20% - Assa Abloy

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Corporate governance report 46 Board Johan Molin Sven-Christer Nilsson Seppo Liimatainen Mats Persson Rune Hjälm Per Edvin Nyström Board members elected at the 2007 Annual General Meeting Johan Molin Board member of ASSA ABLOY AB since 2006. Born 1959. Bachelor of Science in Economics. President and CEO of ASSA ABLOY AB since 2005. CEO of Nilfisk-Advance 2001–2005. Various posts mainly in finance and marketing, later divisional head in the Atlas Copco Group 1983–2001. Other appointments: Board member of AB Electrolux. Shareholdings (including family and through companies): 500,000 Series B shares and Incentive 2006 and Incentive 2007 convertibles corresponding to 440,000 Series B shares. Sven-Christer Nilsson Board member of ASSA ABLOY AB since 2001. Born 1944. Bachelor of Science, Lund University. President and CEO of Telefonaktiebolaget LM Ericsson 1998–1999, various posts mainly in marketing and management in the Ericsson Group 1982–1997. Other appointments: Chairman of the National Swedish Public Service Broadcasting Foundation (Sveriges Radio AB, Sveriges Television AB and Sveriges Utbildningsradio AB) and Swedish ICT Research AB. Board member of CEVA, Inc. and Tilgin AB. Shareholdings (including family and through companies): 2,500 Series B shares. Board members appointed by employee organizations Seppo Liimatainen Board member of ASSA ABLOY AB since 2003. Born 1950. Employee representative, Federation of Salaried Employees in Industry and Services. Shareholdings: 2,600 Series B shares. Mats Persson Board member of ASSA ABLOY AB since 1994. Born 1955. Employee representative, Swedish Metal Workers Union. Shareholdings: — Deputy board members appointed by employee organizations Rune Hjälm Board member of ASSA ABLOY AB since 2005. Born 1964. Employee representative, Swedish Metal Workers Union. Chairman of ASSA ABLOY European Works Council (EWC). Shareholdings: — Per Edvin Nyström Board member of ASSA ABLOY AB since 1994. Born 1955. Employee representative, Swedish Metal Workers Union. Shareholdings: 7,727 Series B shares and Incentive 2004 convertibles corresponding to 7,800 Series B shares.
Operational management and internal control ASSA ABLOY’s operating activities are split into five divisions, where the fundamental principle is that these divisions should as far as possible be responsible for business operations, while various functions at Group headquarters are responsible for coordination, monitoring, policies and guidelines at an overall level. The Executive Team (Group Management) consists of the CEO, the heads of the Group’s divisions, the Chief Financial Officer, the Director for Technology and Product Development and the Director for Market and Business Development. The composition of this group gives a geographical and strategic spread of responsibility designed to ensure short decision-making paths. Management philosophy ASSA ABLOY’s approach is that the people make the company. The Group’s management philosophy is based on trust, positive thinking and respect for local conditions and cultures. Good leadership spurs employees to do their utmost for the company’s best advantage. ASSA ABLOY’s Vision is: • To be the world-leading, most successful and most innovative provider of total door opening solutions. • To lead in innovation and offer well-designed, convenient, safe and secure solutions that create added value for our customers. • To be an attractive employer to our workforce. ASSA ABLOY’s primary financial target is a return on capital employed (ROCE) exceeding 20 percent. The aim is to achieve this figure no later than 2008, through the following sub-targets: • Sales should increase by 10 percent per year on average over a business cycle through organic and acquired growth. • The profit margin should improve to 16–17 percent through continued growth, a modern product portfolio and leveraging synergies in the Group. • The positive long-term trend for ASSA ABLOY’s operating cash flow should be maintained. • Capital efficiency should be continuously improved. Given the potential to benefit from synergies in production, capital expenditure can be maintained at today’s level, below that of current depreciation. In order to strive towards this vision and achieve these financial targets, the strategic action plans have been divided into three areas: market presence, product leadership and cost-efficiency. The details of these strategic action plans are to be found on page 6. Corporate governance report 47 Guidelines and policies The Group’s most important guidelines and policies define the product areas in which the Group should operate and describe the principles for market development, growth, product development, organization, cost- efficiency and staff development. These principles are described in the publication �Strategy to Action�, which will