Remuneration of Group Management Team members consists of total salary, including fringe benefits such as car, phone and meal benefit, annual short-term bonus payment and long-term plans such as long-term incentive plan and pension benefits. In addition, the Board has decided of a fixed-term incentive plan for 2023 and 2024 related to the Group’s strategic transformation program.
Decision-making regarding remuneration
YIT Corporation’s Annual General Meeting decides on the fees for the Board of Directors. The Board of Directors decides on the salary and fees and other terms of employment of the CEO and other key Group employees, such as the members of the Group’s Management Team. In addition, the Board of Directors decides annually both short and long-term indicators for management remuneration and the target values for the indicators which are designed to support the achievement of the strategic goals. On the basis of the President and CEO’s proposal, the Board of Directors also decides on the amount of fees and whether the indicator-based goals have been reached.
The task of the Personnel Committee is to assist the Board in matters related to appointing and rewarding key personnel. The Personnel Committee prepares proposals for the development of the Group's corporate culture and HR policy, remuneration and incentive schemes, the rules for performance-based bonuses and the proposals for performance-based bonuses paid to the management. In addition, identifying talents, the development of key personnel and planning for management successors fall under the preparation responsibility of the Committee.
Summary of Group Management Team remuneration
| |
2023 |
2022 |
2021 |
2020 |
2019 |
| Remuneration (EUR) |
Group Management Team
(others than CEO) |
Group Management Team
(others than CEO) |
Group Management Team
(others than CEO) |
Group Management Team
(others than CEO) |
Group Management Team
(others than CEO) |
| Annual Salary (incl. holiday bonus pay) |
2 455 780
|
3 166 712
|
2 722 065
|
2 379 591
|
2 382 354
|
| Benefits |
76 373
|
66 437
|
114 858
|
103 542
|
208 649
|
| Final salary and severance payments |
110 196
|
0
|
555 490
|
255 831
|
0
|
| Annual Short-term Incentives |
583 371
|
281 731
|
0
|
473 189
|
552 033
|
| Long-term Incentives * |
23 591
|
683 892
|
161 109
|
579 258
|
296 095
|
| Supplementary pension |
332 194
|
500 983
|
444 259
|
472 256
|
443 568
|
| Total compensation |
3 505 132
|
4 699 755
|
3 997 781
|
4 263 667
|
3 882 699
|
*Rewards earned from YIT LTIP 2020-2024 program’s earning period 2020-2022 were paid 4 May 2023.
Group Managment Team Annual STIP metrics
| |
2023 |
2022 |
2021 |
2020 |
2019 |
| KPI |
Weight |
Weight |
Weight |
Weight |
Weight |
| Adjusted operating profit |
40% |
70% |
40% |
35% |
40% |
| Operative Cash Flow |
40% |
20% |
30% |
25% |
40% |
| Work Safety |
10% |
5% |
10% |
15% |
10% |
| Customer Satisfaction |
10% |
5% |
10% |
10% |
10% |
| Strategic objectives |
- |
- |
10% |
15% |
- |
| Group Adjusted Operating Profit as trigger |
|
|
|
|
|
| Total |
100% |
100% |
100% |
100% |
100% |
Pension, retirement age and termination compensation
Group Management Team`s pension scheme is defined contribution-based and the amount of the payment is 20 per cent of the fixed annual base salary. Group Management Team members are entitled to retire at the age of 63. The supplementary pension arrangements do not apply for interim members of the Group Management Team.
The period of notice for the members of the Group Management Team is 6–12 months. Some members of the Group Management Team also have the contractual right to be paid severance payments amounting to six months’ salary if the company terminates their contract.
Short-term remuneration
The basis of remuneration is a total salary, in addition to which most of the Group’s salaried employees are included in a short-term performance-based bonus scheme. The Board of Directors confirms the criteria for the payment of performance-based bonuses annually. The bonuses paid are determined on the basis of the realization of personal objectives, the Group’s financial result, and the attainment of profitability, growth and development related objectives. Performance and development discussions are an essential part of the management by key results system. In these discussions, employees and their superiors agree on the key objectives and their relative weighting and review the fulfilment of the previously agreed objectives. The achievement of key objectives is monitored regularly by the Group Management Team. The key principles and objectives for the result period influencing the personal performance-based bonuses are specified at the business division and unit level.
For Group Management Team members, other than President and CEO, the maximum annual performance-based bonus paid equals 50 per cent of their annual remuneration (salary and fringe benefits). The bonus payments made in 2023 were earned in 2022 and based on operating profit, cash flow or capital employed, work safety, and customer satisfaction related metrics.
