The Board’s work

The Board’s work

Every year, the Board adopts work procedures for the Board’s work.

The work procedures outline how the Board’s duties should be distributed, including the specific role and duties of the Chairman, instructions for the division of duties between the Board and the President and for the reporting of financial information to the Board. The Board has also adopted specific instructions for the Board’s committees, which are linked to the work procedures.

The Board’s work in 2018

The Board’s work is mainly performed within the framework of formal Board meetings and through meetings in the respective committees of the Board. In addition, regular contact is maintained between the Chairman of the Board and the CEO in order to discuss ongoing business and to ensure that the Board’s decisions are executed.

In 2018, there were nine regular Board meetings and one statutory Board meeting. The Company’s auditor attended one Board meeting during the year.

In 2018, business cycle management has been high on the Board’s agenda. In addition, the Board continued to focus on measures to increase the Group’s profitability and to strengthen the balance sheet. In May 2018, the Volvo Group divested a Chinese subsidiary holding shares in

Inner Mongolia North Hauler Joint Stock Co., Ltd, resulting in a capital gain of approximately SEK 0.8 billion. Furthermore, in December 2018, the Volvo Group signed an agreement to divest 75.1 percent of the shares in its wholly-owned subsidiary WirelessCar. The divestment will, at the time of closing of the transaction, result in a positive impact on operating income of approximately SEK 1.5 billion and a positive cash flow effect of SEK 1.1 billion. The completion of the transaction is subject to customary authority approvals.

Another focus area for the Board has been New Technologies and throughout the year, the Board has paid particular attention to the Group’s strategic focus on disruptive technology trends and initiatives within the areas of digitalization, electrification and automation.

The Board also decided on an overall financial plan and investment framework for the Group’s operations. In addition, the Board regularly monitors the Group’s earnings and financial position and maintains continuous focus on risk related issues such as overall risk management and ongoing legal disputes and investigations. Throughout the year, the Board has devoted considerable time to talent review and succession planning and on the review and follow-up of the Company’s quality work.

By allocating time to business reviews of the Group’s various truck divisions and business areas the Board remains continuously up-to-date on the status and development of the Group’s operations. In June 2018, the Board visited the Company’s operations in Ghent in Belgium. Additionally, the Board has focused on the Group’s strategy regarding its operations and joint ventures in Asia and as part of this the Board, in October 2018, visited the Group’s operations in India.

In 2017, a Volvo CE Committee was established with a specific focus on monitoring and evaluating Volvo CE’s operations. Following the improved financial and operational performance of Volvo CE, the Volvo CE Committee was renamed the Business Area Committee in April 2018. Following this change, the main purpose of the committee is for the Board to allocate time for deep-dives and additional follow-ups of specific business areas.