Remuneration

In accordance with the proposal of the Shareholders’ Nomination Board, the Annual General Meeting resolved, in addition to increasing the fixed annual fees, that the fixed fees for the Committee work, which previously had been in use, will be discontinued to streamline the remuneration structure. The following fixed annual fees will be paid to the Chair, Deputy Chair and the other members of the Board of Directors for the term that started at the end of the Annual General Meeting 2025 and ending at the end of the Annual General Meeting 2026.

The annual fee of the Chair, Deputy Chair and other members of the Board of Directors:

• Board Chair: EUR 155,000
• Board Deputy Chair: EUR 85,000
• Committee Chairs: EUR 85,000, in case that he/she does not simultaneously act as Chair or Deputy Chair of the Board of Directors
• Board Members: EUR 68,000

The meeting fee payable to a Board member, also for the Committee meetings, will be EUR 1,000 for each meeting, or EUR 2,000 in case the member travels to the meeting outside his/her country of residence. When a member participates in the meeting via remote connection, or for the decisions that are confirmed without convening a meeting, the meeting fee will be EUR 1,000. The travel expenses of Board members are compensated in accordance with the Company’s travel policy.

The annual fee for the Board work of the Board members will be paid in Company shares and in cash in such a way that approximately 40 % of the amount of the annual fee will be payable in shares acquired on behalf and in the name of the Board members, and the remainder in cash. The Company will pay the costs and the transfer tax related to the purchase of the Company shares.

The shares will be acquired on behalf and in the name of the Board members within two weeks following the publication of the Company’s first quarter 2025 interim report. If share purchases cannot be carried out within the aforementioned schedule due to a reason related to the Company or a Board member, the shares will be acquired later, or the annual fee will be paid fully in cash. The meeting fees will be paid fully in cash.

The Board members are not in an employment relationship or service contract with Fortum and therefore they have not been given the opportunity to participate in Fortum’s STI or LTI programmes, nor has Fortum had a pension plan in which they could have opted to take part. The travel expenses are compensated to the members of the Board of Directors in accordance with Fortum’s travel policy. 

The Shareholders’ Nomination Board proposed to the Annual General Meeting 2024 that the remuneration payable to the members of the Board of Directors would be changed in line with the earlier decision in principle to increase the remuneration, and the fees presented in the adjacent table would be paid for a term ending at the end of the Annual General Meeting 2025. 

The Annual General Meeting held on 25 March 2024 approved the proposals of the Shareholders’ Nomination Board. 

The annual fee for the Board work of the Board members is paid in company shares and in cash in such a way that approximately 40% of the amount of the annual fee is payable in shares acquired on behalf and in the name of the Board members, and the remainder in cash. The Company pays the costs and the transfer tax related to the purchase of the company shares. The meeting fees and the fixed fees for the Committee work are paid fully in cash. 

In 2024, a total of 13 Board meetings and 22 Committee meetings were held. Further information about the Board and Committee meetings held in 2024 is available in the Fortum Governance 2024 report. 

Fees paid to the members of the Board of Directors in 2024

1) Includes the 6,849 Fortum shares held through Mikael Silvennoinen’s controlling company Agendum Oy. 
2) Not disclosed 

Remuneration and Company performance over the last five financial years 

1) Excluding the annual fixed fee for the Committee work. 
2) Based on the figures in the consolidated financial statements, including wages and salaries, pensions, social security costs as well as short- and long-term incentives (excl. the President and CEO). The financial statements include costs accrued for the year.  
3) Comparative information for 2022 has been restated following the reclassification of the Russian operations as discontinued operations in 2023. For additional information, see Financials 2023. 
4) Including Russian operations in 2020-2021 and Uniper in 2020. 

The Board of Directors considers various factors when determining the fixed compensation of the President and CEO, including individual contribution, business performance, role scope and employee pay across Fortum. When setting the total remuneration for the President and CEO, alignment with market benchmark data from Nordic and Finnish listed companies of similar size and, where necessary, European companies operating in relevant sector, is considered.

In 2024, the monthly fixed compensation of the President and CEO remained unchanged at EUR 125,000. The fixed compensation includes a company car and phone as fringe benefits. In addition, the President and CEO received an electric vehicle subsidy of 25% of the taxable value of the full car benefit in accordance with Fortum’s company car instructions. The maximum STI was limited to 40% of the annual fixed compensation and the variable elements in total (STI and LTI) were limited to a maximum pay-out of 120% of the President and CEO’s annual fixed compensation. 

