Remuneration

The Annual General Meeting (AGM) decides on the remuneration of the Board of Directors. Upon the recommendation of the Board’s People and Sustainability Committee, the Board submits the Remuneration Policy (at least within every 4 years) and Remuneration Report (annually) to the AGM. The Board decides on the remuneration of the President and CEO within the confines of the Remuneration Policy, and on the remuneration of the other Leadership Team members based on the President and CEO’s proposal.

In determining the remuneration, Vaisala takes into account its financial performance, employees’ knowledge and performance in their job, job grading and external remuneration references at relevant markets. Remuneration of the President and CEO follows the same principles and takes into account the special role of the position in the formation and implementation of the business strategy of the company and in achieving short- and long-term financial results.

Remuneration Policy
Remuneration Report 2021
Remuneration Report 2020

Remuneration of the Board of Directors

Remuneration of the members of the Board of Directors consists of an annual fee and a meeting fee. The members of the Board do not participate in incentive or retirement plans of the company.

The Annual General Meeting held in March 2022 confirmed that that the annual remuneration payable to the Chair of the Board of Directors is EUR 55,000 and each Board member EUR 40,000 per year. Approximately 40% of the annual remuneration will be paid in Vaisala Corporation’s series A shares acquired from the market and the rest in cash. No special terms or conditions are associated with the share ownership. In addition, the Annual General Meeting confirmed that the meeting fee for the Chair of the Audit Committee would be EUR 1,500 per attended meeting and EUR 1,000 for each member of the Audit Committee and Chair and each member of the People and Sustainability Committee and any other committee established by the Board of Directors for a term until the close of the Annual General Meeting in 2023. The meeting fees are paid in cash. Possible travel expenses are reimbursed according to the travel policy of the company.

Remuneration of the President and CEO

Information on the President and CEO Kai Öistämö’s current remuneration is provided in the table below.

Salary The fixed total salary, including base salary and fringe benefits, of the President and CEO is EUR 39,000 per month as of March 2022. He is entitled to vacation allowance as well.
Short-term incentives The President and CEO is entitled to participate in short-term incentive (STI) plan. STI is based on predefined performance criteria, which are Vaisala EBITA and Vaisala net sales development. The maximum STI payment is 72% of annual salary.
Share-based incentives

The President and CEO is entitled to participate in Performance Share Plan 2021-2023 and 2022-2024. The plans are based on predefined performance criteria, which are the Total Shareholder Return (TSR) of Vaisala’s share and operating profit during the performance period. The maximum gross number of reward shares in 2021-2023 plan is 23,100 and in 2022-2024 plan 20,000 Vaisala series A shares. The potential rewards will be paid partly in the company’s shares and partly in cash in 2024 and 2025. The reward is conditional to continued employment in Vaisala.

Special award The President & CEO's service contract includes a special award related to its entry into force. He was paid a reward corresponding to 8,000 Vaisala series A shares in March 2021 and a reward corresponding to 4,000 Vaisala series A shares in March 2022.
Shareholding requirement The President and CEO is required to build up and hold the reward shares received from the share-based incentive plans so that his total shareholding in Vaisala corresponds to at least the annual gross base salary.
Supplementary pension The President and CEO is entitled to participate in a supplementary defined contribution pension plan with an annual fee corresponding to three month’s base salary. The President and CEO’s retirement age is 62 years.
Termination of agreement The notice period for both parties is six months. If the company terminates the agreement, there is an additional severance pay equaling six times the monthly salary. 

 

Remuneration of the other Leadership Team members

The Board of Directors decides on the remuneration of the other Leadership Team members based on the President and CEO’s proposal and Vaisala's remuneration strategy and principles. Overall remuneration of the Leadership Team members consists of a monthly total salary (including base salary and customary fringe benefits), pension plan, and short-term incentive (STI) plan as well as share-based incentive plan. Information on the current remuneration is provided in the table below.

Short-term incentives Leadership Team members are entitled to participate in short-term incentive (STI) plan. STI is based on predefined performance criteria, which are Vaisala EBITA and Vaisala Net Sales development as well as unit based performance metrics depending on the position. The maximum STI payment is 60% of annual salary.
Share-based incentives Leadership Team members are entitled to participate in Performance Share Plans. The plans are based on predefined performance criteria, which are the Total Shareholder Return (TSR) of Vaisala’s share and operating profit during the performance period. The total maximum gross number of reward shares in 2021-2023 plan is 71,800 and in 2022-2024 plan 61,000 Vaisala series A shares. The potential rewards will be paid partly in the company’s shares and partly in cash. The reward is conditional to continued employment in Vaisala. 
Shareholding requirement Each Leadership Team member is required to build up and hold the reward shares received from the share-based incentive plans so that the total shareholding in Vaisala corresponds to the member’s annual gross base salary.
Supplementary pension Leadership Team members are entitled to participate in a supplementary defined contribution pension plan with an annual fee corresponding to two to three month’s base salary depending on role. The plan defines the optional retirement age as 62 years.
Termination of agreement Notice period for the Leadership Team members is three to six months for both parties depending on role. 

