Starting from the 2020 financial period, the remuneration principles for Taaleri’s bodies, i.e. the Board of Directors and the CEO and Deputy CEO, are defined in the Remuneration Policy, which will be addressed for the first time in the Annual General Meeting 2020.
In accordance with the Corporate Governance Code, Taaleri composes a remuneration report for each financial period that will be presented annually to the Annual General Meeting; the report presents the paid and outstanding remuneration to the governing bodies for the previous financial period. The remuneration report will be compiled for the first time for the 2020 financial period, and it will be addressed at the Annual General Meeting 2021.
Taaleri’s remuneration statements which have been prepared in accordance with the remuneration reporting section of the Finnish Corporate Governance Code issued in 2015 and in force until 31 December 2019 as well as the CRR-450 document, can be downloaded under the links below. The Remuneration statements include information on the remuneration paid to members of the Board of Directors, CEO and other members of the Executive Management Team.
The remuneration of members of the Board of Directors
The General Meeting 2020 decided that the members of the Board of Directors be paid annual remuneration as follows:
- Chairman of the Board EUR 50,000 per year
- Deputy Chairman of the Board EUR 36,000 per year
- Chairman of the Audit Committee EUR 36,000 per year
- Member of the Board EUR 30,000 per year
The General Meeting decided that the members of the Audit Committee will be paid a meeting-specific fee of EUR 1,000 to the Chairman of the Audit Committee and EUR 500 to each other member of the Audit Committee.
The annual remuneration will cover the entire term of office and Committee work.
'The Annual General Meeting decided additionally that travel, and accommodation expenses of the members are paid against invoices when the meeting of the Board of Directors and the Committees takes place outside members’ domicile
Forms of remuneration
Taaleri’s remuneration scheme is based on the General Principles of Remuneration Schemes confirmed by the Board of Directors of Taaleri Plc. The remuneration scheme is separately confirmed for each calendar year by Taaleri Plc’s Board of Directors. If, during the financial period, fundamental changes occur within Taaleri Group or its operating environment, the Board of Directors of Taaleri Plc may revise the remuneration scheme, even in the middle of the year. Taaleri has a Remuneration Committee, comprising members of Taaleri Plc’s Board of Directors, which assists the Board in remuneration-related decision making.
The aim of Taaleri Group’s remuneration schemes is to encourage and reward personnel for work that is in line with Taaleri’s valid strategy and for observing set rules, and to motivate them to make efforts for the success of Taaleri Group.
The fixed component of remuneration is set based on professional experience, job description and responsibility. The fixed component of remuneration must always be so big that non-payment of the variable component of remuneration is not unreasonable. A competitive fixed component of remuneration also ensures the required high level of expertise of personnel.
The variable component of remuneration is based on the remuneration models specified in the bonus scheme descriptions. The variable component of remuneration is based on an overall assessment of the performance of the recipient of the remuneration and relevant business unit or company and on the overall result and result development of Taaleri Group and individual companies, taking into account financial and other factors and the personal performance of the recipient of the remuneration.
The overall assessment of the variable component of remuneration takes into account how the performance or result have been achieved in the long-term, as well as the risks known about at the time of assessment, capital expenditure and necessary solvency. The variable component of remuneration must not create a conflict of interest between the recipient of the remuneration and the customers of Taaleri Group. The variable component of remuneration takes into account qualitative criteria in addition to quantitative ones.
The variable components of remuneration, including any delayed share, are paid, or the right to them only arises, if they are sustainable taking into account the overall financial status of Taaleri Group and the business unit or company making the payment, and if they are justified based on the performance of Taaleri Group, the business unit or company making the payment and the employee in question. The criteria for reducing any remuneration based on risk or the conditions of reclaiming any remuneration are applied as specified in the bonus scheme.
Taaleri may decide not to pay any variable component of remuneration, in part or in full, or may decide to delay their payment, if payment might jeopardise the solvency of Taaleri Group or the business unit or company making the payment, or if it might lead to a detrimental or unreasonable end result from the perspective of Taaleri Group or the business unit or company making the payment. Taaleri may also decide not to pay variable components of remuneration, in part or in full, or decide to reclaim variable components of remuneration already paid, if the actions of the recipient of the remuneration give grounds for it.
