The Board elects the Vice Chair and appoints the members of the Board Committees.
The Board has adopted written working procedures governing its work, which also describe the management and risk reporting to the Board (the “Charter”), and separate working procedures for the work carried out by each of the Board committees (the “Committee Charters”). For example, the Charter determines the Board’s and the Chair’s respective areas of responsibility, documentation and quorum as well as the frequency of meetings. It also contains rules regarding conflicts of interest, confidentiality and the Board Secretary.
The Board is charged with the organisation of Nordea, the administration of Nordea’s operations and the overall management of the Nordea Group’s affairs in accordance with the external and internal frameworks and its Charter. The Board must ensure that Nordea’s legal and organisational structure is appropriate and transparent with a clear allocation of functions and areas of responsibility that ensures sound and effective governance, avoids the creation of complex structures and enables supervisors to conduct efficient supervision.
The Board regularly follows up on Nordea’s strategy, business development as well as Nordea’s financial position and performance. Furthermore, the Board regularly updates the policies and internal rules on governance and control on which it has decided. The Board also reviews the risk appetite and regularly follows up on relevant risks, capital and liquidity.
Significant organisational changes, certain senior management appointments as well as mergers and acquisitions and other resolutions of significance are other matters dealt with by the Board. For example, in 2024 the Board approved the Nordea Group strategy, and monitored and analysed the macroeconomic and geopolitical developments. The Board also handled matters related to sustainability, digitalisation, cyber defence, internal control and compliance, financial crime, M&A, share buy-backs and dividends as well as monitored business area, technology and data strategy execution. The Board must also ensure that Nordea’s organisation in terms of accounting, management of funds and Nordea’s financial position in general includes satisfactory controls. The Board is ultimately responsible for ensuring that an adequate and effective system of internal control is established and maintained. Group Internal Audit annually provides the Board with an assessment of the overall effectiveness of governance and the risk and control framework, together with an analysis of themes and trends emerging from internal audit work and their impact on the organisation’s risk profile.
The Board regularly meets the external auditor. In addition, the auditor in charge regularly attends the meetings of the Board Audit Committee. In 2024 the Board held 14 meetings, 6 of which were held per capsulam.
Chair
The Chair of the Board is elected by the shareholders at the Annual General Meeting. The Board meets according to its annual meeting schedule and as necessary. The Chair ensures that the Board’s work is conducted efficiently and that the Board fulfils its duties. The Chair leads and organises the Board’s work, maintains regular contact with the President and Group CEO and ensures that the Board receives sufficient information and documentation, that the work of the Board is evaluated annually and that the Shareholders’ Nomination Board is informed of the result of the evaluation.
Evaluation of the Board
The Board conducts a self-evaluation process annually, through which the performance and the work of the Board are evaluated for the purpose of continuously improving the Board’s work and efficiency. The evaluation is based on methodology that includes questionnaires to evaluate the Board as a whole, the Chair and the individual Board members. From time to time, Nordea engages an external party to assist in the Board’s annual self-evaluation for an objective view. The result of the self-evaluation process is further discussed by the Board and presented to the Shareholders’ Nomination Board by the Chair of the Board.
In accordance with applicable European regulatory requirements, a suitability assessment of the individual Board members and of the Board as a whole is completed annually and in connection with the selection process for new Board members. The annual suitability assessment for 2024 concluded that the Board members individually and collectively possess the requisite knowledge of and experience in the social, business and cultural conditions of the regions and markets in which the main activities of Nordea and the Nordea Group are carried out, exhibiting adequate diversity and breadth of qualities and competencies, and that the gender distribution is well-balanced.
Board Committees
In accordance with the external framework and in order to increase the effectiveness of the Board work, the Board has established separate working committees to assist the Board in preparing matters falling within the competence of the Board and in making decisions in matters delegated by the Board. The duties of the Board committees as well as working procedures are defined in the Committee Charters. In general, the Board committees do not have autonomous decision-making powers and each committee regularly reports on its work to the Board. Nordea follows the legal requirements and complies with the Code in terms of Board committees.
Further information regarding the Board Committees is given here.
Board training
To enable a good understanding of Nordea’s organisation and structure, business model, risk profile and governance arrangements, new Board members participate in an induction programme, covering, among other things, areas related to Nordea’s structure and business model, risk profile, governance, Board responsibilities, business strategy, financials and risk management as well as relevant laws and regulations. Depending on the individual needs of the Board members, further training on specific subjects is arranged in order to maintain and deepen relevant knowledge.
Board members also receive annual training based on their individual and collective needs as well as regulatory and supervisory requirements. The annual training plan is designed to cover the key risk areas of Nordea and ensure up-to-date knowledge of identified relevant knowledge areas. The training activities also take into account the results of the annual self-evaluation and suitability assessments of the Board as well as input on identified training needs from senior management.
In 2024 the Board received approximately 20 hours of training as part of the annual training plan, requested ad hoc training and strategy sessions in line with industry best practice. As part of the annual training plan, the Board received training in several key areas, including IT infrastucture, information security, capital, liquidity and funding, market and model risk, credit risk, internal ratings-based approach and models, financial reporting, financial crime, ESG topics, people matters as well as compliance and governance topics.
Time commitment
Board members must be able to commit sufficient time to perform their duties and comply with the rules on the limitation on the number of directorships. The acceptable number of directorships is subject to both the Finnish Act on Credit Institutions and market expectations. Based on the regulatory requirements and market expectations, reflected for example in the policies of proxy advisers and institutional investors, a Board member, including the position on the Nordea Board, may
1. hold a maximum of one (1) executive directorship and two (2) non-executive directorships, or four (4) non-executive directorships, unless the ECB has granted an exemption which may be sought on a case-by-case basis
2. subject to fulfilling the requirements under item 1 above, hold no more than five (5) mandates in publicly listed companies, where a non-executive directorship counts as one (1) mandate, a non-executive chair position counts as two (2) mandates and a position as executive director (or a comparable role) is counted as three (3) mandates
3. regardless of the above, not hold the position of an executive director (or a comparable role) in a publicly listed company and of a non-executive chair in another publicly listed company.