 

Share-base​d incentive plans

The share issue without payment approved by Vaisala’s Annual General Meeting on April 10, 2018, doubled the total number of series K and A shares. All share related figures have been adjusted to reflect the increased number of shares.

Share-based incentive plans are targeted to the group key employees. The performance criterion for 2018 plan was based on the group’s profitability in respective calendar year. From 2019 onwards the performance criteria of the plans are based on the development of the total shareholder return (TSR) and the group’s profitability during the three-year plan period. The rewards are paid partly in Vaisala’s series A shares and partly in cash. The cash portion covers taxes and tax-related costs arising from the reward to a key employee. No reward is paid if a key employee’s employment or service ends before the reward payment date. From the plan 2019-2021 onwards, Vaisala’s Board of Directors requires that the President and CEO and each member of the Leadership Team retains his/her ownership of shares received under this plan until the value of his/her ownership in Vaisala corresponds to at least his/her annual gross base salary.

On February 7, 2018, the Board of Directors resolved a share-based incentive plan 2018. On March 10, 2021, the reward corresponding to 166,200 series A shares, 55% of the maximum, was paid to 27 key employees. On June 28, 2019, the reward corresponding to 923 series A shares was paid to a key employee. On March 10, 2021, the reward corresponding to 8,000 series A shares was paid to Kai Öistämö, President and CEO. Closing price of Vaisala’s series A share was EUR 22.10 on the grant date of the incentive plan. A total expense of this plan of EUR 3.8 million was recorded for 2018–2021.

On February 12, 2019, the Board of Directors resolved a share-based incentive plan 2019-2021. On March 3, 2022, the reward corresponding to 247,900 series A shares, 100% of the maximum, was paid to 42 key employees. On March 3, 2022, the reward corresponding to 4,000 series A shares was paid to Kai Öistämö, President and CEO. Closing price of Vaisala’s series A share was EUR 19,06 on the grant date of the incentive plan. On March 10, 2021, the reward corresponding to 23,040 series A shares was paid to former President and CEO, Kjell Forsén.

On February 12, 2020, the Board of Directors resolved for a share-based incentive plan 2020–2022 for approximately 45 key employees. The reward will be paid in spring 2023. The maximum amount of this plan originally corresponded to 240,000 series A shares. The expenses of this plan are accrued from May 2020 to March 2023. Closing price of Vaisala’s series A share was EUR 28.65 on the grant date of the incentive plan. On March 10, 2021, the reward corresponding to 5,529 series A shares was paid to former President and CEO, Kjell Forsén.

On December 17, 2020, the Board of Directors resolved for a share-based incentive plan 2021-2023 for approximately 45 key employees. The reward will be paid in spring 2024. The maximum amount of this plan originally corresponded to 180,000 series A shares. The expenses of this plan are accrued from April 2021 to March 2024. Closing price of Vaisala’s series A share was EUR 32.10 on the grant date of the incentive plan.

On February 17, 2022, the Board of Directors resolved for a share-based incentive plan 2022–2024 for approximately 40 key employees. The reward will be paid in spring 2025. The maximum amount of this plan originally corresponded to 161,000 series A shares. The expenses of this plan are accrued from April 2022 to March 2025. Closing price of Vaisala’s series A share was EUR 45.00 on the grant date of the incentive plan.

On February 17, 2022, the Board of Directors also resolved for a Matching Share Plan (MSP) and Restricted Share Unit Plan (RSP) 2022–2026.

The Matching Share Plan 2022–2026 consists of matching periods lasting for 12 to 36 months, as decided by the Board of Directors. In the plan, the participants are given an opportunity to receive matching shares for the predetermined personal investment in Vaisala’s series A shares. The rewards based on the plan will be paid after the end of the matching period, provided that the share ownership prerequisite is fulfilled, and the employment or director contract is in force on the reward payment date. 

The Restricted Share Unit Plan 2022—2026 consists of vesting periods lasting for 12 to 36 months, as decided by the Board of Directors. In the plan, the participants are given an opportunity to receive a pre-determined number of restricted shares. The reward is conditional to a valid employment or director contract and the continuity of the employment or service during a vesting period. The rewards based on the plan will be paid after the end of the vesting period, provided that the employment or director contract is in force on the reward payment date. 

The rewards to be allocated from the MSP and RSP pool of shares during 2022–2026 correspond to the value of a maximum total 100,000 Vaisala’s series A shares, including the potential proportion to be paid in cash.