9.1.1.2 Board committees

The CGP recommends establishing three board committees: the nomination committee, remuneration committee and audit committee. However, the composition and appointment of the nomination committee differ from common practice in the United Kingdom and the Netherlands. These board committees may be staffed with people from outside the board, such as shareholders. The SSA recommends establishing a nomination committee that should comprise between three and five members and should reflect the different groups of shareholders of the company (Aktiespararna 2001: 15). The general meeting should appoint the nomination committee and not the board itself. At least one representative of the smaller shareholders should be on the nomination committee and the chairman of the board must be part of it as well. In addition, employees of the company, who may have a position on the board as employee representative, are not allowed to be members of the nomination committee.

The remuneration committee must be appointed by the board and should comprise three representatives from the board (Aktiespararna 2001: 19). Non-board members, such as shareholders, may also serve on the remuneration committee. The audit committee recommendations provide that the board should appoint an audit committee from among its members who are not employees of the company. So the managing director is not allowed to be a member of the audit committee. The number of members should be at least three, but can be expanded with qualified people (Aktiespararna 2001: 20). Contrary to the other two committees, the nomination committee is appointed by the general meeting instead of the board. Non-board members are allowed to have a position on the nomination committee and remuneration committee.