The Board's work

Every year, the Board adopts work procedures for the Board’s work.

The work procedures outline how the Board’s duties should be distributed, including the specific role and duties of the Chairman, instructions for the division of duties between the Board and the President and for the reporting of financial information to the Board. The Board has also adopted specific instructions for the Board’s committees, which are linked to the work procedures.

The Board's work in 2023

The Board’s work is mainly performed within the framework of formal Board meetings and through meetings in the committees of the Board. In addition, regular contact is maintained between the Chairman of the Board and the CEO in order to discuss ongoing business and to ensure that the Board’s decisions are executed.

In 2023, there were eleven ordinary Board meetings, four extraordinary Board meetings and one statutory Board meeting. During 2023 the Board applied a meeting structure with fewer, but longer, physical meetings combined with more frequent digital meetings in order to get the most value out of the in person meetings, increase meeting efficiency and reduce the CO2 impact by travelling less. Consequently, all of the extraordinary Board meetings and several of the ordinary Board meetings during 2023 were held as video conferences. The attendance of the Board members at the Board meetings during 2023 is presented here. The company’s auditor attended one Board meeting during the year.

In 2023, turbulent developments in the world affected the Volvo Group in many aspects. Hence, monitoring and considering the effects thereof have been an important part of the Board’s work. The consequences of the war in Ukraine, with a priority on questions relating to the health and safety of colleagues and business partners, and the Volvo Group’s strategic directions in relation thereto have been a focus area throughout the year. The continued strains on the supply chain and industrial system, due to e.g. shortages of labor, materials, components and transport services, have also been a challenge during the year. Costs related to energy, material and supply chain disruptions continued to increase throughout 2023. The Board has closely monitored and followed-up on the effects of the higher inflation on the Volvo Group and its profitability and initiated several proactive activities in relation thereto. In addition, the Board has spent a great deal of time considering how to assess and communicate certain key issues related to the short-term risks described in Note 2 to the financial statements. 

The Volvo Group’s sustainability work and objectives are integrated parts of the Volvo Group’s business and are regularly followed-up by the Board. The focus on sustainability and the corresponding alignment of the product portfolio of the Volvo Group has continued during 2023, with a particular focus on strategic decisions for electromobility. To meet the growing demand for battery electric heavy-duty vehicles and machines, the Volvo Group has initiated the process to establish a large-scale production plant for battery cells in Mariestad, Sweden, and to start to produce battery modules in the Volvo Group’s truck plant in Ghent, Belgium. The Volvo Group’s climate targets under the Science Based Targets initiative (for further information, see pages 154–156 in the Annual Report for 2023) are, together with background materials, followed-up by the Board on a quarterly basis. At the Board meeting in December 2023, the Board spent time on the Group’s broader work related to sustainability and focusing on communication, future environmental impacts and expectations on human rights, as well as regulations relating to strategy, performance and reporting. The Board is involved in on-going work to strengthen the reporting and enable consolidated follow-ups within the area of sustainability.

The speed of transformation of the industry is accelerating and, in light thereof, the Board has devoted most of its time to strategic topics, with particular focus on electrification, digitalization, autonomous solutions and new productivity services. These technologies play an essential part in the Volvo Group’s ambition to lead the transformation and, electrification in particular, in the transition to a decarbonized transport system. As a part of the ongoing technology shift, the Volvo Group continues to develop the strategic partnerships previously entered into with focus on autonomous solutions, electrification and charging infrastructure.

The Board’s ambition is to stay close to the business and the Board receives continuous up-dates on the status and development of the Group’s transformation work and strategies in relation thereto. Furthermore, the Board has devoted time to talent review and succession planning and on the review and follow-up of the company’s quality work. Related to this work, the Board usually makes a yearly visit to the company’s operations throughout the world. In October 2023, the Board travelled to the US and visited the head office of the Volvo Group’s North American business in Greensboro and the Volvo Group’s truck assembly plant in New River Valley.

During 2023, the Board resolved on an overall financial plan and investment framework for the Group’s operations. In addition, the Board regularly monitors the Group’s earnings and financial position and maintains continuous focus on risk related issues such as overall risk management and ongoing legal disputes and investigations. The Board proposed a distribution of an ordinary dividend of SEK 6.50 per share and an extraordinary dividend of SEK 6.50 per share, which was resolved by the Annual General Meeting 2023. Furthermore, the Board regularly reviews the management’s short and long-term incentive programs to ensure that they fulfill their purpose and drive the right behavior in the current business environment.

In 2023, the Board also resolved to establish a Volvo CE Transformation Committee with a specific focus on the strategic direction and transformation of the Volvo Construction Equipment business area. The main purpose of the committee being to ensure that Volvo Construction Equipment is successful in the transformation.