Remuneration report 2024
Remuneration decision making protocol
Shareholders that represent over 50% of company’s voting rights shall propose to Annual General Meeting the composition and remuneration of the Board of Directors.
Based on Company’s Human Resource and Rewarding Committee (HRRC) proposal, the Board of Directors shall decide on CEO’s remuneration as well as incentive plans and management’s share-based incentive programs.
Authorised by the Company’s Board of Directors, HRRC Committee decides nomination and remuneration of the Group Management Team (GMT) as well as their possible short term incentive plans. Company CEO determines the targets for the GMT’s possible Short term incentive plan.
Main Remuneration principles
Remuneration of Board of Directors
Members of the Board shall be paid a monthly fee for being a Board member and annual fee for being in a Board Committee(s) as well as realised travel expenses. No separate meeting fee shall be paid.
In the Annual General Meeting in 2024 it was decided that fees for the members of the Board shall be 3 700 Euro per month for the Chairman and 1 850 Euro per month for the Board members. In addition, Board members shall receive a Euro 1 600 per annum for being a member in a Board Committee(s).
Remuneration of Group CEO and Management Team
Company has short-term and long-term incentive plans to reward the CEO and Management Team members, which are described below.
Short-term incentive plan
The purpose of the short-term incentive plan is to reward and incentivize improvements in short-term financial and operational performance and support the delivery of the business strategy. Earning period for the short-term Incentive plan is one year and remuneration is paid annually. In 2024, the short-term incentive was based on EBIT with 100 percent weight.
Share based incentive plans
Purpose of the share-based incentive plans is to unite shareholders and key employees’ objectives on long-term basis as well as to commit key employees to execute company’s strategy. Plans’ objective is to offer to key employees a competitive model to earn company’s shares.
Board of Directors decides the earning criteria and targets beginning of the earning periods.
Performance-based Matching Share Plan 2024–2026
On March 13, 2024, Martela Oyj's Board of Directors decided on a new share-based incentive plan for the group's key employees. The new system largely follows the principles of the old system.
Participating in the new plan requires that the participant acquire new or transfer already acquired company A shares up to the amount decided by the Board of Directors. In order to implement the plan, the Board of Directors decided on April 29, 2024, on a share issue of 65,717 company A shares aimed at the target group of the plan. In addition to this, the employees who participated in the old plan have transferred 172,644 of the company's A shares from their investments in the old plan to the new plan.
The new shares were entered into the Trade Register on 4 June 2024 and trading on the new shares at the Main market administered by Nasdaq Helsinki Ltd began on 5 June 2024.
In the plan, it is possible for the target group to earn Martela Oyj's A shares based on performance and personal investment in Martela Oyj's A shares. The board decides the earning criteria of the plan and the goals set for each earning criterion at the beginning of the earning period.
The rewards paid based on the plan are estimated to correspond to a maximum of 712,000 Martela Oyj's A shares, including the portion paid in cash.
37 people, including the CEO and other members of Martela's Management Team, were part of the plan’s target group when the plan started.
The new performance-based additional share plan 2024–2026 has three earning periods, the fiscal years 2024, 2025 and 2026. In the earning period 2024, the rewards are based on the group's operating profit (EBIT). In 2025, no reward shall be paid based on the program, as the targets for the 2024 earning period were not achieved.
The rewards will be paid partly in Martela Corporation series A shares and partly in cash. The cash proportions of the rewards are intended for covering taxes and tax-related expenses arising from the rewards to the participants.
As part of the implementation of the performance-based share plan, the Board of Directors granted interest-bearing loans of EUR 42,100 to persons participating in the program to finance the acquisition of the company's shares. With the loans in question, the participants financed the acquisition of 65,717 of the company's A shares in the above-mentioned share issue. The maximum amount of the loans in question is 70 percent of the participant's share investment. In addition to this, for persons who participated in the old plan and have transferred to the new plan, the Bord of Directors has decided to extend the maturity of the loans granted in 2021 by two years until the end of 2027.
