Organization

Telia Finance’s regulatory status

Telia Finance AB (corporate registration no. 556404-6661) is a Swedish company, whose headquarters are located in Solna. Telia Finance AB is a credit market company under the supervision of the Swedish Financial Supervisory Authority (“SFSA”, in Swedish Finansinspektionen). You can find more information on our license to provide financial services in SFSA’s register.

Telia Finance AB offers financial services in other countries within the Nordic region through its branches in accordance with EU Directive 2013/36 / EU. The Telia Group's companies provide sales support to Telia Finance AB in the local markets. Telia Finance AB is a contracting party in all agreements with customers.

Good corporate governance means ensuring that companies are run sustainably, responsibly and as efficiently as possible. If you would like to learn more about how governance and control is organized in Telia Finance you can find more detailed information under Corporate Governance.

Maintaining the confidence and trust of all our stakeholders are vitally important for Telia Finance. The corporate governance structure distributes rights and responsibilities between the shareholder, the Board and the CEO according to applicable laws, rules and processes. Well defined reporting lines and distribution of distinct responsibilities are essential. High ethical and professional standards and a sound risk culture remain vital. The image below provides a summary of how governance and control are organized at Telia Finance.

Framework for corporate governance

The licensed activity means that Telia Finance, in addition to general laws, rules and industry practices, also complies with the more detailed regulations specific to banks and credit market companies, for instance the Swedish Banking and Financing Business Act and rules issued by the Swedish Financial Supervisory Authority (SFSA). This is usually called the external framework.

The internal framework includes, among other things, the Articles of Association, which have been adopted by the Annual General Meeting (AGM). Policies and guidelines that have been drawn up to define the division of responsibility within Telia Finance are important tools for the Board and the CEO in their governing and controlling roles. Of special importance are the Instructions for the CEO, the Risk Policy, the Credit Policy, Policy for managing conflict of interests, Telia Code of Conduct, the Policy for AML/CTF and the Policy for Remuneration.

Telia Finance organization

Telia Finance activities are divided into seven overall material business units. These business units are ultimately led by a Head whom are part of the Management Team and report to the CEO, with the exception of Head of Legal who is included in the Management Team but reports to Head of Credit & Operations. The CEO reports in turn to the Board.

There are also three independent control functions: Risk Control, Compliance and Internal Audit. Risk Control and Compliance are both directly subordinated to the CEO and also report directly to the Board. Internal Audit, which reports directly to the Board, has been outsourced to an external party.

General meeting and legal structure

Telia Finance AB is wholly owned subsidiary to Telia Company AB (publ.). Telia Company has as owner issued Owner´s directive to Telia Finance in order to clarify the owner´s intentions and goals for Telia Finance. Telia Finance has three separate branches in Finland, Norway, and Denmark.

The AGM is Telia Finance's highest decision-making body, at which shareholder exercise its voting rights.

The Board is the highest decision-making body in Telia Finance structure for management and control. The Board is responsible for the company’s organization and for the management of the company's operations.

The Board members are elected by the shareholder at the AGM for a one-year term of office extending through the next AGM. The external framework does not require Telia Finance to have a nomination committee. The Board has not adopted a recruitment policy, and in practice Board members are proposed and appointed by the parent company.

The Board has adopted Charter for Telia Finance AB´s Board of Directors and its committees that regulate the Board’s role and ways of working. The Board has overall responsibility for the activities carried out within Telia Finance and has the following duties, among others:

• Deciding on the nature, direction and strategy of the business as well as the framework and objectives of the activities,
• regularly following up and evaluating the operations in relation to the objectives and guidelines established by the Board,
• ensuring that the business is organized in such a way that the accounting, treasury management and financial conditions in all other respects are controlled in a satisfactory manner and that the risks inherent in the business are identified, defined, measured, monitored and controlled in accordance with external and internal framework, including the Articles of Association,
• deciding on major acquisitions and divestments as well as other major investments,
• selecting, monitoring and planning the succession of the Board members,
• appointment or dismissal of the CEO Head of Risk Control and Head of Compliance
• deciding which external party will perform the Internal Audit, and
• deciding on remuneration to the CEO, members of the Group Management Team as well as to the heads of the control functions Risk Control and Compliance.

