The Board decides on and implements Metso’s long-term incentive plans. The purpose of these plans is to align the interests of operative management and shareholders in driving the company’s performance and success. The plans also aim to ensure long-term commitment of management and offer them a competitive reward scheme.
Any shares to be potentially paid as reward in these incentive plans will be acquired through public trading and therefore will have no diluting effect on the share value. Share repurchase and share issue authorizations are obtained from the Annual General Meeting. The current valid authorizations are presented on our website. There are no options outstanding or available from any of the prior option programs.
The company applies a share ownership recommendation policy for the members of the Leadership Team and for the President and CEO. In accordance with this policy, at least 50 percent of the share rewards (net shares after deduction of the applicable payroll tax) received by these individuals under the performance-based share plans shall be retained until the share ownership of the individual participant amounts to their annual gross base salary.
If the participant’s employment or service ends for reasons relating to the participant before the reward payment, no reward will be paid from the long-term incentive plans. Long-term incentive payments cannot exceed 350% of the participant’s annual base salary at the time of payment.
Long-term incentive plans at Metso
On July 1, 2020, Metso announced new share-based long-term incentive programs for the Company’s management and selected key employees. The programs include a Performance Share Plan (also “PSP”) and a Restricted Share Plan (“RSP”) as a complementary structure for specific situations.
Performance Share Plan
The Performance Share Plan consists of annually commencing individual performance share plans, each comprising a three-year performance period, followed by the payment of the potential share reward in listed shares of Metso. The commencement of each new individual Plan is subject to a separate Board approval.
Performance Share Plan 2025-2027
PSP 2025-2027 commenced in 2025 and the potential share rewards thereunder will be paid in spring 2028, provided that the performance targets set by the Board of Directors for the Plan are achieved.
The performance measures based on which the potential reward under PSP 2025-2027 will be paid are the absolute total shareholder return of Metso’s share, cumulative earnings per share and sales growth of the company’s Metso Plus offering.
Approximately 200 key employees of Metso, including the Leadership Team are eligible to participate in PSP 2025-2027. If all the performance targets set for PSP 2025–2027 are fully achieved, the aggregate maximum number of shares to be paid based on this Plan is approximately 2.25 million shares (referring to gross earning before the withholding of the applicable payroll tax).
Restricted Share Plan
The Restricted Share Plan consists of annually commencing restricted share plan, each comprising a three-year retention period and followed by the payment of the share rewards granted within the Plan in listed shares of Metso. The commencement of each new individual Plan is subject to a separate Board approval.
The purpose of the Restricted Share Plan is to serve as a complementary long-term retention tool for individually selected key employees of Metso in specific situations.
Restricted Share Plan 2025-2027
In December 2024, the Board of Directors decided to commence a new plan period for the complementary Restricted Share Plan. The share rewards potentially granted thereunder will be paid in spring 2028.
The aggregate maximum number of shares to be paid based on RSP 2025-2027 is approximately 450,000 shares (referring to gross earning before the withholding of the applicable payroll tax).
Status of the ongoing Metso PSP and RSP plans as of December 31, 2024
