Corporate governance > Remuneration
Revenio's Remuneration Reporting consists of a Remuneration Policy to be submitted to the Annual General Meeting at least every four years and an annual Remuneration Report from 2021 on the remuneration paid to the Company's bodies during the financial year.
The Remuneration Policy defines the principles for the remuneration of Revenio’s governing bodies, i.e. the Board of Directors, President & CEO, and deputy President & CEO.
Revenio has published a Remuneration Report for the year 2022 in accordance with the Corporate Governance Code.
The objective of remuneration is to promote the implementation of Revenio’s strategy and Revenio’s long-term financial success, competitiveness, and the favorable development of shareholder value. Remuneration is the Company’s key incentive and a tool to commit key employees to the Company. Remuneration also plays a key role in ensuring competitive recruitment for the Company. The Company’s current strategy is a growth strategy, which the Company seeks to take into account in the methods and conditions of remuneration.
The Company’s objective is fair and encouraging remuneration at all organizational levels, which is why the Company’s employee salary and remuneration terms are also taken into consideration when deciding on the remuneration of governing bodies.
Statutory governing bodies are the Annual General Meeting, Board of Directors, and President & CEO, and Deputy President & CEO. The statutory governing bodies are supported by the Company’s Chief Financial Officer. The Company may also have committees appointed by the Board of Directors.
The remunerations paid to the Board of Directors are decided by the Annual General Meeting. The Board prepares the remuneration proposal for the Annual General Meeting. The board of directors may appoint one or more of its members or nominate a committee to investigate the justifications for proposed performance-based pay systems and other benefits and to coordinate the use of possible outside experts. The company periodically assesses the competitiveness of the company’s remuneration in relation to other international listed companies with a similar market value.
The remunerations paid to the Board of Directors are decided by the Annual General Meeting. The Board prepares the remuneration proposal. The Company may also appoint a Remuneration Committee or external expert to prepare remuneration proposals for the Board.
The remuneration of the Board consists of an annual fee. Members of committees established by the Board are paid a separate fee in accordance with the decision of the Annual General Meeting. An increased fee is paid to the typically Chair of the Board of Directors. The travel costs of permanent Board members will be reimbursed according to the Company’s currently valid travel policy. The AGM can also decide on the criteria for other forms of remuneration. The decisions of the AGM concerning the remuneration of Board members are disclosed in the same stock exchange release with other decisions of the AGM.
The Annual General Meeting held on March 23, 2023 confirmed that the annual remuneration payable to the members of the Board of Directors elected at the Annual General Meeting for the term ending at the Annual General Meeting in 2023 be paid a remuneration as follows: EUR 60,000 to the chair of the Board of Directors, EUR 45,000 to possible deputy chair of the Board of Directors, EUR 30,000 to the members of the Board of Directors, EUR 20,000 to the chair of the Audit Committee, EUR 10,000 to the chair of the Nomination and Remuneration Committee, EUR 5,000 to members of the Board Committees. Approximately 40 per cent of the annual remuneration (gross) will be settled in the form of the company’s shares held in its treasury, however not exceeding a maximum of 3 200 shares in total, while approximately 60 per cent will consist of a monetary payment. Tax will be deducted from the monetary payment, calculated on the amount of the entire annual remuneration.
The Annual General Meeting held on March 23, 2023 also confirmed that the
chairs of the Board of Directors and the Board Committees be paid an attendance allowance of EUR 1,000 for Board and Board Committee meeting and EUR 600 for short teleconferences, Board members EUR 600 for Board and Board Committee meetings and EUR 300 for short teleconferences per meeting, yet so that the aforementioned attendance allowance for the Board and Board Committee meetings for Board and Committee chairs who live outside of Finland and travel to Finland for the meeting is EUR 2,000 and the aforementioned attendance allowance for the Board and Board Committee meetings for members is EUR 1,200.
The Board of Directors decides on the President & CEO’s remuneration within the framework of the Remuneration Policy for governing bodies presented to the AGM. The Board of Directors prepares the remuneration proposals for the President and CEO, the CEO's of the subsidiaries and the members of the Group Management Team in their entirety, however, the fixed salaries of the CEO's of the subsidiaries and the members of the Group Management Team are decided on the President & CEO's proposal.
The remuneration system for the President and CEO, the Group Management Team and the CEO's of the subsidiaries consists of a fixed monthly salary, an annual performance bonus scheme, an option scheme and a share-based incentive scheme determined by the Board on the basis of the fulfillment of performance criteria and estimates.
The Group's President and CEO and Management Team have group pension insurance and medical expenses insurance as of January 1, 2012. The financial significance of the insurance for the company is insignificant.
The remuneration of the President & CEO consists of a fixed salary, (including supplementary pension and fringe benefits), and a variable portion. The variable portion consists of:
a short-term incentive scheme (STI)
a long-term share-based incentive scheme (Performance-based share plan and Restricted share plan)
The CEO Agreement is subject to customary terms of notice.
The CEO Agreement also includes a confidentiality clause, a non-compete clause and a prohibition of
enticement clause applicable to the CEO.
In 2022, the CEO received a total of EUR 372,866 in pay and remuneration, including fringe benefits.
The Board of Directors shall set a maximum amount for the CEO’s annually confirmed short-term performance-based bonus.
The criteria for the performance-based bonus scheme are typically growth and profitability requirements at both Group level, along with a discretionary portion. The Board of Directors may choose to raise or lower the annual bonus paid to the CEO and Group Management Team by 50%.
