The basis for the Wallenberg family’s activities is to be an active owner in the companies in which the Wallenberg Foundations have ownership interests through Investor AB and FAM AB. The family’s long-term work with these international corporations, and the successes of each company, enable the Foundations to distribute around SEK 2.2 billion annually to research and education in Sweden.
The most important holdings that are owned directly through the Foundations, or indirectly via Investor AB and FAM AB, are: ABB, Aleris, AstraZeneca, Atlas Copco, Bergvik Skog, BraunAbility, Electrolux, Epiroc, EQT, Ericsson, Grand Hôtel, Husqvarna, Höganäs, IPCO, Laborie, Mölnlycke, Nasdaq, Nefab, Permobil, Piab, Saab AB, Sarnova, SAS, SEB, SKF, Sobi, Stora Enso, Wärtsilä and 3 Scandinavia.
THE WALLENBERG FOUNDATIONS
The Wallenberg Foundations is the collective name for the non-profit public and private foundations established by individual members of the Wallenberg family. The endowment of these Foundations has either been donated by Wallenberg family members, or it has been raised through collections to honor family members.
Funding excellent researchers and research projects beneficial to Sweden, the Foundations have awarded more than SEK 17 billion in grants the last ten years and around SEK 33 billion since 1917. The three largest Foundations granted a total of SEK 2.2 billion in 2018. The Foundations focus mainly on funding research in the fields of medicine, technology and the natural sciences, although donations are also made to support research in the social sciences, the humanities and archeology.
Investor, founded by the Wallenberg family in 1916, is a leading owner of high-quality international companies, of which the majority with Swedish roots. The company is partly owned by the three largest Wallenberg Foundations (capital 23.3%, votes 50%). Through boards, Investor actively works for continuous improvement of the performance of its holdings. Investor AB strives to make and keep its portfolio companies best-in-class by utilizing its industrial experience, financial strength and the broad network around the companies and the Wallenberg family.
The heart of Investor’s business model is to be a long-term owner that focuses on maximizing the core value of holdings – the present value of all future cash flows – which is decisive for Investor’s success as a world-class owner. Investor’s cash flow generation allows the company to support strategic initiatives in holdings, capture investment opportunities and provide shareholders with steadily increasing dividends.
Investor has three distinct business areas: one focuses on active ownership in listed core investments and another – Patricia Industries – develops and expands the portfolio of wholly-owned subsidiaries. The third business area is the private equity firm EQT. Investor AB was one of the founders of EQT in 1994 and has been a sponsor of EQT's funds ever since. Investor’s three largest holdings are ABB, AstraZeneca and Atlas Copco.
FAM is a privately-owned holding company with assets totaling approximately SEK 50 billion. FAM manages these assets as an active owner with a long-term ownership horizon. FAM is owned by the three largest Wallenberg Foundations and focuses its ownership on a number of strategic holdings and a selection of alternative investments.
By actively contributing to the long-term development and growth of holdings, their dividend capacity and value can increase over time. With its experience and expertise as an unlisted company, FAM, together with the Wallenberg network, can find unique and attractive investment opportunities and further develop existing holdings. The company is an active owner of listed and unlisted companies. FAM’s goal is to generate real long-term growth in its assets over time. The largest holdings include Höganäs, IPCO, SKF and Stora Enso.
The following overview displays the ownership structure of the Wallenberg ecosystem.
FOCUSING ON BOARD WORK
The family bases its ownership philosophy on the Swedish model for corporate governance, in which the owners of the company appoint the board, and especially the chairman, which is significant for securing the right long-term strategy and the right leadership for a company. A number of key principles serve as the platform for the family’s involvement in holdings as an owner.
When we are involved in companies and foundations, we want to be deeply involved in devising and developing their long-range strategy. This is why we always strive to have a clear position as the principal owner. We are part-owner of most of our holdings and therefore collaborate with a number of other owners. In our role as principal owner, we put much emphasis on interacting with the other stakeholders to create a solid platform for the companies and their long-term orientation.
RIGHT BOARD COMPOSITION
The board is the primary forum in which we act. In the Swedish governance model, it is of the greatest importance to ensure that the right chairperson is in place. The entire composition of the board is equally important because of its role to stake out the company’s long-term direction and appoint the CEO. We therefore put much effort into helping to find the right blend of competence and experience, and the appropriate professional background, for each director on a board. Nomination committees are the principal channel for this work.
PARTICIPATING IN STRATEGIC ISSUES
We participate in companies on board level and deal with their ownership issues and major strategic initiatives, not the day-to-day management of their business.
FOCUSING ON EACH INDIVIDUAL COMPANY
The best long-term interests of each individual company are always in focus. We never work with general checklists, and we do not communicate our views, or comment on our work, through the news media. We also apply this approach to our work within important areas like sustainability, which must be part of a company’s DNA. We would never drive issues that could give a company a competitive advantage over another holding in our sphere.
TIME-TESTED METHOD FOR PROFESSIONAL BOARD WORK
“An owner never sleeps” – this expression says something about our never-ending ambition to obtain a deep level of knowledge about our holdings as an owner and member of their boards. To support our board representatives, we have internal specialists and a network of skilled and experienced experts that we respect highly.
We are deeply involved in research and education through the Wallenberg Foundations and as an engaged and long-term owner of companies in which we, directly or indirectly, are lead owners. Dividends from these holdings fund basic science and education, contributing to the development of Sweden.