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. Starting from the Annual General Meeting 2021, the Remuneration Report will be presented to the shareholders for an advisory vote annually.
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 2021. Other information is available in the Remuneration Policy 2020 and the Remuneration Report for 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
- 70% operating profit
- 20% strategic objectives
- 10% environment, social and governance-related metric
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
The co-investment arrangement: Mr. Lundmark may invest up to two times his base salary in Nokia shares and is offered a matching award of two 2021 Performance Shares for each share invested. The invested shares must be held for three years from the date of the matching award for the matching shares to vest, which will be subject to performance.
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 2021 is available here.
In addition, information on the remuneration paid to the members of the Board of Directors during the previous financial year is included below in the Remuneration Report for 2020.
Other information on remuneration
In addition, the below Remuneration Statement included in our Nokia in 2020 Annual Report includes information also on the remuneration of the Nokia Group Leadership Team and their aggregate paid remuneration for the financial year 2020. For 2021 the Group Leadership Team members are offered a similar co-investment arrangement as the President and CEO.