Volvo 2014 Annual Report Download - page 106

Volvo’s auditors are elected by the Annual General Meeting. The current
auditor is PricewaterhouseCoopers AB (PwC), which was elected at the
Annual General Meeting 2014 for a period of four years. Two partners of
PwC, Peter Clemedtson and Johan Rippe, are responsible for the audit of
Volvo. Peter Clemedtson is Lead Partner.
The external auditors discuss the external audit plan and risk manage-
ment with the Audit Committee. The auditors review the interim report for
the period January 1 to June 30 and audit the Annual Report and the
consolidated accounting. The auditors also express an opinion whether
this Corporate Governance Report was prepared or not, and in such
respect whether certain information therein coincides with the Annual
Report and consolidated accounting. The auditors report their fi ndings
with regard to the annual report, consolidated accounting and the Corpo-
rate Governance Report through the audit reports and a separate opinion
regarding the Corporate Governance Report, which they present to the
Annual General Meeting. In addition, the auditors report detailed fi ndings
from their reviews to the Audit Committee twice a year and once a year to
the full Board of Directors.
When PwC is retained to provide services other than the audit, it is
done in accordance with rules decided by the Audit Committee pertaining
to pre-approval of the nature of the services and the fees.
For information concerning Volvo’s remuneration to the auditors, refer
to Note 28 “Fees to the auditors” in the Group’s notes in the Annual Report.
Volvo’s core values, vision and strategies
Volvo’s core values are quality, safety and environmental care. These val-
ues form the common base for the Group’s long-term goals and vision and
for the strategies and plans, the purpose of which is to contribute to
achieving Volvo’s goals and vision.
The Volvo Group’s vision is to become the world leader in sustainable
transport solutions. The vision describes the overall long-term goal for the
operations. Volvo has also adopted a wanted position 2020 with the aim
to achieve its long-term vision. In addition, the Board has resolved on
several fi nancial targets for the operations, primarily in relation to growth
and profi tability, which have been effective since 2012.
How Volvo will achieve the vision, the wanted position 2020 and the
fi nancial targets are defi ned in long-term plans for different areas such as
brand positioning, product development, fi nance and IT, and in more short-
term strategic objectives with a duration of three years. The long-term
plans may be both Group-wide and business area/division specifi c, and
even if a long-term approach is applied, they will be updated continuously.
Every third year, focus areas and strategic objectives are formulated that
are specifi c to the Group’s various business areas and divisions. These
focus areas and strategic objectives defi ne what is to be achieved over the
next three years, with the purpose of achieving the fi nancial targets, the
wanted position 2020 and also, in longtime-perspective, the vision.
The implementation of activities to reach the strategic objectives has
high priority. Throughout the three-year period, monthly and quarterly
follow-ups of the strategic objectives are reported to the management
groups of each business area/division. Potential risks of not achieving the
goals are therewith identifi ed and discussed at an early stage, enabling
effi cient adjustment or action. The vision and strategies thereby become
management and governance tools for the Group.
Governance documents
Another key component of the governance and control is the Group’s
policies and directives, such as the Code of Conduct and policies pertain-
ing to investments, fi nancial risks, accounting, fi nancial control and inter-
nal audit, which contain Group wide operating and fi nancial rules for the
operations, as well as responsibility and authority structures.
Organizational structure
The Volvo Group’s business activities are organized into six business
areas: Group Trucks, Construction Equipment, Buses, Volvo Penta,
Governmental Sales and Volvo Financial Services.
The Group Trucks operations, which account for almost two-thirds of the
Group’s total sales, are as per January 1, 2015 organized into three divisions.
The previous three sales divisions are merged into one sales division, Group
Trucks Sales (GTS), with responsibility for all sales and marketing activities for
all truck brands in the Volvo Group. The division is also responsible for the
Group’s joint venture Volvo Eicher Commercial Vehicles together with Eicher
Motors Ltd in India. There is also a division with responsibility for product devel-
opment of engines, transmissions and trucks, Group Trucks Technology (GTT).
Finally, Group Trucks Operations (GTO) is a division within Group Trucks with
responsibility for purchasing and production of trucks and the Group’s engines
and transmissions. GTOis also responsible for the Group’s spare parts supply
and logistics operations.
There are fi ve Corporate Functions: Corporate Human Resources, Cor-
porate Communication & Sustainability Affairs, Corporate Finance, IT &
Financial Services, Corporate Legal & Compliance and Corporate Strat-
egy & Brand Portfolio, providing support to the CEO and the Group Exec-
utive Team with expertise in each Corporate Function area and develop-
ing standards for the entire organization through policies, directives and
guidelines. In addition there are more than twenty Group Functions that
provide services and/or products to the entire Group, for example IT Ser-
vices and Business Services.
Auditors
PricewaterhouseCoopers AB
Peter Clemedtson
Authorized Public Accountant.
Lead Partner.
Auditor since 2012.
Peter Clemedtson’s other listed
clients are SKF AB and Ratos AB.
His unlisted clients include Stena
AB and Wallenbergstiftelserna.
Born 1956.
Johan Rippe
Authorized Public Accountant.
Partner.
Auditor since 2010.
Johan Rippe’s other clients
include Stena AB, Stena Metall
AB and Elanders AB.
Born 1968.
External auditing
7Governance and organizational structure 8
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CORPORATE GOVERNANCE REPORT 2014 CORPORATE GOVERNANCE