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KONE has a long-term share-based incentive plan to support long term value creation and align interests of shareholders and management. Measuring performance over three years, the share plan emphasizes profitable growth and sustainability. Incorporating sustainability measures alongside financial metrics ensures a strong focus in driving transformation and achieving our sustainability ambitions.
The performance share plan consists of annually commencing individual share plans, each subject to a separate approval of the Board of Directors. The target group and targets within the plan as well as possible rewards are decided upon annually by the Board. The company's Board Members are not included in the plan. If the participant's employment or service relationship with KONE Group terminates before the end of the performance period, the participant, as a rule, forfeits the share award without compensation. The potential reward will be paid as a combination of KONE class B shares and a cash payment equivalent to the taxes and similar charges that are incurred from the receipt of the shares. A long-term target for share ownership has been set as part of the plan for the senior management of KONE.
In addition to the above, KONE operates a restricted share plan that serves as a complementary long-term share plan to be used as a commitment instrument for retention and recruitment purposes for top management and other selected key persons. The plan has a commitment period up to three years, after which the potentially granted share awards for an individual plan will be paid to the participant in KONE class B shares, provided that their employment or service relationship with KONE Group is in force at the time of payment.
Performance share plan 2022
The 2022 performance share plan is targeted to approximately 55 members of the top management, including the President and CEO, members of the Executive Board and other top management, and approximately 525 other selected key personnel of KONE Group. The performance criteria applied to the 2022 performance share plan are based on annual growth in sales, adjusted EBIT margin and improvements in sustainability. The sustainability performance condition is a combination of reductions in carbon footprint, and targets related to diversity, equity and inclusion as well as safety.
Information about the previous years’ performance share plans can be found from the remuneration reports.
KONE no longer has option programs in place. More information on the previous option rights can be found from the published stock exchange releases.