METSÄ BOARD Annual review 2024
Development of remuneration in 2020–2024 No changes were made to the remuneration paid to Board members in 2020–2021. In 2022, the Annual General Meeting decided to increase the annual remuneration paid to Board members. The annual remuneration paid to the Chair and to the Deputy Chair of the Board of Directors is EUR 99,000 and EUR 85,000, respectively. The annual remuneration paid to other members of the Board of Directors is EUR 67,000. Around half the annual remuneration is paid in cash, and the rest in shares. The 2022 Annual General Meeting also decided to keep meeting fees at EUR 800 and pay a separate monthly remuneration of EUR 900 to the Chair of the Audit
Remuneration Report
Committee. The 2024 Annual General Meeting decided to keep annual and monthly remuneration unchanged and raise meeting fees from EUR 800 to EUR 1,000. The meeting fee is paid in cash, and as of the 2024 Annual General Meeting, only once if several meetings are held during the same day. The CEO’s base salary has been increased by around 10% over a five-year period. The development of gross earnings has been influenced particularly by the company’s success and thus by the number of the company’s B series shares earned in the long-term incentive system. The development of employees’ average earnings has been moderate.
Business operations and value creation 2 This is Metsä Board 4 CEO’s review 6
Introduction
Metsä Board’s remuneration aims to fairly support profitable growth and the increase of shareholder value in line with the company’s values and interests. The key objective is to enable the achievement of the company’s vision, as well as its strategic and operational targets. We aim to motivate excellent performance both in the short-term and long-term. Remuneration in Metsä Board is based on the following principles: • Ensuring sustainable and responsible business operations Our remuneration supports the achievement of the company’s vision, strategic and operational targets, and sustainability targets. We encourage activities in line with the company’s values and 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, for profitable growth and the increase of share- holder 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 the personnel’s competence and offer opportunities for career development. Our leadership is of a high
In the 2024 financial period, the remuneration of Board members com- prised the annual remuneration approved by the Annual General Meeting and the meeting fees paid based on participation. In the 2024 financial period, the CEO’s remuneration consisted of a fixed base salary, fringe benefits and short- and long-term performance-based incentives, as well as the contributions to the supplementary defined benefit pension arrangement. Clawback terms are in place for exceptional situations in both short-term and long-term incentive system. No incentives were recovered in the 2024 financial period. Short-term and long-term incentive systems Metsä Board has a short-term incentive system with a review period of one calendar year. The company also has a long-term share-based incentive system with a performance period of three years and a restriction period of approximately two years. The targets of the long-term incentive system, tied to the return on capital employed, operating result, and equity ratio, affect the long-term development of shareholder value. The Board of Direc- tors has steered the company’s operations in the short- and long-term with the support of the incentive systems. Metsä Board’s financial result has a direct impact on the remuneration of the CEO through both the short- and long-term incentive systems.
Strategy and financial targets
8
Value creation
Financial development 10 Key figures 12
Report of the Board of Directors
DEVELOPMENT OF THE BOARD OF DIRECTORS’ REMUNERATION, THE CEO’S REMUNERATION, AND THE AVERAGE EARNINGS OF EMPLOYEES (IN EUROS)
20 20 37 70 89 96
• Sustainability statement
General information
2024
2023
2022
2021
2020
E – Environment
Chair of the Board of Directors Ilkka Hämälä as of 27 March 2018
114,400
111,800
113,400
108,600
108,300
S – Social responsibility
G – Governance
Vice Chair of the Board of Directors Jussi Linnaranta as of 11 June 2020 Martti Asunta until 11 June 2020
101,400
97,800
99,400
93,600
94,700
Annexes to the Sustainability statement
98 Consolidated financial statements 102 Notes to the consolidated financial statements 150 Parent company financial statements 153 Notes to the parent company financial statements 166 The Board’s proposal to the Annual General Meeting for the distribution of funds 167 Auditor’s Report 171 Sustainability statement assurance report 173 Shares and shareholders 177 Ten years in figures 178 Taxes 179 Production capacities 181 Calculation of key ratios and comparable performance measures Corporate governance 183 Corporate governance statement 190 • Board of Directors of Metsä Board 194 • Corporate Management Team of Metsä Board
Other members of the Board of Directors (average)
82,229
80,200
82,329
75,986
75,900
CEO 1)
1,514,834
2,268,101
1,817,130
1,558,658
1,148,937
Mika Joukio as of 1 October 2014
Average earnings of employees 2)
53,183
52,221
59,564
56,941
50,695
Ratio of highest annual earnings to median earnings 3)
25
39
-
-
-
quality and we encourage the personnel’s participation. • Consistency, competitiveness and transparency
1) The figures shown in the table do not include paid supplementary pension insurance premiums. 2) The average earnings of employees have been calculated from the employee costs of Metsä Board Group in its entirety by deducting social security costs from the total and dividing the remainder by the average number of employees. 3) The annual total remuneration ratio of the highest paid individual to the median annual total remuneration for all employees (excluding the highest-paid individual). Comparison figure is not available for years 2020–2022.
The company’s financial development
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.
OPERATING RESULT, COMPARABLE
RETURN ON CAPITAL EMPLOYED, COMPARABLE %
EUR million
Compliance with the remuneration policy In the 2024 financial period, the remuneration of the Board members and the CEO was in line with the remuneration policy approved by the Annual General Meeting on 26 March 2024. No deviations were made from the remuneration policy.
600 500 400 300 200 100 0
24 20 16 12
8 4 0
20 21 22 23 24
20 21 22 23 24
196 Remuneration report 201 Investor relations and investor information
196
4 197
Remuneration report | METSÄ BOARD ANNUAL REVIEW 2024 REMUNERATION REPORT 2024 | METSÄ BOARD
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