Corporate Governance

F-Secure’s General Meeting decides on the remuneration of the Board of Directors and its committees based on the Board’s proposal. Remuneration of the Board of Directors consists primarily of an annual remuneration that can be paid in shares, cash or a combination of the two.

F-Secure’s General Meeting, held in 23 March 2023 decided that the remuneration for the Board of Directors of F-Secure shall be paid as follows: EUR 80,000 for the Chairman of the Board of Directors, EUR 48,000 for the Chairman of each Committee, EUR 38,000 for other members of the Board of Directors, and EUR 12,667 for a member of the Board of Directors employed by F-Secure.

Approximately 40 per cent the Board of Directors’ remuneration is paid as shares in F-Secure to be repurchased from the market. F-Secure Corporation will repurchase the shares or transfer shares held by F-Secure Corporation as treasury shares for the account of and on behalf of the members of the Board of Directors of F-Secure.

The travel expenses and other costs of the members of the Board of Directors of F-Secure directly related to board work are paid in accordance with F-Secure compensation policy in force from time to time. Each member of the Board of Directors of F-Secure is paid a predetermined travel fee in addition to travel expenses for meetings held outside their country of residence. A separate meeting fee of EUR 1,000 is paid to the Board members travelling from another country to an on-site meeting within the European continent. If inter-continental travel is required, the fee is EUR 2,000. The travel expenses and other costs directly related to the Board work of the members of the Board of Directors are paid in accordance with the company’s compensation policy in force at any given time.

The contract of the President and CEO is an indefinite contract with a six-month period of notice both ways. If the Company terminates the contract for reasons other than a breach of the contract, the President and CEO shall be entitled to receive severance pay equivalent to six (6) months’ salary in addition to the salary for the notice period.

The Company has obtained a life insurance for the President and CEO with an amount equaling the annual gross salary of the President and CEO. The President and CEO does not have a supplementary pension plan, and the determination of his pension conforms to the standard rules specified by Finland’s Employee Pension Act (TYEL). The President and CEO’s retirement age is also determined by the statutory pension system and is 65 years under the applicable Finnish legislation.

The main components of the President and CEO’s total remuneration are base salary and short- and long-term incentives. In addition, he may participate in the voluntary Employee Share Savings Plan (ESSP) which was approved by the Board of Directors on 23 August 2022.

In year 2022 CEO Timo Laaksonen´s fixed annual salary including fringe benefits was 150,120 euros.

Short-term incentive (STI) payout for the President and CEO is 50% of annual base salary if targets are met, maximum payout being equal to the annual base salary.

The company's Board of Directors decides on the salaries, rewards and other benefits of other members of the Group Leadership Team. The remuneration of the other members of the Group Leadership Team consists of monthly salary, customary fringe benefits and incentives as in force from time to time.

The pension benefits of the members of the Group Leadership Team are determined in accordance with applicable law or collective bargaining agreements.

Remuneration of the Leadership Team (excl. CEO) in 2022 (30.6.2022-31.12.2022)

Salary 863,618 eur
Fringe benefits 23,177 eur
Short term incentive (STI or Sales Incentive or other bonuses) 193,652 eur
Long term incentive 0 euro
Additional pension, if any 0 eur

Remuneration in total 1,080,448 eur

Share-based incentive programs

F-Secure has share-based incentive programmes for the key personnel. Share-based incentive programs can be based on long-term financial and strategic performance or solely on the increase of the value of F-Secure’s shares. In programmes based on F-Secure’s share value increase, the participants may be granted subscription or purchase rights at a predetermined price. In performance-based incentive programmes, the achievement of performance criteria is evaluated after each performance period by the Board of Directors of F-Secure and the amount of the reward is determined based on the extent to which the targets have been reached during the performance period. The reward from an incentive programme based on F-Secure’s share value increase is defined by the future valuation of F-Secure’s share. In accordance with the incentive plans, no reward can be given to any participating employee, whose employment has terminated or a notice of termination has been given before the distribution of the share reward.

F-Secure has the following share-based incentive programmes:

• share-based long-term incentive plan 2021–2023, in which the performance period continues until February 2024 and based on which the maximum number of share rewards to be paid is 372,000 shares in F-Secure;

• share-based long-term incentive plan 2022–2024, in which the performance period continues until February 2024 and based on which the maximum number of share rewards to be paid is 324,000 shares in F-Secure;

• share-based long-term incentive plan 2023–2025, in which the performance period continues until spring 2026 and based on which the maximum number of share rewards to be paid is 800,000 shares in F-Secure;

• restricted share-based incentive plan 2023–2025, in which the performance period continues until spring 2026 and based on which the maximum number of share rewards to be paid is 80,000 shares in F-Secure

The payment of share rewards is conditional on the fulfillment of certain performance criteria set out in the terms and conditions of the incentive plans and on the continuation of the person’s employment or service relationship with F-Secure and that no notice of termination of employment or service agreement has been given before the payment of the share reward.

Employee Share Savings Plan (ESSP)

The aim of the ESSP is to encourage employees to acquire and own F-Secure shares, and it is intended to align the interests of the shareholders and the employees as well as to increase employees’ long-term commitment to the company.

The ESSP consists of annually commencing plan periods, each one comprising of a 12-month savings period and a holding period following the savings period. The ESSP is offered to all F-Secure employees. The employees will have an opportunity to save a proportion of their salaries and invest those savings in F-Secure shares. The savings will be used for acquiring F-Secure shares quarterly after the publication of the respective interim reports. As a reward for the commitment, F-Secure grants the participating employees a gross award of one matching share for every two shares acquired with their savings. Continuity of employment and holding of acquired shares for the duration of the holding period are the prerequisites for receiving the award.

The potential award will be settled in shares, or partly in shares and partly in cash, after the end of the holding period. The cash proportion is intended to cover taxes and tax-related costs arising from the award in those countries where the employer has the obligation to withhold taxes. Matching shares will be freely transferable after their registration on the participant’s book-entry account. During the savings and holding period, any dividends to be paid on the acquired savings shares, the matching shares given within the ESSP, and any other shares received within the ESSP will be reinvested in additional shares on the next potential acquisition date. These shares will have an equal right to matching shares.

Participation in the ESSP is voluntary and the employees will be invited to participate in one plan period at a time.