Old performance-based Matching Share Plan 2021–2023
In the effective Performance-based Share Plan 2021–2023, there were three earning periods, which were financial years 2021, 2022 and 2023. The prerequisite for participating in the new plan was that a participant acquires the company´s series A shares up to the number determined by the Board of Directors.
Approximately 40 key employees, including the CEO and other Martela’s Management Team members, were belonging to the target group of the share-based incentive plan. In the plan, the target group was given an opportunity to earn Martela Corporation series A shares based on performance and on their personal investment in Martela Corporation series A shares. The Board of Directors decided the earning criteria and the goals for each criterion of the plan at the beginning of each earning period. 53,881 additional shares based on the program were paid as rewards in 2023 and 11,657 in 2022. In 2024, no reward were paid on the basis of the plan, because the goals of the earning period 2023 were not achieved.
Remuneration of the CEO
The remuneration of the CEO consists of fixed annual remuneration, i.e. base salary and fringe benefits and variable remuneration, i.e. short- and long-term incentive plans.
Short-term incentive plan
The maximum short-term incentive for the CEO in 2024 was 50% from the annual salary. The criteria for the underlying 2024 short-term incentive plan were not achieved, and based on them, no remuneration shall be paid to the CEO in 2025. Neither the criteria for the short-term incentive plan 2023 were not reached and the no rewards on the earning period was paid to Ville Taipale in 2024.
Performance-based Matching Share Plan 2024–2026
In the plan, the CEO is given an opportunity to earn Martela Corporation series A shares based on performance and on their personal investment in Martela Corporation series A shares. The Board of Directors decides on the plan’s performance criteria and targets to be set for each criterion at the beginning of a performance period. The potential rewards based on the plan will be paid after the end of each performance period. The Performance-based Matching Share Plan 2024–2026 consists of three performance periods, covering the financial years of 2024, 2025 and 2026, respectively. The maximum outcome for the plan for Ville Taipale is 183 000 shares, of which part can be paid in cash to cover the tax implication from received shares.
Criteria for financial year 2024 was tied to performance of Company’s EBIT. Share-based rewards from 2024 performance period were not reached and no shares shall be given to CEO in 2025.
Performance-based Matching Share Plan 2021–2023
In the plan, the CEO was given an opportunity to earn Martela Corporation series A shares based on performance and on their personal investment in Martela Corporation series A shares. The Board of Directors decided on the plan’s performance criteria and targets were set for each criterion at the beginning of a performance period. The potential rewards based on the plan were paid after the end of each performance period. The Performance-based Matching Share Plan 2021–2023 consisted of three performance periods, covering the financial years of 2021, 2022 and 2023, respectively. The maximum outcome for the plan for Ville Taipale was 73 260 shares, of which part can be paid in cash to cover the tax implication from received shares.
Criteria for financial year 2023 was tied to performance of Company’s EBIT. Share-based rewards from 2023 performance period were not reached and no shares were given to CEO in 2024.
Remuneration of other Group Management Team members
Management team member salary is based on full compensation basis, including the fixed salary and the fringe benefits. Management Team members participate in short-term incentive plan and Performance-based Matching Share plans 2024–2026 and 2021–2023, which are described in detail under the section Share based incentive plans.
Management Team’s fixed salary in 2024, without the CEO, was 767,926 euros and fringe benefits were 36,639 euros.
Short-term incentive plan
The maximum short-term incentive for Management Team members in 2023 and 2024 was 30% from the annual salary. The criteria underlying the 2023 and 2024 short-term incentive plan were not achieved, and based on them, no remuneration was paid 2024 and shall not be paid to the Group Management Team members in 2025.
Performance-based Matching Share Plans 2021–2023 and 2024–2026
The share based incentive remuneration of Management Team members is based on the Performance-based Matching Share Plans 2021–2023 and 2024–2026. The outcome for the plans for Management Team members shall partly be paid in cash to cover the tax implication from received shares. From 2023 and 2024 performance periods no share rewards was paid in 2024 and shall not be paid in 2025.
Remuneration Report 2024
Martela Oyj's Remuneration Policy 2020–2023
Martela Oyj's Remuneration Policy 2024–2027