Investor AB (publ) (INVEA) Earnings Call Transcript & Summary

[Presentation] So dear shareholders, a warm welcome to Investors Annual General Meeting 2022. And it is almost precisely 3 years ago, we last met in real life. And as I've said already today, I think that means a lot. And myself and my friends here at the podium, are very happy to see you again in this manner. I don't think that there is no substitute for a lively discussion. And this involvement that you get when you actually meet one another. But at the same time, we should be happy that over these past 2 years, we've actually been able to continue operations, not least thanks to modern digitalization. I would like to begin with a few short thoughts about the very complicated situation that we have right now in the world. We all know that we are faced with massive challenges. We have a terrible war in Ukraine that leads to far-reaching sanctions that will impact the world. We have a conflict between East and West, China, the U.S., 2 different systems that compete with one another with us in Europe somewhere in the middle. Value chains for companies have been severely impacted both by corona and by the war. And this will lead to our talking ever more in terms of maybe bringing production home to our own country. The problem is when 200 countries say that at the same time and everyone produces in their own country, that leads to protectionism, that leads to globalization and free trade that we're used to and dependent on in small countries, such as Sweden, is actually being question. And that is something strongly negative, I think. And then we have energy. Energy that will be a major issue when Russia invades Ukraine. The question about the war on the one side and sustainability on the other will mean that energy prices will increase significantly. And that will impact all of us. We see that in Sweden, very high energy prices, primarily in the south of Sweden. So we're living in a world that will impact all of us and a world that threatens our security. And that will impact all of us here today, not only as citizens, but also the company, Investor, and the companies that we work with. I would like to say in this context that it is important to stress that in Sweden -- to talk about Sweden, specifically, for a moment, that we have a wide-ranging discussion about our security, that we have a public discourse about NATO throughout our society so that we have an opportunity to learn, to learn more and delve into this very important matter. Because at the end of the day, it is about the fact that we fairly soon will have to make a decision, concerning what's best for Swedish security, for our security. And for that reason, I do applaud the work that is ongoing in society today and the public discourse. It is also very important to stress how important it is look at the role of EU, of Europe that were members of the European Union and that the Union remains strong, and we saw that not least when Russia invaded Ukraine, where we finally saw a strong united EU stand up and show true leadership. In conclusion, 2021 was a very strong year for investor. Our portfolio companies have continued delivering excellent results, and they've done so in a situation, as I said, the global economy was clearly impacted by the pandemic. We've continued to work, and we'll hear more from the CEO later. We'll continue to work on the basis of our values, our business model being long-term engaged owners, which you also heard in the film, and that very attractive portfolio of competitive companies. Now we can see that 2022 will be a challenging year for our portfolio companies and, therefore, also for Investor. But we have this excellent financial strength that our CEO often talks about. And I think that we're flexible enough and well positioned to continue our positive development. And with that, I would also like to thank you, all of you shareholders, for the support and for the confidence that you show in Investor. And that is particularly gratifying to see so many new shareholders. Today, we have more than 500,000 owners of Investor. That's more than any other company in Sweden, and I find that very interesting. And on that note, I would like to declare Investors Annual General Meeting 2022 open. Thank you. And we'll start with the first item of our agenda, which is election of the Chair of the meeting. And here, I would like to tell you that the Secretary for this AGM will be Petra Hedengran. She is next to me. And she is the Investor Chief Legal Counsel, and she will be taking the minutes for today's AGM. Next to me on my other side, I have the President and CEO of Investor, Johan Forssell. The Nominations Committee has proposed that lawyer Eva Hagg to Chair the meeting, and she is here next to me. And I would like to ask the meeting if the meeting can approve that proposal to have Eva Hagg as Chair of today's meeting. Thank you.

And I say thank you, and thank you for the confidence shown in me. Before we continue with the agenda items, let me mention a few things. Participation in this AGM can be done in different ways. We have a presence here in these premises, and we have shareholders who have voted in advance through postal voting, and they represent about 97% of the votes and 88% of the shares that we have in the registration. People have notified their attendance, which means that we know that the Board and the Nominations Committee already have the necessary majority, and the exception there being [ 8 and B, ] where we need to vote and you have voting devices. The Board has also decided to make this AGM more accessible in that shareholders and others will be able to follow the proceedings through the company website on the webcast. And we have others than shareholders in the room. Only the podium and the [ restroom ] will be shown on video. And that being said, we continue with Agenda Item 2, where we have drawing up an approval of the voting list, and I would like to hand over to the Secretary.

List over those shareholders who have notified their attendance for physical attendance in these premises or through postal voting has been distributed here today. Registration was done when you came to the meeting, for those participating in person. Our proposal is that the voting list to be that list of notified attendance minus those shareholders that haven't been registered here today, which means that 58% of shares represented -- of shares in the company are represented, and 77% of votes are represented here today. Thank you. Can the meeting approve that voting list? Thank you. It has been approved.

