Remuneration of the Board of Directors
The Annual General Meeting decides annually on the fees to be paid to the members of the Board of Directors for one term of office at a time.
The Annual General Meeting approved the following fees to the members of the Board of Directors for 2009:
• To the ordinary members EUR 55,000/year
• To the deputy chairman EUR 82,500/year
• To the chairman EUR 110,000/year
In addition, each member will be paid EUR 400/meeting attended, the chairman’s meeting fee being double this amount. Roughly 40% of the annual fee is paid in Wärtsilä shares.
The six members of Wärtsilä’s Board of Directors, none of whom are employees of the company, were paid altogether 454,580 euros for the financial period that ended 31 December 2009. The Board’s members were not covered by the company’s stock option scheme or bonus scheme.
Fees paid to the Board of Directors in 2009 (thousands of euros)
| Board of Directors, 31 December 2009 |
2009 |
2008 |
| Antti Lagerroos, chairman |
125 |
121 |
| Matti Vuoria, deputy chairman |
89 |
88 |
| Maarit Aarni-Sirviö, member |
61 |
59 |
| Kaj-Gustaf Berg, member |
60 |
56 |
| Kari Kauniskangas, member |
59 |
56 |
| Bertel Langenskiöld, member |
60 |
57 |
| |
| Board of Directors, until 19 March 2008 |
| Göran J. Ehrnrooth, deputy chairman |
|
3 |
| Heikki Allonen, member |
|
2 |
| |
455
|
442 |
Fees paid in Wärtsilä shares in 2009
| Board of Directors |
No. of shares |
| Chairman Antti Lagerroos |
1 652 |
| Deputy Chairman Matti Vuoria |
1 239 |
| Maarit Aarni-Sirviö |
827 |
| Kaj-Gustaf Bergh |
827 |
| Kari Kauniskangas |
827 |
| Bertel Langenskiöld |
827 |
Remuneration of the President and CEO and the Board of Management
The remuneration paid to the President and CEO and other members of the Board of Management, and the principles underlying it, are determined by the Board of Directors. The remuneration paid to the President and CEO and the other members of the Board of Management consists of a monthly salary and a bonus. The Board of Directors determines the terms for the bonus payment. The bonus payments for the President and CEO and the Board of Management are paid according to the achievement of the company’s profitability targets for the financial year. The variable salary can be at the most one third of the maximum total salary. Additionally, the group has a long-term incentive scheme for senior management tied to the development of the company’s share.
Further information on the incentive scheme
Monthly updated information on shares held by the President and CEO and the other members of the Board of Management, can be found here.
The President and CEO is eligible to take retirement on reaching the age of sixty and his retirement pension is 60% of his statutory earnings. Remuneration paid to the President and CEO if dismissed by the company, corresponds to 24 month’s salary plus six months’ period of notice salary. The retirement age of some of the members of the Board of Management is sixty years. Regarding these members, additional pension schemes are based on the retirement scheme of the national social security system to which the person in question belongs. The retirement pension is 60% of statutory earnings.
Financial benefits of President and CEO Ole Johansson
- Salary 2009: EUR 649 thousand
- Bonuses 2009: EUR 177 thousand
- Shares and share related rights granted as remuneration: -
- Retirement age: 60
- Period of notice: 6 months
- Compensation paid if dismissed by the company: 24 months’ salary + 6 months’ period of notice salary.
Salaries and bonuses paid to the other Board of Management members can be found in the Notes to the financial statements (Note 29: Related party disclosures ).
Management incentive schemes
The Board of Directors determines the incentive schemes for the President and CEO and other members of the Board of Management, and the principles underlying them. The Board of Directors also decides on other possible long-term incentive schemes for senior management, unless they are by law determined by the Annual General Meeting. The Board of Management decides on bonus schemes for other directors and managers.
The Group operates a bonus scheme, which is implemented globally in all businesses. The bonus is based on the Group’s profitability and agreed personal targets. Approximately 1,700 directors and managers are covered by this bonus scheme.
The Board of Directors has decided on a long-term bonus scheme for senior management tied to the stock development of the company’s share. The bonus scheme applies to approximately 50 directors. More information on the bonus scheme can be found here.
The Group’s white- and blue-collar employees are covered by various bonus or profit-based incentive schemes. These are applied in each country according to that country’s legislation, or to agreements concerning profit-sharing schemes. All in all, some 60% of the company’s employees are covered by the Group’s bonus scheme and various other profit-based incentive schemes.