Named persons are defined in the bonus scheme. If the total amount of the variable component of remuneration of a named person exceeds €50,000 in one calendar year, at least 40% of the total amount of the variable component of remuneration will be delayed for payment in equal instalments over the next three years. If the total amount of the variable component of remuneration earned by a named person exceeds €50,000 in one calendar year, it is paid half in cash and half in Taaleri Plc shares or, if regulation so permits, in other financial instruments linked to Taaleri Plc shares, in arrangements based on a contract or in other arrangements.
The variable component of remuneration paid to a recipient may not exceed 100% of the total amount of the recipient’s fixed component of remuneration, unless decided otherwise at the Annual General Meeting. The General Meeting has decided to raise the total amount of variable remuneration to 200%.
The variable component of remuneration of persons working in supervisory functions is not dependent on the result of the business unit or company that he/she is supervising. The Board of Directors of Taaleri Plc monitors the remuneration of persons working in supervisory functions.
Taaleri Plc’s Board of Directors approves the remuneration paid to those working in control functions and to senior management, and processes the risk adaptation process estimate for the entire Group before the payment of variable remuneration. The Executive Management Team of Taaleri Plc approves for payment the variable components of remuneration of other recipients.
Taaleri’s Compliance function annually evaluates the conformity to regulations of the bonus schemes and whether they have been observed. The Compliance function reports its observations to the Audit Committee and the Board of Directors of Taaleri Plc. If necessary, internal auditing also evaluates the conformity to regulations of the bonus schemes.
Remuneration and incentive schemes for key personnel
Taaleri has three ongoing share-based incentive schemes, two of which are for the Group’s key personnel and the third is for the company’s CEO.
The first incentive scheme is synthetic option rights from the year 2015, the potential bonus of which will be paid in cash. On 31 December 2019, , for the option scheme of the year 2015 a total of 545,000 synthetic options were outstanding. The Board of Directors has the right to require Taaleri key personnel to purchase company shares to a maximum of 50 per cent of the received bonus amount.
The second incentive scheme is a share-based incentive scheme from 2017 and consists of three earning periods lasting three years each. The Board of Directors will decide on the earning criteria and the targets set for each earning criterion at the beginning of each earning period. The potential bonus in accordance with the incentive scheme is based on total shareholder return of Taaleri Plc’s shares. By the end of 2019, the bonuses paid will correspond with the value of no more than 550,000 Taaleri Plc shares, including the part paid in cash. The bonus will be paid partly in company’s shares and partly in cash.
The third incentive scheme is a share-based incentive scheme from 2019 for the company’s CEO Robin Lindahl. In the scheme, the CEO will acquire a minimum of 200,000 euros of company shares. The share-based incentive scheme is a one-off, five-year scheme, and the earning period is 1 June 2019—15 June 2024. The earning period includes three measuring periods, which commence at the beginning of the earning period and end on 15 September in years 2022, 2023 and 2024. Any remuneration awarded under the scheme will be based on Taaleri Plc’s total shareholder return. The remuneration paid will correspond to the value of no more than 249,000 Taaleri Plc shares, including the part paid in cash.
ENDED INCENTIVE SCHEMES
Taaleri Plc’s Board of Directors decided on 4 December 2013 on a share-based incentive scheme for the Group’s key personnel. Based on the incentive scheme, synthetic options were issued to the key personnel and the potential bonus in years 2017-2018 was paid partly in company’s shares and partly in cash. At the time of issue, the potential bonus paid in accordance with the incentive scheme corresponded with the value of the increase of value of the maximum of 200,000 Taaleri Plc’s B shares, including the part paid in cash. The dilution of the company’s shares caused by the incentive scheme was the maximum of 3.08%. The starting value of the shares was defined as EUR 13.00 which was decreased with the divided shares and capital return. The end value of the share was the average market price of the synthetic option weighted with the number of the closed trades in the First North marketplace during the time period preceding 20 trading days from the use date of the option right.