Remuneration

Metsä Group’s remuneration principles

Metsä Group's remuneration is based on the following main principles which are applicable to all statutory governing bodies of Group companies as well as those employed by Metsä Group:

Ensuring sustainable and responsible business operations

Our remuneration supports the achievement of Metsä Group's vision, strategic and operational goals as well as the goals of sustainable development. We encourage activities in line with our values and Metsä Group's interests – responsible profitability, reliability, renewal and cooperation.

Ensuring performance and profitable growth

With remuneration, we encourage excellent performance and results in both the short and long term. We remunerate our people for achieving and exceeding targets and for profitable growth and the increase of shareholder and stakeholder value.

Supporting competence development and renewal

With remuneration we support competence development and the commitment of talent. We encourage continuous improvement, renewal and the creation of conditions needed for future success. In addition to monetary remuneration, we develop personnel's competencies and offer opportunities for career development. Our leadership is of a high quality and we encourage the personnel's participation.

Consistency, competitiveness and transparency

The remuneration is fair and based on clear principles and structures. We offer competitive overall remuneration. We communicate and report on remuneration transparently and according to requirements.

Remuneration

Decision-making process concerning remuneration

Decisions on the remuneration of the Supervisory Board of Metsä Group's parent company, Metsäliitto Cooperative, are made by the Representative Council. Decisions on the remuneration of the members of Metsäliitto Cooperative's Board of Directors are made by the Supervisory Board on the basis of a proposal made by the Supervisory Board's Nomination Committee.

Metsäliitto Cooperative has a CEO, who also acts as the President and CEO of Metsä Group, unless otherwise decided by the Board of Directors. The President and CEO manages the operations of the entire Metsä Group. The Board of Directors decides on the remuneration and other financial benefits of the Group's President and CEO and the members of the Group's Executive Management Team employed by Metsäliitto Cooperative, as well as on the principles of the short and long-term incentive systems on the basis of the HR Committee's preparation.

All Metsä Group companies comply with the same remuneration principles, and the remuneration criteria are approved by the Board of Directors of each subsidiary. The decision-making process guarantees that the decisions are made fairly and impartially.

Remuneration of the Supervisory Board

Pursuant to a decision of the Representative Council, the Chair and Deputy Chair of the Supervisory Board are paid fixed monthly remuneration and meeting fees. Other members of the Supervisory Board are paid meeting fees. Meeting fees are also paid for the meetings of the Supervisory Board's committees as well as for the meetings of Metsäliitto Cooperative's district councils. The members of the Supervisory Board are furthermore entitled to travel allowance pursuant to Metsä Group's travel instructions. The Chair and Deputy Chair of the Supervisory Board are voluntarily TyEL-insured (Finnish statutory pension system).

The monthly remuneration of the Supervisory Board's Chair is EUR 4,100 and Deputy Chair EUR 1,800. The meeting fee paid to the members of the Supervisory Board is EUR 800 (the meeting fee regarding the district councils' meetings is EUR 400).

Remuneration of the Board of Directors

Pursuant to the Supervisory Board's decision, each member of the Board of Directors is paid fixed monthly remuneration and meeting fees. Meeting fees are also paid for the meetings of the Board of Directors' committees. The members of the Board of Directors are voluntarily TyEL-insured (Finnish statutory pension system) and entitled to travel allowance pursuant to Metsä Group's travel instructions.

At a meeting held on 27 October 2021, the Supervisory Board decided to pay the following fees to the Chairman, Vice Chairman and members of the Board of Directors in 2022:

The monthly remuneration of the Board of Directors:

  • the Chair of the Board of Directors EUR 12,000
  • the Deputy Chair of the Board of Directors EUR 5,500
  • other members of the Board of Directors EUR 4,500
The meeting fee payable to the members of the Board of Directors is EUR 800.

In addition, the Chairs of the Board of Directors' Audit Committee and HR Committee are paid separate monthly remuneration. The monthly remuneration of the Chair of the Board of Directors' Audit Committee is EUR 1,300 and the Chair of the Board of Directors' HR Committee EUR 1,100.