Long-term incentive schemes form part of the Company’s remuneration program for the President & CEO and key personnel and are aimed at supporting the implementation of the Company's strategy and harmonizing the objectives of the President & CEO and other key personnel and Company shareholders in order to grow the Company's value.
The Company’s Board of Directors shall separately decide on the launch of share-based long-term incentive schemes and their earning period within limits of the authorization granted by the AGM. The Board of Directors shall decide separately on the minimum, target and maximum bonus of each participant, as well as performance criteria and the related targets.
The purpose of the short-term incentive scheme is to support the achievement of Revenio's annual financial and strategic objectives. The payment of the short-term incentive is based on the meeting of performance criteria during the performance period. The performance criteria are decided by the Board of Directors. The highest possible annual short-term incentive for Revenio’s CEO corresponds to the fixed salary component for nine months. The criteria in the short-term incentive scheme are EBITDA and cash flow at the Group level and individual targets.
It is possible for the CEO to invest an amount equal to two months’ salary from the short-term performance bonus in the personnel fund. The employee fund established by the Company is open to all employees of the Company in Finland. Employees may transfer to the personnel fund from their annual bonus an amount not exceeding two months' salary. Each employee decides for themselves whether they participate in the fund. Alternatively, bonuses can also be taken as salary. The Company pays an additional 25% on top of the amount transferred to the fund, with this additional amount corresponding to the statutory costs that the Company would have to pay if the bonus were paid as salary. The fund invests in the shares of Revenio Group Corporation.
The purpose of the long-term performance-based share plan is to support the implementation of the Company's strategy, increase the Company’s value and profits in the long-term, strengthen the participants’ commitment to the company, and provide the participants with competitive total remuneration.
The performance-based share plan consists of three-year performance periods. The Board of Directors decides separately on the minimum, target and maximum bonus as well as the performance criteria and related targets. The amount of the bonus to be paid depends on the development of the share price in accordance with the pre-defined targets. Bonus is not paid if the targets are not met or if the participant's employment relationship ends before the bonus is paid.
The targets of the plan must be related to the total absolute shareholder return of the Company's share and cumulative operating result for three years. If the targets of the incentive scheme are achieved, bonuses will be paid in the spring of the year following the performance period. The total amount of the share incentive paid on the basis of the plan's performance periods may be no more than approximately 100,000 shares of Revenio Group Corporation. The number of shares is equal to gross earnings minus any cash component deducted from it in order to cover taxes and any other tax-like charges arising from the share incentive, with the remaining net incentive paid in shares. However, the Company has the right to pay the fee fully in cash in certain situations. The Company’s Board of Directors may decide on new share-based incentive schemes within the limits of the authorization granted by the Annual General Meeting.
The criteria for the performance-based share plan are the total shareholder return and the cumulative operating result (as a cutter) at the Group level. The current CEO is eligible to participate in the performance period 2020–2022. In 2021, the current CEO was not paid share-based remuneration based on the performance-based share plan. The first potential payment under the performance-based share plan will be paid to the CEO in 2023.
In addition, on March 19, 2021 the Board of Directors has launched a restricted share plan arrangement which is directed to five key employees of Oculo. The arrangement is established to form part of the long-term incentive and commitment program for certain key employees of Oculo. The aim of the arrangement is to support the implementation of the company´s strategy, combine the interests of the shareholders and the participants in order to increase the value and performance of the company in the long-term, to commit participants to the Company after the acquisition. The maximum number of shares in the program is limited. Under the program, shares will be issued for a maximum total value of AUD 1,660,000, calculated at the trading-weighted average price on the closing date of the Oculo acquisition. The Arrangement is a three-year performance share plan for the calendar years 2021, 2022 and 2023, respectively.
Restricted share plan
The restricted share plan was established for the CEO as part of the long-term incentive and commitment program. The purpose of the plan is to supplement the CEO's remuneration, to combine the interests of shareholders and the CEO, to increase the Company's value and profits in the long term and to strengthen the CEO’s commitment to the Company.
The restricted share plan consists of one three-year vesting period 2021–2023. During the vesting period, the CEO may receive shares provided that the CEO’s employment relationship continues until the shares are delivered. The shares are delivered in three instalments. The first third of the incentive is paid after the first year of the vesting period, the second third after the second year of the vesting period and the final third is paid when the entire vesting period has ended. The number of shares is equal to gross earnings minus any cash component deducted from it in order to cover taxes and any other tax-like charges arising from the share incentive, with the remaining net incentive paid in shares. It is recommended that the value of the shares held by the CEO corresponds to 50% of the CEO’s annual gross basic salary.
In May 2022, altogether 400 Revenio Group Corporation shares were paid in a directed free share issue to the current CEO for the payment of share-based award under the 2021-2023 LTI RS-program from year 2021.
Oculo share-based incentive scheme The arrangement is established to form part of the long-term incentive and commitment program for certain key employees of Oculo. The aim of the arrangement is to support the implementation of the company´s strategy, combine the interests of the shareholders and the participants in order to increase the value and performance of the company in the long-term, to commit participants to the Company after the acquisition. The maximum number of shares in the program is limited. Under the program, shares will be issued for a maximum total value of AUD 1,660,000, calculated at the trading-weighted average price on the closing date April 27, 2021 of the Oculo acquisition. The Arrangement is a three-year performance share plan for the calendar years 2021, 2022 and 2023, respectively. A total of 1,579 of the company’s treasury shares were issued in October 3, 2022 in a directed share issue without payment to persons included in the share-based incentive scheme.