Remuneration

Key Principles

The aim of the Remuneration Policy is to ensure the alignment of pay and performance in Rovio. To achieve this, Rovio has built a remuneration framework that creates an incentive to pursue the Company’s success and shareholder value creation in the long term and to support the Company’s growth strategy with its focus on games business while leveraging its Angry Birds franchise and other IPs through games and other entertainment. It is also important that the Remuneration Policy and the remuneration framework allow Rovio to be able to attract and retain competent management and Board members in the Company.

The Remuneration Policy is set to be consistent with the remuneration framework applied to all Rovio employees. This is for instance reflected in variable remuneration elements, eligible groups, and relevant metrics; the Company has carefully considered the purpose and function of the different remuneration elements, after which the metrics and the target groups are in alignment with the purpose of the variable remuneration element. All in all, the metrics of the plans are supporting the achievement of the overall strategic goal, yet avoiding overlapping of the rewarding mechanisms and target groups.

Application of the Remuneration Policy in 2021

Rovio appointed Alexandre Pelletier-Normand as the company’s new CEO as of January 1, 2021. Before this, Pelletier-Normand had acted as the Head of Games at Rovio since 2019. The remuneration of the new CEO, Alexandre Pelletier-Normand is in line with the Remuneration Policy although the actual payments of variable elements in 2021 are based on his earlier position as the Head of Games. In 2021, the former CEO, Kati Levoranta, received payments for the notice period and severance pay as well as variable payments and accrued remuneration.

During the year, the Board of Directors has evaluated that the total remuneration opportunity is sufficiently competitive by conducting a benchmark study to analyse CEO and Leadership team compensation against peer companies.

To demonstrate sustainable remuneration practises and connection with the shareholder value creation in the long term, Rovio launched the second earnings period of the Performance Share Plan for key employees including the CEO and members of the Leadership Team as well as the second savings period of the voluntary Employee Share Saving Plan. The restricted shares were granted to key employees of Rovio to share ownership of the company and retain key talent. Restricted shares weren’t granted to the CEO in 2021.

The remuneration related decisions taken during the year 2021 followed the initiation and approval process described in the Remuneration Policy. The Board has not deemed it necessary to utilise clawback nor make deviations to the Remuneration Policy during the year 2021.

During the year 2021 the Board of Directors decided to update the Remuneration Policy. The updated policy includes the following changes concerning the remuneration of the CEO:

long-term incentives have been defined to be performance-based. The event that the share incentives would be granted without performance criteria, would be considered as ‘exceptional circumstances’
the total period length of the long-term incentives program is set to be minimum of three years
short-term incentives and one-time bonuses are set a cap of 100% of the annual salary per plan.

In addition, changes which are not deemed material have been done to the terminology used in the policy.