Proposal for remuneration guidelines for the CEO and other senior managers 2016
The Board of Directors of Capio AB proposes that the Annual General
Meeting 2016 adopts guidelines for remuneration to the CEO and
other senior managers in accordance with the following:
• These guidelines concern the remuneration and other terms of employment for the CEO and other senior managers. Senior managers include Group Management
• The guidelines are valid for employment agreements entered into after the approval of the guidelines by the Annual General Meeting and for changes made to existing employment agreements thereafter
• Remuneration to the CEO and other senior managers will include fixed salary (base salary), possible variable remuneration, other benefits and pension. The variable compensation comprises (i) an individual annual variable compensation, and may also, as a supplement, include (ii) a long-term incentive program
• The total remuneration should correspond to market conditions and be competitive in the senior manager’s relevant labor market. Fixed salary and variable remuneration is to be linked to the manager's responsibility and authority. The annual variable salary for the CEO and the other members of the management may not amount to more than 60 percent of the fixed annual gross salary. The variable remuneration is to be based on the outcome of predetermined objectives and, as far as possible, be linked to the growth in value of the Capio share, from which the shareholders benefit
• Programs for variable remuneration shall be designed in such a way as to enable the Board of Directors, if exceptional economic conditions prevail, to restrict or omit payment of the variable remuneration if such action is deemed reasonable and consistent with the company’s responsibility towards shareholders, employees and other stakeholders
• In order to establish a long-term perspective in the decision-making and to ensure long-term achievement of goals, the Board of Directors may propose the general meeting to resolve on long-term incentive programs. The program participants shall be nominated based on i.a. competence and performance. The outcome shall be dependent on the fulfillment of certain predetermined performance requirements. The aim of the Group’s long-term incentive programs shall be to create a long-term commitment to Capio, to offer the
participants to take part in Capio’s long-term success and value creation and to create possibilities to attract and retain members of the management and key employees
• In the event of termination of employment, the notice period should not exceed 12 months. The right to severance payment, which shall only be payable if the termination is initiated by the company, should not exceed 12 months, and include a reduction of other income during the period. Consequently, the combined notice period and period during which the employee is entitled to severance payment should not exceed in aggregate 24 months
• Pension benefits should if possible be defined by contribution but may also be defined by benefit, or by a combination thereof, and should entitle the senior manager to pension payments from the age of 65 at the earliest, unless local regulations provide otherwise. Variable remuneration shall not be included in the base when calculating pension unless local regulations provide otherwise
• Matters of remuneration for the CEO shall be prepared by the
Remuneration Committee and be resolved by the Board of Directors.
The remuneration for senior managers who report directly to the CEO shall be prepared by the Remuneration Committee and can also be resolved by the Remuneration Committee
• The Board of Directors may derogate from the guidelines in certain
cases if there are special reasons for doing so. Special reasons may
include, for example, offering to members of the senior management
who reside outside Sweden terms that are competitive in their
country of residence
The decisions already taken on remuneration to the senior managers
that has not become due for payment at the time of the Annual
General Meeting 2016 fall within the frames of these guidelines.
Remuneration guidelines and related costs for Group Management
in 2015 are presented in note 4 in the Annual Report.
Deviations from the guidelines
All employment agreements concerning the remuneration for the CEO and other senior managers in 2015 were entered into before the adoption of the remuneration guidelines by the Extraordinary General Meeting on June 16, 2015. Consequently, there are current remuneration terms for Group Management deviating from adopted guidelines. These deviations mainly relate to dismissals where six senior managers (not the CEO) are entitled to severance pay. Pension benefits for Group Management are in line with local regulations why a number of Group Management members are entitled to pension payments before the age of 65. For further information, refer to note 4 in the Annual Report.