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Executive Board

The Executive Board prepares the business strategy and budget and monitors the results of operations. The Executive Board also considers investments and divestments of strategic significance to the whole Group, as well as the company’s operational guidelines and reporting. The Executive Board comprises the President and CEO, the CFO, the SVP for Corporate Communications and IR, and the heads of the business units, in total seven persons.

The members of the Executive Board are insured with a contribution-based group pension insurance. Sponda Plc pays the annual insurance premium until the member reaches the age of 63. The insurance premium amounts to 7.5 per cent of each member’s fixed annual salary.

The members of the Executive Board participate in the long-term share-based incentive scheme for the Group’s key personnel approved by the Board of Directors. The revised incentive scheme implemented in 2009 comprised two one-year vesting periods (the 2010 and 2011 calendar years) and two three-year vesting periods (2010–2012 and 2011–2013). In 2012, Sponda’s Board of Directors decided on the implementation of a new incentive scheme, which is effective from the beginning of 2012. The incentive scheme comprises three three-year vesting periods, which correspond to the calendar years 2012–2014, 2013–2015, and 2014–2016. The Board of Directors decides separately on the earning criteria and the targets to be established for each vesting period.

The earning criteria for the vesting periods that began prior to 2012 were tied to cash flow from operations per share and return on capital employed. The earning criteria for the 2012–2014 vesting period are the Group’s average Return on Capital Employed (ROCE) in the financial periods 2012–2014 and the Group’s cumulative Operational Cash Earnings Per Share (CEPS) for the financial periods 2012–2014. In addition, the Board of Directors will assess the Group’s success in relation to the prevailing market conditions. The earning criteria for the 2013–2015 vesting period are the Group’s average Return on Capital Employed (ROCE) in the financial periods 2013–2015, the Group’s cumulative Operational Cash Earnings Per Share (CEPS) for the financial periods 2013–2015, and real estate sales. In addition, the Board of Directors will assess the Group’s success in relation to the prevailing market conditions. The Board of Directors monitors the fulfilment of the targets set for the earning criteria regularly.

Any remuneration paid, less taxes, is used to purchase the company’s shares on behalf of the persons participating in the incentive scheme. The remuneration amount includes the purchased company shares as well as taxes and tax-like charges incurred from the remuneration to the persons participating in the scheme and settled by the company.

The shares may not be disposed of within a set commitment period following their receipt. The duration of this period is two years for the one-year vesting periods and three years for the three-year vesting periods. The commitment period for the 2012–2014 vesting period ends on 31 December 2017 and the commitment period for the 2013–2015 vesting period on 31 December 2018. After the commitment period ends, a member of the Group’s Executive Board must own one half of the shares paid on the basis of the scheme, until the value of the shares he or she owns equals the amount of his or her annual salary. This ownership obligation shall be in effect for as long as the employment contract of the member of the Executive Board continues.

Sponda Plc shares owned by members of the Executive Board as of 31 December 2013:

Name

No. of shares

Change

Kari Inkinen

378,044

+ 64,678

Pia Arrhenius

48,494

+ 18,309

Erik Hjelt

114,232

+ 24,876

Ossi Hynynen

163,333

+ 32,439

Kari Koivu

78,351

- 13,221

Sirpa Sara-aho

109,687

+ 19,602

Veli-Pekka Tanhuanpää

5,970

+ 5,970