And that takes us to agenda item 3, where we have approval of the agenda, and I find based on the postal votes that have been submitted that the agenda has been approved. That brings us to Item 4, which is the election of 1 or 2 people to check the minutes. And the Secretary has asked Javier Ragnar, SEB Investment Manager, and [ Ossion Ektol ] from AP1 fund, and they have declared that they're willing to take on that assignment. Ossion, you're here, if I could ask you to stand up. Thank you so much for that. And do we have any additional nominees? Can the meeting elect the proposed candidates? All right. I find that to be the case. That brings us to item 5, which is a resolution whether the AGM has been duly convened. And I can conclude that based on the postal votes that this AGM has been duly convened. That brings us to item 6, which is a presentation of the parent companies and the Investor Group's annual accounts and auditor's report. The annual accounts and the auditor's report has been printed and sent to the shareholders who so wished, and has also been available on the company's website and at the company, including here at the registration point. So the documents can, therefore, be considered to have been presented duly in new order. We will, under this item, be hearing the report from the auditor, and after that, from the CEO. After these presentations, there will be a Q&A session for shareholders. So I'll cede the floor now to our auditor, Jonas Stahlberg, who's a senior auditor.

My name is Jonas Stahlberg. And I represent Deloitte, and I'm the lead auditor for the audit of the Investor. We have audited Investor's annual accounts and the corporate government statement. In addition to the audit of the annual accounts, we have also reviewed the Investor sustainability report and the second and the fourth quarters, the interim reports and the accounts. The main part of the audit is being conducted by a central team in Stockholm. But in addition to that, we also have local auditing teams for audits of the subsidiaries that are owned by Investor. We instructed those auditors of those subsidiaries as to how to conduct the audit. We have a close regular contact with them, and they report formally the outcome of their audit. We compile that. We analyze, and we report it to management and also to the Audit and Risk Committee of Investor. In connection with the year-end closing, I also met with the entire Board, where I had summarized the outcome of the audit and our conclusions. Our audit is primarily focused on risks that are linked to the financial reporting and some of the more important issues in the audit of what we have audited centrally and that are also described in the audit report are governance over financial reporting, valuation of listed and unlisted investments and also valuation of goodwill. And I'm going to describe these briefly. When it comes to the first matter, we have audited have Investor instruct its subsidiaries and how governance is being done to ensure that the principles are adhered to when it comes to financial reporting. We've also audited IT controls that are relevant for that financial reporting and also that there are functioning routines for quality assurance. Our opinion is that Investor has well-functioning routines in this area, and that the company is disclosing financial information of high quality to you, shareholders. The second audit matter that I would like to address is the processes for valuation of other investments, those companies who are not subsidiaries, unlisted investments. Well, there we look at and audit assumptions that are being made. And we also look at listed investments where accounting might not be all that complicated, but it did represent around 75% of the carrying value of Investor. And here as well, our opinion is that the company has good routines, and these routines are applied in a consequent manner over time. And then the third audit matter, which is also linked to valuation of assets. It is valuation of goodwill, the goodwill that is included in the balance sheet. And this audit includes, among other things, that we look at the methods and the assumptions that are being made by Investor. And we find that these are solid and goodwill that value has gone up this year, which is related to a number of acquisitions made by subsidiaries. We've also looked at company compliance with guidelines for remuneration to senior management. We have presented a special report, and we have found no deviations. So all in all, we find that the company's financial information is of high quality, gives a fair presentation of the business, and the accounts have been set up according to applicable rules. And against that backdrop, I would like to refer you to our audit report on Pages 113 through 116 in the annual report. It's an unqualified so-called clean audit report, and we recommend the meeting to adopt the income statement and the balance sheet for the parent and the group, that the profit is appropriated in accordance with the proposal and that directors and the CEO are granted discharge for this financial year. Thank you.

Thank you for that. And that brings us to item #7, and I will cede the floor to our CEO, Johan Forssell.

