Qred is a financial company licensed to conduct banking operations in accordance with the Swedish Banking and Financing Business Act (2004:297).
Annual General Meeting
The Annual General Meeting is Qred's highest decision-making body, where shareholders exercise their voting rights and make decisions on, among other things, the balance sheet and income statement in the annual report, discharge from liability, board members for the coming year, and election of auditors.
Board of Directors
Qred's Board of Directors is responsible for Qred's organization and management of its affairs in accordance with, among other things, the Swedish Companies Act and has the ultimate responsibility for ensuring that operations are conducted in accordance with good internal governance and control. Qred's internal governance and control is formalized through internal rules in the form of policies and instructions as well as supporting route descriptions, process descriptions and checklists.
The Board of Directors decides on the internal rules for internal governance and control, while the CEO is responsible for implementing them in Qred's operations in accordance with the Board's instructions.
The Board of Directors is also responsible for ensuring that Qred conducts its activities in an ethical and professional manner, to identify and manage conflicts of interest in a sufficient and appropriate manner, and that Qred maintains a sound risk culture.
Chairman of the Board
The Chairman of the Board leads the work of the Board and ensures that the Board fulfills its obligations under the Swedish Companies Act and other applicable rules. The Chairman of the Board shall, through contact with the CEO, monitor Qred's development.
Qred's Chairman of the Board is responsible for conducting an annual suitability assessment to ensure that the Board members, the CEO and senior management are individually suitable for their duties at all times. This includes assessing whether they function properly and ensuring that the Board fulfills its obligations under the Swedish Companies Act and other applicable regulations. The Chairman of the Board shall keep himself updated on Qred's development through contact with the CEO.
Qred's Chairman of the Board is responsible for conducting an annual fitness assessment to ensure that the Board members, the CEO and the senior management are individually fit for their duties at all times. This involves an assessment of the following:
- The company has a sufficiently good reputation.
- The company possesses sufficient knowledge, skills and experience to perform their tasks.
- The company acts with honesty, integrity and the ability to think independently to effectively assess and challenge decision-making where necessary.
- The company sets aside sufficient time to complete their tasks.
- The suitability assessments and results are documented.
The suitability assessments and results are documented.
To support the board in specific areas, the board has established two committees. These committees are tasked with preparing a basis for decision-making on matters that fall outside each committee's area of competence:
- Remuneration committee
- Risk and audit committee
Each committee consists of 2-3 board members and 1-3 senior executives from the company. The committees shall assist the Board of Directors with expertise and prepare proposals, advice and preparation of cases within their respective areas. The work of the committees is further regulated in instructions.
The Board of Directors appoints Qred's CEO, who is authorized to make decisions in all matters that are not to be decided by the Board of Directors or the General Meeting. The CEO is responsible for the day-to-day management as instructed by the Board of Directors and for such obligations incumbent on the CEO under external regulations.
The CEO is responsible for implementing policies, instructions, and routine and process descriptions in the organization and ensuring that all employees have access to relevant documentation.
The company's CEO has an advisory forum, a management team, with the purpose of ensuring that the company's operations are conducted in a responsible and efficient manner. In its work, the management must always consider the interests of the company and its customers. The management normally meets whenever necessary, but at least once a month. The CEO convenes and chairs the meetings, which must have a fixed agenda and be minuted.
Internal control and supervision
Three lines of defense
Qred uses the principle of three lines of defense to define where in the organization the responsibility and control of the organization's risk-taking should be placed.
The first line of defense consists of Business Operations, including the CEO, who is responsible for and controls day-to-day risk management and compliance. Business Operations is also responsible for performing checks on the processes that Qred uses in the form of internal controls.
The second line of defense consists of risk management and compliance, which, among other things, monitors, controls and reports on Qred's risks and the company's compliance with internal and external regulations. The control functions in the second line of defense report to the CEO and primarily constitute the CEO's independent control body, but must also report directly to both the Board of Directors and the CEO.
The third line of defense consists of the internal audit function, which reports directly to the board of directors and acts as the board's independent control body. The third line of defense reviews and assesses the first and second lines of defense.
Salary policy and guidelines
Qred has a remuneration policy, the purpose of which is to describe and establish the principles for how the company's remuneration system is designed, controlled and continuously monitored. The policy shall be consistent with and promote effective risk management and discourage excessive risk-taking.
The policy shall also ensure that customers' interests are not negatively affected by the company's incentive structure. The remuneration system shall promote Qred's ability to attract and retain competent personnel and contribute to ensuring that the company's long-term goals can be achieved.
The Board of Directors is ultimately responsible for the content, establishment, implementation and compliance of the policy. The policy must be regularly, at least annually, reviewed and, if necessary, updated prior to approval by the board. A risk analysis shall form the basis for the board's decision to adopt the remuneration policy. The Board of Directors shall also decide on:
- Remuneration of the management team
- Remuneration of the control functions
- The outcome and payment of any variable remuneration
- Measures to monitor the application of the remuneration policy
The board has established a remuneration committee.
The Remuneration Committee is responsible for monitoring and assessing the company's remuneration system at least once a year and for preparing decisions on remuneration issues for the Board of Directors' decision. In the follow-up of the remuneration system, the Remuneration Committee shall also monitor the development of unjustified pay differences between women and men.
