The Annual General Meeting 2018 resolved on the following guidelines for determining remuneration of senior executives in Qliro Group and Board members of the parent company, to the extent to which they are remunerated outside their directorship.
Qliro Group shall strive to offer a total remuneration which will enable the group to attract, motivate and retain senior executives in competition with Qliro Group’s international peers, which primarily are Nordic companies operating within e-commerce and retailing with consumer brands and products, as well as Nordic credit market companies specialized in online-payment solutions, digital consumer financing, personal loans and savings accounts.
The remuneration to the senior executives in Qliro Group shall both short-term and long-term reflect the individual’s performance and responsibility and the results in Qliro Group, inclusive of its subsidiaries, and shall also be designed so that it aligns the senior executives’ interests and rewards with the shareholders’. Therefore, the remuneration to the senior executives shall be based on the pay for performance principle and encourage them to build up a significant private ownership of Qliro Group shares (in relation to their personal financial conditions).
The remuneration to the senior executives shall consist of:
• fixed salary,
• short-term variable remuneration paid in cash,
• the possibility of participation in long-term incentive plans, and
• pension and other customary benefits.
The senior executives’ fixed salary is revised each year and shall be competitive and based on the individual’s competence, responsibilities and performance.
The senior executives’ short-term variable remuneration paid in cash shall be based on fulfilment of established targets for their areas of responsibility and for Qliro Group and its subsidiaries, respectively. The outcome shall be linked to measurable targets (qualitative, quantitative, general and individual). The targets within the senior executives’ respective area of responsibility are defined to promote Qliro Group’s development both in the short and long-term. The maximum payment of cash based variable remuneration may not exceed a maximum of 100 percent of the senior executive’s annual fixed salary. The Board may resolve that part of the senior executives’ variable remuneration paid in cash shall be invested in shares or share-related instruments in Qliro Group.
Long-term incentive plans shall include an own investment, and be linked to certain pre-determined value creation and/or share or share-price related performance criteria. The long-term incentive plans shall be designed to ensure a long-term commitment to the value growth of Qliro Group and/or its subsidiaries, and align the senior executives’ interests and rewards with the shareholders’ by awarding the participants share-based remuneration.
Qliro Group has three outstanding long-term equity-related incentive programs (performance share plans) for senior executives and other key persons in the parent company and Qliro Group’s subsidiaries/segments, namely “PSP 2015”, “PSP 2016” and “PSP 2017”. The incentive programs expire in April 2018 (PSP 2015), April 2019 (PSP 2016) and April 2020 (PSP 2017). These programs could be followed by other equity-related programs, warrants and synthetic options. For more information about Qliro Group’s long-term incentive programs, please see the annual report.
Synthetic call options
Qliro Group has two outstanding synthetic call option plans (“QOP 2016” and “QOP 2017”) for the management and other key persons in Qliro Group’s subsidiary/segment that offers financial services. For more information about Qliro Group’s synthetic call option plans, please see the annual report.
Pension and other benefits
Pension commitments will be secured through premiums paid to insurance companies. Under normal circumstances the retirement age is 65 years. Other benefits shall be customary and facilitate that the senior executives can carry out their duties, for example a company car, company health care and health care insurance.
Notice of termination and severance pay
The maximum notice period in any senior executive’s contract is generally twelve months, and in exceptional cases, eighteen months, during which time salary payment will continue.
Compensation to Board members
Board members, elected at General Meetings, may in certain cases receive a fee for services performed within their respective areas of expertise, outside of their Board duties. Compensation for these services shall be paid at market terms and be approved by the Board.
Remuneration to senior executives covered by the remuneration rules for credit market companies
For senior executives covered by the remuneration rules for credit market companies, special remuneration rules apply pursuant to laws and regulations issued by the Swedish Financial Supervisory Authority. The remuneration rules will become applicable in relation to the parent company Qliro Group AB (publ) when Qliro Group AB (publ) forms a so called consolidated situation with its subsidiary Qliro AB. The boards of Qliro Group AB (publ) and Qliro AB have established a remuneration policy that covers all employees in each respective company and, on the one hand, is compatible with and promotes sound and efficient risk management and, on the other hand, counteracts excessive risk taking. In addition to the guidelines set out above, the following guidelines will mainly be applied in relation to remuneration for senior executives covered by the remuneration rules:
• Qliro Group AB (publ) and Qliro AB will conduct an analysis annually to identify employees whose duties have a significant impact on the company’s risk profile based on a number of different criteria.
• The performance assessment shall, in case of variable remuneration, be set in a multi-year framework in order to ensure that the assessment process is based on long-term, sustainable results and that the underlying business cycle and business risks are taken into account when paying performance based remuneration.
• The variable remuneration shall be based on the employee’s performance and the overall performance of both the business unit and the company. Both financial and non-financial criteria shall be taken into account in the assessment of the employee’s performance.
• At least 40-60 percent of the variable remuneration shall be deferred at least three to five years before it is paid or the right of ownership passes to the employee.
• Variable remuneration shall only be paid or passed to the employee to an extent justifiable by the company’s financial situation and justified based on the performance of the company, the business unit and the employee. The deferred portion of the remuneration may be cancelled in full for these reasons.
Deviations from the guidelines
The Board may, if it considers that special circumstances are at hand, deviate from the guidelines. In such a case the Board shall explain the reason for the deviation at the following Annual General Meeting.
For further information on remuneration of the CEO and senior executives, see Note 24 in the Annual Report.