Thank you so much, dear shareholders and guests. I would also like to extend a warm welcome to you all to this year's AGM. Even though the online AGMs worked well for 2 years, it is a pleasure to meet in real life here again, and I really felt that during the Investor Dialog which at least some of you attended, hopefully. I will -- in a minute, I will tell you about the Investor's development over the past year and our strategy for the future. But first, I'd like to say a few words about the world around us. In 2021, we saw a recovery in the economy after the worst periods of the pandemic, a global recovery in combination with very low interest rates led to a strong stock market. But inflation started to rise, and we saw significant disruptions to our supply chains around the world caused by a shortage of components. The opening of 2022, however, will, unfortunately, always be remembered for the unprovoked invasion of Ukraine by Russia, and that war is almost a major human tragedy, and all of us agree that this is a terrible thing. But we will, in all probability, also have long-term geopolitical and business effect. Some of the challenges that we saw already before the war, such as disruptions in our supply chains, growing inflation, has accelerated even more. And the sharply rising inflation, as we see it now, will force the central banks to increase interest rates by more than they previously thought they would have to. In this very complex and unpredictable world, we continue at Investor to have a very close dialogue with our companies. To future-proof our companies and strengthen our competitiveness is more important now than ever. And at Investor, we have a clear strategic focus that we have been working in accordance with for many years. Our aim is to generate value for people and society, by building strong and sustainable companies. Let me have a closer look now at Investor. At the end of the year, our asset amounted to SEK 775 billion. Around 2/3 of our assets are listed companies. Slightly less than 20% is Patricia Industries, which comprises primarily our wholly owned subsidiaries. And then finally, 15%, our investments in EQT, comprising both the listed company EQT, but also that we've invested in some of their funds. When it comes to our overarching strategy, it remains in place. But in 2021, we clarified our priorities, such as, for example, that sustainability is a strategic priority that will permeate everything we do. Our overarching target or goal to generate an attractive total return, is underpinned by 3 strategic priorities: To increase the net asset value; to generate a steadily increasing dividend; and to reach our sustainability targets. Our operational priorities concern how we will achieve our goals and strategic priorities. And in this regard, we focus on being an engaged owner in our 24 companies to ensure that we have an attractive portfolio for the future, operating in an efficient manner at Investor and maintaining our financial flexibility, as Jacob touched upon earlier. I will come back to the importance of that for Investor. Let me now briefly go through our development within these priority areas. Let us begin with our overarching goal, to generate an attractive total return. The return should exceed our goal of 8% to 9% per year. Last year, we did that by some distance. Our return amounted to as much as 55%. But we need to remember that we will, of course, we benefited strongly from a strong stock market when the Stockholm exchange went up at 39%. I say that the share price does not always reflect the company's development in the short term. But in the long term, the share price and its trend is a very good measurement of value creation. And in light of that, I think it is good to see that over 5, 10 and 20 years, respectively, Investor has exceeded both our profitability requirement and the stock exchange as a whole. As Jacob touched upon last year, we split the shares 4:1, 4:1, which led to our now having more than 0.5 million shareholders, and that's something that we're very happy about at Investor. And that's actually almost a threefold increase compared to the number of shareholders 5 years ago. Let me now go through developments in our 3 strategic priorities. Over the last 5 years, up until 2021, our net asset value has increased by an average of 20% per year. When it comes to our strategic priority, to generate a steadily increasing dividend, we managed to increase our dividend each year with the exception of the pandemic year in 2019. It is gratifying that the Board can now, thanks to its strong financial position, can propose a dividend of SEK 4 per share, which corresponds to an increase of 14%. In sustainability, we have 3 focus areas: To future proof our company's business ethics and governance; climate and resource efficiency; and diversity and inclusion. One, our climate goals, is that Investor, as a company, shall achieve net zero emissions by 2030. Another goal is that our aggregate portfolio, our overall portfolio, will reduce CO2 emissions by 70% by 2030 compared to our baseline year, 2016, and these goals are in compliance with the Paris Accords. Let me provide you with some examples of our developments in sustainability. Within business ethics and governance, we have 10 principles that we and our companies must abide by. And again, let me be very clear, we have 0 tolerance to any form of unethical behavior, but that doesn't mean, of course, that it never occurs. But when it does, we have to deal with it and take the requisite measures. Within this field, we can see that 100% of our companies have a whistleblower function, and that 92% of our companies conduct anticorruption training. When it comes climate -- to climate impact, we have seen a positive trend. CO2 emissions for our overall portfolio has been reduced by 49% compared to 2016. And as regards to diversity, we can see that the share of women has increased from 30% in 2020 to 34% in last -- during last year. So let us move over to our operational priorities. That is how we reach our ambitions and our goals. Let me begin by talking about our role as engaged owner of our companies. Our companies operate in a variety of industries and face different situations. And based on our ownership model, we always try to do what is right for each individual company. But in our role as owners, we have a number of priority areas. And they are digitalization, innovation, sustainability; to be able to grow through acquisitions, succession planning, talent management; and finally, having the right corporate structure and flexibility in our organization to be able to handle fluctuations. I would now like to give you a few examples when it comes to our engaged ownership during 2021 and, thus far, in 2022. Atlas Copco has, over the last few years, invested significantly more in research and development to be able to, on a continuous basis, come up with new, better products and services. It's decisive in order to win market share and have high profitability long term. Within the sustainability area, the objective is that each new project that is being developed should be more environmentally friendly than the previous one. And during the last few years, Atlas Copco has expanded as well forcefully through acquisitions. For example, in areas like vacuum, machine vision. And this year, we have seen 2 high qualitative acquisitions within industrial pumps, which means that there is now a strong platform for continued growth. And these are just a few examples of that development at Atlas Copco. And let me continue with another example, Mölnlycke, our largest wholly owned company. Mölnlycke has developed well over the last many years, and today has net sales of around SEK 17 billion and the profit is around SEK 5 billion. In order to strengthen focus even more, the CEO Zlatko Rihter, has reorganized Mölnlycke into 4 decentralized customer-centric areas: Wound Care; Gloves; Operating Room Solutions; and Antiseptics. And in this picture, you see some of the company products within these areas. This change creates focus gives full responsibility for those area managers and creates an even stronger platform for continued growth. One prioritized area is that our strong platform companies should grow through add-on acquisitions within attractive segments that are a good match for our companies. Let me give you a few examples. Sarnova, an American specialist provider of health care products, acquired Allied 100 supplier of defibrillators. Piab, leading manufacturer within automation, acquired the French, Joulin, and that strengthens the offering within a number of important segments. And we also have Advanced Instruments that we discussed earlier during the Investor Dialog. Through a number of acquisitions, they have significantly strengthened the position they have within Analytical Instruments, for example, within the biopharma sector. Let me also touch upon the developments within EQT. Since the listing 2019, EQT has accelerated activities. Activities within credit were divested. They were seen as not significant strategically for the company. In 2021, Exeter and Life Science Partners were acquired and these 2 acquisitions strengthen the presence within real estate and life science. Beginning of this year, EQT has made public a very big acquisition of Baring Private Equity Asia that will strengthen the position of the company in this important Asian market. Totally, in total, EQT as a matter of fact, has almost tripled the capital, the assets under management compared to the year before the listing. One important part of our engaged ownership is to continuously work to position our companies so that we can benefit from long-term trends like, for example, digitalization, automization, electrification, demographies, health care, sustainability and savings. And we do have a good starting position with companies like ABB, Atlas Copco, Piab, that are strong within automation. We have several strong technology companies in our portfolio and also an extensive portfolio within health care. And then we have SEB and EQT that benefit from increased savings. But we also invest in new companies. And when we do that, we focus geographically on the Nordics and the United States. And we continuously look for companies that live up to the criteria that we have set. We quite simply want these companies to, number one, be attractive in attractive niches. And we also try to find leading companies within such a niche companies with strong market positions. We're looking for companies with good profitability, good cash flow, sustainability that is integrated into the business model. And also, we ensure that these companies have flexibility in activities and also good corporate cultures. In other words, this list tells us that we prefer to pay a higher price in order to be able to acquire a company that has good opportunities to grow and is already a great company. As a long-term owner, we know that it's important to have those high-quality companies that are led by very talented individuals. However, sometimes, we also need to exit certain companies. And that doesn't mean in any way that those companies are doing poorly, it is rather that they do not fit within our strategy where we feel that we are not the best owner. In 2021, we sold Grand Hotel, and that is an amazing business, but we have felt that the hotel segment is not appropriate for our future strategy. To conduct operations within Investor and to do that efficiently, that is our third operational priority, and we continuously work with making processes more efficient, working in smart ways and try to reduce costs where we can. But at the same time, and this is important to stress, just like the companies that we invest in, they need to invest in research and development, and we need to invest in our organization so that we can fulfill our role as an engaged owner and carry out investments. Quite simply, conduct a strategy we have decided upon. And our last operational priority is to maintain financial flexibility. We want to have that financial strength so that we can support our companies and so that we can benefit from attractive investment opportunities in difficult times. And today, we have a very strong financial position. We have a leverage of only 2%, which feels safe, secure in this uncertain world that we're living in today with the war in Ukraine and interest rates that are rising. One of the investors' strengths when it comes to financial flexibility is our strong cash flow. That gives us a significant flexibility over time. And a good cash flow gives us that opportunity to invest and to pay an increasing dividend to shareholders without having to increase leverage. Over the period 2015 to 2021, we have generated a cash flow or received a cash flow of around NOK 120 billion, and that is what you see on this slide. About half of that comes from dividends from listed companies, about 1/3 of that cash flow we get from our subsidiaries and about 15% we get from EQT. And how have we've been using this SEK 120 billion over this time span? Well, about half has been distributed to our shareholders. And just under half of it, we have invested in new companies and also in existing companies. And in spite of us having increased the dividend, we have been successful in reducing our leverage with SEK 6 billion over this period. And this tells us how important it is to have a strong cash flow. As I mentioned initially, the world is becoming more and more complex, and there's no shortage of challenges. But regardless of global economies and the stock markets, how they will develop, my evaluation is that Investor will remain strong. We have a well-proven governance model. We have a clear strategy. We have a portfolio where we have very, very nice companies with strong market positions. We have a strong financial position. And last but not least, we need to have the right person in the right place that is decisive. And in my role, being the CEO of Investor, I'm lucky because I have that amazing team of coworkers at Investor, and our companies are led by engaged professional individuals, and that is absolutely decisive for our future development. I hope that you feel that you now have an increased understanding of our strategy, how we work. And to conclude, I would like to take this opportunity to say thank you to you, all of you shareholders for the confidence that you've shown in us. And I can just promise you that we will do everything we have with everything we got to continue to have your confidence and to continue to generate an attractive return. Thank you.

