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Demokratiskolan
The Corporations card from MethodKit for Society and Politics
Card 103 of 128 · MethodKit for Society & Politics
  • AreaEconomy & work
  • Centre of gravityCentral government
  • Points of influence3 on the journey
  • Decisive electionThe general election
Economy & work

Corporations

Big & multinational companies

A handful of large companies account for a large share of Sweden's exports, research and stock market value, and their decisions move jobs between countries. No Swedish level governs them alone: the central government sets taxes and company rules, the EU guards the market and the municipality (kommun) owns the land they want to build on. And through your pension you are yourself, often without knowing it, a part-owner.

Where does the power lie?1

  • Municipality · land, plans & establishments · approx 15 %
  • Region · infrastructure & skills · approx 5 %
  • State · taxes, company law & oversight · approx 45 %
  • EU · market, mergers & state aid · approx 35 %

The central government and the EU share the framing power, but the large companies' own power is considerable and moves across borders. The general election and the European Parliament election weigh heaviest.

How it works: the breakdown

The municipalityThe land & the hosting
The regionThe conditions
Central governmentThe rules & the taxes · centre of gravity
Who decides?
The municipal council (kommunfullmäktige), the building committee (byggnadsnämnd) and the business office.
The regional council (regionfullmäktige) and the regional development committee.
The Riksdag, the Government, the Swedish Tax Agency (Skatteverket), Bolagsverket (the Companies Registration Office) and Konkurrensverket (the Swedish Competition Authority).
What do they decide?
Detailed development plans (detaljplan) and land for offices, warehouses and factories. Municipalities compete for establishments.
Public transport, skills supply and regional planning that large employers require.
Corporate tax, the Companies Act, the examination of company acquisitions and oversight of the markets.
Where are decisions made?
In the council and committees. Detailed development plans go out for consultation (samråd).
In the regional council, often in dialogue with business.
In the Riksdag and at the agencies. Listed companies' reports are public.
Who pays?
The municipal tax, in the hope of workplaces and people moving in.
The regional tax.
The central government budget. The corporate tax and the employer contributions go the other way, in to the central government.
Fastest way in?
Municipal election Respond to consultations on establishments, submit a citizen's proposal (medborgarförslag).
Regional election The regional election steers the transport and the training around the large workplaces.
General election Respond to referrals (remiss) on company and tax rules.
EUThe EU examines the largest company acquisitions, guards state aid and places more and more requirements on the giants' market behaviour. Influence it in the European Parliament election.

Read the table by column to understand one level, or by row to compare the levels. The green level is the area's centre of gravity.

How it works: follow the decision

The case Two chains want to become one
  1. EU

    The giants' playing field is European

    The internal market lets large companies operate across the whole union, and mergers above certain thresholds are examined directly by the European Commission in Brussels.

  2. State

    The deal is reported to Konkurrensverket

    Two Swedish chains want to merge. The acquisition must be reported to Konkurrensverket (the Swedish Competition Authority), which investigates whether customers would lose out from reduced competition.

    Point of influence

    Konkurrensverket obtains views from customers, suppliers and competitors during the examination.

  3. State

    Conditions or a stop

    The agency can approve the deal, require that shops be sold off or, ultimately, have it stopped in court. The decision is justified publicly. It is the Patent and Market Court that, on Konkurrensverket's action, decides on a stop, and the companies concerned can appeal the decision.

    Point of influence

    The general election steers the Competition Act and the corporate taxes that frame the large companies.

  4. Municipality

    The shop locations are renegotiated

    The merger redraws the shop network. New locations require detailed development plans and building permits, and the municipality negotiates over land and transport.

    Point of influence

    Detailed development plans always go out for consultation (samråd). Neighbours and associations can give their views.

  5. Your everyday life

    The receipt and the pension

    You meet the new giant at the till, but also in the pension statement: funds and pension capital own large parts of the stock market's big companies and vote at their meetings. A piece of the giant is yours.

The journey looks the same in reverse: what has been built came the same way, through the same decisions. Whoever knows where the decisions are made also knows where they can be changed.

Questions to discuss

  1. Which large companies shape your everyday life the most, and how is it noticeable?

  2. What does it do to a town to be dependent on a single large employer?

  3. Your pension savings own parts of the stock market's giants. What responsibility comes with that ownership?

  4. The large companies operate globally but are taxed nationally. How should that fit together?

  5. When a large company and a municipality negotiate over an establishment, who holds the power?

Glossary

Fusion
When two companies merge into one, examined by competition authorities if the companies are large.
Koncern
A group of companies under the same owner, often with subsidiaries in several countries.
Bolagsstämma
The shareholders' meeting where the board is elected and major decisions are made. One share gives one vote.
Tröskelvärde
A turnover threshold that decides whether a company acquisition must be reported and where it is examined.
Bolagsskatt
State tax on companies' profits.

Go further

Footnotes

1) This is an estimate of how decision-making power over the issue is split between the municipality, the region, central government and the EU, based on how responsibility is divided in legislation. A teaching guide, not an exact measurement.