The Relevance of the Swedish Corporate Governance Code to Private Companies with a Broad Shareholder Base


On 1 November 2015, a new Swedish Corporate Governance Code (“SCGC”) enters into force, following broad consultations between the Swedish Corporate Governance Board and the users of the code. The aim of corporate governance is essentially to mitigate the risk that conflicting interests between the owners of a company and its board of directors or management may lead to sub-optimization in management from an owner perspective (meaning that the company is not managed as efficient as possible in the interest of its shareholders). This may be the case as regards, for example, long vs short term return on investment, risk levels, executive/board remuneration and financial structure. This risk increases when ownership and management is separated and none, or only some, of the shareholders take part in the management of the company.

The work of the Swedish Corporate Board is mainly focused at companies listed at a regulated market, such as the Nasdaq Stockholm exchange, but the SCGC also inspires companies listed at non-regulated market places, such as the Nasdaq First North and Aktietorget, and is generally applied by companies owned by the Swedish state (where all tax-payers are indirect stakeholders). However, the principles expressed in the SCGC could function as guidance also for private companies with a broad shareholder base, where shareholders’ agreements may not be a possible or practical instrument to implement a governance structure. This may be the case in, for example, crowdfunded companies. In such cases, the annual general meeting could instruct the board to apply all or parts of the SCGC, or give a separate instruction based on principles derived therefrom.

More information on Swedish corporate governance, including the revised SCGC is available on

For further information, please contact Oskar Belani.

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