Thank you so much for that, Johan. And that means that we will now open for questions from shareholders. We have roaming microphones around the room. So we'd be grateful if you started by telling us who you are please. Please. Here is one, Dorval Davidson.

Yes. Thank you, Madam Chair. I would like to find out a little bit more about gender and ethnicity from an equality perspective, what the trend is there. I have under -- I've realized that the current development has not really come all the way. And I'd like to find out why that is. And what is your intentions? What kind of measures are you planning, both at the Board level, company management level and throughout the entire organization. Secondly, I'm wondering about combating bribery. I normally argue that it's probably the case that is impossible to conduct business in certain countries, in certain regions without ending up with your hands in the cookie jar as it were. I know that the Chairman and the CEO are of different opinion. But what kind of forceful measures are being taken to prevent any incidents in that area that can generate extensive bad will if it were to occur? And thirdly, I'm wondering what do you do in order to try to prevent occupational accidents? What are the figures like in that regard? And are you happy with developments within that area?

Thank you. I think those are questions for you, Johan.

Well, we can share it, but I can begin. When it comes to general equality, I can see that, at Investor, we are approximately 50-50 across the entire company. In the Board, we have 40% women, 60% men. And in my management team, the men are in the minority because we're 43% men and 57% women. When it comes to the different companies, like I said before, the developments have moved ahead quite rapidly when it comes to Boards. In our portfolio, it's an average of 34% women in the company Boards. If we look at the listed companies in Stockholm, at 39%. But we've also seen a definite improvement over the past few years when it comes to the Boards and our wholly owned subsidiaries. There, we've seen some significant improvements. If we look at the company's management teams, things are not moving as rapidly. There, we're at about 25%, 26% at the moment. So we haven't seen the same increase over the past 5 years. But we need to keep in mind when we look at management teams that there are different functions. You've got communication, HR, with some operational managers, CEO, CFO, et cetera. So the allocation of different roles could vary. And in some of our companies, for example, in finance and HR, you can have more women. Many of our companies are working very hard on increasing the total share of women in the companies, particularly if it's a male-dominated industry, historically, such as in heavy industry. And they're also working intensely to get senior executives who are women, which normally for many of our major companies could comprise a couple of hundred people. I can only see that there is a lot of focus on this in the companies right now and they're working on it, although much remains still to be done.