The Chairman

The Chairman of the Board organizes and leads the work of the Board. According to the Charter for Telia Finance AB´s Board of Directors and its committees, the Chairman is to follow Telia Finance' development through contact with the CEO, ensure that the CEO provides the Board with sufficient information to be able to assess Telia Finance' current position, financial plans and future development and to discuss strategic issues with the CEO.

Telia Finance’ CEO participates in all Board meetings except on matters in which the CEO has an interest that may be in conflict with the interests of Telia Finance, such as when the CEO’s work is evaluated. Other members of the Management Team participate whenever required for purposes of informing the Board or upon request by the Board or the CEO.

Suitability assessment

In order to ensure that the Board, the Board members and the CEO meet the requirements for sufficient knowledge, insight, experience and suitability, Telia Finance has established a policy for suitability assessment and diversity. The suitability is assessed according to criteria for the person's experience and reputation. An assessment is made as soon as possible and no later than four weeks after the election of the Board member, appointment and on extended assignments. The ability of each of the Board members to dedicate the commitment, diligence and time required is also evaluated. The CEO, together with the Head of Compliance, is responsible for the assessment. When a new Board member or a new CEO assumes their duties, they are also assessed by the SFSA.

The CEO’s performance and knowledge, insight, experience and suitability are evaluated in the corresponding way. The CEO is charged with the day-to-day management of Telia Finance and Telia Finance´s affairs in accordance with applicable laws, rules and regulations, instructions provided by the Board including Instructions for the Chief Executive Officer of Telia Finance AB and group instructions. The Board appoints and dismisses the CEO of Telia Finance.

Independence

Telia Finance complies with applicable rules regarding the independence of the Board. Telia Finance considers all of the members elected by the shareholders to be independent of the company and its executive management. None of the Board members elected by the shareholders is employed by or works in an operative capacity at the company.

Diversity

The Suitability and Diversity Policy also serves to promote diversity of the Board. According to the policy all board assignments in Telia Finance are based on merit with the prime consideration being to maintain and enhance the Board’s overall effectiveness. Within this, a broad set of qualities and competences is sought for and it is recognized that diversity, including age, gender, geographical provenance and educational and professional background, is a factor to take into consideration. The ambition is to ensure diversity and that the Board members complement each other to cover expertise that is vital for Telia Finance. It is Telia Finance’ assessment that these objectives and targets have been achieved.

Number of assignments

The Board members have many years of professional experience from different but relevant areas for Telia Finance. Thus, the Board of Directors has solid knowledge and experience in areas such as banking and finance, telecom, IT and technology companies, capital supply, risk control, accounting, international sales operations, small and medium-sized business operations, leadership, etc. The Board also meets the need for knowledge and insight into the conditions of the various geographic markets in which Telia Finance operates. A more detailed presentation of the members' backgrounds and other assignments can be found here.

Training

The Board annually adopts a Board training plan and has assigned to Compliance to plan and carry through the training activities. These shall consist of an introductory program for new Board members; on-going training of individual members and the Board as a whole in matters that have been considered important by the Board itself; and the Board is also provided access to all e-learnings launched by the Telia Group.

Chief Executive Officer

Telia Finance’ Chief Executive Officer (CEO) is responsible for the day-to-day management of the company's activities in accordance with the external and internal frameworks. The CEO reports to the Board and submits at each board meeting a report on the performance of the business in relation to decisions made by the Board, among other things. The Board has adopted an instruction for the CEO’s work and duties which also regulates the division of responsibilities and the interaction between the CEO and the Board.

The CEO appoints the heads of departments and the heads of the control functions. The Chief Risk Officer and the Head of Compliance appointments and replacements are also approved and decided on by the Board. The CEO of Telia Finance is Sanna Augustsson.

Management Team

The CEO works together with the seven heads of departments and the heads of the control functions in Telia Finance Management Team. The Management Team discusses matters of common concern to several departments and teams, strategic issues, business plans, financial forecasts and reports.

The Management Team usually meets weekly or when the CEO convenes a meeting.

