Remuneration

The aim of the remuneration system of the Board of Directors and the CEO is to contribute to the favourable development of shareholder value, promote the Company’s competitiveness and long-term financial success as well as the achievement of the Company’s targets and the implementation of its strategy.

The main principle of the Company’s Remuneration Policy is that the remuneration of the Board of Directors and the CEO should promote the achievement of the aforementioned objectives and offer a fair, engaging and competitive system which adheres to the market practices in its extent and structure. The principles and decision-making process concerning the remuneration of governing bodies is described in more detail in the Remuneration Policy.

The Remuneration Report of Pihlajalinna Plc (“the Company”) is a Remuneration Report for Governing Bodies as referred to in the Limited Liability Companies Act, the Securities Markets Act and the Corporate Governance Code 2025. It describes the remuneration of the members of the Board of Directors, the CEO and the Deputy CEO registered in the Trade Register, if any, during the previous financial year. The aim of the Remuneration Report for Governing Bodies is to provide a clear picture of the implementation of the Company’s Remuneration Policy

Remuneration Report 2024
Remuneration Report 2023
Remuneration Report 2022
Remuneration Report 2021

Share-based incentive plan

The Board of Directors of Pihlajalinna Plc approved the establishment of a new long-term share-based incentive plan for key employees of the Group on 13 December 2024. The purpose of the plan is to align the interests of the company’s shareholders and key employees to increase the company’s value in the long term. The purpose is also to commit key employees to implement the company's strategy, objectives and long-term interest and to offer them a competitive incentive plan based on earning and accumulating the company’s shares. The plan replaced the previous share-based incentive plan launched in 2022.

The Performance Share Plan 2025–2029 consists of three performance periods, covering the financial years 2025–2027, 2026–2028 and 2027–2029 respectively. The Board of Directors will resolve annually on the commencement and details of a performance period.

The target group in the performance period 2025–2027 consists of approximately 30 key employees, including the members of the Group Management Team and the CEO. The performance criteria of the performance period 2025–2027 are tied to Relative Total Shareholder Value, Growth Rate, Return on Capital Employed and rate of sickness related absences.

Earning of the incentive plan

In the incentive plan, the target group has an opportunity to earn Pihlajalinna’s shares based on performance. The potential rewards from the plan will be paid within five months after the end of each performance period.

The value of the rewards to be paid on the basis of the plan corresponds to a maximum total of 553,000 shares of Pihlajalinna, including also the proportion to be paid in cash. The potential rewards will be paid partly in Pihlajalinna’s shares and partly in cash. The cash proportion of the reward is intended to cover taxes and statutory social security contributions arising from the reward to the key employee. As a rule, no reward will be paid if the key employee’s employment or director contract terminates before the reward payment.

The Group Management Team members must hold 50 per cent of the received shares, until the value of the Group Management Team member’s total shareholding in Pihlajalinna equals to 50 per cent of their annual base salary for the calendar year preceding the payment of the reward. The CEO must hold 50 per cent of the shares received, until the value of their total shareholding in Pihlajalinna equals to their annual base salary for the calendar year preceding the payment of the reward. This number of shares must be held as long as the position as the CEO or the membership in the Group Management Team continues.