The Board is the highest decision-making body in Klarna’s 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 shareholders at the annual general meeting (AGM) for a one-year term of office extending through the next AGM. The external framework does not require Klarna to have a nomination committee. The Board has not adopted a recruitment policy, and in practice Board members are proposed and appointed by the shareholders holding a majority of the votes as well as the capital of the company. The Board has adopted Rules of Procedure that regulate the Board’s role and ways of working as well as special instructions for the Board’s committees. The Board has overall responsibility for the activities carried out within Klarna 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, the Chief Risk Officer, the Chief Compliance Officer and the Chief Information Security Officer
- deciding which external party will perform the Internal Audit, and
- deciding on remuneration to the CEO, members of the CXO-team as well as to the heads of the control functions Risk Control and Compliance.
The Board consists of the following members:
Michael Moritz, chairman of the Board
Sebastian Siemiatkowski, CEO and Board member
Roger W. Ferguson Jr.**
* The three new Board members were elected on 2020-12-23. In addition to this, Michael Moritz was appointed as chairman of the Board on the same date.
** Andrew Young resigned from the Board and Roger W. Ferguson Jr. was elected to the Board (pending SFSA approval) on 2021-05-20.
Michael Moritz, Chairman of the Board of Directors
Michael Moritz is a Partner at Sequoia Capital, where he works with investments in the services sector. Mr. Moritz founded Technologic Partners and previously held various positions at Time Warner before joining Sequoia Capital in 1986. During his time at Sequoia Capital, Mr. Moritz has invested in companies such as Google, Yahoo and PayPal and has served on the Boards of these companies.
Sebastian Siemiatkowski, CEO and Board Member
Sebastian Siemiatkowski holds a degree from the Stockholm School of Economics and has eight years’ experience in sales, including being former Head of Sales at Djuice Uppsala. However, the most noted of Sebastian’s accomplishments is that he, along with our two other founders, revolutionized Swedish e-commerce, and created the success story we know today as Klarna.
Mikael Walther, Board Member
Mikael Walther leads investment company Navos Capital. He has broad experience within investment banking and other financial companies and has previously worked for Cevian Capital and Goldman Sachs.
Andrew Young, Board Member
Andrew is a Principal at Permira, an international investment firm. He focuses on investment opportunities in the Technology sector, with a particular focus on Fintech. He has worked on a number of transactions including All3Media and Ancestry. Prior to joining Permira, Andrew worked for Pacific Equity Partners, an Australasian Private Equity firm, as an Investment Associate in Sydney and New York.
Lise Kaae, Board Member
Lise most recently comes from Svenska Handelsbanken AB where she was a member of the board from 2015-2020. She has also been a member of that Board’s committee for credit, auditing and risk at various times. In addition to this, Lise has been a member of the Danish Financial Supervisory Authority’s board (Finanstilsynet). Lise has strong competencies in accounting, auditing, financial and business controls, business analysis and financial and risk management.
Sarah Smith, Board Member
Sarah has over 20 years of experience in banking. She has worked for Goldman Sachs since 1996 and has served as chief compliance officer, controller and chief accounting officer.
Omid Kordestani, Board Member
Omid has strong experience in business management and development for IT and tech companies. He was Senior Vice President of Worldwide Sales and Business Development at Google from 1999-2009 and held a number of other positions within the company including Chief Business Officer and Senior Advisor for Google. He has also been a board member of Spotify and Vodafone as well as chairman of the board of Twitter Inc. where he has been a board member since June 2020.
Roger W. Ferguson Jr., Board member (pending SFSA approval)
Roger W. Ferguson Jr. is the Steven A. Tananbaum Distinguished Fellow for International Economics at the Council on Foreign Relations. Mr. Ferguson is the immediate past president and CEO of TIAA. Mr. Ferguson is the former Vice Chairman of the Board of Governors of the U.S. Federal Reserve System. He serves on the boards of Alphabet, Inc.; Corning, Inc.; General Mills, Inc.; and International Flavors & Fragrances, Inc.
The composition of the Board and its committees in 2020 as well as the number of meetings held and the attendance is shown further down on this page.
