Remuneration to senior executives

The principles for remuneration and other employment conditions for senior executives are adopted every year by the Annual General Meeting. The Board’s proposal on principles is prepared by the Board’s Remuneration Committee.

Fixed and variable salary

The members of Group management receive both fixed and variable remuneration. The basic principle is that the variable remuneration may comprise a maximum of 30 per cent of fixed annual salary. The exception is the President whose variable salary portion may total a maximum of 55 per cent of fixed annual salary. The variable salary portion is normally divided between several targets, for example, the Group's earnings, earnings in the business unit for which the manager is responsible and individual/quantitative targets. The variable salary portion is based on an earnings period of one year. The targets for the President are established by the Board. The targets for the other senior executives are established by the President following recommendations by the Board's Remuneration Committee.

 

Incentive schemes

Performance Share Plans 2012-2015

At the 2012, 2013, 2014 and 2015 Annual General Meetings, resolutions were made regarding an incentive scheme in the form of Performance Share Plans. These Plans encompasses about 100 senior executives and managers as appointed by Nobia senior management. Participation in these plans required an investment in Nobia shares. Following a period of three years, participants are entitled to allotment, free of charge, of one matching share in Nobia and a maximum of four performance share rights in Nobia. The conditions are related to the employee's continued employment at the company and holding of the invested shares, and to the degree of fulfilment of an interval, as determined by the Board, for Nobia's accumulated earnings per share for the next two fiscal years. For the President, each saving share entitles the holder to four performance share rights. For other members of Group management, each saving share entitles the holder to three performance share rights.

 

Performance Share Plan 2016
The Annual General Meeting 2016 decided to introduce a new Performance Share Plan, comprising approximately 100 senior managers and employees with senior positions. In comparison with previous plans, participation in the Performance Share Plan 2016 entails among other things that the maximum variable salary portion is adjusted downwards. Participants are allotted share rights, which after three years gives the right to shares, provided that certain conditions have been fulfilled, including a financial performance target linked to accumulated earnings per share for Nobia during the 2016-2017 fiscal years.

 

Other benefits and employment terms

The President is entitled to pension benefits corresponding to 30 per cent of pensionable salary, meaning fixed annual salary. Other members of Group management are entitled to pensions according to established local practise. The age of retirement is 65. Members of Group management are offered other employment benefits. The periods of notice for the President and members of Group management are between six and 12 months.

 

A more detailed description of the remuneration guidelines and other employment benefits for the President and members of Group management as well as a table with remuneration levels is found in the Annual Report.