Each country has different requirements and best practice recommendations regarding committees.
In Sweden and Norway, the nominating committee is not a subcommittee of the board but is a separate board generally composed of shareholder representatives. In Finland, nomination committees may either be formed by the board or as a separate nominating board composed of shareholder representatives. In Denmark, it is typical for the nomination committee to be a subcommittee of the board.
In Finland, boards are not obliged to establish separate committees. However, best practice is that a separate audit committee should be established when necessary. In Denmark, while there is also no hard regulation, it is recommended that separate audit, nomination, and remuneration committees be set up. In Norway, audit committees are obligatory, alongside a recommendation that separate audit and remuneration committees be established. In Sweden, the audit committee is a requirement; forming a remuneration committee is recommended.
Audit committee
All but two companies had an audit committee. Audit committees convened on average 6.4 times in the period under review.
Among audit committee chairs, 54% (44) are women. Denmark has the highest proportion of female audit chairs (52%, 11) followed by Finland (61%, 14), Norway (55%, 11) and Sweden (44%, eight). 49% (128) of audit committee members are female.
34% (28) of audit committee chairs are foreign. Denmark has the highest proportion of foreign audit chairs (62%), followed by Sweden (28%). 25% of audit committees in Norway have a foreign chair. The lowest proportion is in Finland, where foreign audit chairs make up 22% of all audit chairs. 41% (88) of audit committee members are foreign.
The average fixed fee paid to audit chairs is €33,433; members average €19,435.
Remuneration committee
Remuneration committees convened 5.1 times in the year under review.
18% (11) of all remuneration committee chairs are women. Remuneration committees in Norway (29%, five) and Finland (29%, four) have the most female chairs, followed by Sweden (7%, one) and Denmark (7%, one). 29% (54) of remuneration committee members are women.
32% (19) of remuneration committee chairs are foreign. The greatest proportion is found in Denmark (64%, nine), followed by Finland (29%, four), Norway (24%, four), and Sweden (13%, two). 41% (50) of remuneration committee members are foreign.
The average fixed fee paid to chairs is €18,283; members average €11,960.
Sustainability committees
Consumers and other stakeholders across all sectors are becoming increasingly focused on environmental, social and governance (ESG) issues, and the tougher levels of scrutiny they are subject to. Boards must ensure that their oversight, compliance and reporting responsibilities are robust and that management is capable of keeping track of and swiftly responding to sustainability issues. A few boards have also chosen to establish a sustainability committee, although most consider this to be a subject best dealt with by the full board. Consequently, there are far fewer sustainability-related committees in the Nordics than in other parts of Europe.
Across the region, there are eight board committees related to sustainability, convening an average of 5.7 times in the period under review.
The main duties of sustainability committees include reviewing and overseeing the implementation of a sustainability-related strategy, and monitoring risks to the company relating to sustainability.
62% (five) of sustainability committee chairs are women and 75% (six) are foreign.
The average fixed fee remuneration for chairs of sustainability-related committees is €28,666; members average €14,083.
Our perspective: The board’s role in sustainability
Sustainability looms large as a key topic of boardroom discussions, particularly as the new Corporate Sustainability Reporting Directive regulations are taking effect.
These new rules go beyond setting up a sustainability-related committee and/or having an ESG expert on the board. They also force companies to thoroughly report on how the topic is addressed by board members throughout the year. This means there is now an increased need to develop frameworks and processes to address sustainability in a systematic way during discussions, with clear supporting documentation.
While it has always been best practice, competency matrices will be a crucial way of showcasing the board’s relevant ESG expertise. This is particularly difficult as board members tend to be former CEOs or P&L leaders with broader remits, rather than possessing more granular ESG knowledge. Clear scoring guidelines paired with subjective questions will be key.
Other committees
The most common committee outside audit, remuneration and nomination committees is a standalone risk committee (13 committees). Eight companies have a dedicated ESG committee.
Most of the standalone risk committees are found in the financial services sector. Three of the sustainability-related committees occur in Norwegian boards (Equinor, Nordic Semiconductor, and Tomra); two are Danish (A.P. Moller Maersk, NKT), two are Finnish (Nordea and Stora Enso) and one is Swedish (SKF).
Chairs and members of risk committees are the highest paid. Chairs receive €39,344 while members receive €23,593.
Board committees
|
Sample size |
Avg. meetings |
Average committee chair fee |
| Audit |
98 |
6.4 |
€33,433 |
| Remuneration |
74 |
4.9 |
€18,283 |
| Nomination |
18 |
5.1 |
€30,173 |
| Standalone risk |
13 |
5.8 |
€39,344 |
| Sustainability |
8 |
5.7 |
€28,666 |