The series of US corporate scandals, disproportionately generous bonus systems for company executives, and a steep decline in the Swedish stock market have sparked off an intensive debate regarding corporate governance issues in Sweden. As in the US, many politicians and institutions have called for new, tougher governmental regulations, similar to the Sarbanes-Oxley Act and the regulations currently being drafted by the US Securities and Exchange Commission (SEC). However, understanding the future development of Swedish corporate governance requires not only an understanding of current regulations but also a familiarity with Swedish politics, the historical background to the Swedish business environment, and something that can be best described as ‘the Swedish way’.
Historically, the Swedish business environment, and the corporate governance regime in particular, have been influenced by four dominating players setting the agenda. On the one side, one can discern a unity between the Government – for which read the Social Democratic Party – and the traditionally strong labour unions. On the other side, a more ambiguous unity can be traced between a couple of large commercial banks and a few powerful Swedish families.
