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Main features of the Executive leadership team’s remuneration

The Board of Directors appoints the Managing Director (President and CEO) and confirms the terms of his employment and other compensation. The Board is also responsible for appointing the members of the Executive Board, approving their terms of employment and other compensation, and deciding on the principles for the Group’s compensation systems. The Compensation Committee is responsible for preparing matters related to these topics.

In addition to base salary, Fiskars offers its executives variable pay programs to further promote high performance. The company has established an Annual Bonus Plan and a Long-term Incentive Plan. In addition, Executive Board members based in Finland and the UK have a voluntary, contribution-based, pension insurance.

Incentive plan design

Both Fiskars Annual Bonus Plan and its Long-term Incentive Plan are designed to reward for achievements against pre-established goals. Incentive Plan participants are assigned a ”target level” that will  dictate the incentive payout as a percentage of base pay. Incentive targets represent an overall target opportunity and are not a guarantee that a payout will be made.

Annual Bonus Plan payments will be made on the basis of performance against “plan metrics”. The plan metrics may consist of a mix of financial metrics, operational metrics and other personal goals. The potential payout ranges from nothing to a maximum percentage of each participant’s annual salary. The maximum level for the President and CEO and the other members of the Executive Leadership Team is at maximum 1.5 times the target level with the exception of President, SBU Functional, in whose case the maximum is 2 times the target level.

Participants in the Long-term Incentive Plan are selected by the Board of Directors annually, and the Board also decides on the earning criteria annually based on financial targets in the plan. The long-term incentive targets for the period 2017 to 2019 are purely financial and are tied to the Company’s consolidated net sales and cumulative EBIT for that period at the end of 2019. For the CEO and COO, 50% of the targets are the same as for all executives, whereas 50% of the targets are based on cumulative total shareholder return including a cumulative EBIT threshold.

The vesting period for the Long-term Incentive Plan is three years. The bonus will be paid during the quarter following the vesting period. The bonuses for performance in 2017–2019 will be paid during the first quarter of 2020.

Principles of the President and CEO's incentive scheme in 2017

  Minimum Target Maximum
Annual bonus plan,
% of annual base salary
0 50–75% 75–102,5%
Long-term incentive plan,
% of annual base salary
0 80–125% 160–250%

Principles of the Executive Board's incentive scheme in 2017

  Minimum Target Maximum
Annual bonus plan,
% of annual base salary
0 30–75% 45–150%
Long-term incentive plan,
% of annual base salary
0 30–100% 60–200%

 

Updated February 20, 2018