Code for Corporate Governance

The Swedish Code of Corporate Governance (the Code) has during the spring 2008 been subject to a thorough review. As from 1 July 2008 the Code is applicable for all companies whose shares are traded at the NASDAQ OMX Stockholm. This is a considerable extension of the application of the Code compared to the previous situation. The Code has been simplified and shortened without this having affected the demand in the Code for good corporate governance. The Code is still based on the principle “comply or explain”, which means that a company has the opportunity to deviate from a certain rule in the Code, if this deviation in the specific case leads to a better corporate governance. A company that has made a deviation from the Code shall in the corporate governance report describe the deviation, what kind of other solution that the company has chosen and the reason for this action.

Companies that before 1 July 2008 have applied the previous version of the Code are to apply the revised Code from that date. Companies that did not apply the previous version of the Code before 1 July 2008 are to apply the revised Code as soon as possible from that date and no later than the date of the first annual general meeting held after 1 January 2009. A corporate governance report is therefore to be included in or attached to the annual accounts for 2008. Companies whose shares are admitted to trading on the main market of the Exchange after 1 July 2008 are to apply the Code in the same way as those companies who had not applied the Code earlier. The Code is thus to be applied fully from the date of the first annual general meeting held the year after the admittance to trading at the Exchange.

The Code is not formally a part of the Exchange ´s rules. But the Code is indirectly a part of the rules since the Code is to be seen as an expression of good stock market practice regarding corporate governance, and the Exchange ´s rules state that a listed company shall conduct its business in line with common accepted market practice. (The complete Code is enclosed. It can also be found on the web site of the Swedish Corporate Governance Board, www.bolagsstyrningskollegiet.se).