F1. Group companies

AP Accounting principles

Group companies

The companies over which Essity has control are consolidated as Group companies. Control means that Essity has sufficient influence to control the relevant activities of the Group company, and that Essity has the right to, and can influence, its variable returns from its participation in the Group company. Most of the Group’s companies are wholly owned, which means that Essity has control over the companies. Essity owns 52% of Vinda, which is deemed to give Essity control over the operation. For information on the change in ownership in Familia, see Note F2 Jointly owned Group companies with significant non-controlling interests and Note F6 Acquisitions and divestments of Group companies. For more information on the change in ownership in Asaleo Care, see Note F3 Investments in associates and joint ventures and Note F6 Acquisitions and divestments of Group companies.

Non-controlling interests

Non-controlling interests are recognized as a separate item in the Consolidated statement of changes in equity. Profit or loss and every component of other comprehensive income are attributable to the owners of the Parent company and to non-controlling interests. Losses attributable to non-controlling interests are recognized even if this results in a negative balance for the non-controlling interest. In connection with acquisitions of less than 100% when a controlling influence is achieved, non-controlling interests are determined either as a proportional share of the fair value of identifiable net assets excluding goodwill or at fair value. Subsequent acquisitions up to 100% and divestments of participations in a Group company that do not lead to a loss of controlling influence are recognized as an equity transaction.

List of major Group companies

The Group’s participations in major Group companies at December 31, 2021 are presented below. The following selection of wholly owned Group companies or Group companies with significant non-controlling interests includes companies with external and internal sales in excess of SEK 500m in 2021.