Share-based programs are part of the Group’s incentive and commitment-building system for key employees. The objectives are to align the interests between key employees and shareholders, promote shareholder value creation and the achievement of long-term strategic targets. 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 has currently no active stock option programs.
Performance Share Plan and Restricted Share Pool
Outokumpu's share-based programs consist of the Performance Share Plan and Restricted Share Pool. The Performance Share Plan (PSP) includes an earning criterion and is part of the regular compensation of top executives, with a maximum number of participants of 150.
The Restricted Share Pool (RSP) does not have any specific earning criteria and it is used for a limited number of employees, for key recruitments, exceptional performance, high potential, retention needs and other individual specific situations..
Plan periods
Outokumpu has currently three ongoing plan periods for the Performance Share Plan and Restricted Share Pool: 2021–2023, 2022–2024 and 2023–2025. The share rewards from the 2020–2022 plan were paid in 2023.
The share rewards will be delivered in next spring after the end of each plan period if the employment conditions and performance criterion is met. Upon delivery, applicable taxes will be deducted from gross shares, and the remaining net value will be paid to the participants in Outokumpu shares.
The tables below include the participants, maximum number of gross shares and earning criteria of the ongoing share plans as well as the latest ended plan.
| Performance share plans | 2020–2022 | 2021–2023 | 2022–2024 | 2023–2025 |
|---|---|---|---|---|
| Number of participants | 88 | 98 | 105 | max 200 |
| Maximum number of gross shares to be paid | 2,903,702 | 3,700,000 | 3,700,000 | 3,700,000 |
| Earning criteria | Return on operating capital compared to a peer group | Return on capital employed as an absolute measure | Return on capital employed (80%) CO2 emissions per ton of crude steel produced (20%) | Return on capital employed (80%) and CO2 emissions per ton of crude steel produced (20%) |
| Share delivery year | 2023 | 2024 | 2025 | 2026 |
| Restricted Share Pool | 2020–2022 | 2021–2023 | 2022–2024 | 2023–2025 |
|---|---|---|---|---|
| Number of participants | 34 | 56 | 67 | * |
| Maximum number of gross shares to be paid | 161,900 | 250,000 | 500,000** | 250,000 |
| Share delivery year | 2023 | 2022, 2023, 2024 | 2023, 2024, 2025 | 2024, 2025, 2026 |
*) Number of participants to be confirmed later on.
**) The Restricted Share Plan (RSP) 2022–2024 includes a one time increase of share budget to maximum 500,000 gross shares to cater for an extra retention plan for up to 5–6 selected management positions with highest retention risk.
Ownership requirement
The members of Outokumpu’s Leadership Team, including the CEO, are expected to own Outokumpu shares received under the company’s share-based incentive programs corresponding to the value of their annual gross base salary. Half of the net shares received from the share-based incentive programs must be used to fulfil this ownership requirement.
Latest share rewards paid in 2023
For the Performance Share Plan’s plan period 2020–2022, the targets were met in full. Therefore, 1,298,701 gross shares were delivered to the participants.
In the Restricted Share Pool, the participants will receive 145,400 gross shares of the plan period 2020–2022, 67,499 gross shares of the plan period 2021–2023 (second instalment) and 45,434 gross shares of the plan period 2022–2024 (first instalment). A total number of 258,333 gross shares were delivered to the participants of the Restricted Share Pool.
These shares were delivered in February 2023.
For more information on the previous share plans, please check our Remuneration statements.