Remuneration in the Savings Banks Group complies with EU and Finnish legislation and the guidelines issued by the Finnish Financial Supervisory Authority. The remuneration system for personnel and management is based on valid legislation, the regulations and recommendations governing the financial sector and the Finnish Corporate Governance Code.

The Savings Banks Group’s decisions on the remuneration systems for operative management and personnel are compliant with Chapter 8, “Corporate Governance”, of the Act on Credit Institutions.

However, the Savings Banks Group does not apply the provisions of Chapter 8, Sections 9, 11 and 12, of the  Act on Credit Institutions to those employees whose variable remuneration for one year does not exceed EUR 50,000 and whose variable remuneration for one year does not exceed 100% of the employee’s total fixed remuneration.

By “remuneration systems” we refer to the decisions, contracts, policies and procedures that are followed in the remuneration of the management and personnel. The remuneration system includes the remuneration method as well as the processes related to its development and implementation. The remuneration system is developed actively and with a long-term view in order to secure the Amalgamation's competitiveness, good economic growth, incentivisation, commitment and the availability of new competent personnel.

The remuneration policies are in line with the Savings  Banks Group’s business strategy, goals and values, and they serve its long-term interests. The remuneration system is consistent with the effective risk management of the member credit institutions and member companies of the Savings Banks Group and it is always implemented within the framework of its current risk-management principles. Remuneration does not encourage risk-taking that would exceed the sustainable risk level defined on the basis of the risk-bearing capacity of the member credit institution or the company.

Total compensation, which is the basis of remuneration, is divided into fixed and variable compensation. The variable compensation includes both short and long-term remuneration.

If the amount of variable compensation exceeds EUR  50,000, at least half of the compensation must be paid in a form other than cash. For remuneration exceeding EUR 50,000, the company must, before the start of the remuneration period, have an investment instrument for use in remuneration that can either be converted to Common Equity Tier 1 capital (CET1) or whose book values can be reduced. The financial instruments must reflect changes in the company’s equity or credit rating.

If a person who, based on his or her job description, is assigned to a group whose professional duties may cause significant risk to a member credit institution or the company (“person affecting the risk profile”), is proposed to be paid more than EUR 50,000 annually, the provisions of the Act on Credit Institutions on deferring the payment of variable remuneration are applied.  A significant proportion — at least 40% of the defined variable remuneration total — is deferred and paid in  3–5 years, at the earliest. The person’s risk profile and the nature of the business are taken into consideration in determining the length of the deferral.

The Savings Banks Group has identified significant risk-takers who can affect a bank’s risk profile or  through their actions cause considerable financial risk to a bank. The persons affecting the risk profile include the Managing Directors and other individuals participating in the management and decision-making of the member credit institutions, the central institution and other  member organisations as well as other individuals who have a material effect on the company’s risk exposure, including people associated with functions that are independent of business operations. Each member of the Group is responsible for the accuracy and timeliness of its own information.

At least once a year, the Savings Banks Group’s internal audit verifies compliance with the remuneration systems decided on by the Board of Directors of Savings Banks’ Union Coop.

Each member company of the Savings Banks Group decides on its short-term remuneration targets and indicators based on the recommendations of the Remuneration Committee. The central institution’s Remuneration Committee monitors and controls the functioning and competitiveness of the remuneration systems, ensuring their ability to support the Group’s short and long-term goals, and prepares proposals to the Board of Directors for the development of the remuneration system.