Contact

Group Management

Gränges’ Group Management consists of eight members led by CEO Johan Menckel. In addition, the Group has an extended Group Management, where HR, Operational Development, Research & Innovation, Sustainability and IT are included. Altogether the extended Group Management constitutes thirteen members.

Group Management consists of CEO, CFO, President Asia, President Europe, President Americas, SVP Technology & Business Development, General Counsel and SVP Corporate Responsibility & Communication. SVP Human Resources, SVP Process Engineering & Operational Development, SVP Research & Innovation, SVP Sustainability and CIO are part of the extended Group Management. CEO is appointed by the Board and is responsible for the day-to-day management of the company in accordance with the Board’s instructions and guidelines.

Group Management is responsible for developing and implementing the Group’s overall strategies regarding for example product and customer strategies, and acquisitions and disposals. The matters are prepared by Group Management to be decided upon by the Board.

Group Management holds monthly meetings to review the results and financial position of the Group and subsidiaries. Other questions dealt with at these meetings include strategy issues and follow-up of budgets and forecasts. Subsidiaries are also monitored more closely due to the CEO being chairman of the three subsidiaries. Other members of Group Management and employee representatives also serve on these boards. The subsidiaries’ boards monitor day-to-day operations and approve each subsidiary’s strategy and budget.   

Group Management presentation ›
Remuneration to senior executives

Gränges shall offer remuneration levels and terms of employment which are necessary to recruit, develop, and retain individuals in Group Management. These individuals shall possess the expertise, motivation and capacity required to uphold, develop, and implement overall value-additive strategic targets for the Gränges Group and, moreover, to support its long-term interests. To obtain this, it is important to sustain fair and internally balanced terms that are at the same time competitive on the market with respect to structure, scope and remuneration levels. These guidelines ensure that individuals in Group Management, regardless of geographical market, may be offered competitive total remuneration, and is aimed at creating increased transparency on remuneration issues. Applicable laws and other relevant regulatory frameworks (both Swedish and foreign) in this area must be complied with at all times.

Senior executives refer to the Group's CEO, the Group's Deputy CEO, and senior managers reporting directly to the CEO.

Remuneration to the CEO, the Deputy CEO, and other members of the Group Management is to be determined by the Board of Directors, but follow the guidelines adopted by the General Meeting.

The basic principle is that the remuneration should be competitive and consist of a balanced combination of fixed salary, variable remuneration, pension benefits, other benefits and terms for dismissal/severance payment. Furthermore, the Board of Directors may prepare and the General Meeting resolve on, share and share-price related incentive programs. Such a combination of remuneration fosters and supports management and achievement of objectives in both a short and long-term perspective.

The Annual General Meeting on 25 June 2020 passed a resolution on guidelines for remuneration to senior executives according to the following:


Fixed salary

The fixed salary shall consist of customary base salary. The salary is based on responsibility, performance, expertise and the complexity and scope of the task. In the event of full payment of variable remuneration, the fixed annual base salary comprises 40 per cent of the total cash remuneration, with the exception for President Americas, where the percentage is 33.33 per cent.


Variable pay - STI and LTI

The variable remuneration shall comprise an annual incentive program (STI) and a long-term incentive program (LTI), both of which pay cash remuneration. There is no guaranteed variable remuneration.

The outcome of STI is determined by a number of financial and non-financial parameters for the Gränges Group. Examples of financial key ratios includes adjusted operating profit and examples of non-financial objectives includes a selection of the Group’s long-term sustainability targets and, in certain cases, also specific projects or tasks. The objectives shall be designed so as to both promote the group's business strategy and long-term interests and the individual long-term development of the member of Group Management.

At the end of the measurement period for fulfillment of the predefined parameters for payment of STI, a comprehensive evaluation shall be conducted to assess the extent to which these parameters have been met. The CEO is responsible for this evaluation for each and every member of Group Management with the exception of the CEO personally. The Board of Directors’ remuneration committee is responsible for the evaluation of the CEO. With regards to financial objectives, the evaluation will be based on the latest financial information made public by the company.

Maximum remuneration for STI is 60 per cent of the fixed annual base salary for each individual in Group Management, with the exception of the individual who holds the position of President Americas, for whom the maximum remuneration can be 100 per cent of the fixed annual base salary.