The Chair of Metsäliitto Cooperative's Board of Directors Jussi Linnaranta and the Deputy Chair Timo Saukkonen are also members of Metsä Board Corporation's Board of Directors. The remuneration paid for board work in Metsä Board Corporation is available on company's webpages www.metsaboard.com.

Remuneration of the President and CEO

The Board of Directors appoints and discharges the President and CEO and decides on the President and CEO's remuneration and the other terms and conditions of the President and CEO's engagement. By decision of the Board of Directors, the President and CEO is paid a fixed base salary, which is a compensation for the President and CEO's responsibilities and is based on the requirements of the position, the President and CEO's individual's competence and performance as well as prevailing market practice. The monthly salary of the President and CEO Ilkka Hämälä is EUR 68,563 (January 2022). The monthly salary includes a company housing, car and phone benefit, extended health, travel and accident insurance coverage as well as other minor fringe benefits.

A short and long-term incentive can be paid to the President and CEO by decision of the Board of Directors. In 2022 the maximum level of remuneration available in the short-term incentive system is, accounting for Metsä Group's EBIT multiplier 93.75% of the fixed annual salary. The reward is based on Metsä Group's operating result (50% weighting) and the strategic goals defined by the Board of Directors, including sustainability targets (50% weighting) as well as the realisation of Metsä Group's EBIT multiplier. The potential reward shall be paid in March 2023.

The potential reward for the performance period 2020–2022 regarding the long-term performance plan 2020-2024 is based on the development of Metsä Group's return on capital employed (ROCE, %) as determined by the Board of Directors. Minimum levels have also been set for earnings before interest and taxes as well as the equity ratio. The Board of Directors is entitled to reduce the rewards fully or partly if defined earnings or equity ratio criteria are not met, or if the reward should exceed the maximum reward limit defined for the President and CEO. In addition to the outcome of the performance criteria the basis for the reward is a synthetic share value of which is determined based on Metsä Group's total value. On maximum level the reward potential of the President and CEO is 250% of the President and CEO’s annual base salary (the reward limit is 325% of the President and CEO’s annual base salary). The potential reward shall be paid in cash after the restriction period (in March 2025 at the latest) and it shall include taxes and other possible expenses. Should the President and CEO’s service terminate during the performance or restriction period, the President and CEO shall principally lose the right to reward.

The terms and conditions of the President and CEO Ilkka Hämälä's service contract are defined in writing in the President and CEO's contract, the terms of which have been confirmed by the Board of Directors. The period of notice pursuant to the contract is 12 months. If the service contract is terminated by the company, Hämälä is entitled to severance pay corresponding to 12 month salary. No severance compensation is paid if the contract is terminated by Hämälä himself.

Hämälä falls within the scope of the Employees Pensions Act. It provides pension security based on the period of service and earned income as provided in the Act. Hämälä's retirement age is in accordance with the Employees Pensions Act. Hämälä is also entitled to the supplementary defined benefit pension insurance that covers Metsä Group's management. According to the supplementary pension insurance the President and CEO's maximum level of pension is 60% of the total salary under the Employees Pensions Act, calculated on the basis of the five-year period preceding retirement. In case the President and CEO's service with Metsä Group terminates before his retirement age, the President and CEO is entitled to a free policy.

Remuneration of the President and CEO in 2022

In 2021 the maximum level of remuneration available in the short-term incentive system was, accounting for Metsä Group's EBIT multiplier 93.75% of the fixed annual salary. The reward was based on Metsä Group's operating result (50% weighting) and the strategic goals defined by the Board of Directors (50% weighting) as well as the realisation of Metsä Group's EBIT multiplier. The short-term incentive of EUR 723,305 based on performance in 2021 was paid to the President and CEO in March 2022.

The reward for the performance period 2019–2021 regarding the performance share plan 2017-2021 was based on the development of Metsä Group's return on capital employed (ROCE, %) as determined by the Board of Directors. Minimum levels had also been set for the operating result and equity ratio. The realisation of the performance period 2019-2021 was 49,0% based on which the President and CEO received 68,600 Metsä Board Corporation's series B shares in March 2022. The long-term incentive paid to the President and CEO regarding the performance period 2019-2021 was EUR 1,246,855 in total. The amount of the reward was limited. The President and CEO's reward (including both shares and cash) can be 250% of the annual base salary at the maximum. The reward payment is followed by a restriction period of approximately two years, during which the President and CEO may not transfer or dispose of the shares. 