have been provided to all employees in the Group by year-end 2008. Other important guidelines and policies concern financial control, communication matters, the Group’s brands, business ethics and environmental issues. Common financial, accounting and investment policies provide the framework for financial control and monitoring. ASSA ABLOY’s communication policy aims to treat all stakeholders equally, provide important information at the right time and in the right way, meet legal requirements and comply with current stock market rules. Guidelines for brands aim to protect and develop the major assets that the Group’s brands represent. ASSA ABLOY has adopted a Code of Conduct that applies to the whole Group. The Code, which is based on a set of internationally accepted conventions, defines the values and guidelines that should apply within the Group with regard to the environment, health, safety, working conditions, human rights and business ethics. Decentralized organization with a strong control environment ASSA ABLOY’s operations are decentralized. Decentralization is a deliberate strategic choice based on the local nature of the lock industry and a conviction of the benefits of a divisional control model. Another contributory factor is that the Group has been built up over a relatively short period through a large number of acquisitions. Historically, this structure has meant that internal control started from a strong, centrally based control environment, in which the integrity, ethical values, competence and management philosophy of the Executive Team, as well as high visibility across the organization, were decisive in forming the basis for other areas of internal control. ASSA ABLOY’s operating structure is designed to create the greatest possible transparency, to facilitate financial and operational monitoring and to promote the flow of information and communication across the Group. The Group consists of five divisions, which in turn are divided into around 30 business units. These consist in turn of a considerable number of sales and production units, depending on the structure of the business unit concerned. Apart from monitoring by unit, monitoring of products and markets is also carried out. At all these levels, there are designated people and a management group responsible for ensuring that the internal control of financial reporting maintains a satisfactory quality.
Page 1 and 2: Annual Report 2007 The global leade
Page 3 and 4: Significant events Financials in br
Page 5: ASSA ABLOY is the global leader in
Page 8: CEO’s statement 4 innovative prod
Page 11 and 12: 1 Excluding restructuring costs. 2
Page 13 and 14: Presence and strong relationships t
Page 15 and 16: In the security market today, manuf
Page 17 and 18: HID’s Crescendo Smart Card allows
Page 19 and 20: Check in with your cellphone Signat
Page 21 and 22: ASSA ABLOY worked closely with the
Page 23 and 24: The division manufactures and sells
Page 25 and 26: Security a top concern at new biote
Page 27 and 28: Woodside in Australia is one of the
Page 29 and 30: The division sells electronic secur
Page 31 and 32: “In today’s turbulent times, bu
Page 33 and 34: In 2007 ASSA ABLOY Entrance Systems
Page 35 and 36: More information about sustainable
Page 37 and 38: Open House in Brazil Sustainable de
Page 39 and 40: Tom Devine from ASSA ABLOY Australi
Page 41 and 42: Report of the Board of Directors, C
Page 43 and 44: Report of the Board of Directors Th
Page 45 and 46: End Corporate governance report ASS
Page 47 and 48: CEO reported on the Group’s perfo
Page 49: Gustaf Douglas Melker Schörling Ca
Page 53 and 54: The Board’s proposed guidelines f
Page 55 and 56: The Executive Team From left: Ulf S
Page 57 and 58: Income statement - Group ASSA ABLOY
Page 59 and 60: Results by division ASSA ABLOY Annu
Page 61 and 62: Balance sheet - Group ASSA ABLOY An
Page 63 and 64: Cash flow statement - Group ASSA AB
Page 65 and 66: Income statement Parent company Bal
Page 67 and 68: Financial risk management ASSA ABLO
Page 69 and 70: Maturity - financial liabilities an
Page 71 and 72: Note 1 Notes Note 1 Significant acc
Page 73 and 74: Note 1 cont. benefits can be reliab
Page 75 and 76: Note 1 cont. USA, which are reporte
Page 77 and 78: Notes 9-12 Note 9 Employee benefits
Page 79 and 80: Note 15 cont. ASSA ABLOY Annual Rep
Page 81 and 82: Notes 17 -18 Note 17 Shares in subs
Page 83 and 84: Notes 24-25 Note 24 Cash and cash e
Page 85 and 86: Note 29 cont. A) Specification of a
Page 87 and 88: Notes 30-35 Note 30 Other provision
Page 89 and 90: Note 36 Adams Rite On 24 March 2006
Page 91 and 92: Five years in summary 2003 Business
Page 93 and 94: Quarterly information ASSA ABLOY An
Page 95 and 96: Proposed disposition of earnings Th
Page 97 and 98: The ASSA ABLOY share Share price tr
Page 99 and 100: Convertible debentures for personne
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