Corporate governance

Remuneration

Remuneration

The remuneration of F-Secure's management is designed to contribute to achieving the company's financial objectives and long-term profitability. The company's aim is to reward based on performance and competence. Remuneration is regularly assessed to ensure that remuneration is competitive, considering the individual performance and skills of employees.

F-Secure's Board of Directors has approved a remuneration policy describing the remuneration of F-Secure's Board of Directors and CEO, the principles for policy creation and its implementation. The remuneration policy was presented to the 2022 Extraordinary General Meeting of WithSecure that decided on the partial demerger of WithSecure into F-Secure.

Remuneration of the Board of Directors add

F-Secure’s General Meeting decides on the remuneration of the Board of Directors and its committees based on the Board’s proposal. Remuneration of the Board of Directors consists primarily of an annual remuneration that can be paid in shares, cash or a combination of the two.

WithSecure’s Extraordinary General Meeting, held in 31 May 2022 decided that the remuneration for the Board of Directors of F-Secure shall be paid as follows: EUR 80,000 for the Chairman of the Board of Directors, EUR 48,000 for the Chairman of each Committee, EUR 38,000 for other members of the Board of Directors, and EUR 12,667 for a member of the Board of Directors employed by F-Secure.

Approximately 40 per cent the Board of Directors’ remuneration is paid as shares in F-Secure to be repurchased from the market. F-Secure Corporation will repurchase the shares or transfer shares held by F-Secure Corporation as treasury shares for the account of and on behalf of the members of the Board of Directors of F-Secure.

The travel expenses and other costs of the members of the Board of Directors of F-Secure directly related to board work are paid in accordance with F-Secure’s compensation policy in force from time to time. Each member of the Board of Directors of F-Secure is paid a predetermined travel fee in addition to travel expenses for meetings held outside their country of residence in accordance with F-Secure’s travel policy in force from time to time.

Remuneration of the CEO add

The Board of Directors decides on the remuneration of the CEO and other compensations paid to him/her. The CEO’s remuneration consists of a fixed monthly salary, in addition to which the CEO is entitled to customary fringe benefits and incentives in accordance with incentive programmes as in force from time to time, as well as bonuses in accordance with the bonus programmes of F-Secure. The fixed monthly salary of the CEO is EUR 24,000.

The CEO’s service contract may be terminated at a six (6) months’ notice. Upon termination of the contract by the Company for reasons other than a breach of the contract, the CEO shall be entitled to receive severance pay equivalent to six (6) months’ salary in addition to the salary for the notice period. The Company shall take out a life insurance for the CEO with an amount equalling the annual gross salary of the CEO. The pension accumulation and retirement age of the CEO is determined by local legislation and practices.

Remuneration of the Group Leadership Team add

The company's Board of Directors decides on the salaries, rewards and other benefits of other members of the Group Leadership Team. The remuneration of the other members of the Group Leadership Team consists of monthly salary, customary fringe benefits and incentives as in force from time to time.

The pension benefits of the members of the Group Leadership Team are determined in accordance with applicable law or collective bargaining agreements.

Incentive Programmes add

F-Secure has share-based incentive programmes for the key personnel. Share-based incentive programs can be based on long-term financial and strategic performance or solely on the increase of the value of F-Secure’s shares. In programmes based on F-Secure’s share value increase, the participants may be granted subscription or purchase rights at a predetermined price. In performance-based incentive programmes, the achievement of performance criteria is evaluated after each performance period by the Board of Directors of F-Secure and the amount of the reward is determined based on the extent to which the targets have been reached during the performance period. The reward from an incentive programme based on F-Secure’s share value increase is defined by the future valuation of F-Secure’s share. In accordance with the incentive plans, no reward can be given to any participating employee, whose employment has terminated or a notice of termination has been given before the distribution of the share reward.

F-Secure has the following share-based incentive programmes:

  • share-based long-term incentive plan 2020–2022, in which the performance period continues until February 2023 and based on which the maximum number of share rewards to be paid is 340,000 shares in F-Secure;

  • share-based long-term incentive plan 2021–2023, in which the performance period continues until February 2024 and based on which the maximum number of share rewards to be paid is 372,000 shares in F-Secure;

  • share-based long-term incentive plan 2022–2024, in which the performance period continues until February 2024 and based on which the maximum number of share rewards to be paid is 324,000 shares in F-Secure; and

  • restricted share-based incentive plan 2021–2022, in which the performance period continues until January 2023 and based on which the maximum number of share rewards to be paid is 40,000 shares in F-Secure

The payment of share rewards is conditional on the fulfillment of certain performance criteria set out in the terms and conditions of the incentive plans and on the continuation of the person’s employment or service relationship with F-Secure and that no notice of termination of employment or service agreement has been given before the payment of the share reward.