Remuneration of the President and CEO in 2021

The base salary, including fringe benefits, paid to the President and CEO in 2021 was EUR 860,671 in total and the remuneration paid by other Group companies was EUR 132,160.

In  2020 the maximum level of remuneration available in the short-term incentive system was, accounting for Metsä Group's EBIT multiplier 93.75% of the fixed annual salary. The reward was based on Metsä Group's operating result (50% weighting) and the strategic goals defined by the Board of Directors (50% weighting) as well as the realisation of Metsä Group's EBIT multiplier. The short-term incentive of EUR 208,627 based on performance in 2020 was paid to the President and CEO in March 2021.

The reward for the performance period 2018–2020 regarding the performance share plan 2017-2021 was based on the development of Metsä Group's return on capital employed (ROCE, %) as determined by the Board of Directors. Minimum levels had also been set for the operating result and equity ratio. The realisation of the performance period 2018-2020 was 54,0% based on which the President and CEO received 75,600 Metsä Board Corporation’s series B shares in March 2021. The long-term incentive paid to the President and CEO regarding the performance period 2018-2020 was EUR 1,493,780 in total. The amount of the reward was limited. The President and CEO's reward (including both shares and cash) can be 250% of the annual base salary at the maximum. The reward payment is followed by a restriction period of approximately two years, during which the President and CEO may not transfer or dispose of the shares.

The President and CEO is covered by a supplementary defined-benefit pension insurance. In 2021, the contribution to the supplementary defined-benefit pension insurance was EUR 2,683,020.

Remuneration of other Metsä Group's Executive Management Team members

The Board of Directors decides on the remuneration and other financial benefits of the other Group's Executive Management Team members employed by Metsäliitto Cooperative on the basis of the HR Committee's preparation.

A fixed base salary is paid to the other Group's Executive Management Team members. Base salary is a compensation for the executive's responsibilities and is based on the requirements of the position, the executive's individual competence and performance as well as prevailing market practice. Base salary includes car and mobile phone benefits and an extended health, travel and accident insurance coverage.

A short and long-term incentive can be paid to the other Group's Executive Management Team members by decision of the Board of Directors. In 2022 the maximum level of remuneration available in the short-term incentive system is, accounting for Metsä Group's EBIT multiplier, 75% of the fixed annual salary. The reward is based on the operating result of the respective company (50% weighting) and the strategic goals defined by the Board of Directors, including sustainability targets (50% weighting) as well as the realisation of Metsä Group's EBIT multiplier. The potential reward shall be paid in March 2023.

The CEO of Metsä Board Corporation is a member of Metsä Board’s performance share plan 2020-2024. The potential reward for the performance period 2020-2022 shall be paid in March 2023. Further information on Metsä Board's performance share plan 2020-2024 is available on company's webpages www.metsaboard.com. The potential reward of other Group’s Executive Management Team members for the performance period 2020–2022 regarding the long-term performance plan 2020-2024 is based on the development of Metsä Group's return on capital employed (ROCE, %) as determined by the Board of Directors. Minimum levels have also been set for earnings before interest and taxes as well as the equity ratio. The Board of Directors is entitled to reduce the rewards fully or partly if defined earnings or equity ratio criteria are not met, or if the reward should exceed the maximum reward limit defined for the other Group’s Executive Management Team member individually. In addition to the outcome of the performance criteria, the basis for the reward is a synthetic share value of which is determined based on Metsä Group's total value. On maximum level the reward potential of the other Group’s Executive Management Team members is 140% or 210% of the executive’s annual base salary (the reward limit is 180% or 270% of the executive’s annual base salary). The potential reward shall be paid in cash after the restriction period (in March 2025 at the latest) and it shall include taxes and other possible expenses. Should the other Group’s Executive Management Team member’s service or employment terminate during the performance or restriction period, the executive shall principally lose the right to reward.

The period of notice applicable to other Group's Executive Management Team members is six months, and the members are entitled to severance pay equaling 6–12 month salary if their contract is terminated on grounds not related to the executive.

