Board of Directors
The General Meeting of Shareholders determines the emoluments payable to the members of the Board of Directors in advance, for one year at a time. In 2011, the following annual fees will be paid: Chairman EUR 46,250, Vice Chairman EUR 30,500 and each member EUR 25,750. The fees will be paid so that each member purchased company shares worth of the net amount of the fee (40%) in public trading on NASDAQ OMX Helsinki. In addition, the following meeting fees will be paid: Chairman EUR 1,000, Vice Chairman EUR 700 and members EUR 500 per meeting. The meeting fees will also be paid to the Chairman and to the members of the committees established by the Board as follows: Chairman EUR 700 and members EUR 500.
In 2010, the following annual fees were paid: Chairman EUR 46,250, Vice Chairman EUR 30,500 and each member EUR 25,750. In addition, the following meeting fees were paid: Chairman EUR 1,000, Vice Chairman EUR 700 and members EUR 500 per meeting. The meeting fees will also be paid to the Chairman and to the members of the committees established by the Board as follows: Chairman EUR 700 and members EUR 500.
The members of the Board are not included in the share option schemes and they do not have any pension contracts with the company.
President and CEO and other management
The Board of Directors determines the salary, bonuses and other benefits of the President and CEO and the direct subordinates of the President and CEO.
The President and CEO and the members of the Group Executive Board are included the share option scheme and in the share-based incentive programme directed to the key personnel of the company, which are approved by the General Meeting. The basis for the determination of the reward is decided annually by the Board of Directors. Rewards to be paid for the year 2011 will be based on the EVA result of Lassila & Tikanoja Group. The maximum share-based payment may equal 4–12 months’ salary depending on the responsibilities of the member of the Group Executive Board. The decision on the remuneration is done by the Board of Directors based on the statement drafted by the remuneration committee.
The company has also provided a compensation scheme, the criteria of which are determined annually in advance by the Board of Directors. The bonus is based on operating profit excluding non-recurring items and it may equal 3–6 months’ salary, at maximum, depending on the responsibilities of the member of the Group Executive Board. The decision on the remuneration is done by the Board of Directors based on the statement drafted by the remuneration committee.
Separate emoluments are not paid to the Group Executives for the memberships of Boards of Directors of the subsidiaries.
Group Executives are not covered by any supplementary pension scheme.
In 2010, the salaries paid to the President and CEO totalled EUR 763,000 including salaries and benefits EUR 338,000, bonuses EUR 164,000 and a share-based payment EUR 261,000. The salaries paid to the Group Executive Board totalled EUR 1,606,000 which includes salaries and benefits EUR 852,000, bonuses EUR 206,000 and share-based payments EUR 548,000. The figures include salaries for the period during which the persons in question held an executive position.
No share-based payments will be paid for the year 2010. Rewards for the year 2010 were be based on the EVA result of Lassila & Tikanoja group. In 2010, a total of 8,490 shares were granted to the President and CEO and a total of 17,829 shares to the Group Executive Board as a part of the rewards for the year 2009 of the share-based incentive programme. No options were granted in 2010.
A written service contract has been drawn up for the President and CEO. According to the contract, the period of notice is 12 months should the company terminate the contract, and 6 months should the President and CEO terminate the contract. In case the company terminates the contract the President and CEO's obligation to work ceases after 6 months but his salary will be paid until the end of the period of notice. The President and CEO may choose to retire at the age of sixty. The amount of pension is agreed in advance, and an index increase is made to the sum annually. The amount is less than the full amount of pension under the Employees’ Pensions Act. The pension is recognised as a defined benefit liability in the financial statements. In 2010, EUR 42,000 arising from this agreement was recognised in the income statement.