The Chairman of the Board organizes and leads the work of the Board. According to the Rules of Procedure, the Chairman shall, through contact with the CEO, follow Klarna’s development, ensure that the CEO provides the Board members with the information necessary to be able to assess Klarna’s current position, financial plans and future development, and deliberate with the CEO on strategic issues.
Klarna’s CEO is also a Board member and participates in all board meetings, except on matters in which the CEO has an interest that may be in conflict with the interests of Klarna, such as when the CEO’s work is evaluated. Other members of the CXO-team participate as required for purposes of informing the Board or at the request of the Board or CEO.
The reputation, experience and assignments of the Board and the CEO
The Board brings many years of professional experience from various sectors that are relevant to Klarna, for example banking and finance including venture capital, e-commerce, technologies, payments, capital procurement, risk control and compliance, accounting, international sales, entrepreneurship and leadership. The Board composition also meets the need for knowledge and insight regarding the conditions and prerequisites for business in the various geographic markets where Klarna operates. A detailed presentation of the Board members’ background and other assignments are found here.
In order to ensure that the Board, the Board members and the CEO meet the requirements for sufficient knowledge, insight, experience and suitability, Klarna 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 six 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 deputy CEO is responsible for the assessment. When a new Board member or CEO assumes their duties, they are also assessed by the SFSA.
The CEO’s performance and knowledge, insight, experience and suitability is evaluated in the corresponding way. According to the Rules of Procedure of the Board, the Board shall ensure that the CEO fulfills his duties. The Board appoints and dismisses the CEO of Klarna.
Klarna complies with applicable rules regarding the independence of the Board. Klarna considers all of the members elected by the shareholders to be independent of the company and its executive management apart from Sebastian Siemiatkowski who is the CEO. Apart from the CEO, no other Board member elected by the shareholders is employed by or works in an operational capacity at the company.
Two members, Sarah Smith and Omid Kordestani, are independent in relation to the company’s major shareholders.
Thus, the number of Board members who are independent in relation to the company and its executive management, and independent in relation to the company’s major shareholders, meets the minimum requirements.
The Suitability, Training and Diversity Policy also serves to promote diversity of the Board. According to the policy all board assignments in Klarna 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 Klarna’s ongoing success. It is Klarna’s assessment that these objectives and targets have been achieved.
Number of assignments
There are regulatory limitations on the number of directorships a Board member of a bank may hold. As Klarna is not a significant institution a general assessment of reasonableness of the numbers of positions held by the Board members and the CEO shall be made, taking into consideration the circumstances in the individual cases as well as the nature, scale and complexity of Klarna’s business activities. Klarna has concluded that all Board members assignments are compliant with the new rules. A detailed presentation of the members’ background and other assignments can be found above.
The Board annually adopts a Board training plan and has assigned to the Compliance Function 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 Klarna.
The overall responsibility of the Board cannot be delegated. The Board has established separate working committees to assist the Board in preparing matters, belonging to the competence of the Board. The duties of the Board Committees, as well as working procedures, are defined in an internal policy. Each committee regularly reports on its work to the Board. Committee members are appointed by the Board for a period of one year at a time. Klarna has two Board committees: the Remuneration Committee and the Audit, Compliance & Risk Committee.
The Remuneration Committee (Rem Co) is responsible for preparing and presenting proposals to the Board on Remuneration policy, approach and implementation. including remuneration of members of the CXO-team and employees who lead control functions.
The Rem Co shall make a competent and independent evaluation of the Remuneration Policy and Klarna’s remuneration system, together with the suitable control function(s) if necessary.
The Rem Co fulfils its responsibilities through correspondence between the committee members, with formal decisions not covered by its delegation authority being reported to and documented by the Board at the closest following Board meeting.
Omid Kordestani (chair)
Audit, Compliance & Risk Committee
The Audit, Compliance & Risk Committee (ACRC) is responsible for all risk and capital related issues as well as matters regarding internal audit and compliance.
ACRC has had eight meetings in 2020.
Sarah Smith (chair)
Meetings and attendance
The table shows the number of meetings held in 2020 by the Board of Directors and its committees as well as the attendance of the individual Board members:
|Year 2020||Board||Audit, Compliance & Risk Committee|
|Number of meetings||12||8|
|(of which per capsulam)||(0)||(0)|
* CEO and Board member
** Resigned from the Board 2020-12-23