So if I were to say a few words about bribery -- to begin with, I can only agree that -- I mean, we are in agreement that we disagree. It should be possible to operate and conduct business all across the globe and still avoid bribery. We have 0 tolerance. All our portfolio companies have a 0 tolerance to bribery. And for us, that's very foundational. This is a matter of our values. And I would like to say that we need to remind ourselves, and we've talked about this in previous years that in Germany, bribes were a tax-deductible cost for companies up until maybe 15 years ago. So the authorities expected that bribery would be used, and they had rules accordingly. And of course, that is one way of consider this matter. But since then, that has changed completely. And that means that you need to get major organizations to change, and that does not happen overnight. Johan touched upon that earlier that this -- or not all people are perfect. You and I are, of course, but not everyone is. And for that reason, we are actively working to promote this 0 tolerance through training, for example. These are principles that we have in all companies. We talked about Ericsson earlier during the Investor Dialog. And I would like to stress what Borje Ekholm did when he stepped in as CEO in 2017, was to begin dealing with this very matter to establish a 0-tolerance policy and change the way of working in the company to focus on this not only being unacceptable, but the historical way of operating would change and then he implemented a number of changes in the company. Another thing that has happened is that companies have stopped using agents. Historically, agents have been a problem in terms of bribery. It's a well-known problem among many companies and in the media. And in conclusion, I can only again stress the fact that all companies have a training about this. All employees have to attend the training. I attended it within the scope of ABB, where I'm on the Board, et cetera. So there is a very active approach. And 0 tolerance is the only principle that applies.

And when it comes to workplace accidents, that's an excellent question because that is something that many companies working a lot with and sometimes struggle with. And as you know, our broad portfolio of companies, I'm not able to summarize it, but 1 area where we see far too many accidents in our companies are hands. It's on the factory floor that where we're seeing many of these problems. And they can be fairly severe injuries. They can be even serious than that, but that's serious enough. One of the advantages of this pandemic, if I may put it like that, is that we learned to work better virtually. And for many of our global companies, they take advantage of that, not least when it comes to working on health and safety to conduct trainings digitally that can be rolled out globally. That's very important. Another thing is that company by company, they share lessons learned, experiences. So when you see something happens, you make sure that it's not repeated somewhere else. And as owners, we can gather these companies under different themes where we learn from one another or where the companies learn from one another within in these fields. I should also say that accidents is one thing that we're working on. But now during the long period of pandemic health, in general, has also been an important matter for companies. It's very difficult to keep track of the health of your employees when more and more people are sitting and working from home. So that's been another focus area. Thank you so much.

And I see another question there.

Hello. Wilson is my name. And during the Investor Dialog, we talked about smaller nuclear power plants. And I would like to know whether Investor is involved in fusion power because investments are being made in Europe. And we see the beginnings of how you can control, so to say, that fusion power only 3 seconds for now. But anyway, a lot of activities are underway.

Well, I can just say that when it comes to Investor and direct investments, we are not involved. I don't know if you have something you want to add?

Well, yes, I would like to say something. In addition to that, even if we, as a company, do not have any direct investments, it is something that we encourage. We want to see more developments within that area. It's an alternative in the energy mix that we need as a nation. What we have, just renewables and [ wall-to-wall ]. That will not be enough. We will need nuclear power unless we want to use -- we'll continue to use fossil fuels, et cetera, which, needless to say, right now, we're trying to move away from that. So we would really like to see more investments and more development research work being done within that area than what we do today.

Thank you. I see a question up here as well.

Emilie Westholm, and I represent Folksam. And I'm sure that you've heard that sustainability is important for our customers. And that usually ask a question at AGMs having to do with sustainability in your financial report, you work that -- work with good governance and building strong, successful companies. And you've talked about that here today as well. And could you tell us more about what you do to increase the knowledge about, well, business ethics and all those challenges amongst those that represent you in your portfolio companies and those boards. And where are the biggest challenges?

Well, thank you. Thank you for that question. In our ownership model, well, it's built on distribution of tasks. We are owners, then we have the Board of Directors and the company management of the company. Our role as an owner, and I've already talked about that here today, business, ethics, governance, that is 1 of our 3 prioritized sustainability areas. And that tells you how important we feel that, that issue is. As a long-term engaged owner, we also have sustainability guidelines. I didn't have time to talk you through them when I addressed you earlier, but we have clear expectations. Activities within Investor and our companies should be conducted in a responsible way and with a good ethical stance as well. And 1 of these 10 guidelines is that the companies should have policies and code of ethics that cover whistleblowing functions as well as -- well, them having good business ethics. And in addition to that, I can also mention that at Investor, we have a network, and we gather those individuals 3 to 4 times a year. So Viveka, who was here earlier, who is in charge of that, and we have all those experts coming together. And then we discuss and learn from each other from the different companies. And this is a big advantage. I've touched upon that earlier today talking about something else. We do not have companies that compete with each other, which means that we can gather them all so that they can learn from each other. And that is something important. We also have continuous training sessions within Investor. And several years now, we've been integrating sustainability into what we do when we work with value creation plans. And there, we work on business teams. And there, we have investors and analysts and also representatives from the Board of Directors who is very integrated. And let me also say when talking about these issues and business ethics, we're a big owner, of course, we're on Nomination Committees. And there, you present proposals for Boards and directors. And therefore, it's very, very important for us to ensure that we have strong Boards. And this, of course, is one such important parameter. And when it comes to the more specific issues, for example, how a company is to manage its value chain and what to do there. Well, in our governance model, it's for that company, that Board, that management to make those more detailed decisions. And that is quite simply because they have the most in-depth knowledge about that specific company.

