Long-term Incentive Plan
In 2019, the Board of Directors of Nokian Tyres decided on two share-based incentive program that are performance share plan (PSP) and restricted share plan (RSP) for the Group's Management Team and certain key employees. The purpose of the share-based incentive plans is to combine the objectives of the owners and key employees to increase the value of the company in the long term and to commit the key employees to the company.
In Performance Share Plans, the maximum amount of the share-based reward is 250% for the President and CEO and 200% of the annual base salary for the member of the Group Management Team.
The earned share reward is gross, i.e. income tax is levied on it and the net reward is paid in shares.
The President and CEO and members of the Group Management Team must own 25% of the paid net shares until the total shareholding corresponds to the value of his/her gross annual salary.
Active Performance Share Plans
Performance period | Performance criteria | Gross number of shares | Release of shares |
2023–2024 About 150 participants, including the management team | EBITDA, growth in passenger car tyre production volume and reduction of direct CO2 emissions | 1,400,000 | 2026 |
2024–2025 About 150 participants, including the Management Team | EBITDA, growth in passenger car tyre production volume and reduction of direct CO2 emissions | 1,760,000 | 2027 |
Active Restricted Share Plans
Performance period | Performance criteria | Gross number of shares | Release of shares |
2022–2024 5 participants | Continued employment in the Group until the payment of the share-based reward and return on capital employed (ROCE) | 120,000 | 2025 |
2023–2025 2 participants | Continued employment in the Group until the payment of the share-based reward and return on capital employed (ROCE) | 120,000 | 2026 |
2024–2026 3 participants | Continued employment in the Group until the payment of the share-based reward and return on capital employed (ROCE) | 120,000 | 2027 |