Honkarakenne’s salary and remuneration report 2019
Decision-making order concerning remuneration
Board of Directors
The General Meeting shall decide on the basis for remuneration for work in the Board and committees.
CEO
The Board shall decide on the CEO’s remuneration and any other compensation. CEO remuneration shall comply with the valid remuneration policy.
The Board or the remuneration committee, if appointed, shall prepare matters concerning CEO remuneration. The Board or the remuneration committee, if appointed, shall assess the appropriateness of remunerating the CEO to ensure that it complies with the company’s strategy, business requirements and shareholder interest. The assessment may include external consultation and research data on remuneration to ensure that the level of CEO remuneration is appropriate with comparable companies.
The CEO is not a member of the Board or remuneration committee, if one is appointed, and will not take part in the decision-making concerning his or her personal remuneration.
Executive Group
The Board shall decide on the Executive Group members’ remuneration and any other compensation.
Remuneration of the Board
The 2019 General Meeting decided that the Board members will be remunerated as follows:
Board members shall receive EUR 1,500 a month and the Chairman EUR 2,500 a month. If the Board forms committee among their members, committee members shall receive EUR 500 per committee meeting. Members’ travel and accommodation expenses are also compensated against receipt.
Remuneration of the Board in 2019:
| Ristola Arimo, puheenjohtaja | 30,000 |
| Kohtamäki Timo | 18,000 |
| Ruponen Helena | 18,000 |
| Saarelainen Kari | 18,000 |
| Saarimäki Kyösti | 18,000 |
| Yhteensä | 102,000 |
Remuneration of the CEO
The CEO’s remuneration consists of the following:
The CEO’s remuneration consists of a fixed monthly salary including fringe benefits, variable long- or short-term incentives schemes based on performance, and any other elements that may be included in the remuneration policy.
Long- and/or short-term incentive schemes form the performance-based part of the CEO’s remuneration.
Short-term, performance-based incentive schemes are part of the CEO’s annual remuneration system. Short-term, performance-based incentive schemes may include elements paid in cash and/or share-based elements, and supplementary pension cover.
Long-term, performance-based incentive schemes may be used to further commit the CEO, ensuring a strong connection between the CEO and the shareholders’ interests. Long-term, performance-based incentive schemes may include elements paid in cash and/or share-based elements.
The CEO’s remuneration consisted of the following in 2019:
- salary
- fringe benefits
- medical expenses insurance
- voluntary pension insurance, which may amount to one or two monthly salaries
- remuneration for short-term performance-based incentive scheme decided by the Board, that is, the 2019 bonus. The remuneration under the short-term performance-based incentive scheme consisted of both cash and share-based elements.
In 2019, the CEO’s incentive scheme based on short-term performance was in three tiers, and tied to the budgeted operating margin. The scheme’s first-tier bonus corresponded to a supplementary pension payment equivalent to one monthly salary, plus 5,000 of Honkarakenne Oyj’s Series B shares. The second-tier bonus consisted of the first-tier bonus, a cash bonus worth one monthly salary and 5,000 of Honkarakenne Oyj’s Series B shares. The scheme’s third-tier bonus corresponded to the second- and third-tier bonuses, a supplementary pension payment equivalent to one monthly salary, plus 5,000 of Honkarakenne Oyj’s Series B shares.
Pension, retirement age and severance pay
No specific agreement has been made regarding the retirement age of Honkarakenne’s CEO. The basic pension is based on a defined contribution plan, in addition to which the CEO, as all Executive Group members, shall have a defined contribution arrangement, the expenses of which are specified under the section describing benefits after termination of employment relationship.
Honkarakenne Oyj’s CEO’s period of notice is 6 months, in addition to which he or she will receive a compensation equivalent to 6 months’ salary if termination occurs on the company’s initiative.
Remuneration of the Executive Group
The Executive Group’s remuneration consisted of the following in 2019:
- salary
- fringe benefits
- medical expenses insurance
- voluntary pension insurance, which may amount to one or two monthly salaries
- remuneration for short-term performance-based incentive scheme decided by the Board, that is, the 2019 bonus. The remuneration under the short-term performance-based incentive scheme consisted of both cash and pension benefit elements.
In 2019, the Executive Group’s the incentive scheme based on short-term performance was in three tiers, and tied to the budgeted operating margin. The scheme’s first-tier bonus corresponded to a supplementary pension payment equivalent to one monthly salary. The second-tier bonus consisted of the first-tier bonus and a cash bonus worth one monthly salary. The scheme’s third-tier bonus corresponded to the second- and third-tier bonuses and a supplementary pension payment equivalent to one monthly salary.
CEO’s and Executive Group’s remuneration in 2019
CEO Marko Saarelainen
Other members of the Executive Group
Leena Aalto, Vice President-Finance, CFO
Jan Fröberg, Vice President, Production
Sanna Huovinen, Vice President, Marketing as of 1 December 2019
Jari Noppa, Vice President, BA Finland and Sweden
| CEO | Rest of the Executive Group |
|
|---|---|---|
| Salary | 232,860 | 297,709 |
| Fringe benefits | 240 | 855 |
| Cash bonus in 2019 | 18,500 | 23,300 |
| Share-based bonus 2019 | 23,500 | 0 |
| Voluntary pension costs | 37,000 | 46,600 |
| Total 2019 | 312,100 | 368,464 |
| Total 2018 | 250,204 | 309,105 |