President and CEO Markus Rauramo participated in the 2021 Employee Share Savings (ESS) plan and earned a total of 235 ‍matching shares (gross). The delivery of the net number of matching shares (125 shares in total) took place in March 2024. Markus Rauramo has also participated in the 2022 ESS ‍plan. Based on his participation in the ESS plan in 2022 and the number of ESS shares held on 31 ‍December 2024, Markus Rauramo earned a total of 362 ‍matching shares (gross) at the maximum. The matching share amount (gross) will be confirmed and the delivery of the net number of matching shares will take place in the spring of 2025. Furthermore, Markus Rauramo participated in the 2024 Employee Share Savings (ESS) plan. The matching share amount (gross) will be confirmed and the delivery of the net number of matching shares will take place in the spring of ‍2027.

The retirement age of President and CEO Markus Rauramo is determined in accordance with the Finnish Employees’ Pension Act. In addition to the statutory pension, Markus Rauramo is entitled to participate in the supplementary group pension plan for the members of the Fortum Leadership Team. The annual defined contribution premium is 20% of the annual fixed compensation. If Rauramo’s managing director service agreement is terminated before the retirement age, the President and CEO is entitled to retain the funds that have accrued in the pension arrangement up to that time.

The terms of the managing director service agreement of President and CEO Markus Rauramo are in line with Fortum’s Remuneration Policy for the Governing Bodies. The notice period for both parties is six (6) months. If the Company terminates the agreement, President and CEO Markus Rauramo is entitled to a fixed compensation for the notice period and a severance pay equal to six (6) months’ fixed compensation. No severance compensation is paid if the agreement is terminated by the President and CEO himself. The malus and clawback provisions for the President and CEO were not utilised in 2024.

In accordance with the terms of the Solidium bridge financing facility with the Finnish State, the President and CEO is not paid any short- or long-term incentives that accumulated in 2022 and 2023. The awards for the 2020–2022 and 2021–2023 LTI plans were originally scheduled for payment in 2024. The Board of Directors earlier resolved that the agreed deduction (EUR 68,082) related to the change in his role from the Deputy Chair to Chair in Uniper’s Supervisory Board in 2021 would have been done from the LTI payments in the spring of 2024. As Markus Rauramo decided to waive the awards for the 2020–2022 and 2021–2023 LTI plans and no LTI awards were paid in 2024, the Board of Directors resolved that the agreed deduction would be done from the incentive payments for the President and CEO in the spring of 2025. Read more about the Remuneration and Terms of the Service Contract of the President and CEO

1) Benefits and vacation pay are included in the fixed compensation. 
2) In accordance with the terms of the Solidium bridge financing facility with the Finnish State, the STI earned in 2023 were not paid. 
3) The awards for the 2020–2022 and 2021–2023 LTI plans were originally scheduled for payment in 2024. In May 2023, President and CEO Markus Rauramo decided to waive the awards for the 2020–2022 and the 2021–2023 LTI plans, thus no LTI awards were paid to Markus Rauramo in 2024. 
4) President and CEO Markus Rauramo earned a total of 235 matching shares (gross) for the 2021 Employee Share Savings plan amounting to a award of EUR 2,744. 
5) The STI earned in 2024 based on the outcome of performance measures was EUR 307.050. As resolved by the Board of Directors and described above, STI payable for 2024 is calculated taking into account the deduction related to the change in the Uniper Supervisory Board role in 2021.  
6) Estimated LTI earning of EUR 46,100. The net number of shares delivered will be disclosed on website after the publication of the Remuneration Report 2024.
7) With regard to the 2022 Employee Share Savings plan, Markus Rauramo earned a total of 362 matching shares (gross) at the maximum, with the estimated earning of EUR 5,000. The matching share amount (gross) will be confirmed and the delivery of the net number of matching shares will take place in the spring of 2025

Summary of granted, earned and paid share-based incentives to the President and CEO

1) Taking the pro-ration into account, the final earning for Markus Rauramo led to an outcome of 3% of the original maximum number of shares granted in the 2021–2023 LTI plan and to an outcome of 5.5% in the 2022–2024 LTI plan. 
2) Maximum number and maximum value of shares granted (gross) takes into account the remuneration restrictions applicable to the Fortum Leadership Team members in 2022 and 2023. In the 2021–2023 and 2022–2024 LTI plans: the original maximum number of shares granted and shares pro-rated 2/3; in the 2023–2025 LTI plan: original maximum number of shares granted and shares pro-rated 1/3. 
3) In May 2023, President and CEO Markus Rauramo decided to waive the award for the 2021–2023 LTI plan, thus no shares were delivered to Rauramo in 2024. 
4) Shares of the 2023–2025 LTI plan were granted in deviation from the schedule of the previous years due to the preparations related to the reorganisation of Fortum operating structure, businesses and enabling functions. The first phase was completed at the end of August, and the allocation process was finalised by the end of November 2023. 

