Using Excel or Word to maintain a share ledger is not consistent with good governance, given that errors systematically occur.
Problem Area 1: The Share Ledger Must Be Maintained
Many Excel or Word templates on the market do not meet the Swedish Companies Act’s (ABL) formal requirements regarding the contents of the share ledger.
The general level of knowledge about share ledger administration is usually so low that most people fail to maintain the ledger correctly using Excel or Word templates. Simply put, people often do not know how to correctly register changes.
Excel or Word are not process tools. There is a high risk that older information gets deleted and that individual share numbers are double-booked.
Excel or Word templates hinder an efficient and rational work process.
It is difficult for the board of directors and auditors to fulfill their review responsibilities.
It is difficult to delegate the task to an external party.
An ineffective practice and studies show that using Excel or Word templates leads to 9 out of 10 companies making systematic mistakes and violating the law.
Problem Area 2: The Share Ledger Must Be Preserved
A file with incorrect content means that the share ledger, according to ABL, is not considered properly preserved.
It is impossible to guarantee that only one version exists. Excel and Word files are easily duplicated (on computers, via email, etc.). Thus, it quickly becomes unclear which version constitutes the actual, legally valid share ledger.
There is a risk of the ledger disappearing in the event of a computer crash.
Problem Area 3: The Share Ledger Must Be Kept Available
A file with incorrect content means that the share ledger, according to ABL, is not considered properly available.
It is common for the only printout of an Excel or Word ledger to get lost.
Reminder: It is the board’s responsibility to ensure that the share ledger is maintained, preserved, and kept available. Failure to do so—whether intentionally or negligently—can result in fines or imprisonment for up to one year.
Additionally, board members can be held liable for damages if an individual shareholder or third party suffers financial harm.
These sanctions highlight the critical importance for shareholders to be properly registered in the share ledger.