Remuneration

The main objectives of remuneration at Marimekko Corporation are to promote competitiveness and long-term financial success of the company, contribute to the favourable development of shareholder value and increase the commitment of the company’s key persons.

Remuneration of the members of the Board of Directors

The Annual General Meeting decides on the remuneration payable to the Board of Directors. The Audit and Remuneration Committee of the company handles and prepares matters related to the remuneration payable to the Board of Directors. All members of the Audit and Remuneration Committee are independent of the company and its significant shareholders. A person serving the company under an employment or service agreement receives no fee for the membership of the Board of a Marimekko subsidiary.

According to the resolution by the Annual General Meeting of 12 April 2018, approximately 40 percent of the annual remuneration to the Board of Directors in 2018 was paid in Marimekko Corporation’s shares acquired from the market and the rest in cash. In case a member of the Board held the company’s shares worth more than EUR 500,000 on the date of the Annual General Meeting, 12 April 2018, the remuneration was paid entirely in cash. According to the decision of the Annual General Meeting, the shares were acquired directly on behalf of the Board members within two weeks from the release of the interim report for 1 January–31 March 2018 or if this was not possible due to insider rules, as soon as possible thereafter. There are no special rules applying to the Board of Directors concerning the ownership of shares received as remuneration. The Board is not, as a rule, entitled to any other financial benefits in addition to the fixed annual payment. Marimekko has not issued monetary loans to the Board members or guarantees or other contingent liabilities on their behalf.

In 2018, the Annual General Meeting resolved that the annual remuneration payable to the members of the Board be as follows: EUR 40,000 to the Chairman, EUR 30,000 to the Vice Chairman and EUR 22,000 to the other members of the Board. The Board members receive no additional fee for attending the Board meetings. Committee members receive no additional remuneration for committee work, nor any additional fee for attending committee meetings. The remunaration of the Vice Chairman of the Board includes chairing the Audit and Remuneration Committee.

In additional to the annual remuneration of the Chairman of the Board decided on by the Annual General Meeting, Mika Ihamuotila, full-time Chairman of the Board has been paid a monthly fee of EUR 8,800 pursuant to a separate full-time executive service agreement with the company. No other fees, such as annual bonuses or benefits, in addition to the above-mentioned, have been paid to Mr Ihamuotila. His pension is determined by the statutory employee pension plan (TyEL). The Audit and Remuneration Committee of the company handles and prepares matters related to the terms of the executive service agreement and remuneration of the full-time Chairman of the Board.

Remuneration report

Fees to members of Marimekko’s Board of Directors 2017–2018

(EUR 1,000) Fee for Board work Other financial benefits Total compensation in the financial year
2018 2017 2018 2017 2018 2017
Mika Ihamuotila 40 40 123*) 111*) 163 151
Elina Björklund 30 30 30 30
Rebekka Bay 22 22 6**) 32**) 28 54
Arthur Engel 22 22 4**) 8**) 26 30
Mikko-Heikki Inkeroinen 22 22 22 22
Helle Priess 22 22 80**) 20**) 102 42
Catharina Stackelberg-Hammarén 22 22 22 22
 Total 180 180 213 171 393 352

*) Monthly fee paid under the full-time executive service agreement.
**) Consultancy compensation.

In accordance with the resolutions by the Annual General Meeting on 6 April 2017 and 12 April 2018, part of the annual remuneration to the Board of Directors was paid in Marimekko Corporation’s shares:
2017: the Vice Chairman of the Board received 1,113 shares and the other members 816 shares each.
2018: the Vice Chairman of the Board received 859 shares and the other members 630 shares each.

In accordance with the resolution by the Annual General meeting, the remuneration of the Chairman of the Board was paid entirely in cash in both 2017 and 2018 as Mika Ihamuotila held company´s shares worth more than EUR 500,000 on the dates of the Annual General Meeting.

Remuneration of the President and CEO

The Board of Directors of Marimekko Corporation decides on the salary and remuneration payable to the President and CEO. The Audit and Remuneration Committee of the company handles and prepares matters related to the terms of the service contract and remuneration of the President and CEO. All members of the Audit and Remuneration Committee are independent of the company and its significant shareholders.

