We manage our remuneration through clearly defined processes, with well-defined governance principles, ensuring that no individual is involved in the decision-making related to their own remuneration and that there is appropriate oversight of any compensation decision. Remuneration of the Board is annually presented to shareholders for approval at the Annual General Meeting on the recommendation of the Board’s Corporate Governance and Nomination Committee. The remuneration of the President and CEO is approved by the Board, upon the recommendation of the Personnel Committee.
Remuneration Policy was presented to the 2020 Annual General Meeting. The resolution was advisory, but the remuneration of the President and CEO as well as the Board of Directors shall be in line with this Policy as long as it remains in force. A Remuneration Policy will be presented to the Annual General Meeting again no later than the 2024 AGM.
Remuneration of the President and CEO
Pekka Lundmark started as President and CEO of Nokia on August 1, 2020. The below table outlines his pay overview for 2020. Other information is available in the Remuneration Policy 2020 below.
Annual base salary
EUR 1 300 000
Target award: 125% of base salary
Minimum 0% of base salary
Maximum 281.25% of base salary
- 100% Nokia scorecard
- 20% revenue
- 40% operating profit
- 40% free cash flow
Achievement against measures is multiplied by the business results multiplier (operating profit), the overriding affordability measure.
Three-year performance share plan
Target award: 200% of base salary
Minimum payout 0% of base salary
Maximum payout 400% of base salary(1)
Metric: Absolute Total Shareholder Return
Participation in the co-investment arrangement: Mr. Lundmark may purchase up to two times his base salary in Nokia shares and will be offered a matching award of two 2020 Performance Shares for each share purchased. The purchased shares must be held until January 1, 2023 to qualify for the matching award to vest.
Contribution to the mandatory TyEL pension plan in Finland.
Benefits & mobility
Life and critical illness insurance, private medical insurance and company car.
Share ownership requirement
Target: 3 times base salary.
(1) The maximum payout from the long-term incentive plan is 200% of the units awarded. At a target award of 200% of base salary this could result in a maximum payout of 400% of base salary ignoring share price movement.
Remuneration of the Board of Directors
Remuneration of the Board of Directors is annually presented to shareholders for approval at the Annual General Meeting. Information on the Board remuneration approved by the Annual General Meeting 2020 is available in the minutes of the meeting here.
Other information on remuneration
In addition, the below Remuneration Statement 2019 includes information on the remuneration of Nokia Board of Directors, the President and CEO and the Nokia Group Leadership Team for the financial year 2019.