Fortum’s short-term incentive scheme, i.e. bonus system, supports the realisation of the Group’s financial performance targets, sustainability targets, values and structural changes. The system ensures that the performance targets of individual employees align with the targets of the division and the Group. All Fortum employees, with the exception of certain personnel groups in Poland and Russia, are covered by the system.
The Board of Directors decides on the bonus criteria - based on predetermined and measurable performance and result targets - for senior management (the President and CEO and other members of the Fortum Management Team). The bonuses paid to the members of senior management are dependent on the Group’s financial performance and on their own success in reaching personal targets. The performance bonus criteria also include indicators related to sustainability targets. The maximum bonus for senior
management is 40% of the executive’s annual salary including fringe benefits (annual salary = 12 times the salary paid in December of the year in question).
The bonuses of the division heads, who are all members of the Fortum Management Team, are determined on the basis of the division’s performance and the Group’s financial performance. During the annual performance discussion held at the beginning of the year, the division head and his/her superior, the President and CEO, agree on the criteria used to assess the personal performance of the executive.
The Board of Directors assesses the performance of the President and CEO on an annual basis.