The objective of corporate governance is to ensure that the Mycronic Group is managed as efficiently as possible in order to create shareholder value. This is achieved through a clear division of responsibilities between the Annual General Meeting, the Board and the Executive management, as well as through clear regulations and transparent processes.

Framework for corporate governance

Corporate governance is based on external governing instruments such as the Swedish Companies Act, the Annual Accounts Act, Nasdaq Nordic’s Main Market Rule Book and the Swedish Code of Corporate Governance (the Code), as well as internal governance systems. In 2022, Mycronic complied with the Code in all respects.

The vision, mission, values and Code of Conduct form the basis for internal governance systems. Internal regulations include the Articles of Association, the rules of procedure for the Board of Directors, the Board policy for the CEO and several other policy documents that are updated annually. Examples of steering documents include the Code of Conduct, financial policy and approval and signing policy.

More information on corporate governance and the Code is available at www.bolagsstyrning.se.

Reports

A report on corporate governance is included in Mycronic's annual report. There is also an archive of Mycronic's corporate governance reports on the website. 

Archive of all reports

Mycronic’s Annual General Meeting is held on Tuesday, May 9, 2023, at 5:00 p.m. at the company’s premises at Nytorpsvägen 9 in Täby. 

Requests from shareholders shall be received no later than seven weeks before the Annual General Meeting, or at least in such time that the matter, if necessary, can be included in the Notice to the Annual General Meeting.

The Annual General Meeting (AGM)

The AGM is the company’s highest decision-making body. All shareholders have the right to participate in the AGM and to exercise their voting rights relative to their shareholdings. Rules regarding the AGM can be found in the Swedish Companies Act and the Articles of Association. Notice to attend the AGM shall be made four to six weeks prior to the meeting through an announcement in Post- och Inrikes Tidningar and in a press release published on the company website. Issuance of the notice shall be announced in Svenska Dagbladet. Shareholders who wish to participate in the Meeting must submit an application in accordance with information in the official notification.

Articles of association

Articles of association
Archive of earlier AGM's documents

• Nomination Committee
• Audit Comittee
• Remuneration Committee

The Nomination Committee represents the shareholders. Its task, ahead of the AGM, is to produce proposals regarding election of the chair of the meeting; decisions on the number of Board members; election of and decisions on fees to Board members, the Chairman of the Board and auditor; election of and decisions on fees to members pertaining to other special committees or councils that the AGM may resolve on appointing; and proposals for principles on appointing a Nomination Committee for resolution by the AGM.

In accordance with the resolution by the AGM, the Nomination Committee consists of four persons: representatives from the three largest known owners as of August 31 and the Chairman of the Board. The composition of the Nomination Committee is published at the latest six months prior to the AGM. The Nomination Committee’s proposals are presented in the Notice of the AGM and on Mycronic’s website.

The annual evaluation of the Board’s work is presented to the Nomination Committee and is the basis for its work in proposing Board members. The Nomination Committee bases its work on the requirements of the Swedish Companies Act and the Code, as well as company-specific requirements. In its work, the Nomination Committee applies section 4.1 of the Code as the diversity policy. The intention is to have an appropriate Board composition, which shall be characterized by versatility and breadth including age, gender, education, background and experience. Additional information is available in the Nomination Committee’s reasoned statement regarding its proposal to the 2023 AGM.

The Nomination Committee for the 2023 AGM consists of Henrik Blomquist (Bure Equity), Patrik Jönsson (SEB Funds), Thomas Ehlin (Fourth Swedish National Pension Fund) and Patrik Tigerschiöld (Chairman of the Board).

Recommendations to the Nomination Committee

Shareholders who would like to make recommendations to the Nomination Committee should do so in writing to:

Mycronic AB
Nomination Committee
Ann Borgström
Box 3141
183 03 Täby
Sweden

The Audit Committee is appointed by the Board and consists of three Board members. The Committee is tasked with ensuring the quality of financial reporting, monitoring the effectiveness of the internal control including risk management with respect to financial reporting, as well as evaluating performed internal audit work . This comprises reviews of significant accounting and valuation issues. The Audit Committee evaluates the external auditing and assists the Nomination Committee with proposals for the election of the auditor. Employees do not participate during parts of certain meetings between the Audit Committee and the external auditor.

Since the 2022 AGM, the Audit Committee has consisted of Anna Belfrage (Chairman), Katarina Bonde and Staffan Dahlström. In 2022, the Audit Committee held five meetings.

The Remuneration Committee is appointed by the Board and consists of three Board members. The Committee is tasked with proposing the CEO’s salary, other remuneration and terms of employment. The Committee also proposes guidelines for remuneration and terms of employment for other members of the executive management and proposals for incentive programs. The Remuneration Committee shall ensures that established guidelines for remuneration to members of the executive management are complied with.

Since the 2022 AGM, the Remuneration Committee has consisted of Patrik Tigerschiöld (Chairman), Arun Bansal and Robert Larsson. The Remuneration Committee held three meetings in 2022.

Shareholding in Mycronic as per 31 March, 2023.

The Board of Directors (the Board) has overall responsibility for the company’s organization and management. The Board monitors operations, ensures a suitable organization, and establishes guidelines for internal control. The Board establishes strategies and goals and makes decisions on major investments. The CEO is appointed by the Board and is responsible for ongoing administration.

