9.1.1.1 Board composition

The CGP recommends including between six and nine directors, who are independent of the company’s management (Aktiespararna 2001: 15). The whole board should be balanced with respect to relevant competences and no employees should be included on the board, except for the Managing Director. The managing director is comparable to the CEO in the United Kingdom, because he is a member of the executive management. The other members of management are not part of the board, and in this sense the Swedish unitary board structure is rather different than the British unitary board structure. Besides (possibly) the managing director, all the other members of the board are NEDs. As the Swedish unitary board structure and the Swedish NEDs are different from the British and Dutch unitary board structures and NEDs, the remainder of this study will use the terms Swedish board structure and Swedish NEDs (SNEDs) or simply board members. An elaborate description of the Swedish board structure is given in subsection 9.2.1. After resignation, the former managing director should not be appointed Chairman of the board. Nor should there be a working Chairman, which means that CEO duality is prohibited.