Remuneration

The remuneration in Rapala VMC Corporation is based on the Group’s remuneration policy, available here. Policy has been adopted at the Rapala VMC’s General Meeting on 25 March 2020.

Group’s previous remuneration statement is available here.

BOARD REMUNERATION

In 2021, the annual fee to the Chairman of the Board was EUR 80 000 and the fee to other Board members was EUR 30 000. In addition, a reward of EUR 1 000 was paid of a Board or its Committee meeting. Members of the Board are reimbursed for travel expenses corresponding to the Group’s traveling compensation principles.

For 2022, shareholders together representing approximately 38.73 per cent of the shares and votes of the company propose that the annual remuneration to the members of the Board of Directors would be the same as in 2021.

More information concerning the actualized remuneration of the Board is available in the Group’s Remuneration Report.

REMUNERATION OF PRESIDENT AND CEO

Rapala VMC Corporation’s President and CEO’s remuneration consists of fixed base salary with fringe benefits, short-term incentive scheme and long-term incentive schemes.

Salary, pension and short-term incentive

President and CEO’s annual fixed base salary in 2021 was 295 520 euros. The value of the fringe benefits paid to him was 20 035 euros per year. In 2021, a maximum earning opportunity of 240 000 euros was set as short-term incentive for the CEO & President and criteria achievement did lead to a full earned reward payable in 2022. 

President and CEO is entitled to statutory pension benefits in accordance with the Employees Pension Act (“TyEL”). The company has committed to provide the President and CEO an additional pension benefit in form of a free-form group pension insurance or an additional annual payment. The maximum amount of the additional pension benefit is 25% of the President and CEO’s base salary of which the employer’s pension contribution is deducted.

President and CEO’s Managing Director’s Agreement will end by the time of the statutory retirement age. Both the company and the President and CEO have a notice period of six months. Upon dismissal by the company a severance payment equaling to one year's base salary is being paid in addition to the notice time’s salary.

Long-term incentives

Two new share-based long-term incentive plans were established in 2021 covering the President and CEO. Matching Share Plan 2021-2023 for the President and CEO consists of one matching period, covering the financial years of 2021–2023. President and CEO is given an opportunity to receive matching shares for his personal investment in Rapala VMC shares. The reward based on the plan will be paid after the end of the matching period. The reward will be paid partly in Rapala VMC shares and partly in cash. The reward to be paid correspond to the value of a maximum total of 28 800 Rapala VMC shares, including also the proportion to be paid in cash.

The key employees’ Performance Share Plan includes one three-year performance period, covering the financial years 2021–2023. The rewards to be paid on the basis of the plan correspond to the value of an approximate maximum total of 800 000 Rapala VMC shares including also the proportion to be paid in cash. The potential rewards from the performance period 2021–2023 will be paid partly in the Company’s shares and partly in cash in 2024.

The potential reward from the performance period will be based on the Rapala VMC’s financial performance criteria and the Company’s share price criterion which will be measured during 2023. The financial performance criteria for the performance period are the Rapala VMC group product sales, the Company’s comparable earnings before interest and taxes (comparable EBIT) and the Rapala VMC’s average working capital ratio in 2023.

Allocation of the potential rewards for the President and CEO correspond to the value of an approximate maximum total of 120 000 Rapala VMC shares also including the proportion to be paid in cash.

More information concerning the actualized remuneration of President and CEO is available in the Group’s Remuneration Report.

EXECUTIVE COMMITTEE REMUNERATION

The Remuneration Committee of the Board of Directors, appointed by the Board of Directors of Rapala VMC Corporation, prepares and presents the proposals of the Executive Committee’s salary and other benefits to the Board of Directors according to its charter. The Board of Directors makes the decisions on Executive Committee’s remuneration based on the proposals.  

Salaries

The Executive Committee members' base salaries and fringe benefits reflect the performance and individual job responsibilities, experience, skill and knowledge. 

Short-term incentives

The members of the Executive Committee participate in the Group’s senior management bonus scheme. The amount and payment of the bonus requires that the financial and strategic targets are achieved. If the targets are not achieved, payment of bonus is fully at the discretion of the Board of Directors. Bonuses awarded under the scheme are paid in two installments, the first when the audited results for the relevant financial year are known and the second after a predetermined vesting period, to encourage retention of senior management. Principally, the bonus can be no more than 100 percent of the annual salary.

Long-term incentives

The key employees’ Performance Share Plan established in 2021 includes one three-year performance period, covering the financial years 2021–2023. The rewards to be paid on the basis of the plan correspond to the value of an approximate maximum total of 800 000 Rapala VMC shares including also the proportion to be paid in cash. The potential rewards from the performance period 2021–2023 will be paid partly in the Company’s shares and partly in cash in 2024. 

The potential reward from the performance period will be based on the Rapala VMC’s financial performance criteria and the Company’s share price criterion which will be measured during 2023. The financial performance criteria for the performance period are the Rapala VMC group product sales, the Company’s comparable earnings before interest and taxes (comparable EBIT) and the Rapala VMC’s average working capital ratio in 2023. 

Allocation of the potential rewards for the Executive Committee (excluding the President & CEO) correspond to the value of an approximate maximum total of 455 000 Rapala VMC shares also including the proportion to be paid in cash. 

Performance Share Plan for Executive Committee, excluding the President & CEO

Performance period2021-2023
TypeShare
Performance criteriaTotal share return, the Group product sales, EBIT margin in 2023, the Group’s average working capital ratio in 2023
Performance share rights allocated455 000
Share value at the grant date euro / share7.12

Pensions

Pension and the retirement age of each Executive Committee member is determined by the pension legislation applicable to him/her. The Company has not arranged separate group pension insurance schemes or other additional pension benefits for Executive Committee members. Certain members of the Executive Committee have limited additional pension arrangements due to the local practices.

Remuneration paid for Executive Committee members on aggregate level

MEUR

2021

2020

2019

Salaries and fringe benefits

3.1

2.1

1.8

Expense of statutory/ voluntary pension plans

0.2

0.6

0.5

Short-term incentives

1.2

0.7

0.6

Long-term incentives

 1.7

 -

Performance share rights allocated

455 000

465 000

465 000