The other Group Executive Management Team members fall within the scope of the Employees Pensions Act. It provides pension security based on the period of service and earned income as provided in the Act. Depending on the date on which the employment contract began, some members of Metsä Group's Executive Management Team are entitled to the supplementary defined benefit pension insurance, with a retirement age of 62. According to the supplementary pension insurance the maximum level of pension is 60% of the total salary under the Employees Pensions Act, calculated on the basis of the five-year period preceding retirement. In case their employment relationship with Metsä Group terminates before the retirement age, a member of the Executive Management Team is entitled to a free policy.

Remuneration of other Metsä Group’s Executive Management Team members in 2022

In 2021 the maximum level of remuneration available in the short-term incentive system was, accounting for Metsä Group's EBIT multiplier, 75% of the fixed annual salary. The reward was based on the operating result of the respective company (50% weighting) and the strategic goals defined by the Board of Directors (50% weighting) as well as the realisation of Metsä Group's EBIT multiplier. The short-term incentive of EUR 1,122,595 based on performance in 2021 was paid to the other Group's Executive Management Team members in March 2022.

The reward of Metsä Board's CEO for the performance period 2019-2021 regarding the performance share plan 2017-2021 was based on the development of Metsä Board Group's (50%) and Metsä Group's (50%) return on capital employed (ROCE, %), as determined by the Board of Directors. Minimum levels had also been set for the operating result and equity ratio. The realisation of the performance period 2019-2021 was 70,0%. The reward of other Group's Executive Management Team members was based on the development of Metsä Group's return on capital employed (ROCE, %) as determined by the Board of Directors. Minimum levels had also been set for the operating result and equity ratio. The realisation of the performance period 2019-2021 was 49,0%. Based on the realizations of the performance period 2019-2021 other Group's Executive Management Team members received 137,433 Metsä Board Corporation's series B shares in March 2022. The long-term incentives paid to the other Group's Executive Management Team members regarding the performance period 2019-2021 were EUR 2,525,779 in total. The amount of reward was limited. The reward of other Group's Executive Management Team members (including both shares and cash) can be 200% of the executive's annual base salary at the maximum. The reward payment is followed by a restriction period of approximately two years, during which the other Group's Executive's Management Team members may not transfer or dispose of the shares.

In April 2022 a total of EUR 27,195 of deferred long-term incentives for the performance period 2015-2017 was paid to one member of other Group's Executive Management Team in accordance with the terms and conditions of the performance share plan.

Remuneration of other Metsä Group’s Executive Management Team members in 2021 (in euros)

  Base salary and 
fringe benefits
(a company car and
phone benefit, extended insurance coverage)
Short-term incentive (concerns performance in 2020) Long-term incentive
 (concerns the performance period
2018-2020)
Deferred
long-term incentive
Total
Other Metsä Group's Executive Management Team  2,254,601 434,776 2,668,919 495,693 5,853,990
2020 1,999,959 340,242 2,186,152 1,901,905 6,428,257

 

In  2020 the maximum level of remuneration available in the short-term incentive system was, accounting for Metsä Group's EBIT multiplier, 75% of the fixed annual salary. The reward was based on the operating result of the respective company (50% weighting) and the strategic goals defined by the Board of Directors (50% weighting) as well as the realisation of Metsä Group's EBIT multiplier. The short-term incentive of EUR 434,776 based on performance in 2020 was paid to the other Group's Executive Management Team members in March 2021.

The reward of Metsä Board's CEO for the performance period 2018-2020 regarding the performance share plan 2017-2021 was based on the development of Metsä Board Group's (50%) and Metsä Group's (50%) return on capital employed (ROCE, %), as determined by the Board of Directors. Minimum levels had also been set for the operating result and equity ratio. The realisation of the performance period 2018-2020 was 59,0%. The reward of other Group's Executive Management Team members was based on the development of Metsä Group's return on capital employed (ROCE, %) as determined by the Board of Directors. Minimum levels had also been set for the operating result and equity ratio. The realisation of the performance period 2018-2020 was 54,0%. Based on the realizations of the performance period 2018-2020 other Group's Executive Management Team members received 133,350 Metsä Board Corporation’s series B shares in March 2021. The long-term incentives paid to the other Group’s Executive Management Team members regarding the performance period 2018-2020 were EUR 2,668,919 in total. The amount of reward was limited. The reward of other Group's Executive Management Team members (including both shares and cash) can be 200% of the executive's annual base salary at the maximum. The reward payment is followed by a restriction period of approximately two years, during which the executives may not transfer or dispose of the shares.

