We are active owners and this means that we engage with the companies we invest in. One important part of our active ownership work is to participate in nomination committees to prepare for nomination of board members at the companies’ annual general meetings. The purpose of our participation in nomination committees is to ensure a good composition of board members with different skill sets who can contribute to the long-term value creation in the companies that we invest in.
The nomination committee is the group of people who select candidates for the company’s board during the coming year. In the Nordic countries, the largest shareholders are usually part of the nomination committee. This presents an opportunity for the shareholders to influence how the company is managed and how it can create shareholder value. .
Nordea is a large investor in several Nordic companies and has sufficiently large ownership of some of these companies to participate in their nomination committee. During 2024, representatives of Nordea Funds participates in over 40 nomination committees in Sweden, Finland and Norway.
– As an active owner, it is our responsibility to safeguard our fund savers' interest for the continued financial value in a responsible manner. The board's work is evaluated in several ways, including through interviews. A recurring topic this year is the board's competence around artificial intelligence and the risks and opportunities connected. Most boards have made sure to educate themselves in this area and have started to identify risks and opportunities for the company, says Katarina Hammar, Head of Investment Stewardship.
The nomination committees’ proposals on board composition, auditors and board remuneration are discussed at the companies' annual general meetings.
Why is this good for you who are saving in our funds
It is the board that draws up the guidelines for the company's future strategy and that evaluates and appoints a managing director. A company board consisting of members with varied backgrounds, experiences and skills provides a more comprehensive understanding of different business aspects and can tackle challenges and opportunities from multiple perspectives.
Marie Karlsson, Head of Nordic, Finnish and Swedish Equities at Nordea and a part of the nomination committee for Nokian Tyres, explains why she and several of the portfolio managers in her team works with nomination committees.
– The board is responsible for making strategic decisions that will affect the future value of the company. As shareholders, we want to make sure that the company has a strong and diversified board that can set a solid strategic direction and respond to threats and opportunities along the way.
We work for diversity on boards
Our work and participation in nomination committees gives us a good opportunity to push the issue of diversity on the board.
– There are studies that show that companies that have a broad diversity in their boards, for example, a good mix of men and women, different backgrounds and experiences, have been more profitable over time. Diversity on the board is good for society, good for the companies and good for those who save in our funds, concludes Katarina Hammar.
