Remuneration

Preparation and approval

The remuneration policy, and possible material amendments thereto, will be prepared by the Remuneration Committee of the Board of Directors, or similar corporate body to which the preparation of remuneration has been assigned. The Board of Directors will handle, approve and present the remuneration policy and material amendments thereto to the General Meeting. The General Meeting makes a consultative decision as to whether it adopts the remuneration policy that has been presented to the General Meeting. The shareholders may not propose changes to the remuneration policy that has been presented to it. If the majority of the General Meeting does not decide to adopt the presented policy, a revised remuneration policy will be presented to the following Annual General Meeting at the latest.

In such a case, the decision on the remuneration of the Board of Directors and the President and CEO shall be based on the remuneration policy that has been presented earlier to the General Meeting, until the revised remuneration policy has been handled at the General Meeting.

Follow-up

The Remuneration Committee of the Board of Directors will observe the implementation of the remuneration policy annually, and when necessary, presents to the Board of Directors its proposals for actions in order to ensure proper fulfilment of the remuneration policy. The Board of Directors will present the remuneration policy to the General Meeting within, at least, intervals of four (4) years and always when material amendments have been made to the policy.

The Board of Directors will also annually present a remuneration report to the Annual General Meeting, thus allowing the shareholders to evaluate the fulfilment of the remuneration policy in the company. The General Meeting will decide on the approval of the remuneration report.
The decision of the General Meeting on the remuneration report is of consultative nature.

Implementation

The General Meeting of Rapala VMC Corporation will annually decide on the remuneration of the members of the Board of Directors based on the proposal of the Board of Directors or the Remuneration Committee of the Board or similar corporate body to which the preparation of remuneration has been assigned. The decision on the remuneration of the Board of Directors will be based on the remuneration policy that has been presented to the General Meeting.

The Board of Directors of the company will decide on the remuneration of the President and CEO in accordance with the remuneration policy. The Remuneration Committee will prepare matters pertaining to the remuneration, utilizing assistance of independent external experts when necessary.

In share-based incentive schemes, the issuance of shares, options or special rights entitling to shares is based on a resolution of the General Meeting or a resolution of the Board of Directors of the company authorized by the General Meeting.

The General Meeting decides annually on the remuneration to be paid to the Board members for their Board and Committee work. If a member of the Board of Directors has an employment or service relationship with the company, he/she will be paid a normal salary based on the employment or service relationship.

The following fees were approved by the 2024 Annual General Meeting:

Annual fees

• EUR 70,000 for chairman
• EUR 25,000 for members

Meeting fees (Board & Committee meetings)

• EUR 1,000 per meeting

Board Remuneration is paid fully in cash and does not include pension payments or reimbursement for expenses. Members of the Board of Directors are not included in Rapala VMC’s short- or long-term incentive programs.

The remuneration of the President and CEO and Deputy CEO may consist of a fixed monthly salary with benefits in kind and variable remuneration components, which may include, for example, a short-term performance-based incentive scheme and a long-term share-based incentive scheme or other long-term incentive scheme.

Basic salary and benefits

The annual basic salary of the President and CEO shall be EUR 325,000. The basic salary does not include fringe benefits. The President and CEO is entitled to ordinary employee benefits such as a company car, lunch benefit and phone benefit. They are also entitled to occupational health care equivalent to the company’s employees.

The annual basic salary of the Deputy CEO shall be EUR 179,000. In addition to the basic salary, the Deputy CEO is entitled to ordinary employee benefits, including a company car (EUR 4,660).

Incentive schemes

The President and CEO and the Deputy CEO are currently part of the company’s performance-based short-term incentive scheme. The criteria in the incentive scheme are net sales, comparable EBIT and average inventory. In addition, the criteria include a proportion at the discretion of the Board of Directors.

Other principal terms of the employment relationship

There are no supplementary pension arrangements for the President and CEO or the Deputy CEO. The retirement age and pension of both are determined by local legislation.

At present, the company has not established principles governing the ownership of company shares by the President and CEO or the Deputy CEO.

The employment contracts of the President and CEO and the Deputy CEO can be terminated mutually, subject to a six-month period of notice. No separate severance pay has been agreed for either, but the President and CEO and the Deputy CEO will receive pay for the period of notice.

The Remuneration Committee appointed by Rapala VMC Corporation’s Board of Directors prepares and makes proposals on the remuneration and other benefits of the Global Management Team to the Board of Directors based on the Rules of Procedure. Based on the Committee’s proposals, the Board of Directors decides on the remuneration of the Management Team.

Basic salary and benefits

The basic salaries and fringe benefits of the members of the Global Management Team are generally based on job performance, the complexity of the job and the individual's experience.

Short-term incentives

The members of the Global Management Team participate in the Group’s senior management bonus scheme. The amount and payment of the bonus require 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 once a year. 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 included 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 Rapala VMC’s financial performance criteria and the company’s share price criterion which will be measured during 2023. The performance criteria were the sale of Rapala VMC Group's products, comparable EBIT and Rapala VMC’s average working capital relative to sales in 2023, as well as the company’s average share price determined during any forty (40) consecutive trading days in 2023.

Allocation of the potential rewards for the Global Management Team (excluding the President & CEO) corresponds to the value of an approximate maximum total of 430,000 Rapala VMC shares also including the proportion to be paid in cash. The Deputy CEO achieved 10.7% of their targets under the performance criteria, based on which a remuneration corresponding to 4,548 shares was earned (approximately EUR 13,644 based on the share price on 30 December 2023, the applicable share price is determined based on the remuneration plan). The President and CEO did not participate in the expired long-term incentive scheme.

Other principal terms of the Global Management Team's employment relationships

The members of the Global Management Team are employed by the parent company or one of its subsidiaries. The notice periods of the Global Management Team members' employment relationships are based on local employment contract legislation and practices. They can be described as standard. No separate severance pay has been agreed and the compensation when employment ends is limited to the normal pay for the period of notice.

The pension and retirement age of each member of Rapala VMC Corporation’s Global Management Team is determined based on local mandatory pension legislation applicable to them. The company has not arranged separate defined contribution pension insurance or other supplementary pension arrangements for the members of the Global Management Team. Some members of the Global Management Team have limited supplementary pension arrangements due to local practices.

Remuneration of the Global Management Team in the previous financial year (2023)

Overall remuneration paid to the members of the Global Management Team

*Incl. the remuneration of the current Deputy CEO

Remuneration report 2022
Remuneration Report 2021
Remuneration Report 2020
Remuneration policy 2020