

Generally, AP4 believes that direct dialogue - preferably face to face - with the companies' board, management team and owners typically works best. To be successful, dialogues are conducted confidentially and not through, for example, media.

General goals - Corporate governance

AP4's work with corporate governance aims to:

  • contribute to good long-term sustainable return
  • safeguard the best interests of shareholders and individual companies
  • take into account the unique circumstances and need of each individual company
  • exercise the rights and obligations of ownership responsibly and sustainably
  • promote the development of good practice in the securities market. Well-functioning equity markets are essential for long-term investors to be able to generate high and sustainable returns.

General goals - Corporate governance

AP4 should:

1. Participate in Nomination committees for a good board composition

Requested to participate in 27 Nomination committees during the period of 2015/2016, and accepted all.

2. Interview all or part of the board at board evaluations

The Board´s own interviews with the directors is a significant component for the Nomination committee’s evaluation. AP4 advocates that the Nomination committee also conducts their own interviews to gain a deeper understanding of how well the board works for those Nominating committees where AP4 participates. The Nomination committee’s own interviews are an important complement to any written self-assessments the Board has commissioned, or assessments by an external board evaluation. 

3. Increase diversity on boards in terms of gender balance

In the Nomination committees where AP4 participates it's important to ensure that:

  • there's at least one women on the shortlist for the appointment of new directors.
  • the Swedish Corporate governance Code's recommendations regarding the proportion of women on boards are met.

In the nomination committees where AP4 participated during the period of 2015/2016, 13 of the 33 newly elected members were women, equivalent to 39 percent.

4. Exercise voting rights at Swedish AGM's

AP4 gives priority to companies in which AP4 have large holdings, is a major owner and/or at fundamentally important issues.

During 2016 AP4 voted at 100 general meetings, of which nine were by proxy.

5. Exercise voting rights at AGM's of foreign companies

AP4 prioritizes the largest companies in every market, companies where the Ethical Council conducts dialogues and companies where AP4 supports an international initiative. 

AP4 voted at 798 international AGM's in USA, Japan, Canada, United Kingdom, Australia, France, Germany, Switzerland, Netherlands, Spain, Italy, Hong Kong, Irland and New
Zeeland under 2016.

6. Promote initiatives for the establishment of governance and stewardship codes internationally

During the period AP4 submitted comments to the OECD regarding Russia's Corporate Governance Code.