The Board of Directors appoints and discharges the CEO and decides on the CEO’s remuneration and the other terms and conditions of the CEO’s engagement based on the Board of Directors’ Nomination and HR Committee’s recommendations and within the framework of the Remuneration Policy.
By decision of the Board of Directors, the CEO is paid a fixed base salary, which is a compensation for the CEO’s responsibilities and is based on the requirements of the position, the CEO’s individual competence and performance as well as prevailing market practice. The monthly salary of CEO Mika Joukio is EUR 44 729 (February 2025). The monthly salary includes car and mobile phone benefits and an extended health, travel and accident insurance coverage.
A short and long-term reward can be paid to the CEO by decision of the Board of Directors. In 2025, the maximum level of remuneration available in the short-term incentive system is, accounting for Metsä Group’s EBIT multiplier, 75% of the fixed annual salary. The reward is based on Metsä Board’s operating result (40% weighting), Metsä Group's sustainability target (10% weighting) and the strategic targets defined by the Board of Directors, including sustainability targets (50% weighting) as well as the realisation of Metsä Group’s EBIT multiplier. The potential reward shall be paid in March 2025.
The potential reward for the performance period 2023–2027 regarding the performance share plan 2023–2025 is based on the development of Metsä Board Group’s (50%) and Metsä Group’s (50%) return on capital employed (ROCE, %), as determined by the Board of Directors. The Board of Directors is entitled to reduce the rewards fully or partly if defined earnings or equity ratio criteria are not met, or if the reward should exceed the maximum reward limit defined for the CEO. On maximum level the reward potential of the CEO is 210% of the CEO’s annual base salary (the reward limit is 270% of the CEO’s annual base salary). The reward consists of a proportion to be paid in Metsä Board Corporation’s series B shares and a cash proportion. The cash proportion refers to an amount used to cover the taxes to be withheld from the reward. The proportion paid in shares refers to the net reward after the withholding of taxes and other expenses payable for the reward. The potential reward shall be paid in March 2026. The reward payment is followed by an approximately two-year restriction period, during which the CEO is not allowed to sell or otherwise transfer the shares received. Should the CEO’s service terminate during the performance or restriction period, the CEO shall principally lose the right to reward.
The Board can discharge the CEO without a specific reason. The CEO can also resign from his assignment. The mutual term of notice is six months. The Board may, however, decide to discharge the CEO without a period of notice. When the service contract of the CEO is terminated by the Board, the CEO is entitled to receive a severance pay equal to the CEO’s 12-month salary.
The CEO is covered by the Finnish Employees’ Pensions Act, which provides for a pension compensation based on service years and earnings. Basic salary, rewards and fringe benefits are included in the calculation, but not stock option or share plan based income. CEO Mika Joukio is also entitled to the supplementary defined benefit pension insurance, with a retirement age of 62. According to the supplementary pension insurance the maximum level of pension is 60% of the CEO’s total salary under the Employees’ Pensions Act, calculated on the basis of a five-year-period preceding the moment of retirement. In case the CEO’s service with the Company terminates before his retirement, the CEO is entitled to a free policy.
Remuneration of the CEO in 2025
In 2025, the maximum level of remuneration available in the short-term incentive system was, accounting for Metsä Group’s EBIT multiplier, 75% of the fixed annual salary. The reward was based on Metsä Board’s operating result (50% weighting) and the strategic targets defined by the Board of Directors, including sustainability targets (50% weighting) as well as the realisation of Metsä Group’s EBIT multiplier. In 2025, no short-term remuneration will be paid to the CEO for 2024 when the threshold indicator of the short-term remuneration scheme (Metsä Group's operating profit) fell below the threshold value.
The reward for the performance period 2020–2024 regarding the performance share plan 2022–2024 was based on the development of Metsä Board Group’s (50%) and Metsä Group’s (50%) return on capital employed (ROCE, %), as determined by the Board of Directors. Minimum levels had also been set for the operating result and equity ratio. The realisation of the performance period 2022–2024 was 53% based on which the CEO earned 64,349 Metsä Board Corporation’s series B shares. The reward will be paid in March 2025. The reward of the CEO (including both shares and cash) can be 270% of the CEO’s annual base salary at the maximum. The reward payment is followed by an approximately two-year restriction period during which the CEO is not entitled to transfer or dispose of the shares received.
Remuneration of the CEO in 2024
In 2023, the maximum level of remuneration available in the short-term incentive system was, accounting for Metsä Group’s EBIT multiplier, 75% of the fixed annual salary. The reward was based on Metsä Board’s operating result (50% weighting) and the strategic targets defined by the Board of Directors, including sustainability targets (50% weighting) as well as the realisation of Metsä Group’s EBIT multiplier. The short-term incentive of EUR 84,509 based on performance in 2023 was paid to the CEO in March 2024.
The reward for the performance period 2021–2023 regarding the performance share plan 2020–2024 was based on the development of Metsä Board Group’s (50%) and Metsä Group’s (50%) return on capital employed (ROCE, %), as determined by the Board of Directors. Minimum levels had also been set for the operating result and equity ratio. The realisation of the performance period 2021–2023 was 100% based on which the CEO received 62,673 Metsä Board Corporation’s series B shares in March 2024. The long-term incentive paid to the CEO regarding the performance period 2021–2023 was EUR 866,967 in total. The incentive of the CEO (including both shares and cash) can be 270% of the CEO’s annual base salary at the maximum. The reward payment is followed by an approximately two-year restriction period during which the CEO is not entitled to transfer or dispose of the shares received.
In 2024, the payment of the CEO's supplementary defined benefit pension arrangement was EUR 642,104.