Green Cargo's management

MANAGEMENT VIA SIX TARGET AREAS

The management of Green Cargo should take the company in the direction of the owner's business targets and the company's vision. During the 2009 financial year, the Board of Directors of Green Cargo AB consisted of seven members. The Board also includes two employee representatives and their deputies. The Board is composed of three women and six men. During the year, the Board convened eleven times, of which one of these meetings was attended by the company's auditors. Green Cargo's CEO is the Board's primary contact forum with the company and its employees. To operate and monitor the company in accordance with Green Cargo's vision and the conditions stipulated in the State's ownership policy, the strategic issues in 2009 were:

• Implementation of the savings program.
• Focus on cash flow and liquidity.
• Traffic safety.
• Quality.

CONTROL AND FOLLOW-UP VIA OUR "SCORECARD" GOVERNANCE TOOL

Green Cargo uses rolling three-year plans to manage its operations. These plans are prepared by Group executives and adopted by the Board. The business plans establish fixed strategies and goals for the Group as a whole and its parts three calendar years in advance. Concrete measures are set out in the plan to ensure that the set goals are achieved. The targets are social, environmental and financial and are followed up on all relevant levels of the organisation – from Board members to locomotive drivers – using Scorecard. This means that the Board, management and employees at each local worksite regularly receive relevant information about each of Scorecard's target areas.

Scorecard consists of six target areas, Safety, Employees, Society, Environment, Customers and Finance, all of which are linked to our vision and core value, i.e. sustainable development. Scorecard also helps us manage our operations so we meet the demands placed on us by our stakeholders. There are a number of guideline policies in each target area for the environment, occupational health and safety. Procedures and guidelines help employees in their day-to-day activities. The targets are primarily followed up on a monthly basis and, in some cases, even a weekly or daily basis. A few are followed up on an annual basis. Scorecard therefore serves as a critical tool for implementing continuous improvements while at the same time providing an opportunity to counteract negative trends before they can have a major impact. The presentation of the work carried out by Green Cargo and the results for the year is divided into the six target areas.

Target area reporting refers to the Parent Company, Green Cargo AB, with the exception of Finance, which is reported at the Group level. The events and activities reported in each section under the heading "Events in 2009" are not meant to serve as a comprehensive list of all events during the year, but rather a small sample of what has happened. Along the same lines, "Priorities for 2010" provides examples of future initiatives. Green Cargo has a joint certificate for ISO 9001: 2008 (quality), 14001:2004 (environment) and OHSAS18001:2007 (occupational health and safety). Definitions of the measurements included in each target area are available at www.greencargo.com.

• Our operations in 2009
• Our stakeholders
• Green Cargo's management
  • Scorecard
  • Safety
  • Employees
  • Society
  • Environment
  • Customers
  • Finance
• Risks and risk management
• Outlook and profit appropriation