Remuneration and terms of employment of President and CEO
Salary and fringe benefits
The CEO's base salary in 2019 was EUR 84,000/month, including free car allowance and phone allowance as fringe benefits and no increase was allocated.
Short-term incentive system (bonus)
The bonus can be earned annually based on the criteria approved by the Board of Directors. The maximum level is 40% of the annual salary including fringe benefits.
Long-term incentive system (share bonus)*
According to Fortum management's ongoing share bonus systems. The maximum value of shares (before taxation) cannot exceed the annual salary of the President and CEO.
Retirement age is 63. The President and CEO has a supplementary defined contribution pension plan. The annual contribution is 25% of the annual salary, which consists of the base salary and fringe benefits. If the President and CEO's contract is terminated before retirement age, he is entitled to retain the funds that have accrued in the pension fund.
Termination of Contract
The notice period for both parties is six months. If the company terminates the contract, the President and CEO is entitled to the salary of the notice period and severance pay equal to 12 months’ salary.
* The President and CEO of Fortum Corporation is Mr Pekka Lundmark. He participates in 2014-2019 and 2015-2020 share bonus schemes for the remaining earnings periods as of 7 September 2015 when he started in his position.