2 0 1 Corporate governance report 46 Corporate Governance Report Loomis Annual Report 2017 Corporate governance The primary goal of Loomis’ corporate governance is to create clear goals, strate- gies and values that effectively protect shareholders and other stakeholders by minimizing risk and that also form a solid foundation from which to generate value and meet the requirement of a good return on invested capital. To achieve this, Loomis has developed a clear and efficient structure for the delegation of responsibility and control. Compliance with the Swedish Corporate Governance Shareholders Code Shareholders exercise their right to vote at the general meeting of Loomis AB is a Swedish public limited liability company that has shareholders, which is the Company’s highest decision-making been listed on Nasdaq Stockholm since 2008. In addition to the legal body and the forum where the shareholders exercise their right to or other statutory requirements, Loomis applies the Swedish Corpo- vote on company matters. All registered shareholders who have rate Governance Code (the Code). This Corporate Governance Re- notified Loomis by the deadline of their intention to attend, have port has been prepared in accordance with the stipulations in the the right to attend the general meeting and cast votes correspond- Annual Accounts Act, chapter 6, §6 and chapter 10 of the Code. The ing to the number of shares they hold. Shareholders who are un- Code, which is available at www.bolagsstyrning.se, follows the prin- able to attend in person may be represented by proxy. ciple of “comply or explain”, according to which entities applying the Loomis AB’s share capital as of December 31, 2017 consisted of Code may deviate from individual rules but must then report the de- 3,428,520 Class A shares and 71,851,309 Class B shares. Each viation, state the reason for it and describe the alternative solution Class A share entitles the holder to ten votes and each Class B share they have chosen. In 2017 Loomis complied with all parts of the Code to one vote. Loomis AB’s largest shareholders and ownership with the exception of sections 2.4, and 9.7. structure as of December 31, 2017 are shown in the table below. According to section 2.4 of the Code, neither the Chairman of the Board nor any of the other board members are to be appointed as LARGEST SHAREHOLDERS AS OF DECEMBER 31, SHARE 2017 chairman of the Nomination Committee. The chairman of Loomis AB’s Nomination Committee, Jan Svensson, is a member of the Number of Number of Votes % Capital Class A Class B % Board, which is a deviation from the Code’s stipulation. The reason shares shares Jan Svensson was appointed chairman of the Nomination Commit- tee is that it can be considered a natural choice taking into account Latour Förvaltning AB 2,528,520 – 23.8 3.4 Loomis AB’s ownership structure. Jan Svensson is President and Melker Schörling AB 900,000 – 8.5 1.2 CEO of Investment AB Latour which, through Latour Förvaltning BlackRock – 7,548,188 7.1 10.0 AB, is one of Loomis’ two principal owners in terms of voting power. SEB Fonder – 4,681,299 4.4 6.2 The second deviation relates to the Code section 9.7, which states that the vesting period for the share-related incentive pro- Capital Group – 3,698,042 3.5 4.9 grams or the period from the commencement of an agreement to Didner & Gerge Fonder – 3,293,934 3.1 4.4 the date a share may be acquired is to be no less than three years. Swedbank Robur Fonder – 3,040,142 2.9 4.0 Loomis’ incentive scheme, which is described on page 51 in section “Other significant events during the year”, allows shares to be ac- Norges Bank – 2,315,082 2.2 3.1 quired at the market price for a portion of the bonus earned. These Vanguard – 2,240,310 2.1 3.0 shares are allotted to employees the following year as long as they Fidelity – 1,692,367 1.6 2.2 are still employed by the Group. The scheme replaces a purely cash- 10 largest shareholders 3,428,520 28,509,364 59.2 42.4 based system with immediate disbursement and is not approved as Other foreign additional remuneration over and above existing incentive – 35,152,616 33.1 46.7 shareholders schemes. As such, the Board regards a two-year period from the Other Swedish start of the scheme to the allotment of the shares to be warranted – 8,189,329 7.7 10.9 shareholders and reasonable in meeting the objective of the incentive scheme. TOTAL 3,428,520 71,851,3091) 100.0 100.0 1) Includes 53,797 treasury shares as of December 31, 2017. Source: Monitor Loomis Annual Report 2017 Corporate Governance Report 47 Corporate Governance Organization Nomination Shareholders External auditors Committee Board of Remuneration Audit Committee Committee Directors President / CEO