The Board has full responsibility for AP6’s activities and for areas where the Board’s work is not regulated by the Sixth AP Fund Act (2000:193), it is regulated by the Rules of Procedure set by the Board each year. The Board establishes AP6’s performance targets and its long-term strategy, along with appointing and evaluating the Managing Director and ensuring that there are sound procedures in place for internal controls and monitoring.
The Board of Directors, consisting of five members, is appointed by the government, which also appoints the Chairman and Deputy Chairman.
Board members have a 1-year mandate.
Committees to support operations
The Risk & Audit Committee assists the Board with matters concerning audits, financial reporting and risk management. Its task is to monitor AP6’s financial reporting and the efficiency of its internal controls, internal audit (as required) and risk management, as well as briefing the Board on the audit of the annual report.
The Remuneration Committee assists the Board in a drafting capacity in matters concerning remuneration principles, remuneration and other employment terms for senior executives at AP6. It must monitor and evaluate application of the guidelines for the terms of employment for senior executives decided by the Board and use the government’s guidelines issued in 2009. The Committee must also prepare draft proposals for a framework for annual salary reviews for AP6’s employees.
The Sustainability Committee assists the Board in a drafting capacity in matters concerning AP6’s sustainability efforts. The Committee must, in collaboration with AP6’s management prepare the following:
– An annual plan for sustainability efforts
– Relevant sustainability goals
– Criteria and methods for measuring and evaluating AP6’s sustainability efforts
– Guidelines for annual sustainability reporting
Internal controls are essential to efficient operations. The Board is responsible for internal controls. The Board may be assisted by the Managing Director and, if necessary internal audit, if a particular area requiring an audit has been identified. Since AP6 has few employees, and no separate (in-house) function for internal audit, external consultants with the right expertise are instead engaged.
The Board’s own assessment
Under the Sixth AP Fund Act (2000:193), the Board must carry out an annual assess-ment of its management of the fund assets, i.e. a performance review. This assessment must be submitted to the government in conjunction with the presentation of the annual report and the auditors’ report.
AP6’s auditors are appointed by the government. The auditors’ work in-cludes examining AP6’s operating activities, administration, financial statements and annual report. Based on their audit, the auditors express an opinion on the accounting records and the administration.
Their work also includes verifying that AP6 follows generally accepted accounting and valuation principles, and that the accounting records provide a true and fair view of operations. An audit of AP6’s IT environment was also conducted. In addition to this, the auditors report verbally to the Ministry of Finance once a year.
In addition to the Board’s own assessment, the Ministry of Finance conducts an annual assessment of AP6’s operations on behalf of the government. This assessment is carried out for all AP funds using external consultants.
The assessment is presented in a written communication to the Swedish Parliament which is published in conjunction with the government adopting the income statements and balance sheets of the AP funds for the previous year.