Thank you. We also have a question there by sign #4.

Yes. Hello. My name is Bjorn Lundgren. I would like to ask about the company Sobi, which is part of your unlisted portfolio, and which should be a strategic holding for you. But we know that you've gotten offered an acquisition offer of that company that Investor accepted, but which was later stopped by AstraZeneca because there was something in the company that they were interested in. So my question is what is the situation right now? Is this a strategic holding for Investor? And how will we resolve the situation with AstraZeneca?

Thank you for that question. Yes, we are -- we received a bid for Sobi. The Sobi Board recommended that bid, and we made the same assessment as the Board. The bidder for Sobi, could not achieve the 90% that were required for completing that transaction. They only achieved 87%. So that fell through. We stepped out very quickly after that and said that we will take our responsibility as the main owner of the company and focus on developing this company in the long term, trying to maximize value creation. We mustn't forget that Sobi is a company that has a very strong position within very many rare diseases. And of course, we have a very strong position in hemophilia. So we remain in full support of the company's strategy, which is about maximizing and developing the hemophilia segment, growing their growth products and also continue to look for new opportunities and acquisitions. So we're fully behind them in that strategy. As regards to AstraZeneca, I cannot comment on that. We make our decisions and AstraZeneca makes theirs in this matter.

Thank you for that. We have a question up there by #2.

[indiscernible], I'm not a major shareholder, but pretty big amongst the small. And I want to appeal to Investor. Ericsson had an AGM, Ericsson, yes, AGM a few weeks ago. And then we heard, well, the Board was not granted to discharge. And here, we have an AGM, and I do think that Investor has to take responsibility for what Ericsson is doing. So I want to know what happened in Iraq and what will you do so that this will never happen again, and things are taking way too long. I want an answer here and now.

Thank you. Well, thank you for question. Let me start by saying that I'm not neutral because I'm the deputy Chair of Ericsson, but I will try to answer your question. And I share your frustration when it comes to Ericsson, having had a hard time when it comes to answering all questions rapidly, but I will try to explain with a focus on Iraq and that issue more specifically. Ericsson may have paid money to IS, via a carrier, not Ericsson, but a company that has been transporting Ericsson supplies when they were to travel through Iraq, that territory that was partly controlled by IS. We are talking about 2015 and 2016, 5, 6 years ago. So when they traveled through the country, it could have happened that, that company carrying the goods that they paid IS to go through those areas controlled by IS. No one knows that this is a fact. It's claimed that, that could be the case, and that is what is being investigated right now. And until that investigation is done, no one can answer that question that you asked, what really happened? And then that's one part. The other part is how come Ericsson is not saying anything. Well, the reason is, well, for the reason I just mentioned and also for other reasons. Ericsson is being investigated. They're being investigated by the U.S. Department of Justice. And while you are being investigated by the Department of Justice, you can not, you may not, as a company, say anything about those facts that are involved in that investigation. So in practice, this means that there is a gag order. Ericsson cannot say anything. And the Department of Justice, quite simply, doesn't allow you to express yourself in that manner, which means that Ericsson says we cannot answer, but reality is that they may not. And that is the reason why they're not saying anything. If they were to say something, then the DOJ could sue them again because then they would have violated that code or that way of acting that they have to follow, which means that Ericsson, or the Board of Directors are in a very complicated situation. And that is the reason why you are not getting any quick answers to your questions. And that is why you and many with you are being frustrated and I share that frustration. And so does the management of the company that was also addressed at that AGM. But fact is, no one knows yet what actually happened, and that is being looked into. And as soon as we have those facts, if we'll have those facts, then, of course, they will be presented. Is that an answer?

I would also like to know what Investor will do so that, that will not happen again because dealings with IS, that is not good for a company.

That is not acceptable. Of course, of course. But we do not know, and we should be clear about the fact that it's not Ericsson where we have these accusations, it is towards a supplier to Ericsson. But as we have said already, this is totally unacceptable. Bribery, active corruption, be it to IS or someone else, it is unacceptable. But Johan, the CEO, has already said that everyone is not perfect, which means that if something does happen, the important thing is that we have rules, that, the companies have rules, know how to deal with such a thing that speedily and aggressively. And that is exactly what happened in the Iraq situation, and that has also been communicated and that has been communicated by management.

But there was another problem with SEB owner there as well. And Investor is a major owner of SEB as well, and they had the same problems. They were also investigated for bribery and they also had to pay a big fine.

Well, I cannot now enter into issues that I don't know anything about in detail, but this also had today with the DOJ and that they couldn't say anything, but that had to do with money laundering. The principle, however, is the same. What I mentioned when it comes to Investor and Ericsson, that if you do something and if you violate rules, then there also has to be an action plan as to how to deal with that. And SEB has that all companies where we are major shareholders -- major owners have such an action plan.