The President and CEO is required to build up and maintain a holding in Fortum shares equivalent to 100% of the gross fixed compensation; 50% of net shares (after-tax) received at each vesting of share-based remuneration must be retained until a shareholding of 100% of gross fixed compensation is met. As of 31 December 2024, the Fortum shareholding of the President and CEO amounted to 115,997 shares in total, thus meeting the shareholding requirement set for the role.

STI and LTI performance and outcomes

Short-term incentives for 2023

In the STI 2023 plan, the performance measures set for the President and CEO comprised a financial measure (Group comparable operating profit + Share of profits of associates and joint ventures) with 50% weight and ESG measures (customer satisfaction index target and safety measures – completion of safety leadership trainings and key safety actions to improve the safety culture) with 20% weight. President and CEO Markus Rauramo had also one joint Leadership Team and two individual performance measures with 30% weight. The joint Leadership Team measure consisted of successful return to the fixed income markets, progress in the Company transformation and set strategic projects. The individual performance measures related to concretisation and implementation of the new strategy and the operating model. 

Taking the set performance measures, their weights and achievements into account, the weighted outcome of the STI 2023 for the President and CEO was 50.7% in total. In accordance with the terms of the Solidium bridge financing facility with the Finnish State, President and CEO Markus Rauramo was not paid the short-term incentives accumulated in 2023. Further information on the STI 2023 performance measures and outcomes is available in Fortum Remuneration Report 2023.

Short-term incentives for 2024

In the STI 2024 plan, the performance measures set for the President and CEO comprised financial measures (Group comparable operating profit and Group fixed costs) with 50% weight, an operational measure (availability of the production fleet) with 10% weight and ESG measures (net promoter score/customer satisfaction index target and safety actions) with 20% weight. Additionally, President and CEO Markus Rauramo had one joint Leadership Team and one individual performance measures with 20% weight. The joint Leadership Team measure related to the development of strategic growth options and the improvement of employee engagement. The individual performance measure was linked to the development of Fortum’s reputation among stakeholders. 

Taking the set performance measures, their weights and achievements into account, the weighted outcome of the STI 2024 was 51.2% in total, resulting in a payable STI of 20.5% of the President and CEO’s annual fixed compensation. The short-term incentives for the year 2024 will be paid in the spring of 2025. 

2021–2023 Long-term incentive plan

The performance measures for the 2021–2023 LTI plan were the relative TSR measured against a European utilities peer group (80% weight) and the ESG measure (20% weight), which was linked to the reduction of Fortum’s coal-based power generation capacity in line with Fortum’s coal-exit path, with a minimum level requiring the exceeding of the communicated ambition level. The relative TSR peer group consisted of the following companies: A2A S.p.A., BKW AG, CEZ a.s., Drax Group plc, EDP - Energias de Portugal S.A., Enagás S.A., Endesa S.A., Enel SpA, ENGIE SA, Eni S.p.A., Hera S.p.A., Iberdrola, S.A., Iren SpA., Naturgy Energy Group S.A., RWE Aktiengesellschaft, Snam S.p.A., SSE plc, Veolia Environnement S.A., VERBUND AG, and Ørsted A/S. Due to the divestment of Uniper in 2022, the Board of Directors resolved to adjust the ESG measure. Fortum’s reputation index among key stakeholders in Finland, Sweden and Norway was set as a new measure for the year 2023 with 7% weight resulting in a change in the weight of the original measure for the period 2021–2022, thus being 13%. 

