Compensation

The Group's compensation system consists of the basic salary, fringe benefits and a short-term incentive plan, which is subject to an individual employee's position. The superior of an employee's immediate supervisor is responsible for approving an individual employee's compensation.

On 10 December 2014, the Board of Directors approved the establishment of a new long-term share-based incentive plan, which covered a maximum of 25 members of the Group’s key management. The plan covered the years 2015-2017. On 11 December 2015, the Board of Directors approved the establishment of a new long-term share-based incentive plan, which covered a maximum of 25-30 members of the Group’s key management. The plan covers the years 2016-2018. On 12 December 2016, the Board of Directors approved the establishment of a new long-term share-based incentive plan, which covered a maximum of 25-30 members of the Group’s key management. The plan covers the years 2017–2019. Further, on 13 December 2017, the Board of Directors approved the establishment of a continuation to the long-term share-based incentive plan, which may cover a maximum of 50 members of the Group’s key management. The plan covers the years 2018–2020.

The purpose of the plans is to retain key management, as well as to motivate and reward the management for good performance that supports the company's profitability and the implementation of the company's strategy. The plans also encourage the key management to further acquire and own Uponor's shares, which will contribute to aligning the interests of the management, the company and the shareholders.

A Group employee is not entitled to a separate fee for a board membership within a Group company.

The Board determines the CEO's employment terms and conditions and annual compensation, and approves ExCom members' annual compensation, based on the CEO's proposal.