Remuneration of the Executive Team
The Board’s Remuneration and HR Committee decides on the compensation and benefits of the other Executive Team members than President and CEO based on the President and CEO’s proposal and general principles approved by the Board.
The remuneration of the Executive Team members comprises a fixed base salary (including monthly salary and taxable benefits, such as a car and a mobile phone according to local market practice), short-term and long-term incentives and a supplementary pension plan.
Long-term incentive plan, Performance Share Plan
In December 2020, the Board of Directors of Valmet Oyj approved a long-term share-based incentive plan, the Performance Share Plan, for Valmet's Executive Team members. The plan includes a three-year performance period parallel to a one-year performance period. Valmet's Board of Directors decides on the predefined performance measures and targets in the beginning of each performance period.
The potentially earned share reward represents a gross reward from which the applicable payroll tax is withheld, and the remaining net balance is paid to the key employee in shares.
PERFORMANCE SHARE PLAN
|
Performance period |
2022 |
2022–2024 |
2023 |
2023–2025 |
|
Incentive based on |
Comparable EBITA as a percentage of net sales, and orders received growth (%) in the stable business (Services and Automation segments) |
ESG Index, targets linked to implementing Valmet’s Climate Program and Sustainability Agenda |
Comparable EBITA as a percentage of net sales, and orders received growth (%) in the stable business (Services and Automation segments) |
Development of a valuation multiple of Valmet’s share in comparison to peer group |
|
Reward payment |
In spring 2023 |
In spring 2025 |
In spring 2024 |
In spring 2026 |
|
Total gross number of shares (Executive Team excl. President and CEO) |
62,243 | 20,990 | 121,095 | 40,368 |
|
Restriction period |
Two years |
None |
Two years |
None |
|
Performance period |
2024 |
2024–2026 |
|
Incentive based on |
Comparable EBITA margin and orders received growth (%) of the stable business (Services and Automation segments) |
Development of a valuation multiple of Valmet’s share in comparison to peer group |
|
Reward payment |
Deferred payment in spring 2027 |
In spring 2027 |
|
Total number of shares |
176,002 | 58,672 |
|
Restriction period |
None |
None |
The Performance Share Plan includes a recommendation for the members of Valmet's Executive Team to own and hold an amount of Company shares equaling their gross annual base salary (100 percent ownership recommendation). Management shareholding can be found here.
OTHER REMUNERATION ELEMENTS
Notice period for the Executive Team members is six months for both parties. If the company terminates the agreement, there is an additional severance pay equaling six times the last total monthly salary.
Additional pension benefit in the form of a defined contribution pension plan equaling 15-20% of base salary depending on role.
REMUNERATION IN 2023
|
|
Fixed Annual Salary (incl. taxable benefits) |
2023 bonus payment |
Share-based incentive payment |
Supplementary pension |
Total compensation |
|
Executive Team, |
3,427,195 |
1,129,947 |
3,305,615 |
599,534 |
8,462,291 |