Komplett Bank annual report 2019

The Board will present guidelines for compensation for agreement at the AGM in accordance with paragraph 6-16a of the Norwegian Public Limited Liability Companies Act: The Board’s declaration on the determination of salaries and other remuneration to senior employees The company’s collective remuneration plans shall promote behaviour based on the desired culture in relation to performance and result orientation. The collective remuneration shall help the company to attract and retain employees with the desired profile with regards to personal qualities, competence and experience. The remuneration plan shall contribute to promoting and providing incentives for good management and control of the company’s risks, prevent the taking of risks that are too high and contribute to avoiding conflicts of interest. A. Guidelines for the coming accounting year The company’s remuneration plans are adapted within the provi- sions that are always in accordance with Chapter 15 of the act on The Financial Institutions and Financial Groups, including regulations and other applicable regulations for bank remuneration plans. The Board establishes the remuneration for the CEO. The CEO establishes the remuneration for other members of the manage- ment in consultation with the Chairperson. The respective depart- ment Director establishes remuneration for other employees in consultation with the CEO, CFO and HR Director. Benefits in kind that are not significant in relation to fixed salary are established for all employees by the CEO. Remuneration for all employees consists of fixed salary, benefits in kind, variable remuneration and pension and insurance plans. Benefits in kind may also be provided in line with general practice and to promote physical activity among employees. In the case of senior employees and key personnel, remuneration is established based on a holistic assessment, where the main weight- ing of the variable component of the remuneration is based on results achieved, asset-liability management (including financial strength and liquidity management), the implementation of the company’s strategic plan and compliance with accepted limits for risk tolerance. In the assessment, general achievement of targets, developments over time and the company’s long-term interests shall be taken in to account. The overall assessment shall be based on both quantitative and qualitative conditions. The specific conditions emphasised shall be adapted to the individual’s function and area of responsibility. The assessment shall be based on a combination of an assessment of the person in question, the business unit in question and the company as a whole. When measuring results, the risk to the company and costs connected with capital and liquidity shall be taken into consideration. The basis for variable remuneration linked to the company’s results shall be a period of at least two years for employees. The fixed salary shall be assessed at least annually and, among other things, established based on salary trends in society in general and the financial industry in particular. The company’s variable remuneration plans shall have the pur- pose of rewarding behaviour and influencing culture to ensure the creation of long-term values and sensible risk-taking. The Board carries out an annual assessment of the maximum level of variable remuneration. In addition, one-off remuneration may be used if such is deemed necessary to attract or retain employees. There is an agreement with the Chief Executive Officer to pay 12 months in case of termination of employment. All employees are covered by a defined-contribution pension plan with 6% of salary from 1-7 times the National Insurance Plan’s basic amount (G) and 12% of salary from 7-12 G. No other pension plans have been agreed for any employee. B. Binding guidelines for remuneration in the formof shares, subscription rights, options etc. for the coming year Agreements that up to 33%of fixed salary will be honoured in the form of shares or share-based instruments in return for an equivalent reduction being made in the ordinary salary payment may be entered. Half of the variable salaries for senior employees shall be provided in the form of share options with a lock-in period (deferred and conditional) so that 1/36 are released monthly over a three-year period. On a yearly basis potential cancelling of non-vested variable remuneration to senior employees are reviewed, with a possibility to be reduced if earnings in the company or subsequent results indicate this or special circumstances to the relevant employee are present. One-off remuneration may be share-option-based. Share options granted under these plans shall be at the full market value. The Board establishes more detailed guidelines and criteria for these plans. The exercise period shall be 5 years, yet so that the exercise period for granted options can be expanded with up to 3 years assuming that a simultaneous adjustments in strike price are adjusted to reflect the market value of the compensation. C. Description of the management salary policy in the previous accounting year The company has followed the guidelines that were discussed at the AGM in 2019. D. Report on the effects on the company and shareholders of new or changed agreements on remuneration over and above fixed salary The Board believes the agreements on remuneration that have been continued, entered into or amended in 2019 have contributed to ensuring the company has a supply of employees with the desired pro- file and that the agreements benefit the company and shareholders. Komplett Bank Annual Report 2019 89