Thank you so much. Are there any additional questions? Number 2, yes.

Thank you. Johannes Winburg, -- Fund Management. I'd like to ask a follow-up question concerning this whether there is any approximate schedule as to when the Department of Justice investigation has been concluded.

No.

Okay.

At least you got a clear answer. Yes.

To change the subjects on what I would like to ask about EQT and the EQT funds because a very high expected cash flows in those. And as I understand, you intend to continue investing in them. But what direction can you do see there that are particularly interesting to invest in?

Thank you for that question. In connection with EQT's IPO in 2019, before that, those of us who were part of founding EQT, one of the investors at the founding of EQT, we renegotiated our agreement. And the agreement we currently have means that we can invest 3% into funds without paying carry for them. So we have an option to be able to do so up to 3%. And we utilize that in the funds that we want to invest in. And when we look at what we've done historically, if we pay, for example, the equity funds and the infrastructure funds that have incredible track records we invested in them. There are some funds where we've chosen not to invest. Historically, we have not invested in all the credit funds. That part is something that EQT has divested. And neither have we participated in all the property funds. We're a little bit more restrictive there. But within equity and infrastructure, these are 2 areas where we invest. And we've also been part of that -- we'll also be part of another fund.

Thank you for that. Do we have more questions? Number 4.

Well, earlier today, during the Investor Dialog, there was a question about doing business with dictatorships and the consequences that we have seen now in Russia, Germany, but Russia. And the Chair then said that, well, China is another dictatorship, but you will continue or try to continue to do business with China to try to influence developments. And I'm hesitant, I have to say. But there's another China as well and not just that dictatorship China. We also have Taiwan as it is being called, and it would be great if Investor could take an initiative and extend the trade that Sweden has with Taiwan.

Now this is your opportunity.

Oh, such an easy question. Well, of course, we already have a trade with Taiwan. TSMC, for example, one of the biggest Taiwanese companies, it's one of the greatest chip suppliers. And many of our companies have business relationships with them and are struggling to get deliveries today. So we do have quite a lot of cooperation already.

Thank you. Any additional questions? I cannot see any hands. So if there are no additional questions, then we move on down the agenda. And that brings us to item 8, which is the adoption of the parent companies and Investor Group's income statement and balance sheets. And we've heard the auditor recommending the adoption. And I can base it on the cast postal vote, the AGM has adopted the income statement and balance sheet for the parent company and the Investor group. Then item #9, which is the remuneration report from the Board. That can be found in the material that was disseminated today and has also been available at the company's website and has been sent to the shareholders who requested it. So I'm asking if anyone would like to ask any questions or comment on the Board's remuneration report? No. And I can -- I find, based on the cast postal votes, that the AGM has approved the Board's remuneration report. Which brings us to item 10, which concerns the discharge of liability for the administration in 2021. We've heard that the auditor recommend that the Board and the CEO are discharged from liability. We note that the Board members and the CEO does not participate in this decision. Are there any questions or comments? Then with the support of the voting list and the postal votes cast, I conclude that the AGM has discharged the Board and the CEO of liability. And that takes us to agenda item 11, where we have the disposition of the earnings, the proposal and the Board statements, you have on Page 55 in the annual report. And the Board proposes a dividend of SEK 4 per share to be divided upon 2 installments, and that the remaining profits be carried forward. And the first -- the proposal is that first installment be SEK 3 with the record day, May 5; and the second installment be paid out SEK 1 per share with the record day Monday, 7th of November. We've heard that the auditor recommends. Are there questions or comments? I find, based on the cast postal votes, that the meeting has voted in favor. And that takes us on -- well, we have a number of items where we have proposals from the Nominations Committee. And therefore, I would like to hand over to the Chair of the Nominations Committee, Michael Treschow, who will tell us about those proposals.

Thank you, Madam Chair and dear shareholders and attendees at this AGM. The Nominating Committee comprise, as you can see here, investors Chairman, Jacob Wallenberg; and there's Oscarsson from AMF; Lars Isacsson from the SEB Foundation; Carina Silberg; Alecta; and myself, Michael Treschow as a representative for the Wallenberg Foundations. The proposals for the Nominating Committee and the report on its work with a justified opinion can be found in the material that was disseminated here today. In order to assess the demands that will be required of the Board as a consequence of the company's challenges and future focus, the Nominating Committee has discussed the size of the Board and its composition. We've had access to an external evaluation of the Board, and the work is performed, which has shown that the Board is working very well. The Nominating Committee has also seen that the members of the Board have a very high attendance rate, and they have the time required to be able to conclude the assignments in a good way. The Nominating Committee has also considered the need for a well functioning composition of the Board in terms of diversity when it comes to different skills and perspectives, which also includes things such as gender, nationality and industry expertise. The Board member, Sara Mazur, has declined reelection. The Nominating Committee has, therefore, discussed the need for additional skills on the Board. And decided to propose Sara Öhrvall as a new Board member. Sara Öhrvall has experience from senior positions within the financial sector and the media, with a particular skill in digitalization and new business models. Sara Öhrvall is present here in the room. If I may ask you, Sara, to stand up so that everyone can see you. A well-known face to many people who own Investor shares. The Nominating Committee proposes that number of Board members shall be unchanged at 11. The Nominating Committee, thus, proposes reelection of the Board members that you can now see on the screen as well as election of Sara Öhrvall. We also propose that Jacob Wallenberg is reelected to the Chair. The Nominating Committee also proposes Board remuneration according to the division that we'll see on the screens here. What is important is that these remunerations are competitive. And therefore, we've done a competitive analysis when assessing the size of the remuneration. And in light of this analysis and with consideration of the company's good development, the 55%, remember, the Nominating Committee finds that this proposal is reasonable and well justified. The Nominating Committee will propose, just as it did last year, that the Board will adopt a policy according to which a Board member's shareholding, after 5 years on the Board, should correspond to at least the 1 -- the remuneration for 1 year before tax. In order to facilitate the building of such a holding, we propose that the Board member shall continue to have an opportunity to receive 50% of the remuneration in the form of synthetic shares. When it comes to auditors, the Nominating Committee proposes, in accordance with the Audit and Risk Committees' recommendations, Deloitte to continue as an auditor for another year. We also propose that audit fees will be paid in accordance with approved invoicing. And in conclusion, I'd like to thank my dear colleagues and the Nominating Committee for their excellent support in our efforts. Thank You.

