Board of Directors
The Annual General Meeting determines the emoluments payable to the members of the Board of Directors in advance, for one year at a time.
In 2016, the following annual fees were decided to be paid: Chairman EUR 46,250, Vice Chairman EUR 30,500 and each member EUR 25,750. The fees are paid so that 40% of the annual fee is in Lassila & Tikanoja's shares held by the company or, if this is not feasible, shares acquired from the markets, and 60% in cash. Shares are to be issued to Board members and, where necessary, acquired directly from the markets on behalf of Board members within the next 14 trading days, free from restrictions on trading, from the Annual General Meeting. In addition, meeting fees are paid to the members of the Board of Directors as follows: EUR 1,000 to the Chairman, EUR 700 to the Vice Chairman and EUR 500 to each member for each meeting. Meeting fees are also paid to the Chairmen and members of committees established by the Board of Directors: EUR 700 to the Chairman of a committee and EUR 500 to each member for each meeting.
The members of the Board are not included in the company’s share-based incentive schemes and they do not have any pension contracts with the company.
In 2014, the Board of Directors met 14 times, the Audit Committee five times and the Remuneration Committee four times.
In 2016, the Chairman of the Board of Directors was Heikki Bergholm and the Vice Chairman Eero Hautaniemi. Eero Hautaniemi was the Chairman of the Audit Committee, with Sakari Lassila and Teemu Kangas-Kärki as members. Heikki Bergholm was the Chairman of the Personnel Committee, with Miikka Maijala and Laura Lares as members.
In 2014, the fees decided by the Annual General Meeting were paid to the Board of Directors.
President and CEO and other management
The Board of Directors determines the salaries, bonuses and other benefits of the President and CEO and the direct subordinates of the President and CEO. The Board has established a Remuneration Committee. The duties of the committee include among others handling and preparing questions related to management and personnel remuneration and drafting statements to the Board regarding them.
The remuneration of the President and CEO and the other members of the Group Executive Board consists of a fixed monthly salary and benefits, of a compensation scheme and of a share-based incentive programme.
The President and CEO and the other members of the Group Executive Board are included in the share-based incentive programmes directed to the key personnel of the company. The basis for the determination of the reward is decided annually by the Board of Directors. Rewards to be paid for the year 2016 will be based on the Group’s EVA result. 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 bonus 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 bonus is done by the Board of Directors based on the statement drafted by the Remuneration Committee.
Separate emoluments are not paid to the President and CEO and other members of the Group Executive Board for the memberships of Boards of Directors of the subsidiaries.
The President and CEO and other members of the Group Executive Board are not covered by any supplementary pension scheme.
Service contract of the President and CEO
A written service contract has been drawn up for the President and CEO. According to the contract, the period of notice is six months should the company terminate the contract, and six months should the President and CEO terminate the contract. In case the company terminates the contract the President and CEO will be paid compensation amounting to twelve (12) months’ salary. The company has taken out statutory pension and accident insurance for the President and CEO.