In 2021 two members of other Group's Executive Management Team were paid a special reward for a project related to the divestment of a 30% share in the Husum pulp mill to Norra Skog. The paid special rewards were EUR 60,000 in total. Moreover, a total of EUR 495,693 of deferred long-term incentives for the performance period 2015-2017 were paid to two members of other Group's Executive Management Team in April 2021 in accordance with the terms and conditions of the performance share plan and the decision of the Board of Directors.

At the end of 2021, four members of the Group's Executive Management Team in addition to the President and CEO had a supplementary defined-benefit pension insurance. The contribution to the supplementary defined-benefit pension insurance in 2021 was EUR 955,598 (2020: EUR 1,034,308).

 

LONG-TERM REMUNERATION

Performance share plan 2017-2021

The Board of Directors of Metsäliitto Cooperative resolved in January 2017 to continue the performance share plan for Metsä Group's executives to the years 2017–2021. The purpose of the plan was to align the objectives of the owners and the executives in order to increase the Group's value, to commit the executives to perform the Group's mutual strategy, and to offer the executives a competitive reward plan based on share ownership. The performance share plan for 2017–2021 had three performance periods: the calendar years 2017–2019, 2018–2020 and 2019–2021. The Board of Directors determined the performance criteria for each performance period and the targets set for them as well as the executives who belong to the target group and the number of shares allocated to them at the beginning of each performance period. Reaching the targets set for a performance period determined the proportion of the share reward to be paid to the executives. The reward from each performance period was based on the development of Metsä Group's return on capital employed (ROCE, %) as specified by the Board of Directors. Minimum levels were further determined for the operating result and the equity ratio.*

The reward was paid in the spring first following the end of the performance period. The amount of the reward paid annually was limited. The President and CEO's maximum reward (including both shares and the cash portion) was 2.5 times the size of CEO´s annual salary and the maximum reward of the other members of Metsä Group's Executive Management Team was twice the size of their annual salary. Each performance period will be followed by a subsequent, approximately two-year restriction period during which the executive is not allowed to transfer or dispose of the shares received. If an executive terminates  his/her employment or service contract during the restriction period, the executive is obliged to return the share reward they have earned without compensation. If a Group company terminates the employment or service contract of an executive for a reason not related to the executive or if the employment or service contract of the executive ends pursuant to mutual agreement prior to the end of the restriction period, the executive is entitled to keep the shares subject to the transfer restriction and the said restriction expires.

The reward was paid partly in Metsä Board Corporation's series B shares and partly in cash. The cash proportion covered any taxes and tax related charges resulting from the reward to an executive. The plan covered Metsä Group's Executive Management Team members as well as other key employees of Metsä Group.

* Metsä Board’s key employees’ (incl. the CEO of Metsä Board) potential reward is based on Metsä Board Group’s (50%) and Metsä Group’s (50%) return on capital employed (ROCE, %), as determined by the Board of Directors. Minimum levels has also been set for the operating result and equity ratio.

Performance period* 2017-2019
Target group Metsä Group's Executive Management Team members as well as other key employees of Metsä Group, total 75 executives
Reward limit The President and CEO: 250% of the annual base salary at the maximum
Other Group Management Team members: 200% of the annual base salary at the maximum
Performance criteria ROCE 1)
Realisation of performance period, % Metsä Group's performance share plan 100.0
Metsä Board's performance share plan 75.1
Year of payment of reward 2020
Restriction period 2 years
Share price on date of transfer (in euros) 4,86
Number of shares delivered Total 1,126,419 shares of which the proportion of
The President and CEO 110,833 (incl. the proportion earned in previous position as the CEO of Metsä Fibre)
Other Group Executive Management Team members 211,325