STI shall be supplemented by an LTI program for a term of three years. An amount corresponding to the outcome of STI for each participant shall be reserved in a separate, so called, LTI bank. Provided that the employee has not been given notice of termination or personally terminated their employment with the Gränges Group, the amount which is reserved for LTI shall be paid out at a rate of one-third per year for three years. The amount shall be adjusted prior to payment to take into account the total return on the Gränges share.

The total outcome of STI and paid-out LTI during a single year shall be limited to 150 per cent of the fixed annual base salary, with the exception for President Americas, whose payouts are limited to 200 per cent of the fixed annual base salary.

The company does not have any potential deferral periods or, according to agreements, any possibility to reclaim variable remuneration.


Annual short-term incentive programme (STI 2020)

The outcome of the STI is determined by a number of parameters consisting of financial key ratios for the Group, such as adjusted operating profit and cash conversion, and individual pre-determined targets. Remuneration under STI 2020 may not exceed 60 per cent of the total basic salary paid to each senior executive, except for the person holding position as President Americas, whom may obtain 100 per cent of the total basic salary.

 

Long-term incentive programme (LTI 2020)

The long-term incentive programme, LTI 2020, will run for three years and will be offered to senior managers to supplement the annual incentive programme (“STI 2020”).

STI 2020 measures EBIT (50 per cent), cash conversion (30 per cent) and individual performance (20 per cent), for a maximum payout of 60 per cent of annual basic pay. For President Americas, the maximum payout is 100 per cent of annual basic pay. 

LTI 2020 implies that a payout equivalent to the amount of STI 2020 is allocated and indexed to the total return of the Gränges share. The vesting periods for LTI 2020 will run over the years 2021, 2022, and 2023 and payment will be made proportionately on an annual basis over a period of three years – 2022, 2023 and 2024 – provided that the individual remains in the Gränges Group’s employ.

The total payout from STI and LTI programmes may not exceed 150 per cent of the annual basic pay as of the date of the payout. This shall not apply to the person holding the position as President Americas, whose total payout from STI and LTI programmes is limited to 200 per cent of the annual basic pay.

 

Investment programme - IP 2020

The long-term investment programme (“IP 2020”) is a one-off programme and will be offered to senior managers and other key employees. The participants in IP 2020 undertake to invest an amount corresponding to up to 50 per cent of an annual base salary before tax in shares and call options in the company. 

Each participant in IP 2020 receives a conditional cash contribution which, after tax deducted and other applicable fees, amounts to 50 per cent of the investment amount (the "Net Contribution"). If the participant has terminated his/her employment or has been terminated within three years from the date of payment of the Net Contribution, an amount corresponding to the Net Contribution shall be refunded to the company. 

In connection with IP 2020 the Board of Directors of the company is authorized to issue call options for a maximum amount of 2,000,000 shares in the company, corresponding to a maximum of 2.6 per cent of the total number of shares and votes in the company, and to enter into share swap agreements in respect of shares in the company with appropriate parties on the market in order to be able to deliver the shares which will be available for acquisition by the participants within IP 2020 through the exercise of call options which have been issued. Each call option entitles the participants to acquire one share in the company. 


Pension

Pension shall be paid in accordance with relevant national legislation, applicable collective agreements, and suchlike and, for Swedish individuals in Group Management, is limited to the ITP plan (Industry and Trade Supplemental Pension). Accordingly, there are both premium-based and benefits-based undertakings, based on individual prerequisites and regulatory frameworks. There are two main variants of the ITP plan: ITP 1 applies to individuals born 1 January 1979 or later and ITP 2 applies to individuals born 31 December 1978 or earlier.

In order to equalize the differences that can arise between participants in ITP 1 and ITP 2 – in other words, between different individuals in Group Management – certain adjustments are made in relation to the solution indicated by ITP 2 with regard to how much of the remuneration is pensionable. The pension premiums for premium defined pension shall be not more than 30 per cent of paid cash fixed and variable remuneration.

For the CEO, the pension premiums shall amount to 35 per cent, calculated on fixed monthly remuneration, and are thus premium defined. The retirement age for the CEO is 65 years of age.

For foreign individuals in Group Management, a corresponding structure shall apply, based on the circumstances in the relevant country. The pension terms and conditions shall be on market terms. For other individuals in Group Management, the retirement age is 60–65 years of age, depending on the country of employment.