The overall outcome for the 2021–2023 LTI plan was 9% of the maximum. In accordance with the terms of the Solidium bridge financing facility with the Finnish State, President and CEO Markus Rauramo was not paid any long-term incentives accumulated in 2022 and 2023. Therefore, the maximum number of shares granted was pro-rated taking the remuneration restrictions for the years 2022 and 2023 into account. As a result, the final outcome led to 3% of the original maximum number of shares granted to the President and CEO. The award for the 2021–2023 LTI plan was originally scheduled for payment in 2024. In May 2023, President and CEO Markus Rauramo decided to waive his award for the 2021–2023 LTI plan, thus no LTI award was paid to Markus Rauramo in the spring of 2024. Further information on the performance measures and outcomes for the 2021–2023 LTI plan is available in Fortum Remuneration Report 2023.

2022–2024 Long-term incentive plan

The performance measures for the 2022–2024 LTI plan were the relative TSR measured against a European utilities peer group (80% weight) and the ESG measure (20% weight). The relative TSR peer group consisted of the following companies: A2A S.p.A., BKW AG, CEZ a.s., Drax Group plc, EDP - Energias de Portugal S.A., Enagás S.A., Endesa S.A., Enel SpA, ENGIE SA, Eni S.p.A., Hera S.p.A., Iberdrola, S.A., Iren SpA., Naturgy Energy Group S.A., RWE Aktiengesellschaft, Snam S.p.A., SSE plc, Veolia Environnement S.A., VERBUND AG, and Ørsted ‍A/‍S. The ESG measure was related to the reduction of the absolute CO2 emissions in the European fossil fleet, based on a fossil fleet review addressing the Group’s European generation portfolio and a pathway developed to reach Fortum Group’s 2030 and 2035 climate targets. As a result of the divestment of Uniper in 2022, the Board of Directors resolved to revise the ESG measure in early 2023. The revised climate target for 2022–2024 for Fortum was related to the reduction of the absolute CO2 emissions of the Company in Europe, i.e., including also Fortum Recycling and Waste business. 

The overall outcome for the 2022–2024 LTI plan was 16.4% of the maximum. In accordance with the terms of the Solidium bridge financing facility with the Finnish State, President and CEO Markus Rauramo is not paid any long-term incentives accumulated in 2022 and 2023. Therefore, the maximum number of shares granted was pro-rated taking the remuneration restrictions for the years 2022 and 2023 into account. As a result, the final outcome led to 5.5% of the original maximum number of shares granted to the President and CEO. The award for the 2022–2024 LTI plan will be paid in the spring of 2025. 

Remuneration of other Fortum Leadership Team (excl. the President and CEO) in 2020–2024

1) Benefits and vacation pay are included in the fixed compensation. 
2) In accordance with the terms of the Solidium bridge financing facility with the Finnish State, the STI earned in 2022 and 2023 were not paid. The new FLT members who joined the FLT as of 31 March 2023 were eligible for the short-term incentives accumulated in 2022 based on their previous roles in the Company. 
3) The awards for the 2020–2022 and 2021–2023 LTI plans were originally scheduled for payment in 2024. In May 2023, the FLT members decided to waive their respective awards for the 2020–2022 and the 2021–2023 LTI plans, thus no LTI awards were paid in 2024.  
4) The amount stated in the table above includes the LTI award paid to the new FLT members who were eligible for the award for the 2020–2022 LTI plan based on their previous roles in the Company. These shares were delivered in March 2023 resulting in taxable income in April 2023. The amount includes also the RSP 2020–2022 award paid, based on the Executive agreement, to EVP, Sustainability and Corporate Relations in the spring of 2023. 
5) With regard to the 2021 Employee Share Savings plan, the FLT members (excl. the President and CEO) earned a total of 810 matching shares (gross) amounting to a ‍award of EUR 9,413. 

In 2024, the following changes took place in the FLT: Nora Steiner-Forsberg, Executive Vice President, Legal, General Counsel, Eveliina Dahl, Executive Vice President, People and Procurement and Bernhard Günther, Chief Transformation Officer, stepped down from the FLT and left Fortum on 31 December 2024 to take on positions outside Fortum. Karin Svenske Nyberg was appointed as Executive Vice President, People as of 1 May 2025 and Kati Levoranta as Executive Vice President, Legal, General Counsel latest as of 1 July 2025. 