*The information is based on the situation at the time of the reward payment

Performance period* 2018-2020
Target group Metsä Group's Executive Management Team members as well as other key employees of Metsä Group, total 75 executives
Reward limit The President and CEO: 250% of the annual base salary at the maximum
Other Group Management Team members: 200% of the annual base salary at the maximum
Performance criteria ROCE 1)
Realisation of performance period, % Metsä Group's performance share plan 54.0
Metsä Board's performance share plan 59.0
Year of payment of reward 2021
Restriction period 2 years
Share price on date of transfer (in euros) 9.43
Number of shares delivered Total 631,802 shares of which the proportion of
The President and CEO 75,600 (incl. the proportion earned in previous position as the CEO of Metsä Fibre)
Other Group Executive Management Team members 133,350

*The information is based on the situation at the time of the reward payment

Performance period* 2019-2021
Target group Metsä Group's Executive Management Team members as well as other key employees of Metsä Group, total 87 executives
Reward limit The President and CEO: 250% of the annual base salary at the maximum
Other Group Management Team members: 200% of the annual base salary at the maximum
Performance criteria ROCE 1)
Realisation of performance period, % Metsä Group's performance share plan 49.0
Metsä Board's performance share plan 70.0
Year of payment of reward 2022
Restriction period 2 years
Share price on date of transfer (in euros) 8.86
Number of shares delivered Total 674,590 shares of which the proportion of
The President and CEO 68,600 (incl. the proportion earned in previous position as the CEO of Metsä Fibre)
Other Group Executive Management Team members 137,433

*The information is based on the situation at the time of the reward payment

1) Metsä Group's performance share plan: The three-year average ROCE of Metsä Group. Minimum values have also been set for the equity ratio and operating result. Metsä Board's performance share plan:The three-year average ROCE of Metsä Board Group (50 %) and Metsä Group (50 %). Minimum values have also been set for equity ratio and operating result.

 

Performance plan 2020-2024

The Board of Directors of Metsäliitto Cooperative has resolved in October 2019 to continue the long-term performance plan for Metsä Group's executives to the years 2020–2024. The purpose of the plan is to align the objectives of the owners and the executives in order to increase the Group's value, to commit the executives to perform the Group's mutual strategy, and to offer the executives a competitive long-term reward plan. The Plan includes three (3) performance periods (2020–2022, 2021–2023 and 2022–2024), each performance period is followed by a two-year restriction period.

The Board of Directors determines the performance criteria for each performance period and the targets set for them as well as the executives who belong to the target group at the beginning of each performance period. Reaching the targets set for a performance period determines the proportion of the reward to be paid to the executives. The potential rewards for the performance periods 2020–2022, 2021-2023 and 2022-2024 are based on the development of Metsä Group's return on capital employed (ROCE, %) as determined by the Board of Directors. Minimum levels have also been set for earnings before interest and taxes as well as the equity ratio. The Board of Directors is entitled to reduce the rewards fully or partly if defined earnings or equity ratio criteria are not met, or if the reward should exceed the maximum reward limit defined for each executive individually. In addition to the outcome of the performance criteria the basis for the reward is a synthetic share value of which is determined based on Metsä Group's total value. On maximum level the reward potential of the President and CEO is 250% of his annual base salary and the reward potential of the other Metsä Group's Executive Management Team members is 140% or 210% of executive's annual base salary. In addition, the reward limit has been set and the reward of the President and CEO can be 325% of his annual base salary at the maximum and the reward of the other Metsä Group's Executive Management Team members 180% or 270% of their annual base salary at the maximum.

The potential reward shall be paid in cash after the restriction period and it shall include taxes and other possible expenses. Should an executive's employment end during the performance or restriction period, the executive shall principally lose the right to reward.

The plan covers Metsä Group's Executive Management Team members as well as other key employees of Metsä Group, excl. Metsä Board Corporation which has an own long-term performance plan. Further information on Metsä Board's performance share plan 2020-2024 is available on company's webpages www.metsaboard.com.

