Starting from the 2020 financial period, the remuneration principles for Taaleri’s bodies, i.e. the Board of Directors and the CEO and Deputy CEO, have been defined in the Remuneration Policy, which was addressed for the first time in the Annual General Meeting 2020.
In accordance with the Corporate Governance Code, Taaleri composes a Remuneration Report for each financial period that will be presented annually to the Annual General Meeting; the report presents the paid and outstanding remuneration to the governing bodies for the previous financial period. The remuneration report was compiled for the first time for the 2020 financial period, and it was addressed at the Annual General Meeting 2021.
Taaleri’s remuneration statements, which have been prepared in accordance with the remuneration reporting section of the Finnish Corporate Governance Code issued in 2015 and in force until 31 December 2019, as well as the CRR 450 document for 2019, can be downloaded under the links below. The Remuneration statements include information on the remuneration paid to members of the Board of Directors, CEO and other members of the Executive Management Team.
The remuneration of members of the Board of Directors
The General Meeting 2021 decided that the members of the Board of Directors be paid annual remuneration as follows:
- Chairman of the Board EUR 55,000 per year
- Deputy Chairman of the Board EUR 41,000 per year
- Chairman of the Audit Committee EUR 41,000 per year
- Member of the Board EUR 35,000 per year
The General Meeting decided that the members of the Audit Committee will be paid a meeting-specific fee of EUR 1,000 to the Chairman of the Audit Committee and EUR 500 to each other member of the Audit Committee.
The annual remuneration will cover the entire term of office and Committee work.
'The Annual General Meeting decided additionally that travel, and accommodation expenses of the members are paid against invoices when the meeting of the Board of Directors and the Committees takes place outside members’ domicile
Forms of remuneration
Taaleri’s remuneration scheme is based on the General Principles of Remuneration Schemes confirmed by the Board of Directors of Taaleri Plc. The remuneration scheme is separately confirmed for each calendar year by Taaleri Plc’s Board of Directors. If, during the financial period, fundamental changes occur within Taaleri Group or its operating environment, the Board of Directors of Taaleri Plc may revise the remuneration scheme, even in the middle of the year. Taaleri has a Remuneration Committee, comprising members of Taaleri Plc’s Board of Directors, which assists the Board in remuneration-related decision making.
The aim of Taaleri Group’s remuneration schemes is to encourage and reward personnel for work that is in line with Taaleri’s valid strategy and for observing set rules, and to motivate them to make efforts for the success of Taaleri Group.
The fixed component of remuneration is set based on professional experience, job description and responsibility. The fixed component of remuneration must always be so big that non-payment of the variable component of remuneration is not unreasonable. A competitive fixed component of remuneration also ensures the required high level of expertise of personnel.
The variable component of remuneration is based on the remuneration models specified in the bonus scheme descriptions. The variable component of remuneration is based on an overall assessment of the performance of the recipient of the remuneration and relevant business unit or company and on the overall result and result development of Taaleri Group and individual companies, taking into account financial and other factors and the personal performance of the recipient of the remuneration.
The overall assessment of the variable component of remuneration takes into account how the performance or result have been achieved in the long-term, as well as the risks known about at the time of assessment, capital expenditure and necessary solvency. The variable component of remuneration must not create a conflict of interest between the recipient of the remuneration and the customers of Taaleri Group. The variable component of remuneration takes into account qualitative criteria in addition to quantitative ones.
The variable components of remuneration, including any delayed share, are paid, or the right to them only arises, if they are sustainable taking into account the overall financial status of Taaleri Group and the business unit or company making the payment, and if they are justified based on the performance of Taaleri Group, the business unit or company making the payment and the employee in question. The criteria for reducing any remuneration based on risk or the conditions of reclaiming any remuneration are applied as specified in the bonus scheme.
