Remuneration

The principles for remuneration of senior executives are approved by the shareholders at the Annual General Meeting once a year.

On the 2019 Annual General Meeting the following principles were adopted:

Remuneration and other terms of employment for members of the executive management within the group shall be balanced, in accordance with market practice and competitive on the geographical market where the member of the executive management operates, with respect to structure, scope and compensation levels. The reason for this is to both in a short- and long-term perspective enable the group to attract and retain competent members of the executive management and other employees.

The total remuneration to the members of the executive management shall consist of a balanced combination of fixed salary, variable remuneration, long-term incentive program, pension and other benefits and terms for termination/severance payment. The variable remuneration and the long-term incentive program are based on individual performances and shall be connected to predetermined and measurable criteria and each of the programs shall never exceed 50 per cent of the fixed salary upon full goal achievement.

Pension benefits shall be based on defined contribution plans and as main principle be paid in accordance with pension rules in each country. As a main principle, pension premiums are based solely on fixed salary. Certain adjustments may occur in individual cases in accordance with local market practice. Fixed salary during a period of notice (up to 12 months for the managing director and other members of the executive management) and severance pay are together not to exceed an amount equivalent to the individual’s fixed salary for two years.

These guidelines will be valid for employment agreements entered into after the annual general meeting’s resolution and for changes made to existing agreements thereafter. The board of directors is entitled to deviate from the above guidelines if there are particular reasons for doing so in an individual case.