Fortum’s short-term incentive scheme (STI), 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 – including all performance measures, target values and performance scales – for senior management.
The bonuses paid to the members of senior management are dependent on the Group’s financial performance – measured in 2014 by profitability and cash flow, divisional targets and 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, all of whom are members the Fortum Executive Management Team, are determined on the basis of the division’s performance and the Group’s financial performance. The criteria used to assess the personal performance of the executive are agreed in the annual performance discussions held at the beginning of the year.
The Board of Directors assesses the performance of the President and CEO on a regular basis.