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Swedish Corporate Governance and Value Creation: owners still in the driver's seat

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  • Rolf H. Carlsson

Abstract

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.

Suggested Citation

  • Rolf H. Carlsson, 2007. "Swedish Corporate Governance and Value Creation: owners still in the driver's seat," Corporate Governance: An International Review, Wiley Blackwell, vol. 15(6), pages 1038-1055, November.
    • Handle: RePEc:bla:corgov:v:15:y:2007:i:6:p:1038-1055
    DOI: 10.1111/j.1467-8683.2007.00629.x
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    Cited by:

    1. Graaf, Johan & Kraus, Kalle & Strömsten, Torkel, 2022. "The problematics of financialization – On the important (but neglected) horizontal axis of organizational action," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 89(C).
    2. Gerhard Schnyder, 2008. "Revisiting the Party Paradox of Finance Capitalism: Evidence from Switzerland, Sweden and the Netherlands," Working Papers wp372, Centre for Business Research, University of Cambridge.
    3. Iván Darío Hernández Umana & Luis Arturo Rosado Salgado, 2010. "Las instituciones del estado y los grandes conglomerados industriales como determinantes del cambio estructural en corea del sur y Colombia," Revista de Economía del Caribe 7803, Universidad del Norte.
    4. Peter Franck & Stefan Sundgren, 2012. "Determinants of internal governance quality: evidence from Sweden," Managerial Auditing Journal, Emerald Group Publishing, vol. 27(7), pages 639-665, July.
    5. Fogel, Kathy S. & Lee, Kevin K. & Lee, Wayne Y. & Palmberg, Johanna, 2013. "Foreign Investors as Change Agents: The Swedish Firm Experience," Working Paper Series in Economics and Institutions of Innovation 311, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
    6. Schnyder, G., 2010. "Varieties of Insider Corporate Governance: Centre-Right Preferences and the Determinants of Reform in the Netherlands, Sweden and Switzerland," Working Papers wp406, Centre for Business Research, University of Cambridge.
    7. Katarzyna Cieślak, 2018. "Agency conflicts, executive compensation regulations and CEO pay-performance sensitivity: evidence from Sweden," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 22(3), pages 535-563, September.
    8. Robert Strand & R. Freeman, 2015. "Scandinavian Cooperative Advantage: The Theory and Practice of Stakeholder Engagement in Scandinavia," Journal of Business Ethics, Springer, vol. 127(1), pages 65-85, March.
    9. Chrysoula Morfi & Jerker Nilsson & Karin Hakelius & Kostas Karantininis, 2021. "Social networks and member participation in cooperative governance," Agribusiness, John Wiley & Sons, Ltd., vol. 37(2), pages 264-285, April.
    10. Ethel Brundin & Mattias Nordqvist, 2008. "Beyond Facts and Figures: The Role of Emotions in Boardroom Dynamics," Corporate Governance: An International Review, Wiley Blackwell, vol. 16(4), pages 326-341, July.
    11. Hildur Magnusdottir & Audur Arna Arnardottir & Throstur Olaf Sigurjonsson, 2023. "Selecting Nomination Committee Members—Stakeholders’ Perspective," Sustainability, MDPI, vol. 15(6), pages 1-21, March.
    12. Cieslak, Katarzyna & Hamberg, Mattias & Vural, Derya, 2021. "Executive compensation disclosure, ownership concentration and dual-class firms: An analysis of Swedish data," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 45(C).

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