Performance period 2020-2022
Target group Metsä Group's Executive Management Team members 1) as well as other key employees of Metsä Group,
total 66 executives (December 2021)
Reward limit The President and CEO: 325% of the annual base salary at the maximum
Other Group Management Team members: 180% or 270% of the annual base salary at the maximum
Performance criteria ROCE 2)
Number of synthetic shares allocated (gross) Up to 1,106,166 synthetic shares (December 2021)
Restriction period 2 years
Year of payment of reward 2025 (the reward is paid in cash after the restriction period)

 

Performance period 2021-2023
Target group Metsä Group's Executive Management Team members 1) as well as other key employees of Metsä Group,
total 69 executives (December 2021)
Reward limit The President and CEO: 325% of the annual base salary at the maximum
Other Group Management Team members: 180% or 270% of the annual base salary at the maximum
Performance criteria ROCE 2)
Number of synthetic shares allocated (gross) Up to 1,106,993 synthetic shares (December 2021)
Restriction period 2 years
Year of payment of reward 2026 (the reward is paid in cash after the restriction period)

 

Performance period 2022-2024
Target group Metsä Group's Executive Management Team members 1)  as well as other key employees of Metsä Group, total 70 executives (January 2022)
Reward limit The President and CEO: 325% of the annual base salary at the maximum
Other Group Management Team members: 180% or 270% of the annual base salary at the maximum
Performance criteria ROCE 2)
Number of synthetic shares allocated (gross) Up to 1,067,375 synthetic shares (January 2022)
Restriction period 2 years
Year of payment of reward 2027 (the reward is paid in cash after the restriction period)

 

1) Excl. the CEO of Metsä Board who is a member of Metsä Board’s performance share plan.

2) The three-year average ROCE of Metsä Group. Minimum values have also been set for the equity ratio and operating result.

              

Restricted share plan 2017-2021

The Board of Directors of Metsäliitto Cooperative resolved in January 2017 to implement the restricted share plan directed to Metsä Group key employees. The purpose of the plan was to commit the key employees to perform Group's mutual strategy and to offer them a competitive reward plan based on share ownership as well as to align the objectives of the shareholders and key employees in order to increase the Group's value. The Plan offered to the key employees belonging to the target group the possibility to earn Metsä Board Corporation series B shares by meeting the set employment precondition. The Board determined the key employees who belonged to the target group and their rewards.

The plan included restriction periods, lasting for 12-36 months. The Board resolved on the commencement and duration of the restriction period separately for each key employee belonging to the target group. The reward was paid after the end of the restriction period and the reward consisted of a proportion paid in shares and a cash proportion. The proportion which was given in shares meant net reward after the cash proportion had been used for covering taxes arising from the reward to the key employee. The amount of the reward was limited. If the reward (including both shares and cash) exceeded the maximum reward limit set for the key employee, the exceeding part was not paid. The prerequisite for reward payment was that the key employee's employment or service was in force and continued until the end of the restriction period.

In 2020 three key employees (incl. one key employee of Metsä Board) received the reward on the basis of the restricted share plan (total 29,869 shares). In 2021 one key employee received the reward on the basis of the restricted share plan (total 6,000 shares).

 

Restricted share plan 2020-2024

The Board of Directors of Metsäliitto Cooperative has resolved in October 2019 to continue the restricted share plan directed to Metsä Group key employees*. The purpose of the plan is to commit the key employees to perform Group’s mutual strategy and to offer them a competitive reward plan based on share ownership as well as to align the objectives of the shareholders and key employees in order to increase the Group’s value. The Plan offers to the key employees belonging to the target group the possibility to earn a cash reward based on synthetic shares by meeting the set employment precondition. The Board shall determine the key employees who shall belong to the target group and their rewards.

The plan includes restriction periods, lasting for 12-36 months. The Board shall resolve on the commencement and duration of the restriction period separately for each key employee belonging to the target group. The potential reward shall be paid in cash after the end of the restriction period and it shall include taxes and other possible expenses. The amount of the reward is limited. If the reward would exceed the maximum reward limit set for the key employee, the exceeding part is not paid. The prerequisite for reward payment is that the key employee’s employment or service is in force and continues until the end of the restriction period.

There are no key employees nominated to the restricted share plan 2020-2024 yet.

 

* Metsä Board has own restricted share plan 2020-2024 directed to Metsä Board’s key employees. Further information on Metsä Board’s restricted share plan 2020-2024 is available on company’s webpages www.metsaboard.com.