Remuneration Information • Mar 13, 2024
Remuneration Information
Open in ViewerOpens in native device viewer
PONSSE PLC
The remuneration report sets out the remuneration of the Board of Directors and the President and CEO of Ponsse Plc ("Ponsse" or "the company") in 2023. The report has been prepared by the Board of Directors of Ponsse. The purpose of the report is to describe the implementation of the company's remuneration policy clearly and comprehensively. The remuneration policy was adopted by the Annual General Meeting with an advisory resolution in 2020.
This report is based on the requirements outlined in the EU Shareholder Rights Directive and the Corporate Governance Code 2020 issued by the Securities Market Association. The remuneration report is presented annually at the company's Annual General Meeting for an advisory vote. The company evaluates and develops its remuneration reporting annually based on feedback from shareholders, for example. The indicators of the President and CEO's short-term performance bonus programme and their weights have been further specified for the report for 2023.
The remuneration of Ponsse's governing bodies is based on the remuneration policy. The elements of remuneration defined in the remuneration policy aim to harmonise the goals of shareholders, Board members, the President and CEO and the personnel to increase the company's value and to implement the business strategy in the long term. The goal of the remuneration policy is to advance the company's long-term financial performance and to create sustainable shareholder value by recruiting, engaging, and motivating senior managers and employees to fulfil Ponsse's strategy.
The remuneration policy is based on the following key principles:
The purpose of remuneration is to encourage the achievement of the strategic goals confirmed by the Board of Directors both in the short term (short-term incentives) and in the long term (long-term incentives). Short-term incentives typically mean bonuses based on personal performance and the company's results or other criteria, or other one-off and non-recurring fees related to excellent performance. Group-level incentives that measure the company's short-term success have been in use since 2009. Long-term incentive schemes typically mean remuneration based on the company's shares (e.g. share-based incentives).
No deviation from the remuneration policy was made during the 2023 financial year, and there were no situations in which it would have been necessary to recover any fees or either postpone or not make any payments.
The table sets out the paid compensation for the last five years for the members of the Board of Directors, the President and CEO, and the average Ponsse employee, as well as the company's financial performance during the same period. The development is presented in accordance with the average trend of key figures.
| 2023 | 2022 | 2021 | 2020 | 2019 | |
|---|---|---|---|---|---|
| Board of Directors, taxable annual fee (EUR thousand) |
296 | 311 | 283 | 264 | 245 |
| Change from the previous year (%) | -4.8% | +9.9% | +7.2% | +7.8% | |
| President and CEO, taxable income (EUR thousand) |
772 | 628 | 517 | 802 | 702 |
| Change from the previous year (%) | +22.9% | +21.5% | -35.5% | +14.2% | |
| Personnel's average taxable | |||||
| income (EUR thousand)1 : |
|||||
| Parent company | 53 | 53 | 53 | 46 | 51 |
| Change from the previous year (%) | +0.0% | +0.0% | +15.2% | -9.8% | |
| Subsidiaries | 35 | 33 | 33 | 27 | 33 |
| Change from the previous year (%) | +6.1% | +0.0% | +22.2% | -18.2% | |
| Ponsse Group's financial development: |
|||||
| Net sales, MEUR2 | 821.8 | 755.1 | 608.3 | 561.4 | 667.4 |
| Change from the previous year (%) | +8.8% | +24.1% | +8.4% | -15.9% | |
| Operating result, % of net sales | 5.7 | 6.2 | 8.2 | 8.1 | 10.1 |
| Operating result, EUR million3 | 47.2 | 46.6 | 50.0 | 45.4 | 67.3 |
| Change from the previous year (%) | +1.3% | -6.8% | +10.1% | -32.5% |
1 Remuneration paid to the personnel is presented by indicating the total remuneration amount paid by the company.
2 Information about 2023–2020 covers continuing operations. Figures for 2019 have not been adjusted.
3 Information about 2023–2020 covers continuing operations. Figures for 2019 have not been adjusted.
The Annual General Meeting decides on the board remuneration. The shareholders of Ponsse, representing in total more than 50% of the company's shares and votes, made a proposal to the Annual General Meeting held on 12 April 2023 regarding the remuneration of the Board of Directors. The Annual General Meeting decided on 12 April 2023 that the annual remuneration of the Chair of the Board would be EUR 48,000, that of the Vice Chair of the Board EUR 45,000, and that of the other members of the Board EUR 38,000. Reasonable travel expenses of the members of the Board are compensated.
| Time | Annual remuneration | |||
|---|---|---|---|---|
| EUR | ||||
| Mammu Kaario, Vice Chair of the Board |
1 January to 31 December 2023 |
45,000.00 | ||
| Terhi Koipijärvi | 12 April to 31 December 2023 |
27,620.28 | ||
| Matti Kylävainio | 1 January to 31 December 2023 |
38,000.00 | ||
| Ilpo Marjamaa | 1 January to 31 December 2023 |
38,000.00 | ||
| Juha Vanhainen | 1 January to 31 December 2023 |
38,000.00 | ||
| Janne Vidgren | 1 January to 12 April 2023 |
11,868.85 | ||
| Jarmo Vidgren, Chair of the Board |
1 January to 31 December 2023 |
48,000.00 | ||
| Juha Vidgren | 1 January to 12 April 2023 |
11,868.85 | ||
| Jukka Tuomas Vidgren | 1 January to 31 December 2023 |
38,000.00 | ||
| Total | 296,357.98 |
In 2023, Jarmo Vidgren was paid EUR 61,980.84 for consulting tasks related to sales and marketing, and Juha Vidgren was paid EUR 6,922.60 for consulting tasks related to the management of HR and public affairs.
