Remuneration of the Board and its Committees

President and CEO Mikko Helander’s salary, remuneration and other financial benefits in 2015

President and CEO Mikko Helander’s personal compensation, other financial benefits, performance bonus scheme criteria and performance bonuses paid are decided by Kesko's Board of Directors based on the Remuneration Committee's preparatory work. A written managing director's service contract, approved by the Board, is in force between the Company and the President and CEO. Helander has been the Company’s President and CEO and the Chair of the Group Management Board since 1 January 2015.

The salaries, fringe benefits and performance bonuses paid to Helander and his other financial benefits in 2014—2015 are presented in the following tables.

 


Period of notice and termination benefit

The President and CEO’s period of notice is twelve (12) months if the managing director’s service contract is terminated by the Company and six (6) months if Helander resigns. If the Company terminates the contract for a reason other than a material breach of contract by the managing director, and the managing director does not retire on an old-age pension or some other pension, the managing director is paid, in addition to the salary for the period of notice, a compensation corresponding to the combined amount of 12 months' monetary salary and fringe benefits.

Share-based payment awards

On 16 December 2014, Kesko Corporation's Board of Directors decided to transfer 8,791 own B shares held by the company as treasury shares to Mikko Helander, who took office as the company's President and CEO on 1 January 2015. The share transfer took place on 17 December 2014. The share transfer was based on the managing director's service contract signed with Mikko Helander and the transferred shares are part of the agreed total compensation partly covering the remuneration of his service contract preceding Kesko. The transfer was without consideration and, like the share-based compensation plan operated at Kesko, its purpose is to promote Kesko's business and increase Kesko's value by combining the objectives of shareholders and the recipient of shares. The value of the transferred shares at the date of transfer, 17 December 2014, was €260,741.06. In addition, taxes and other statutory charges for the share transfer incurred by the recipient of the shares in a total amount of €419,394.80 were paid in cash.

Share award commitment period

The Kesko B shares awarded to Helander on 17 December 2014 carry a commitment period expiring on 1 October 2016, during which the shares are not allowed to be assigned.

Retirement benefits and insurances

President and CEO Mikko Helander's old-age pension age is 63 and the amount of his old-age pension is 60% of his pensionable earnings in accordance with the Employees' Pensions Act (TyEL). The pensionable salary is determined based on his non-variable monetary salary, performance bonuses and fringe benefits for the last ten (10) years. The supplementary pension is based on a defined benefit plan. The cost of the supplementary pension for the period, calculated on an accrual basis, was €0.8 million and the pension liability was €0.9 million as at 31 December 2015. The pension cost of the President and CEO's statutory pension provision was €0.1 million.

Health and life insurance

A health insurance and a life insurance have been taken out for Helander.

Period of notice and termination benefit

Helander’s period of notice is twelve (12) months if the managing director’s service contract is terminated by the Company and six (6) months if Helander resigns. If the Company terminates the contract for a reason other than a material breach of contract by the managing director, and the managing director does not retire on an old-age pension or some other pension, the managing director is paid, in addition to the salary for the period of notice, a compensation corresponding to the combined amount of 12 months' monetary salary and fringe benefits.

 

Further information

As a result of the Market Abuse Regulation ((EU) N:o 596/2014, ”MAR”) that entered into force on 3 July 2016, the information on the Shareholdings of public insiders pages is not updated after 3 July 2016 and will be removed from the link referred to above on 2 July 2017. 

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