Outokumpu’s Board of Directors has confirmed that share-based incentive programs are part of the incentive and commitment scheme for the company’s key personnel.

The objectives are to reward key personnel for good performance and thereby support Outokumpu’s strategy, and to direct management attention towards increasing Outokumpu’s profitability and shareholder value. The programs offer the possibility of receiving Outokumpu shares as an incentive, provided that the criteria set by the Board for each earnings period are fulfilled. Outokumpu's share-based programs consist of the Performance Share Plan (PSP) and Restricted Share Pool (RSP). In addition, Outokumpu has an ongoing Matching Share Plan for the management.

Outokumpu has currently no active stock option programs.

Performance Share Plan and Restricted Share Pool

The earning criteria of the Performance Share Planmeasures Outokumpu's profitability and the efficiency with which its capital is employed compared to a peer group. The maximum number of participants for each plan are 150 key employees. The Restricted Share Plan does not have any specific earning criteria and it is used for a limited number of employees, i.e. key recruitments, exceptional performance, high potential, retention need and other individual specific situations. 

Current plan periods

The Board of Directors has approved the commencement of Outokumpu’s share-based programs for the periods 2018–2020, 2019–2021 and 2020–2022, Performance Share Plan and Restricted Share Pool. The plans have three years' vesting period. The objective of the programs is to reward selected employees for good performance which supports Outokumpu's strategy, to engage them and to form part of a competitive compensation package.

The share rewards will be distributed in spring after the vesting periods, if the employment conditions and performance criterion are met. Applicable taxes will be deducted from gross shares, and the remaining net value will be delivered to the participants in Outokumpu shares.

Performance share plans, status on Dec 31, 2019  2017–2019  2018–2020 2019–2021  CEO PSP
2019–2020
Number of participants  119  129  134  1
Maximum number of gross shares to be paid  1,473,600 1,261,200 2,461,890   120,000
Earning criteria Return on operating capital compared to a peer group in 2019 Return on operating capital compared to a peer group in 2020 Return on operating capital compared to a peer group in 2021 Return on operating capital compared to a peer group in 2021
Share delivery year  2020 2021  2022  2021

 

Restricted Share Pool, status on Dec 31, 2019   Period 2017–2019  2018–2020 2019–2021 
Number of participants  54  45  68
Maximum number of gross shares to be paid  82,600   102,500 207,900 
Share delivery year  2020  2021  2022 

Matching Share Plan

The Board of Directors of Outokumpu established in 2016 a Matching Share Plan program for key management for the years 2016–2020 to emphasize shareholder value creation, enforce an ownership culture and to incentivize the achievement of the 2020 vision.

According to the plan, the participants have invested an amount corresponding to 30–120% of their annual gross base salary into Outokumpu shares. Outokumpu will match each share acquired by the participant with two gross shares from which the applicable taxes will be deducted and the remaining net number of shares will be delivered to the participant. The matching shares are delivered in four instalments at the end of 2017, 2018, 2019 and the final being delivered in 2020. To receive the matching shares, the participants are required to keep all of the shares they have acquired until the vesting of each matching share tranche. Outokumpu uses its treasury shares for the reward payments, so the total number of shares of the company will not change.

Matching share plans, status on Dec 31, 2019 ceo plan 2019–2020 CEO PLAN 2015–2019 management plan  
Number of participants  1  1  25
Total number of gross shares (taxes included)  168,888  1,157,156 1,420,746
Shares delivered (net of taxes)*  -  289,289  495,638
Gross shares to be paid  168,888  0  355,181
Share delivery years  2020  2016, 2017, 2018, 2019 2017, 2018, 2019, 2020

*) For the CEO, the same net amount was delivered in 2016, 2017 and 2018. 


For more information on the previous and ongoing share plans, please check our Remuneration statements.