The short-term incentives earned in 2023 and the award for the 2021–2023 LTI plan were not paid in the spring of 2024 due to the remuneration restrictions set for the FLT and the FLT members’ decision to waive their respective LTI awards. In the STI 2024 plan, the performance measures set for the other FLT members comprised financial measures (Comparable Operating Profit and Group fixed costs) with 40% weight, operational measure (availability of the production fleet) with 10% weight and ESG measures (net promoter score/customer satisfaction index and safety actions) with 20% weight. Additionally, the FLT members had one joint measure with 10% weight and individual performance measures with 20% weight. The joint FLT ‍measure related to the development of strategic growth options and the improvement of employee engagement. In 2024 the maximum STI was limited to 40% of the annual fixed compensation and the variable elements in total (STI and LTI) were limited to a maximum pay-out of 120% of the FLT members’ annual fixed compensation. The STI earned in 2024 and the award for the 2022–2024 LTI plan will be paid to the FLT members in the spring of 2025.  

The FLT members (excl. the President and CEO) earned a total of 810 matching shares (gross) for the 2021 Employee Share Savings (ESS) plan. The delivery of the net number of the matching shares (474 shares in total) took place in March 2024. With regard to the 2022 ESS plan, based on the number of shares held on 31 December 2024, the FLT members earned a total of 1,121 matching shares (gross) at the maximum. The matching share amount (gross) will be confirmed and the delivery of the net number of the matching shares will take place in the spring of 2025. Furthermore, the FLT members have participated in the 2024 Employee Share Savings (ESS) plan. The matching share amount (gross) will be confirmed and the delivery of the net number of matching shares will take place in the spring of ‍2027. 

Information on incentive plans

Short-term incentive plans (STI)

The Group-level measures and outcomes of the STI 2024 plan are described on Fortum Remuneration 2024 on page 6.

The design and performance measures of the STI 2025 plan are the same as in the STI 2024 plan comprising the Group’s financial, operational, customer- related and sustainability measures as well as business-/function-specific measures and/or team/individual measures. The financial performance measure consists of the Group’s comparable operating profit (30% weight) and Group fixed costs (10% weight). The operational measure (10% weight) is based on the availability of the production fleet, customer-related measure on the customer satisfaction index, CSI ‍(10% ‍weight) and sustainability measure on safety and security actions (10% weight). The business/function specific measures and/or team/individual measures are set taking the business/function priorities and employees’ roles and responsibilities into account (30% weight). 

Long-term incentive plans (LTI)

Fortum’s LTI programme consists of the annually commencing LTI plans with a three-year performance period. The relative TSR measured against a peer group of European utilities has been set as the financial measure in the LTI programme since 2019. An ESG-related measure as part of the LTI target setting was introduced for the first time in the 2020–2022 LTI plan.

In the 2022–2024 LTI plan, the ESG measure was related to the reduction of the absolute CO2 emissions in the European fossil fleet, based on a fossil fleet review addressing the Group’s European generation portfolio and a pathway developed to reach Fortum Group’s 2030 and 2035 climate targets. The relative TSR measured against a peer group consisting of European utilities and gas companies also remained as a measure in the plan. As a result of the divestment of Uniper in 2022, the ESG measure was revised in early 2023. The revised climate target for 2022–2024 was related to the reduction of the absolute CO2 emissions of the Company in Europe, i.e., including also Fortum’s Recycling and Waste business.

In the 2023–2025 LTI plan, the ESG measure is linked to emission reduction targets based on climate science (SBTi 1.5°C) and related to emissions in Europe and to Fortum’s reputation index development among key stakeholders. The relative TSR measured against a peer group of European utilities remained as a measure in the plan but as a result of the divestment of Uniper and Fortum’s renewed strategy, changes were made to the companies in the peer group to better correspond to Fortum.

In the 2024–2026 LTI plan, the performance measures consist of financial, customer-related and ESG measures. The relative TSR measured against a peer group of European utilities is set for the financial measure. The relative TSR peer group is the same as in the 2023–2025 LTI plan consisting of the following companies: A2A S.p.A., Acciona energías renovables, BKW AG, Centrica plc, CEZ, a.s., Drax Group plc, Encavis AG, EDP - Energias de Portugal, S.A., EDP Renováveis, S.A., Endesa, S.A., Enel SpA, ENGIE SA, E.ON SE, Hera S.p.A., Iberdrola, S.A., Iren SpA., Naturgy Energy Group, S.A., RWE Aktiengesellschaft, SSE plc, Veolia Environnement S.A., VERBUND AG and Ørsted A/S. The customer related measure is based on the increase in the share of long-term customer power purchase agreements (PPA) as part of hedging. The ESG measures are based on the development of a pipeline of renewable energy to respond to future demand-driven growth and emission reduction targets aligned with Science Based Targets initiative (SBTi 1.5°C).

