Electrolux 2000 Annual Report Download - page 39

ELECTROLUX ANNUAL REPORT 2000 37
ALLOCATION OF SPP PENSION SURPLUS
During the year the Swedish insurance
company SPP allocated a portion of the
surplus in its pension funds to participat-
ing companies. Electrolux share of the
surplus is SEK 435m, of which SEK
264m refers to the parent company.
This amount has been included in the
accounts for 2000.Actual payments to
Electrolux in 2000 amounted to SEK
279m.The remaining SEK 156m will be
received in the first quarter of 2001.
AGREEMENT IN PENSION LITIGATION
In July 2000, the Group’s US subsidiary
White Consolidated Industries Inc.
(WCI) reached an agreement in pension
litigation with the Pension Benefit Guar-
anty Corporation (PBGC) in the US.The
agreement stipulates that WCI refrains
from appealing the decision against the
company which was rendered in a US
court, and that PBGC will correspond-
ingly not exercise the judicial rights
which follow from the court’s decision.
In accordance with the agreement and
subject to approval by appropriate
authorities,WCI assumes responsibility
for payment of the pension plans in
question. In the event that this responsi-
bility cannot be fulfilled,WCI will pay
USD 180m plus interest to PBGC and
the beneficiaries. It is expected that the
final total cost will be covered by the
provision of USD 225m (SEK 2,135m)
which was made by the Group in 1999.
THE BOARD OF DIRECTORS’
ACTIVITIES IN 2000
The Board of Directors of AB Electrolux
consists of eight members with no
deputies, who are elected by the Annual
General Meeting, and three members
with deputies, who are appointed by the
employee organizations. Other company
personnel participate in Board meetings,
and provide presentations on specific
issues.
Seven Board meetings including the
statutory meeting were held during the
year, one of them in connection with a
visit to an operation in the US. In addi-
tion, three meetings addressing specific
issues, were held.
The Board has adopted the following
working procedures:
• 4–6 meetings per year shall normally be
held, of which at least one in connec-
tion with a visit to a subsidiary.
• The Company’s auditor shall submit a
report to the Board at least once a year.
• Remuneration to senior management
shall be proposed by a committee of
Board members.
The working procedures also involve
providing detailed instructions to the
President as to which issues require the
Board’s approval, and the type of financial
and other reports which shall be submit-
ted to the Board.The instructions specify
the maximum amounts which various
decision-making functions within the
Group have the right to approve for cap-
ital expenditure.The working procedures
also cover the financial policy to be
applied by the Group.
The Board has also established the
practice of referring specific matters to an
ad hoc committee for review and subse-
quent proposal to the Board. Such a
committee was formed in order to
implement the project for the new finan-
cial organization that was implemented
during the year.
PREPARATORY DISCUSSIONS
ON ELECTION OF DIRECTORS
The Chairman of the Board of Directors
normally initiates the process of nomi-
nating members of the Board by
approaching the Company’s major share-
holders for preparatory discussions, well
in advance of the Annual General Meet-
ing.A shareholder who wishes to propose
Board members or otherwise comment
on the composition of the Board may
contact the Chairman, well in advance of
the General Meeting.The results of the
preparatory work are given in the written
notice of the Annual General Meeting.
ENVIRONMENTAL ACTIVITIES
Electrolux operates 118 manufacturing
facilities in 23 countries. Manufacturing
operations comprise mainly assembly of
components made by suppliers. Other
processes include metalworking, molding
of plastics, painting and enamelling, and
casting of parts to a limited extent.
Chemicals such as lubricants and cleaning
fluids are used as process aids, and chem-
icals used in products include insulation
materials, paint and enamel.
The production processes generate an
environmental impact in the form of
water- and air-borne emissions, solid
waste, and noise.
Studies of the total effect of the
Group’s products during their entire life-
times, i.e. through production and use to
disposal, show that the greatest environ-
mental impact is generated when the
products are used.The stated Electrolux
strategy is to develop and actively pro-
mote increased sales of products with
lower environmental impact.
ISO CERTIFICATION
Environmental management systems are
gradually being implemented at the
Group’s manufacturing facilities. During
the year 2000, 6 plants were certified
according to ISO 14001, involving the
first factories to be certified in the US
and Brazil. Since the start of the project
Electrolux has certified 56 units, of which
13 have later been sold.At year-end 2000
a total of 43 plants had been certified.
MANDATORY PERMITS AND
NOTIFICATION IN SWEDEN
Electrolux operates 16 plants in Sweden,
which account for about 7% of the total
value of the Group’s production. Permits
are required by Swedish authorities for 10
of these plants, while 6 are required to
submit notification.The permits refer to
e.g. thresholds or maximum permissible
values for air- and water-borne emissions
and for noise. No significant non-compli-
ance with Swedish environmental legis-
lation was reported in 2000.
For further information about
Electrolux environmental activities, see
pages 70–72.