The remuneration of the President and CEO consists of a regular salary and fringe benefits, an annual bonus as well as a so called long-term bonus system targeted at the company’s Management Group, including the President and CEO. Under the contract between the company and Tiina Alahuhta-Kasko, the President and CEO is, in addition to her regular salary, entitled to an annual bonus, the maximum amount of which corresponds to her regular salary for four months. The principles determining the bonus are confirmed annually by the Board of Directors based on a proposal by the Audit and Remuneration Committee. The President and CEO’s pension is determined by the statutory employee pension plan (TyEL). If the President and CEO resigns of her own accord, her term of notice is six months and she is entitled to a remuneration corresponding to her regular salary for six months. If the company terminates the contract, the term of notice is six months and the President and CEO is entitled to a remuneration corresponding to her regular salary for six months. The remuneration in case of termination is tied to a fixed-term non-compete obligation.

Remuneration of other management

The Board of Directors of Marimekko Corporation decides on the salary and remuneration payable to the members of the Management Group. The Audit and Remuneration Committee of the company handles and prepares matters related to the terms of the service contracts and remuneration of senior management. All members of the Audit and Remuneration Committee are independent of the company and its significant shareholders.

The remuneration of the Management Group members consists of a regular salary and fringe benefits, an annual bonus as well as a so called long-term bonus system. The annual bonus is based on the growth of the company’s consolidated net sales, operating result and individual objectives separately determined by the Board of Directors. The members of the Management Group fall within the scope of the statutory employee pension plan (TyEL).

The Board of Directors of Marimekko Corporation decided on 7 May 2014 on establishing a long-term bonus system targeted at the company’s Management Group. The purpose of the bonus system is to encourage the Management Group to operate with a business mentality and to add to the company’s value in the long-term in particular. The aim is to combine the owners’ and the Management Group’s targets in order to increase the company’s value and to elicit the Management Group’s commitment to the Company over a span of several years.

The system was composed of two earnings periods, which were 8 May 2014–31 October 2017 and 8 May 2014–28 February 2018. The possible bonus for each earnings period was based on the total yield on Marimekko Corporation’s shares, including dividends. The bonus was determined to be paid  in cash in two instalments. The first instalment would have been due in autumn 2017, and the second instalment became due in spring 2018. A total of EUR 177 thousand was paid in bonuses in spring 2018. Earning the bonus required that the person was still working for the company at the time of the payment and committed themselves to using 50 percent of the net value of the bonus for acquiring the company’s shares at transaction price. The shares acquired with the bonus cannot be surrendered prior to two years from the time of acquiring the shares. At the time of its conlusion, the system encompassed eight Management Group members, including the President and CEO.

On 14 February 2018, the Board of Directors decided on establishing a new bonus system targeted at the company’s Management Group. The system is composed of two earnings periods, which are 1 April 2018–30 September 2021 and 1 April 2018–31 January 2022. The possible bonus for each earnings period will be based on the total yield on Marimekko Corporation’s shares, including dividends. The bonus is planned to be paid half in company shares and half in cash in two instalments. The possible first instalment will become due in autumn 2021 and the second instalment in spring 2022. The shares received as part of the bonus are subject to a two-year transfer restriction. Earning the bonus requires that the person is still working for the company at the time of the payment. The annual maximum value of the bonus paid to a member of the Management Group under the bonus system equals the approximate value of annual gross salary. The system encompasses seven Management Group members, including the President and CEO.

Salaries and bonuses paid to the President and CEO 2017–2018

(EUR 1,000)

Salary

Annual bonus

Personnel
share issue

Long-term
bonus system

Total compensation
in the financial year

 2018

 2017

2018

2017

2018

2017

2018

2017

2018

2017

Tiina Alahuhta-Kasko

292

252

38

63

73*)

403

316

Total

292

252

38

63

73

403

316

*) 50 percent of the net value of the bonus used for acquiring the company’s shares at transaction price.

Salaries and bonuses paid to other management 2017–2018

(EUR 1,000)

Salary

Annual bonus

Personnel
share issue

Long-term
bonus system

Total compensation
in the financial year

 2018

 2017

2018

2017

2018

2017

2018

2017

2018

2017

Management Group

961

825

62

39

104*)

1,127

864

Total

961

825

62

39

104

1,127

864

*) 50 percent of the net value of the bonus used for acquiring the company’s shares at transaction price.

 

Remuneration Statement