Corporate Governance

Remuneration

The remuneration policy of the governing bodies was presented to the Annual General Meeting of the Company held March 25, 2021 and approved in the advisory resolution. The remuneration policy defines the principles and decision-making processes for the remuneration of the company’s governing bodies, i.e. the board of directors as well as the managing director and possible deputy managing director.

Remuneration policy

The salaries and bonuses paid to Verkkokauppa.com's board and CEO are presented in the annual remuneration report.

Decision-making procedure add

Borad of Directors

The General Meeting decides on the remuneration payable to the members of the Board. The Shareholders’ Nomination Board prepares the proposal to the General Meeting relating to the remuneration of Board members.

CEO and Management Team

The Nomination and Remuneration Committee of the Board of Directors prepares the framework for remuneration of the Company’s Chief Executive Officer and the management team. The Board of Directors resolves on the remuneration and other benefits of the CEO and the management team operating under the CEO, based on the recommendation by the Nomination and Remuneration Committee.

Principles of remuneration add

Board of Directors

The fees of the members of the Board of Directors consist of an annual fee paid for the Board membership as well as Committee fees paid either as an annual fee or meetings fees. The fees also vary depending on the member’s role as a Chair or member of the Committee and the Board.

Chief Executive Officer

The remuneration of the CEO comprises a fixed base salary and fringe benefits (such as rights for Company car and phone), an incentive bonus related to the achievement of financial and operational targets as well as a share-based incentive scheme for key employees (see “Short-term and long-term incentives” below). The terms of duty have been agreed upon in writing and the CEO is elected for a term continuing until further notice. According to the agreement, the notice period for the CEO is twelve months. The statutory pension age is applied to the CEO. A 12-month non-compete and non-recruiting obligation are applied to the CEO. The CEO is entitled to a compensation corresponding to his base salary for six months, if he is dismissed by the employer without being in breach of contract. This compensation corresponding to the 6-month salary is not paid if the CEO resigns on his own initiative.

The Company pays the CEO’s statutory pension insurance premiums. The CEO does not have any additional pension agreements with the Company and there are no other agreements, based on which the CEO would be entitled to any additional benefits at the end of his service contract.

Management Team

The remuneration of the management team comprises a base salary and fringe benefits (such as rights for Company car and phone), an incentive bonus related to the achievement of financial and operational targets as well a share-based incentive scheme for key employees (see “Short-term and long-term incentives” below). The basic salary can consist of hourly wage or monthly wage. Certain management team members are entitled to additional pay in accordance with the collective agreement for commercial sector (FIN: kaupan alan työehtosopimus) for work outside normal working hours.

If the employment relationship of a member of the management team is terminated for a reason not attributable to the Company, a non-compete period of six months is observed as a rule. The member of the management team is entitled to a monthly compensation for such period, corresponding to the average monthly salary paid for normal working hours.

The management team members do not have any additional pension agreements with the Company and there are no other agreements, based on which the members of the management team would be entitled to any additional benefits at the end of their employment relationship.

Short-term and long-term incentives add

The variable salary component for the CEO and management team consists of a short-term incentive programme as well as a share-based incentive programme linked to the Company’s long-term targets.

Board remuneration add

Board remuneration

In accordance with the decision of the Annual General Meeting held on 4 April 2024, the remuneration payable to Verkkokauppa.com Board members is the following:

Chairperson, annual fee, EUR 70,000 and
Member, annual fee, EUR 35,000

Half of the annual fee is paid in Verkkokauppa.com Oyj shares either purchased from the market or alternatively by using treasury shares held by the Company.

The annual fees payable to members of the committees of the Board of Directors for the term of office ending at the close of the Annual General Meeting in 2024 are proposed to be the following:

EUR 12,000 for the Chairperson of the Audit Committee,
EUR 10,000 for the Vice Chairperson of the Audit Committee,
EUR 6,000 for each member of the Audit Committee,
EUR 8,000 for the Chairperson of the Remuneration Committee, and
EUR 4,000 for each member of the Remuneration Committee.

The fees of the committees are proposed to be paid in cash. It is additionally proposed that the members of the Board of Directors shall be compensated for reasonable accrued travel and lodging expenses as well as other potential costs related to Board and Committee work.

Name	Committee Membership	Board Annual Fee in Total, EUR	Portion of annual fee paid in shares (Number of shares)
Arja Talma	Chairperson of Remuneration Committee since 24 March 2022, Vice Chairperson of Audit Committee	70,000 (70,000)	8,490 (3,678)
Christoffer Häggblom	Member of Remuneration Committee since 24 March 2022 Member of Audit Committee	55,000 (55,000)	6,670 (3,441)
Robert Burén	(member until 25 March 2021)	- (8,750)	- (453)
Mikael Hagman	(member until 4 January 2021)	-	-
Mikko Kärkkäinen	(member since 25 March 2021)	35,000 (26,250)	4,245 (1,613)
Frida Ridderstolpe	(member since 25 March 2021)	35,000 (26,250)	4,245 (1,613)
Johan Ryding	(member since 25 March 2021)	35,000 (26,250)	4,245 (1,637)
Kai Seikku	Chairperson of Audit Committee, Member of Remuneration Committee	35,000 (35,000)	4,245 (2,066)
Samuli Seppälä	Member of Audit Committee Member of Remuneration Committee, both until 25 March 2021	35,000 (35,000)	0 (0)

CEO remuneration add

CEO remuneration in 2023

Application of performance criteria and payable rewards

Application of performance criteria and payable rewards In 2023, the CEO of Verkkokauppa.com had a performance-based short-term incentive and a long-term performance matching share plan

2020–2022 launched on 10 May 2023 in place. The aim of the short-term incentive is to guide towards achieving short-term financial and operative targets and to award for the achievements in accordance with the Company’s business strategy. The aim of the long-term incentive plan is to award for the achievement of strategic and financial targets and for the long-term shareholder value creation, to align the interests of the CEO and the Company’s shareholders as well as to accumulate the CEO’s ownership in the Company in accordance with the share ownership guidance.

In 2023, the performance criteria for the short-term incentive plan were based on the net working capital improvement of 25% and on the comparable operating profit (comparable EBIT) growth of 75%. The maximum CEO remuneration under the short-term incentive plan in the financial year 2023 was equivalent to six months’ fixed salary. The targets set by the Board for the financial year 2023 were achieved in part, to approximately 29 per cent.

Remuneration paid to CEO in 2023 (and 2022)