ANNUAL REPORT 2004 - Skanska

employees. Of the members elected by the
Annual Meeting, more than half are independent
in relation to the Company and at
least two are independent of the Company’s
major shareholders.
During the year, the Board held nine
meetings including its statutory meeting
directly after the Annual Meeting. At its September
2004 meeting, the Board visited the
Group’s operations in the United Kingdom,
including work site visits at two BOT projects,
Derby Hospital and Coventry Hospital.
Among the more important issues that
the Board dealt with were Group strategy,
financial reporting, governance of the
Group’s operations and risk management.
The Board has appointed from among its
own members a Compensation Committee,
an Audit Committee and a Project Review
Committee. These committees routinely
report to the Board at each meeting in
accordance with the mechanisms specified
in the Board’s rules of procedure.
The main task of the Compensation
Committee is to prepare the Board’s decisions
concerning employment of the President
and other members of the Senior Executive
Team, as well as the President’s terms
of employment. The committee also prepares
the Board’s decisions on general
incentive programs.
The main task of the Audit Committee is
to assist the Board in overseeing financial
reporting and report procedures as well as
follow-up of the auditing of the accounts
for the Parent Company and the Group.
The Committee also evaluates the Group’s
internal controls and studies the reports and
opinions of the Company’s external auditors.
These auditors were present at all
meetings of the Audit Committee.
The Project Review Committee has the
Board’s mandate to make decisions on
major construction or real estate projects,
investments and divestments in BOT projects
and certain project financing packages.
The Company’s auditors attend at least
one of the Board’s meeting each year in
order to report their observations from the
auditing task directly to the Board.
The committees of the Board have the
following composition: The Compensation
Committee consists of Sverker Martin-Löf,
Chairman, and Arne Mårtensson, with the
President and CEO as rapporteur. The
Audit Committee consists of Anders Nyrén,
Chairman, and Ulrika Francke, with the
Chief Financial Officer (CFO) as rapporteur.
The Project Review Committee consists
of Sverker Martin-Löf, Chairman,
Roger Flanagan, Anders Nyrén and Nils-
Erik Pettersson, with the President and CEO
as rapporteur.
Research and development
The Skanska Group utilizes research and
development work as an instrument for creating
and disseminating strategic technological
knowledge in its fields of operations.
The objective is to create greater customer
value in Skanska’s products and competitive
advantages that distinguish Skanska from
other market players.
Research assignments are conducted at all
levels in the Group and deal with future-oriented
issues in a variety of disciplines. Skanska
is also active in many European projects.
This involvement creates a skills base of
external experts for Skanska’s knowledge
network, which has been utilized, among
other things, in cases dealing with
• Environmentally safe construction,
where the well-being of the end user is to
be safeguarded with regard to acoustics,
air quality etc.
• Future energy solutions in the built environment
to ensure sustainable development.
• Development of new materials and processes
for a more robust and efficient
final product, which aside from greater
customer satisfaction also creates an
industrialized construction process.
To reinforce and enhance Skanska’s position
as a leading international construction
and project developer, effective access to
knowledge plays an increasingly large role.
During the year, Skanska developed a
knowledge bank on best practices from
projects it has implemented and established
internal networks known as Best Practice
Groups in the following disciplines:
• Minimization of moisture risks in buildings
• Risk management – development of
methods and implementation in projects
• Underground work
• Energy performance of buildings
The Best Practice Groups improve the efficiency
of development work in Skanska’s
business units through exchanges of knowledge
and coordination of projects.
The total cost of research and development
work is difficult to estimate, since such
expenses are embedded in ongoing projects.
In addition, research assignments at universities
are co-financed with public agencies,
research foundations and competitors.
Sustainable development
The task of implementing the Skanska Code
of Conduct continued during the year, including
large-scale training programs. In some
markets, local guidance documents concerning
competition legislation were compiled.
Programs for following up compliance
with the Code of Conduct were developed
by Skanska’s business units. At the Group
level, follow-up occurs at quarterly reviews
with the business units and a more cohesive
yearly follow-up. In addition, certain targeted
follow-ups are conducted in conjunction
with internal audits.
Nearly half of the Group’s projects maintain
higher environmental standards than
required by law in each respective country.
This is a trend that has continued in recent
years. Foresighted customers often take the
initiative for such projects, but equally often
Skanska does so.
Much of this trend is attributable to the
ISO 14001-certified environmental management
systems that cover more than 95 percent
of the Group’s operations. Follow-ups
occurred during 2004 by means of more than
1,200 internal and 240 external environmental
audits. No significant non-conformities
were reported by the external auditors.
Operations in Sweden include a few facilities
that are required to obtain permits and
submit registration documents. Their environmental
impact is relatively limited and does
not cause more than small quantities of atmospheric
emissions and discharges to water.
Employee health and safety continued
to be a high-priority area, and during 2004
the Group’s health and safety strategy was
further strengthened and improved, with
the vision of having accident-free work sites.
An information campaign was carried out
in conjunction with the EU’s European
Week for Health and Safety at Work, October
18–22, which was aimed at the construction
industry.
The overall frequency of accidents, measured
as accidents that lead to absences
from work, fell by about 15 percent compared
to 2003.
For a more detailed description of Skanska’s
sustainability work, see the 2004 Sustainability
Report and the related information
posted on Skanska’s web site, www.
skanska.com.
Personnel
The average number of employees in the
Group during 2004 was 53,803 (69,669).
This included 11,653 (14,236) employees in
Sweden.
Skanska works actively with employee
development. By analyzing and surveying
development needs in various units and at different
levels, the Group focuses on goal-oriented
professional development programs.
The Group’s talent management program
includes reviewing and analyzing
employees with leadership potential, planning
their professional development and
initiating reward systems. The aim of the
program is to promote the development of
the Company and give employees an opportunity
to grow at Skanska by:
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