The Government should more clearly steer state-owned companies towards sustainable business
The Riksdag has decided that state-owned companies should be good examples of sustainable business. The Swedish National Audit Office (Swedish NAO) audit shows that the Government needs to clarify, strengthen and follow up its governance if these ambitions are to be achieved.
The State wholly or partly owns 46 limited companies with a total value of approximately SEK 640 billion (2019).
According to the Riksdag, the companies should set a good example in sustainable business and their operations should be characterised by openness. This involves, for example, promoting a good working environment, decent working conditions, respect for human rights and increased gender equality. In the environmental area, the Government imposes requirements for reduced climate and environmental impact.
The Swedish NAO has audited whether the Government’s governance of state-owned companies has led to the achievement of the ambitions for sustainable business and how they are put into practice.
The audit shows that the Government’s governance is focused on overall issues and processes rather than on concrete results and progress. The Swedish NAO considers that the Government needs to clearly identify which guidelines the companies should follow – and what this means in practice.
“The State is one of the largest company owners in Sweden, and it matters how it acts in this area,” says Auditor General Helena Lindberg.
The audit also shows that the information provided by the Government to the Riksdag on the sustainability work of state-owned companies does indeed contain many essential elements, but that it is difficult to get an overall picture of the companies’ social and environmental development.
“The follow-up of the companies that the Government reports to the Riksdag should be carried out more regularly and be based on better information from the companies,” says Dimitrios Ioannidis, project leader for the audit.
The shortcomings are partly due to the information that the companies provide to the State as owner, where the Swedish NAO believes that the Government may require more comprehensive reporting.
“Here, the State has the opportunity to be a forerunner by imposing higher requirements on state-owned companies so that the sustainability reporting is more comparable and similar to financial reporting,” says Dimitrios Ioannidis.
Recommendations in brief
The Swedish NAO’s recommendations to the Government include the following:
- conduct more systematic and frequent follow-up of state-owned companies’ sustainable business efforts
- clarify the guidelines that state-owned companies must comply with
- consider raising the requirements concerning the companies’ sustainability reporting
- improve the information to the Riksdag
See the report for the full recommendations.
Press contact: Olle Castelius, phone: +46 8-5171 40 04.
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