Duties and responsibilities of the Remuneration Committee are related to the remuneration and succession planning of the President and CEO and senior executives reporting directly to the President and CEO, and to the evaluation, planning and preparation of the company’s incentive schemes and annually commencing plans. The committee’s work to perform these duties and responsibilities is described below.
The company’s management remuneration consists of base salary and benefits, short-term incentives and share-based long-term incentives under the company’s Performance Share Plan and Deferred Bonus Plan.
The Remuneration Committee follows the remuneration market trends at regular intervals and reviews the various components of the management remuneration annually. The review includes benchmarking the different remuneration components to market practices in corresponding positions in peer companies. Based on this review, the committee makes recommendations to the Board for the approval of salaries and benefits of the President and CEO and other senior executives.
Related to the company’s short- and long-term incentive plans, the committee reviews the plans annually and makes recommendations for the structure, measures and targets of the short-term incentive plan, and for the earning criteria and targets of the plans starting annually under the company’s long-term incentive plans. Each year, the committee also evaluates the achievement of the set targets and the overall performance of the President and CEO and other senior executives, and
makes recommendations to the Board for the approval of incentive pay-outs, if any.
In addition, the committee annually reviews the achievement of and compliance with the company’s share ownership recommendation set for the senior executives as well as succession plans for the President and CEO and other senior executives, and reports to the Board on such matters. The committee is also informed of the results of the employee engagement survey which is conducted every year in the autumn.
The Remuneration Committee's duties and responsibilities are defined in the committee charter and a summary of these is available in the Corporate Governance Statement.