Other Group information
The Group’s Parent Company, Essity Aktiebolag (publ), is a holding company with the main task of owning and managing shares in a number of business group companies and performing Group-wide management and administrative functions. The company’s corporate registration number is 556325-5511 and it is domiciled in Stockholm, Sweden. The company’s address is PO Box 200, SE-101 23 Stockholm. In 2018, the Parent Company recognized operating income of SEK 192m (367) and profit before appropriations and tax of SEK 17,102m (1,681). Investments in non-current assets totaled SEK 1m (0) during the year. Cash and cash equivalents at year-end amounted to SEK 0m (0).
Research and development (R&D)
Research and development (R&D) costs during the year amounted to SEK –1,320m (–1,239), corresponding to about 1.1% of consolidated net sales. R&D is coordinated and conducted from a global perspective. Product development is carried out in close cooperation with the local units, as well as through direct collaboration with customers.
Holdings of treasury shares
Essity Aktiebolag (publ) holds no treasury shares.
In 2018, 147,667 Class A shares were converted into Class B shares. The proportion of Class A shares was 9.1% at year-end.
The Board of Directors proposes a dividend of SEK 5.75 (5.75) per share or SEK 4,038m (4,038). The record date for entitlement to receive dividends is proposed as April 8, 2019.
Environmental impact in Sweden
Essity Aktiebolag (publ) is conducting one operation in Sweden for which a permit is required relating to tissue manufacturing. This operation impacts the environment through emissions to air and water, solid waste and noise.
Essity’s statutory sustainability report, in accordance with the requirements of the Swedish Annual Accounts Act, can be found in the chapter Risks and risk management and in the chapter Notes to non-financial information in the Board of Directors’ Report. The company’s business model can be found in the chapter Essity’s business model. This sustainability report for Essity Aktiebolag (publ) encompasses the entire Group. More information on non-financial accounting principles can be found in Note H1.
Guidelines for remuneration of senior executives
The Board of Directors has decided to propose to the AGM 2019 the following guidelines for determining salaries and other remuneration for senior executives to apply for the period following the AGM.
“Remuneration of senior executives will be a fixed salary, variable remuneration, additional benefits and pension. Senior executives include the President, Executive Vice President, Business Unit President and equivalent, as well as Group Function Senior Vice President. The total remuneration is to correspond to market practice and be competitive in the senior executive’s field of profession and linked to the executive’s responsibility and authority. The variable remuneration is to be limited and linked to the fixed remuneration, based on performance results in relation to the annual and long-term established targets. In the event of termination of employment, the notice period should normally be up to two years if termination is initiated by the company, and up to one year, when initiated by the senior executive. Severance pay should not exist. Pension benefits should, to the extent possible, only contain defined contribution pension benefits and entitle the executive to receive a pension from the age of 65. Variable remuneration is not part of pensionable income. The board of directors shall be entitled to deviate from the adopted guidelines if, in an individual case, there are special reasons for doing so. The guidelines shall not prevail over mandatory conditions under labour law or collective agreements. Neither do they apply to existing agreements.”
For information concerning the company’s application of previously agreed guidelines and information on the company’s calculated expenses for remuneration of senior executives, see Note C3.