In the 2025–2027 LTI plan, the performance measures consist of financial, customer-related and sustainability measures. The relative TSR measured against a peer group of European utilities is set for the financial measure. The relative TSR peer group is the same as in the 2024–2026 LTI plan, excluding Hera S.p.A., Iren SpA. and Veolia Environment S.A. which were removed from the 2025–2027 LTI plan peer group based on the divestment of Fortum’s Recycling and Waste business. The customer-related measure is based on the increase in the share of long-term customer power purchase agreements (PPA) as part of hedging. The sustainability measures are based on the development of a pipeline of renewable energy to respond to future demand-driven growth and emission reduction targets aligned with Science Based Targets initiative (SBTi 1.5°C).

Since 2020, as resolved by the Board of Directors, Fortum has also had a Restricted Share Plan (RSP) in place to supplement the LTI programme. In the RSP, a maximum number of shares can be allocated for a three-year plan period in accordance with the customary LTI plan, but the plan is excluded from the performance targets. On 31 December 2024, the amount of shares allocated was 30,772 in the RSP 2022–2024 and 35,951 in the RSP 2023–2025. In the RSP 2024–2026 the amount of shares allocated was 97,500 including allocations for two FLT ‍members. The share delivery of the RSP 2022–2024 took place in February 2025.

Summary table of LTI Performance Share Plans (PSP)

1)  In May 2023, the Fortum Leadership Team members decided to waive their awards for 2021–2023 LTI plan. Therefore, no shares were delivered to the Leadership Team members in 2024.  
2)  The number of shares granted presents the situation as on 31 December 2023 regarding the 2021–2023 LTI plan and as on 31 December 2024 regarding the 2022–2024, 2023–2025 and 2024–2026 LTI plans. The remuneration restrictions for the Fortum Leadership Team members in 2022 and 2023 have been taken into account in the relevant LTI plans. The number of shares granted for the 2021–2023 LTI plan takes also into account the LTI awards waived by the Leadership Team members. 
3)  Granted shares lost due to the termination of the employment after 31 December 2023 regarding the 2021–2023 LTI plan and after 31 December 2024 regarding the 2022–2024 LTI plan.
4)  The shares of the 2023–2025 LTI plan were granted in deviation from the schedule of the previous years in connection with the preparations related to the reorganisation of the Fortum operating structure, businesses and enabling functions. The first phase was completed at the end of August, and the allocation process was finalised by the end of November 2023. 

Summary of shares delivered (net) to the Fortum Leadership Team

1) In May 2023, the Fortum Leadership Team members decided to waive their respective awards for 2021–2023 LTI plan. Therefore, no shares were delivered to the Leadership Team members in 2024. 
2) The share delivery took place in February 2025. 
3) Eveliina Dahl, Bernhard Günther and Nora Steiner-Forsberg left Fortum on 31 December 2024. 

The FLT members are required to build up and maintain a holding in Fortum shares equivalent to 100% of their gross fixed compensation. 50% of the net shares (after-tax) received at each vesting of share-based remuneration must be retained until a shareholding of 100% of gross fixed compensation is met. 

Members of Fortum Leadership Team in Finland participate in the Finnish TyEL pension system, which provides for a retirement benefit based on earnings in accordance with the prescribed statutory system. In the Finnish pension system earnings are based on base pay, annual bonuses, and taxable fringe benefits, but gains realised from the LTI plans are not included.

In addition to the statutory pensions, the members of the Fortum Leadership Team have supplementary pension arrangements. The Group principle is that all new supplementary pension arrangements for the President and CEO as well as the Fortum Leadership Team are defined contribution plans.

Regarding the present Fortum Leadership Team, the retirement age is typically determined in accordance with the local legislation, in Finland in accordance with the Finnish Employees’ Pension Act. This applies also to the President and CEO. However, based on supplementary pension plan, for three executives the retirement age is 63. In Finland Fortum Leadership Team members (excl. two executives who are in the Fortum Pension Fund) have supplementary defined contribution pension plan. The premium of the supplementary defined contribution pension plan is 20% of the annual base salary. If executive’s contract is terminated before the retirement age, the executive who has the supplementary defined contribution pension plan is entitled to retain the funds that have accrued in the pension arrangement up to that time.