Taaleri may decide not to pay any variable component of remuneration, in part or in full, or may decide to delay their payment, if payment might jeopardise the solvency of Taaleri Group or the business unit or company making the payment, or if it might lead to a detrimental or unreasonable end result from the perspective of Taaleri Group or the business unit or company making the payment. Taaleri may also decide not to pay variable components of remuneration, in part or in full, or decide to reclaim variable components of remuneration already paid, if the actions of the recipient of the remuneration give grounds for it.
Named persons are defined in the bonus scheme. If the total amount of the variable component of remuneration of a named person exceeds €50,000 in one calendar year, at least 40% of the total amount of the variable component of remuneration will be delayed for payment in equal instalments over the next three years. If the total amount of the variable component of remuneration earned by a named person exceeds €50,000 in one calendar year, it is paid half in cash and half in Taaleri Plc shares or, if regulation so permits, in other financial instruments linked to Taaleri Plc shares, in arrangements based on a contract or in other arrangements.
The variable component of remuneration paid to a recipient may not exceed 100% of the total amount of the recipient’s fixed component of remuneration, unless decided otherwise at the Annual General Meeting. The General Meeting has decided to raise the total amount of variable remuneration to 200%.
The variable component of remuneration of persons working in supervisory functions is not dependent on the result of the business unit or company that he/she is supervising. The Board of Directors of Taaleri Plc monitors the remuneration of persons working in supervisory functions.
Taaleri Plc’s Board of Directors approves the remuneration paid to those working in control functions and to senior management, and processes the risk adaptation process estimate for the entire Group before the payment of variable remuneration. The Executive Management Team of Taaleri Plc approves for payment the variable components of remuneration of other recipients.
Taaleri’s Compliance function annually evaluates the conformity to regulations of the bonus schemes and whether they have been observed. The Compliance function reports its observations to the Audit Committee and the Board of Directors of Taaleri Plc. If necessary, internal auditing also evaluates the conformity to regulations of the bonus schemes.
Taaleri has three share-based incentive schemes for the Group’s key personnel.
The 2017 share-based incentive scheme for key personnel consists of three three-year earnings periods. At the beginning of each period, the Board of Directors has decided on the earnings criteria and has set the performance targets. The potential rewards from the scheme in every earnings period are based on the total return of Taaleri Plc’s share. The first earnings period expired on 31 October 2020 as worthless and the rewards paid for the second earnings period ended on 31 October 2021 corresponded to 102,790 Taaleri Plc shares, including the portion paid in cash. The rewards to be paid for the third earnings period 2019–2022 correspond to a maximum of 243,455 Taaleri Plc shares, including the portion to be paid in cash. The reward is paid partly in company shares and partly in cash. If the key employee's employment or managerial relationship ends before the reward is paid, the reward will generally not be paid. In connection with the sale of the wealth management operations, Taaleri Plc's Board of Directors decided to proportionate the shares earned through the incentive scheme to the persons belonging to the wealth management operations sold.
The 2021 share-based incentive scheme for key personnel consists of three three-year earnings periods. The Board of Directors decides on the scheme's earnings criteria and the targets to be set for each earnings period at the beginning of each earnings period. The reward of the scheme in the first earnings period 2021–2023 is based on the total return per share (TSR) of Taaleri Plc. Any reward earned for the earnings period 2021–2023 will be paid at the end of the earnings period in the spring of 2024, partly in company shares and partly in cash. If a participant's employment or managerial contract expires before the reward is paid, the rewards of the plan will generally not be paid. The gross rewards to be paid for the earning period 2021–2023 correspond to a maximum total value of 185,000 Taaleri Plc shares, including the portion to be paid in cash.
The Board of Directors of Taaleri Plc decided on 6 April 2022, to launch a new stock option plan directed to the CEO of the company. The company has a weighty financial reason for the issue of stock options, since the stock options are intended to form part of the incentive and commitment program for the CEO. The purpose of the stock options is to encourage the CEO to work on a long-term basis to increase the shareholder value. The purpose of the stock options is also to retain the CEO at the company.