Remuneration of the President and CEO

The remuneration of the President and CEO consists of fixed salary (base salary and fringe benefits in Finland) and of variable elements such as short-term incentives (STI) and long-term incentives (LTI) and supplementary pension.

The Personnel and Remuneration Committee reviews market benchmark data from Finnish and international industrial companies of a similar size and complexity to Neste when setting total remuneration package for the President and CEO. This is used more as a guide than a direct determinant of pay levels. Other factors considered include the level of salary increases for Neste’s employees globally, business and individual performance, and role scope.

President and CEO Matti Lehmus’ fixed salary is 75,105 EUR per month, including taxable benefits (car and mobile phone benefit). In addition, President and CEO is entitled to vacation pay.

Long-term incentives

LTI 2022: Performance Share Plan (PSP)

Based on the attainment of three-year share price performance targets for Neste, incl. PSP 2022-2024, PSP 2023-2025 and PSP 2024-2026. Awards vest in one tranche after three years, partly in shares and partly in cash. The cash element will cover taxes and other tax-like costs.

The award for CEO may vary between 0–120% of annual fixed salary, based on performance and share price appreciation. If Neste share price more than doubles during the three-year performance period, the value which exceeds the two times share price increase will not be paid. LTI 2022 is targeted to selected key employees of Neste, including the CEO and the other ExCo members.

LTI 2022: PSP 2024-2026

Number of original shares granted was 33,700. Performance measure is Relative Total Shareholder Return 2023–2025 (TSR, weight 80%) versus the STOXX Europe 600 index and Combined Greenhouse Gas Impact 2024–2026 (GHG, weight 20%) measured cumulatively in CO2 equivalent, shares will vest in March 2027, no holding period.

LTI 2022: PSP 2023-2025

Number of original shares granted was 23,600. Performance measure is Relative Total Shareholder Return 2023–2025 (TSR, weight 80%) versus the STOXX Europe 600 index and Combined Greenhouse Gas Impact 2023–2025 (GHG, weight 20%) measured cumulatively in CO2 equivalent, shares will vest in March 2026, no holding period.

LTI 2022: PSP 2022-2024

Number of original shares granted was 26,400. Performance measure is Relative Total Shareholder Return 2022–2024 (TSR, weight 80%) versus the STOXX Europe 600 index and Combined Greenhouse Gas Impact 2022–2024 (GHG, weight 20%) measured cumulatively in CO2 equivalent, shares will vest in March 2025, no holding period.

President and CEO Matti Lehmus is entitled also to PSP 2021-2023 based on his previous role as Executive Vice President, Renewables Platform.

LTI 2019: PSP 2021-2023: Performance measure is Relative Total Shareholder Return 2021–2023 (TSR, weight 80%) versus the STOXX Europe 600 index and Combined Greenhouse Gas Impact 2021–2023 (GHG, weight 20%) measured cumulatively in CO2 equivalent, shares will vest in March 2024, no holding period.

Short-term incentives

Performance period 2024

The maximum short-term incentive for the President and CEO is 80 percent of annual base salary in 2024. The short-term incentive is based on Renewable Products EBITDA comparable, Oil Products EBITDA comparable, Group Free Cash Flow, Group Comparable ROACE and Group safety measures of TRIF and PSER. Potential reward payment is in March 2025.

Other remuneration elements

Pension	CEO is entitled to supplementary defined contribution pension plan (DC). The supplementary pension contribution is 16% of annual fixed base salary and retirement age is 62 years.
Other benefits	CEO has the company car benefit, mobile phone benefit, private accident-, life- and disability insurance, business travel, directors’ and officers’ liability insurances. President and CEO may participate in the sickness fund in Finland.
Share ownership guidelines	President and CEO must accumulate and maintain a shareholding which is equivalent to personal annual fixed salary. Until this threshold is met, participants must retain 50% of vested incentive shares after tax.
Service contracts and loss of office payments	Both parties have a six-month period of notice. Should the Company terminate the President and CEO’s agreement, the Company is required to pay six month’s salary and a separate severance pay equivalent to six month’s salary.