Members of the Fortum Leadership Team outside Finland participate in pension systems based on statutory pension arrangements and market practices in their local countries.

Short-term incentives (STI)

Fortum’s STI programme is designed to support the achievement of the Group’s annual financial, strategic and sustainability targets. As the main principle, all employees are covered by the programme or alternatively by a business-specific or a comparable local variable pay arrangement. 

The performance measures, weightings and targets for the selected measures for Fortum’s Leadership Team are annually set by the Board of Directors. Performance measures can vary from year to year to reflect the business priorities, and the composition typically includes a balance of Group’s financial, environmental, social and governance, as well as joint Leadership Team/individual strategic performance measures. As of 1 January 2025, the maximum STI is capped at 100% (2024: 40%) of the President and CEO’s annual fixed compensation. For the other Leadership Team members the maximum STI is capped at 50% (2024: 40%) of the annual fixed compensation. The Board of Directors regularly reviews the performance of the President and CEO and other Fortum Leadership Team members. 

Remuneration of other personnel is based on the targets of Group, unit or function and individual and team targets. Targets are set in Development Discussions held at the beginning of the year. Rewards for short-term incentive programmes are paid in cash. 

In addition to the short-term incentive programme, other variable reward mechanisms can be used in limited, precisely defined cases. Such mechanisms can be, for example, project and recognition fees. 

Long-term incentives (LTI)

The purpose of Fortum’s long-term incentive programme is to support the delivery of sustainable long-term performance, align the interests of management with those of shareholders, and support in committing and retaining key individuals. 

Fortum’s LTI programme provides participants with the opportunity to earn company shares. Under the LTI programme and subject to the decision of the Board of Directors, a new LTI plan commences annually. 

The Board of Directors approves the participation of the Fortum Leadership Team members in each annually commencing LTI plan. Subject to a decision by the Board of Directors the President and CEO is authorised to decide on individual participants and potential maximum awards for other participants than the Fortum Leadership Team in accordance with the nomination guidelines approved by the Board of Directors. Participation in the LTI plan precludes the individual from being a member in the Fortum Personnel Fund. 

Fortum’s LTI programme consists of annually commencing individual plans with a three-year performance period. Performance measures, weightings, and targets for these selected measures are set by the Board of Directors to ensure that they continue to support the company strategy. Performance measures typically include financial, share price-related, and sustainability measures and may also include other strategic measures. Following the end of the performance period the Board of Directors reviews the performance and determines the extent to which each of the targets has been achieved, in order to determine the final pay-out level. The LTI is allocated based on a maximum number of shares. As of 1 January 2025 the maximum LTI is capped at 80–120% (2024: 100%) of the President and CEO’s and other FLT members' annual fixed compensation at grant. 

Since 2020, Fortum has also had a restricted share plan (RSP) as a supplement to the LTI programme. In the RSP, a maximum number of shares can be allocated for a three year plan period in accordance with the customary LTI plan, but the plan is excluded from the performance targets. 

More detailed information of the LTI plans is available on this page under "Remuneration of the other Leadership Team members". 

Employee Share Savings programme – forShares

Fortum has an Employee Share Savings programme since the year 2020. The objective of the programme, forShares, is to motivate the employees to invest in Fortum shares and retain ownership in the Company. The programme consists of annually commencing savings periods, and the annual launch of each period is separately resolved by the Board of Directors. The participants of the ESS programme will invest a part of their monthly salary, and based on this investment they will, as a gross reward, be granted matching shares for the purchased savings shares after approximately three years from the beginning of the respective savings period. 

Based on the decisions made by the Board of Directors, the matching ratio for the 2024 and 2025 savings periods is 2:1. The employee participation rate in the 2024 savings period was 35% of the eligible employees, and 36% in the 2025 savings period.

The holding period for the shares purchased under the 2022 ESS plan ended at the end of 2024. The participants have earned matching shares (gross) according to the terms and conditions of the programme. The matching ratio for the 2022 savings period was 2:1. The delivery of the net number of the matching shares to the participants will take place in the spring of 2025.  

Fortum Personnel Fund

Fortum employees in Finland who do not participate in the long-term incentive programme are eligible for the Fortum Personnel Fund. The amount annually paid to the Personnel Fund is based on the achievement of the annual targets. In 2024, the payment to the Fund totalled EUR 1.2 million (EUR ‍0.0 million in 2023).