The management Team

CEO Sanna Augustsson
Head of Compliance Liselott Hinder
Chief Risk Officer Sofie Grape
Head of B2C Financial Services & Strategy Management Wilhelm Windrup
Head of B2B Financial Services Fredrik Christofferson
Head of IT & Security Erik Björk
Head of Communication & Culture Therese Ekevid
Chief Financial Officer Sofie Rosman
Head of Credit & Operations Malin Skans
Head of Legal Daniel Spritzell*

*The role is included in the Management team, but the role and unit is included in Credit & Operations.

Management committees

The CEO has, besides the Management Team, four separate committees at his disposal for the purpose of managing the operations:

Executive Credit Committee (ECC), which is responsible for taking credit decisions within its mandate set by the Board.

Credit Committee (CC), which is responsible for taking credit decisions and other complex business decisions regarding credits or customers within its mandate set by the Board and to discuss and if needed take actions based on the quarterly reports received according to the Credit Instruction.

New Product/Process Approval Committee, which is responsible for assessment of new or significantly amended products, activities, processes, markets or systems.

Third-party Committee, which is responsible for providing guidance and taking decisions on whether an arrangement is considered to be outsourcing and validate a classification made of ICT services.

Risk is defined as the possibility of a negative deviation from an expected financial outcome. Telia Finance is through its business activities subject to a number of different risks, the main ones being credit risk, market risk, liquidity risk and operational risk. Other risks include concentration risk, business risk, strategic risk, reputational risk, remuneration risk and pension risk.

Telia Finance has a risk appetite framework in place, set by the Board, and supported by limits for specific risk areas.

The purpose of risk management is to safeguard Telia Finance’ long term survival, manage volatility in financial performance, and increase value for the owners by ensuring efficient capital management.

Risk management

The external framework requires good internal control, identification and management of risks and requirements for internal control functions. The Board has ultimate responsibility for Telia Finance’ risk organization and for ensuring satisfactory internal control. The Board and the CEO adopts policies and guidelines for controlling all perceived risks and these are supplemented by detailed routines and guidelines within the organization.

The CEO has overall responsibility for managing all of Telia Finance’s risks in accordance with the Board's policies and guidelines. The CEO shall ensure that Telia Finance’ organization and administration are appropriate and that the company's operations are in compliance with the external and internal framework. In particular, the CEO shall ensure that the Board has all necessary information to make risk related decisions.

Like at all financial institutions, the basis for the risk management and internal control framework in Telia Finance is the three lines of defense model. This is laid down in Telia Finance’ Risk Policy.

The first line of defense refers to all risk management activities carried out by line management and staff. All managers are fully responsible for the risks, and the management of these, within their respective area of responsibility. Hence, they are responsible for ensuring that the appropriate organization, procedures and support systems are implemented to ensure a sufficient system of internal controls.

The second line of defense refers to Telia Finance’ independent Risk Control and Compliance Functions, which report directly to the CEO and the Board. To ensure independence, these functions are not involved in business operations. These functions set the framework and principles for the work on risk management and compliance and carry out independent follow-up. The second line of defense should also promote a sound culture of risk management and compliance by supporting and training managers and employees in different areas of the business.

Third line of defense refers to the Internal Audit Function which performs independent periodic reviews of the governance structure and the system of internal controls.

Risk reporting

In the Risk Policy the Board has established how and when it shall receive information about Telia Finance’ risks and risk management. The periodic recurring risk reporting in Telia Finance is designed to provide reliable, current, complete and timely information to the recipients, reflecting the nature of different risk types as well as market developments. The Board, the CEO and the Management Team, as well as other functions that require such information, receive regular reports on the status of risks and risk management.

Telia Finance’ Risk Control Function shall provide a risk report quarterly, which among other things include a comprehensive and objective presentation of the major risks Telia Finance faces as well as a follow-up of risk appetite and the level of risk management in order to enable the Board to ensure that Telia Finance' risk management and control is satisfactory.