Thank you. We've heard the Nominations Committee proposal and account of the proposed directors and their assignments and other companies have been distributed here today and has also been available on the company website and has been sent to those who requested it. Are there questions or comments to this proposal? I find, based on postal votes that have been cast, that meeting has voted in favor of all these proposals. Number of directors, number of auditors, remuneration to auditors, auditors fee, directors, Chair of the Board of Directors and the auditor. And that takes us to agenda item 17. And here, we have 2 decision items, 17a -- sorry.

Thank you. Yes, I would like to take this opportunity and address Sara Mazur. Sara, there you are. Sara, you have been a member of Investor's Board since 2018. And a few weeks ago, you were elected to be on the Board on something that's called the Wallenberg Investment AB. And that company develops the assets of the Wallenberg Foundation and take strategic long-term decisions that pertain to these assets. And the assets include the ownership of Investor of FAM and the different companies that the Wallenberg foundations are involved in. And in connection with being elected to the Board there, you informed the Investor's Nominating Committee that you declined to be reelected to the Board next year. I would like, on behalf of the Board, to direct our enormous gratitude for your contributions to the Board. You have an excellent background from Ericsson, from research and from running companies. And that is something that we have benefited from -- and the Board work and investor, and we do appreciate that, Sara. And of course, I mean, it's not only that you're experienced and skilled, you're sharp as well and a lovely spirit. And that means so much in that conversation that goes on in the Board room that creates a dynamic based on knowledge and progression. And that means a lot to us. So on that note, I would just like to give you our gratitude. And on behalf of the Board and all the shareholders, thank you so much, Sara.

Thank you. Then we continue with agenda item 17, where we have 2 resolutions. We have 17a, long-term variable remuneration program for employees within investor, excluding Patricia Industries; and we also have 17b, where we have the Board's proposal for a long-term variable remuneration program for employees within Patricia Industries. These proposals have been distributed here today, and they've also been available at the company's website and have been sent out to those shareholders who have requested it. Are there questions or comments? I then find, based on the postal votes that have been cast, that the meeting has voted in favor of these proposals from the Board of Directors concerning variable remuneration program for Investor and for Patricia, respectively. And that takes us to agenda item 18, where we had 18a and 18b. We have the Board's proposals concerning purchase and transfer of owned shares. These proposals, in their entirety, have been distributed here today and have been available at the company website. And it's also been sent to the shareholders who have requested so. And I ask if there are any questions or comments relating to this 2 proposals? Let's then start with the resolution concerning 18a. Here, we have a requirement of 2/3 of shareholders and shares represented voted in favor of this proposal. And based on postal votes that have already been cast, I find that the meeting has voted in favor of these proposals concerning purchase of transfer and owned shares of -- and we continue with 18b. And here, we have to have at least 9/10 of the votes cast and the shares represented at the meeting. And we are going to use the voting devices that have been handed to you. So if you could find your voting devices. And if you're in favor of the Board's proposal, you press 1 for yes; and if you're against, you press no; and you can also abstain if you want to do so, and then press 3. And the vote is open. [Voting]

And we will close the vote in a few seconds. And the vote is closed. And we will soon see the outcome of the vote on the screen behind me. And we can see and I find that the meeting has voted in favor of the Board's proposal with the necessary majority. And that takes us to the last agenda item where I would like to hand over to the Chairman of the Board.

Yes, ladies and gentlemen and dear shareholders. With this AGM, we can officially close 2021. As the CEO talked about, we can conclude that it has been a very good year for us, as shareholders. And I spoke in the beginning about this being the day of the shareholders. And this unique opportunity every year to meet in this manner, now that we are permitted to gather together again and also to have an opportunity for an exchange that shareholders can ask questions, we can discuss different matters that are of importance to our company. And I think we've seen plenty of that here today, and I find that excellent. It's very dynamic. So with that, I would like to thank you all for attending, for participating in the conversations and the dialogue earlier and this AGM itself. And I'd like to take the opportunity, Johan, to thank you and all your colleagues and investors for all the excellent work that you have done in the past year. Thank you. And with that, I turn to all of you, co-shareholders of investors. Thank you so much for coming. I hope to see you again in 1 year. Thank you. [Statements in English on this transcript were spoken by an interpreter present on the live call.]