The remuneration policy provides a remuneration structure that aligns the remuneration for the President and CEO to promote long-term financial performance and to create sustainable shareholder value.
The President and CEO's remuneration consists of:
Juho Nummela has been the company's President and CEO since 1 June 2008. Under the contract signed between the company and the President and CEO, both parties may terminate the contract with a six-month notice period. If the company terminates the contract, the company pays a remuneration equalling 12 months' salary in addition to the salary and other benefits that have been determined for the period of notice. The contract ends without any period of notice when the President and CEO retires.
The President and CEO may retire at the age of 60, with the pension determined in accordance with the Employees Pensions Act.
| Salary EUR |
Fringe benefits EUR |
Short-term incentive schemes (performance bonuses) EUR |
Long-term incentive schemes EUR |
Supplementary pension |
Total remuneration paid EUR |
|
|---|---|---|---|---|---|---|
| President and CEO |
532,718.16 | 14,280.00 | 121,920.00 | 225,793.16 | 282,694.00 | 1,177,405.32 |
| Remuneration percentage |
46% | 1% | 10% | 19% | 24% | 100% |
In 2023, the President and CEO's fixed monthly salary was EUR 41,910.00 from 1 January to 31 March 2023, and EUR 43,377.00 from 1 April to 31 December 2023. Telephone, car, and bicycle benefits were included in the salary as fringe benefits, along with other one-off personnel benefits of negligible value.
The fixed annual salary paid to the President and CEO in 2023 accounted for 46% of total remuneration, while the short- and long-term performance bonuses constituted 29%. The supplementary pension benefit paid to the President and CEO accounted for approximately 24% of total remuneration. No other remuneration was paid to the President and CEO in 2023.
During the 2023 financial year, the President and CEO was paid a performance bonus for the achievement of the targets set for 2022 in accordance with the Board of Directors' assessment and decision. The targets set for the performance bonus were based on indicators related to the efficiency of the working capital (WoCa-%, with a weighted value of 30% and cash flow from operating activities (EUR), with a weighted value of 40%, in total a weighted value of 70%) and the company's profitability (EBIT-%, with a weighted value of 30%). The annual performance bonus cannot exceed 50% of the salary paid in the previous year.
In 2023, a total performance bonus of EUR 121,920.00 was paid based on the achievement of the targets of the 2022 performance bonus, representing 47.5% of the maximum amount of the performance bonus.
During the 2023 financial year, the President and CEO continued to be covered by the short-term incentive scheme, in which the targets set for the performance bonus were based on indicators related to the efficiency of working capital (WoCa-%, with a weighted value of 30% and cash flow from operating activities (EUR), with a weighted value of 30%, in total a weighted value of 60%), the company's profitability (EBIT-%, with a weighted value of 30%), and personnel satisfaction (eNPS, with a weighted value of 10%). The annual performance bonus cannot exceed 50% of the salary paid in the previous year.
The performance bonus to be paid based on the 2023 financial year is based on the Board of Directors' assessment and decision regarding the achievement of the targets set for 2023. The performance bonus is expected to be paid to the President and CEO in March 2024.
The company's Board of Directors has decided on a performance-based shareholding plan for the President and CEO for 2023–2027. The aim of the new plan is to align the objectives of the shareholders and the President and CEO to increase the company's long-term value, to retain the President and CEO at the company, and to offer them a competitive incentive scheme based on earning and accumulating shares in the company. The new plan replaced the President and CEO's performance-based shareholding plan for 2021–2025, based on which EUR 225.8 thousand was paid in 2023.
The President and CEO's shareholding scheme consists of five earning periods: the calendar years 2023, 2023–2024, 2023–2025, 2024–2026 and 2025–2027. The 2023 and 2023–2024 earning periods include a restriction period, starting from the payment of remuneration, and ending on 31 December 2025. The conditional remuneration will be paid by the end of May 2024, 2025, and 2026. Shares received as conditional remuneration may not be transferred during the restriction period ending on 31 December 2025, 31 December 2026, and 31 December 2027. The performance-based remuneration will be paid by the end of May following the end of each earning period. Shares received as remuneration for the 2023 and 2023–2024 earning periods may not be transferred during the restriction period; that is, before 31 December 2025.
The earning criteria for the earning periods beginning in 2023 are Ponsse Group's operating result, growth of net sales, and personnel satisfaction. The portion of the maximum reward to be paid to the President and CEO is determined based on the achievement of the targets set for the earning criteria in relation to the investment made by the President and CEO.
The remuneration to be paid for earning periods starting in 2023 is estimated to correspond to a total value of at most 75,000 Ponsse Plc shares, including the component paid in cash (gross remuneration).
Building tools?
Free accounts include 100 API calls/year for testing.
Have a question? We'll get back to you promptly.