According to the Remuneration Policy for Governing Bodies of Wärtsilä (the “Remuneration Policy” or “Policy”), remuneration at Wärtsilä shall follow the ’Pay for Performance’ principles of being responsive, transparent, and competitive, while aligning relevant interests. These principles are used for structuring the reward approach throughout the organisation, and are designed to align employee rewards with the interests of the company and its shareholders.
Remuneration for the Board of Directors (the “Board”) consists of annual fees for Board membership, attendance fees, and committee fees. Fees vary based on position, workload, and responsibility. Annual fees are paid in shares and cash, attendance and committee fees in cash. The Annual General Meeting (“AGM”) decides on the fees for each term of office.
Remuneration of the Chief Executive Officer (the “CEO”) consists of a base salary, pension, and benefits, as well as short- and long-term incentives. The objective is to have a good balance of rewarding elements, and to guarantee a market competitive level of fixed remuneration. This is supplemented with short- and long-term incentive schemes aimed at providing an appropriate reward for driving company performance.
The Board may deviate from the Policy in extraordinary circumstances.
Remuneration policy (pdf)
The Board fees approved for 2024 saw minor adjustments to Committee and meeting fees but otherwise remained unchanged.
Incentive plan pay-outs
In the short-term incentive plan (STI), the CEO and Board of Management’s focus was on group and business financial targets for 2024.
The STI for 2023 resulted in a pay-out (paid in 2024).
The STI for 2024 resulted in a pay-out (will be paid in 2025).
In our Performance Share Plan (PSP), in addition to Economic Value Added (EVA), we have also included sustainability performance metrics, which are linked to our strategic target of providing a product portfolio that will be ready for zero carbon fuels by 2030.
The 2021-2023 PSP resulted in a pay-out (paid in 2024).
The 2022-2024 PSP resulted in a pay-out (will be paid in 2025).
Remuneration Report 2024
From proxy advisors' feedback and the shareholder engagement in 2024, we noted the request for an increased level of transparency for the short-term and long-term incentive plans. We have acted on this feedback and in this Remuneration Report 2024 we have disclosed numerical achievement rates per STI and PSP performance measures.
Remuneration report 2024 (pdf)