The Board of Directors shall, where applicable, comply with the remuneration decisions made by the Annual General Meeting.
An annual risk analysis shall be conducted by the company to identify employees whose tasks have a significant impact on the company's risk profile. The analysis must take into account all risks to which the company is or may be exposed, including the risks associated with this policy and the company's remuneration system. The analysis must be documented and attached to this policy. The Remuneration Committee shall review the risk analysis before the policy is adopted by the Board of Directors.
The company's remuneration system should be designed in a way that is consistent with and promotes sound and effective risk management and prevents excessive risk-taking. Remuneration systems should encourage employees to perform well and help the company attract and retain competent employees. The remuneration system should be applied in a gender-neutral way.
The basis of the company's remuneration system is a fixed salary. Fixed salary is determined on an ongoing basis, with the first review normally taking place 12 months after the start of employment. As a general rule, salary reviews must take place once a year.
Employees' fixed salary must be determined based on objective criteria and be in line with market conditions. For new hires, the fixed salary is determined based on the market situation for the corresponding profile and the value that the employee is expected to add to the company.
In subsequent salary reviews and when changing roles, an individual assessment must be made and form the basis for the salary. This assessment must be based on parameters such as work performance, independence, initiative, responsibility and personal development. There must be no discriminatory or other unjustified differences between employees' fixed salaries.
In connection with a salary review, the manager who sets the salary must conduct a development and salary interview with the employee, where the connection between work tasks, work results, performance in general and salary development is made clear to the employee.
Vacation allowances are determined according to applicable legislation and individually in connection with employment and salary reviews.
The Board of Directors decides on variable remuneration for the management team and employees whose duties have a significant impact on the company's risk profile. The CEO may decide whether other employees (outside of this group) shall be eligible for variable remuneration.
The company uses a system of variable remuneration in the form of performance-based bonuses for the CEO, the management team and most functions and business units. Performance-based bonuses must be designed in a way that meets the criteria in this section and the remuneration policy in general. The criteria for receiving variable remuneration shall be based on the company's overall performance as well as the employee's individual performance and the performance of the business unit in which the employee works.
The variable salary should be based on:
- Achieving financial goals related to the budget
- Operational goals for the company
- And/or performance-based goals related to individual or group performance.
Performance that forms the basis for calculating variable remuneration shall primarily be based on risk-adjusted performance measures. The company shall take into account both current and future risks as well as the cost of capital and liquidity required by the business. The company shall ensure that variable remuneration is based on long-term and sustainable performance by assessing performance in a multi-year perspective.
Furthermore, the company's underlying economic and business risks must be taken into account when approving and paying variable remuneration.
When determining variable remuneration, the assessment of individual employee performance and achievements must take into account both economic and non-economic factors. Among the non-financial factors, the company must consider, among others, compliance with internal rules, accountability, customer satisfaction and safeguarding customer interests.
If the company's control functions for risk control, compliance and internal audit are employed by the company and eligible for variable remuneration, the company must ensure that such remuneration is determined based on objectives related to each control function, regardless of the performance of each control function and the business areas they review.
The company shall ensure that any variable remuneration does not affect the company's ability to maintain an adequate capital base or, if necessary, to strengthen the capital base.
The company should maintain a reasonable balance between employees' fixed and variable remuneration. Employees' fixed remuneration should always be at a high enough level to set the variable part of the salary to zero.
The total variable remuneration received by employees must never be at a level that risks undermining the company's capital base and ability to generate a positive result in the long term. The total variable remuneration to an employee must never exceed 100% of the employee's annual fixed salary.
The company's sales function, which is completely separate from the company's credit function and credit decisions, is exempt from the above limitation, but can never exceed 100,000 SEK per month in variable remuneration.
Guaranteed variable remuneration
As a general rule, the company shall not provide guaranteed variable remuneration to some employees. If there are special reasons, the Board of Directors may decide to grant guaranteed variable remuneration to an employee, but only in connection with new recruitment and only in the employee's first year of employment.
Ethical guidelines and conflicts of interest
Qred has established a policy with the purpose of ensuring that the business is conducted in an ethically responsible and professional manner in accordance with Qred's internal and external rules. The purpose of this policy is also to promote transparency, integrity and a corporate culture that protects Qred's activities against corruption.
The policy sets common standards to promote Qred's ethical approach and to assist employees in situations where applicable regulations are lacking or provide limited guidance.
Conflict of interest
Qred has established a policy and instructions for handling conflicts of interest that may arise in the company.
Qred employees are expected to always act in Qred's best interests and exercise good judgment that is not influenced by private interests or divided loyalties.
No employee may participate in the processing of a case or make a credit decision concerning a relative, a relative's business or similar when there is a risk of fraud.
Nor may an employee handle matters in which the employee has a personal interest, or matters in which such interest is held by a relative of the employee or by a company in which the employee or a relative of the employee has a material interest. In such a situation, the employee must be exempted from credit processing and credit decisioning.
Qred employees may not purchase goods or services from related parties without prior approval from the CEO, and the CEO may not purchase goods or services from related parties without prior approval from the Board of Directors.