Guidelines for remuneration to Nobina’s senior management
The Annual General Meeting 2016 resolved on the following guidelines for remuneration to Nobina’s senior management for the period until the end of the next annual general meeting. The guidelines shall apply to agreements concluded after the Meeting.
Nobina’s senior management comprises the CEO, CFO, HR director, head of business development, managing directors of Nobina Sweden, Nobina Finland, Nobina Danmark, Nobina Norge and Swebus, head of key operational resources, head of communications and general counsel.
In order for the Company to be able to attract, develop and retain senior management with relevant experience and competence, it is important to have a competitive remuneration package in line with market terms for senior management in similar sectors.
The remuneration for the senior management shall consist of fixed salary, variable remuneration, pension and other customary benefits as well as any severance pay. The total remuneration shall be marketable and competitive and reflect the performance and accountability of the employee. The variable remuneration shall be based on the individual's performance and the company's performance against predetermined targets. Evaluation of targets shall take place annually. The variable remuneration shall consist of a cash bonus as the board determines.
Pension costs consist of defined contribution, where the premium is 30 per cent of the pensionable salary. The pensionable salary is the basic salary as long as the CEO remains an employee of the company. Termination salary is pensionable.
In the event of termination of employment, senior managers are entitled to a maximum of 12 months’ compensation. As a basic principle, a six-month mutual termination period shall apply between Nobina and senior manager. In addition, a maximum of six months of remuneration is payable should employment be terminated by Nobina.
The board of directors shall have the right to deviate from the above guidelines if, in an individual case, special circumstances exist.
The principal terms of employment for senior executives who were employed within the group during the financial year 2015/2016 is reported in the Company’s corporate governance report for 2015/2016 and in note 8 of the Company’s annual report for the financial year 2015/2016.
Pension and terms for the CEO
The retirement age for the company’s CEO is 62. Pension payments by the company are reduced to 90 per cent of salary when retirement takes place at the age of 62–63, 80 per cent of salary when retirement takes place at the age of 63–64 and 70 per cent of salary when retirement takes place at the age of 64–65. Nobina’s commitment to the CEO ends at retirement, at the age of 65. Pension expenses comprise defined contribution pensions, for which the premium is equal to 30 per cent of pensionable salary. Pensionable salary refers to basic salary as long as the CEO remains employed by the company. Salary paid upon termination is pensionable. The CEO has the right to 30 holiday days each year. The CEO is insured for 90 per cent of salary (sick pay) during a maximum of 365 days per calendar year without a qualifying period. In addition to the taxable benefits described above, benefits include health insurance. A certain part of any previously earned bonus is compensated through the allotment of shares.
During the financial year 2015/16, Nobina AB made payments under two incentive programmes, one covering ten senior executives (including the CEO) and the other five Board members (excluding the CEO), after which the incentive programmes were ended. The total cost for both programmes was SEK 172 million (including social security contributions and taxes), whereupon the senior executives received a total amount of SEK 123 million (excluding social security contributions and taxes) and the directors received a total amount of SEK 11 million (excluding social security contributions and taxes). The amount was paid in connection with the IPO, with 75 per cent of the after-tax amount being reinvested via the acquisition of shares in Nobina. The acquired shares were subject to lock-up agreements.
Remuneration of the Board of Directors
The fees to the Chairman and members of the Board are paid in accordance with the resolutions of the AGM. No remuneration is paid to the Board beyond that approved by the AGM now that the aforementioned incentive programme has been concluded. The CEO receives no directors’ fees. Directors’ fees paid during the financial year totalled SEK 2.7 million.