Executive Group Group CFO (fi nancial control) Risk Director (operational control) Segment /Regional Management Country Management Branch Manager Annual General Meeting Nomination Committee’s work in preparation for the 2018 The general meeting of shareholders (Annual General Meeting, AGM AGM) is held once a year to address matters including the follow- The Nomination Committee is a body established by the AGM and ing: tasked with preparing for the election of members of the Board and • Amendments to the Articles of Association the election of the Chairman of the Board, and with presenting pro- • Election of board members and decision on board fees posals regarding remuneration of board members and other related • Discharging the board members and the President from liability matters to be addressed at the upcoming AGM. In addition, ahead • Election of auditors of AGMs where auditors will be elected, the Nomination Committee • Adoption of the statement of income and balance sheet is to consult with the Board and the Audit Committee to prepare for • Appropriation of the Company’s profi t or loss the election of auditors and decisions on auditors’ fees and related • Resolution on guidelines for remuneration for the President and matters. The Nomination Committee has applied section 4.1 in the other members of Group Management Code in regards to its work with the diversity of the board members. • Decision to possibly introduce share-related incentive schemes Diversity is an important factor for the Committee’s nomination work. The Nomination Committee continuously strives for an even The 2017 AGM for Loomis AB (publ) was held on May 4, 2017 in gender distribution and breadth of qualifi cations, experience, and Stockholm. Shareholders in attendance, in person or by proxy, background among the board members. This is evident in current represented 59.5 percent of the votes in the Company. The AGM board composition. Information on which individuals were was also attended by members of the Board and Group Manage- re-elected to Loomis’ Nomination Committee at the 2017 AGM is ment, as well as the auditor in charge. provided in the table on page 48. For more information on Loomis’ Annual General Meetings The 2017 AGM decided that in cases where a shareholder repre- and the 2018 AGM, refer to Loomis’ website, www.loomis.com, sented by a member of the Nomination Committee is no longer a and page 122. principal shareholder in the Company (based on number of votes), 48 Corporate Governance Report Loomis Annual Report 2017 or where a member of the Nomination Committee is no longer em- thermore the Board appoints the President* and CEO* and the Au- ployed by a principal shareholder or for any other reason chooses to dit and Remuneration Committees. The President and CEO is re- resign from the Nomination Committee before the 2018 AGM, the sponsible for the Company’s day-to-day operations in accordance Nomination Committee has the right to appoint another represen- with the guidelines issued by the Board. The Board also determines tative for the principal shareholder to replace that member. The the salary and other remuneration for the President and CEO. composition of the Nomination Committee is published on Loomis’ The duties of the Board and the division of responsibilities be- website. The duties of the Nomination Committee are established in tween the Board and Group Management are stipulated in the specific work procedures for Loomis AB’s Nomination Committee. work procedures for the Board, which are documented in the form Three Nomination Committee meetings were held in 2017. of written instructions and adopted at least once a year. According to the work procedures, the Board is to take decisions on matters Auditors such as the Group’s general strategy, financial reporting, company The 2017 AGM voted to appoint PricewaterhouseCoopers AB as acquisitions and divestments, major investments and financing, the external auditor for one year with Patrik Adolfson as auditor in and is to establish a framework for the Group’s operations by ap- charge. proving the Group’s budget. The rules include a work plan for the The auditors examine the Company’s Annual Report, consoli- President and CEO and financial reporting instructions. dated financial statements and accounts, as well as the adminis- The work procedures also prescribe that an annual evaluation of tration of the Company by the Board and the President. The audi- the work of the Board of Directors should be carried out. On a yearly tors perform their duties in accordance with an audit plan estab- basis, all Board members submit their answers to a questionnaire is- lished in consultation with the Audit Committee and the Board.