The responsibilities of the Board are governed by the Swedish Companies Act and in the rules of procedure. Division of labor between the Board and the CEO is established through written instructions.

The Board consists of seven members appointed by the AGM, and two employee representatives appointed by Unionen and Akademikerna.

Chairman of the board

The Chairman is appointed by the AGM and leads the work of the board and also represents the company on ownership issues. At the 2023 AGM, Patrik Tigerschiöld was elected to the position of chairman. 

Independent

Patrik Tigerschiöld is regarded as a non-independent board member relative to the company's largest shareholder. Other members of Mycronic's board are regarded as independent relative to both the company and its largest shareholders. 

Remuneration

The Chairman and the members of the Board are remunerated according to the Annual General Meeting decision. Members of the Board that are appointed by the unions do not receive remuneration. No fees are paid to the Boards of the subsidiaries.

The AGM elects the company's auditors. At the 2023 AGM, the auditing company Ernst & Young AB was re-elected as auditor for the period up until the 2024 AGM. Authorized Public Accountant Anna Svanberg is the senior auditor. On behalf of shareholders, the auditor is tasked with reviewing Mycronic's annual report and accounting, as well as the board's and CEO's administration.

The senior auditor submits an audit report to the AGM, an opinion on the Remuneration to the Board of Directors and executive management, as well as an opinion on the statutory sustainability statement. 

The 2023 AGM decided that the fee for the company's auditors, for the period up to the next AGM, would be paid in accordance with current invoicing.

In addition to auditing, auditors may be called upon in lesser, advisory questions.

Shareholding in Mycronic as per 31 March, 2023.

The executive management consists of eight persons, including the CEO.

The CEO leads the work of the executive management, which meets once a month. Issues addressed include financial performance, development projects, leadership and skills supply and other strategic issues. The CEO is responsible for keeping the Board informed of the company’s development. Four global management meetings were organized in 2022 to strengthen unified communication and control throughout the Group. In addition to the executive management, there are several collaborative bodies that prepare and coordinate strategic and operational issues.

Remuneration to the CEO and other senior executives

The principles for remuneration to the CEO and other senior executives are approved by the Annual General Meeting. The proposed principles are prepared by the Board’s Remuneration Committee. The Board passes a decision on the proposed principles, which is then put to the Annual General Meeting for approval. The 2023 AGM established the following guidelines for remuneration and other terms of employment for senior executives.

Senior management position holders

Senior management position holders are the CEO and other executive management team members. The executive management team comprises of eight persons, including the CEO, of which three are women.

Guidelines for remuneration

The guiding principle is that Mycronic shall offer competitive remuneration and conditions of employment which enable the company to recruit and retain members of the executive management with the competence and capacity to achieve specified goals. To this end, the company must offer competitive remuneration to motivate the executive management.

When preparing remuneration issues, external advisors are utilized when needed. This is done continuously, in order to collect and evaluate information about current market conditions.

The remuneration and other terms of employment for members of the executive management shall be based on market terms and factors such as scope and complexity of the position in question as well as the individual’s performance is taken into account.

The total remuneration consists of the following parts:

• Fixed remuneration
• Short-term incentive program (STI)
• Long-term variable pay
• Other benefits
• Pension
• Employment terms and severance

Fixed remuneration

In establishing the base salary for the CEO and members of the executive management, the scope and complexity of the position in question, as well as the individual’s performance is taken into account. The executive management’s salaries are, like the other components of remuneration, subject to annual review by the Remuneration Committee, with the support of external salary statistics to ensure that the salaries remain competitive. The base salary constitutes a maximum of 65 percent of total remuneration in the event of a maximum outcome of short-term variable pay.

Short-term variable pay

Short-term variable pay can amount to a maximum of 120 percent of base salary and 55 percent of total remuneration.

Long-term variable pay

Members of the executive management can be offered incentive programs, which mainly should be shared or share price-related. An incentive program is intended to improve the participant’s commitment to the company’s development and shall be introduced on market-based terms. Resolutions on share or share price-related incentive programs must be passed at an Annual General Meeting and are therefore not covered by these guidelines.

Other benefits

Other benefits may consist of car benefits and health insurance.

Pension benefits

Pension benefits are premium-based. Members of the executive management employed in Sweden after 2012 are covered by the contribution-defined plan under ITP1. Members of the executive management employed prior to 1 January 2022 have a supplementary contribution-defined pension plan in addition to the ITP plan.

The contractual retirement age is 65 years for members of the executive management employed in Sweden. For members of the executive management employed outside of Sweden, locally competitive pension plans and retirement ages are applied. The pension premium for the CEO is limited to 35% of the base salary.

Notice of termination and severance pay

The employment or contractual agreements of members of the executive management shall be valid until further notice or for a specified period of time. For the CEO, in the event of termination by the company, a twelve months notice period and twelve months of severance pay apply. For members of the executive management employed in Sweden, the mutual notice period is a maximum of six months.

Upon termination by the company, six months’ severance pay also applies. During the notice period, the current employment contract runs with associated benefits. In cases where severance pay would be paid, no other benefits will be paid after the expiry of the notice period. For other members of the executive management who are locally employed outside of Sweden, employment or contractual agreements shall comply with mandatory rules applicable in the relevant jurisdiction or local practice.