The Compliance Function shall also provide a report quarterly to the Board which among other things includes Telia Finance’ compliance risks. Any breach of the appetite limits requiring immediate escalation according to the Risk Policy shall be reported directly to the CEO and the Chairman of the Board. At Management Team meetings all risk related decisions, and other discussions having implication for the management and control on Board level shall be documented. Risk Control shall follow up any actions and report back to the Board.

Read more about Telia Finance’ capital adequacy and risk management

The Risk Control Function

The Risk Control Function is independent from the business. The Board has adopted a Policy for the Risk Control Function.

The Risk Control Function has the responsibility to monitor, control, analyze and report risks in Telia Finance’ business. This includes facilitating assessment of risks, performing testing of internal controls that have been implemented to reduce Telia Finance’ operational risk, and an evaluation of the appropriateness of the controls. Furthermore, the function is responsible for analyzing the different risk measures that are being used, and to propose changes to these if deemed necessary.

The Chief Risk Control (head of the Risk Control Function), who is appointed by the CEO after approval of the Board, reports on the risks on an ongoing basis to the CEO, Management Team and the Board.

The Compliance Function

The Compliance Function is independent from the business while it is a support function for the business. The Board has adopted a Policy for the Compliance Function.

The Compliance Function is responsible for supporting the business and management in compliance matters and for assisting in identifying, for following-up and reporting on compliance risks, which refers to the risk of Telia Finance not complying with external and internal rules. Furthermore, the Compliance Function is responsible for promoting a sound compliance culture across the business by helping to ensure quality, integrity and ethical practices within the business.

The Head of Compliance, who is appointed by the CEO after approval of the Board, reports on an ongoing basis to the CEO, Management Team and the Board regarding compliance risks and compliance matters.

The Internal Audit Function

Telia Finance’s Internal Audit Function is an independent function, directly reporting to the Board. The Board has adopted a Policy for the Internal Audit Function.

The main responsibility of Internal Audit is to provide reliable and objective assurance to the Board and the CEO regarding the effectiveness of controls, risk management and governance processes, with the aim of mitigating current and evolving risks and in so doing improve the control culture within Telia Finance.

The Board has decided to outsource Telia Finance’ Internal Audit Function to Telia Company and its Internal Audit group. The Risk Control Function is internal coordinator for the internal audit activities.

The Internal Audit Function reports regularly to the Board the results of its audits, including identified risks and suggestions for improvements. Internal Audit also informs the CEO, the Management Team and the relevant departments on internal audit matters. The Board annually establishes a plan for the internal audit work.

External Audit

According to the Articles of Association, Telia Finance shall have one authorized auditor with no deputies. An authorized accounting firm may also be appointed auditor. The auditor is elected by the General Meeting for a term of one year according to Swedish law.

At the AGM 2024, KPMG AB was the re-elected auditor for a period up to the end of the AGM 2025. Anders Tagde is the auditor-in-charge.

Telia Finance has remuneration policies, instructions and processes, securing sound remuneration structures throughout the organization.

Telia Finance’s remuneration structure

Telia Finance has a remuneration structure that recognizes the importance of well-balanced but differentiated remuneration structures, based on business and local market needs, as well as the importance of being consistent with and promoting sound and efficient risk management not encouraging excessive risk-taking and short-term profits or counteracting Telia Finance’ long-term interests.

The aim with the remuneration structure is to both support the ability to attract and retain talents in every position as well as support equal and fair treatment, but also to ensure that remuneration in Telia Finance is aligned with efficient risk management and compliant with existing regulations.

Telia Finance’ Board has confirmed this in the adopted Policy for Remuneration, which is revised when it is necessary, at least annually.

Statement of remuneration in Telia Finance in accordance with the SFSA's regulatory framework

Here you can find Telia Finance’ annual statements according to the SFSA's regulatory framework (only available in Swedish).

Remuneration to the Board of Directors, the CEO and the Management Team

The AGM decides on the Board member’s fees in accordance with Swedish law. It is Telia Finance’ Board that prepares proposals for the AGM regarding these remunerations. At present, no fees are paid to the Board members.

Telia Finance Board decides on remuneration to the CEO, other members of the Management Team and the Heads of Risk Control and Compliance, following proposals from the specifically appointed Board member.