The control environment is characterized by the organization structure, management’s work methods and philosophy as well as other roles and responsibilities within the organization. The Audit Committee assists the Board with respect to important accounting issues which the Group applies and monitors the internal control with respect to financial reporting. In order to maintain an efficient control environment and sound internal control, the Board of Directors has delegated the practical responsibility to the President who, in turn, has delegated responsibility to other members of the Group Executive Committee as well as to heads of business areas/subsidiaries.
A number of projects aimed at achieving improvements in work methods, routines and documentation are regularly conducted with the aim of ensuring that the Group’s internal controls meet the requirements imposed by various stakeholders. In order to ensure the quality of the financial reporting, work takes place regularly on further developing policies and manuals for the entire Group; among other things, there is an accounting manual (Financial Guidelines) for the Group which is regularly updated and communicated within the Group. The Financial Guidelines also include the finance policy. Apart from the Financial Guidelines, the most important overall control documents for the Group are the information policy and business ethics policy. In addition, there are control documents and policies, e.g. credit policy and policy for dissemination of financial information.
All business areas and subsidiaries have adopted guidelines with respect to business ethics issues. The work on clarifying the Group’s Code of Business Ethics continued during 2010. The Group also decided to sign up to the UN Global Compact commencing January 1, 2010. This represents a stage in further strengthening communication of the Group’s values and philosophy.