For employments governed by rules other than Swedish, the pension may be duly adjusted for compliance with mandatory rules or established local practice, taking into account, to the extent possible, the overall purpose of these guidelines.

 

Other benefits

Benefits which are not directly related to fixed salary and variable remuneration, for example a company car and medical care benefits, shall promote the performance of the work and be consistent with standard practice on the market for this target group. The total costs as a consequence of such benefits may not exceed 20 per cent of the fixed annual base salary. For employments governed by rules other than Swedish, other benefits may be duly adjusted for compliance with mandatory rules or established local practice, taking into account, to the extent possible, the overall purpose of these guidelines.

 

Special remuneration

Additional cash variable remuneration may be paid out under extraordinary circumstances, provided that such extraordinary arrangements are limited in time, and may only be awarded on an individual basis either for the purpose of recruiting or retaining individuals in Group Management or as remuneration for extraordinary performance beyond the individual's ordinary tasks. Such remuneration may not exceed an amount corresponding to 20 per cent of the fixed annual base salary and may not be awarded more than once per year and per individual. Any resolution on such remuneration shall be adopted by the Board of Directors based on a proposal from the Remuneration Committee.

 

Terms for termination etc.

There is a mutual notice of termination period of twelve months as between the CEO and the company. Upon termination by the company, severance remuneration without set-off is also paid for an additional twelve months. The mutual notice of termination period for the Deputy CEO and other individuals in Group Management shall correspond to six months. Upon termination by the company, severance remuneration for an additional twelve months is paid, without setting off the first six months.

 

Salary and terms of employment for other employees

In the preparation of this proposal on guidelines, salary and terms of employment for employees of the company have been taken into account by including information on the employees' total remuneration, the components of the remuneration, and increase and rate of increase of remuneration over time, in the Remuneration Committee's and the Board of Director’s basis of decision when evaluating the reasonableness of the guidelines and appurtenant limitations.

 

See Note 8 Payroll expenses in the Annual Report 2019

Information on previously resolved remuneration which is not yet payable

In order to stimulate long-term involvement, during 2017 senior managers were offered a long-term incentive program (LTI 2017) following the adoption of a resolution by the General Meeting on 4 May 2017. The program is for a term of three years and is, essentially, structured as follows: An amount corresponding to the outcome of STI 2017 for each participant is reserved in a separate, so-called, LTI bank. Provided that employment with the Gränges Group has not terminated, the amount shall be paid out at a rate of one-third per year during 2019, 2020, and 2021, adjusted to take into account the total return on the Gränges share. The total outcome of STI and paid-out LTI during a single year is limited to 150 per cent of the fixed annual base salary, with the exception of President Americas, whose total outcome is limited to 200 per cent of the fixed annual base salary.

In order to continue to stimulate long-term involvement, during 2018 senior managers were offered a long-term incentive program (LTI 2018) following the adoption of a resolution by the General Meeting on 3 May 2018. The program is for a term of three years and is, essentially, structured as follows: An amount corresponding to the outcome of STI 2018 for each participant is reserved in a separate, so-called, LTI bank. Provided that employment with the Gränges Group has not terminated, the amount is paid out at a rate of one-third per year during 2020, 2021, and 2022, adjusted to take into account the total return on the Gränges share. The total outcome of STI and paid-out LTI during a single year is limited to 150 per cent of the fixed annual base salary, with the exception of President Americas, whose total outcome is limited to 200 per cent of the fixed annual base salary.

In order to also continue to stimulate long-term involvement, during 2019 senior managers were offered a long-term incentive program (LTI 2019) following the adoption of a resolution by the General Meeting on 8 May 2019. The program is for a term of three years and is, essentially, structured as follows: An amount corresponding to the outcome of STI 2019 for each participant is reserved in a separate, so-called, LTI bank. Provided that employment with the Gränges Group has not terminated, the amount is paid out at a rate of one-third per year during 2021, 2022, and 2023, adjusted to take into account the total return on the Gränges share. The total outcome of STI and paid-out LTI during a single year is limited to 150 per cent of the fixed annual base salary, with the exception of President Americas, whose total outcome is limited to 200 per cent of the fixed annual base salary.

 

Remuneration to Board members

In certain cases, board members elected by the General Meeting should be able to receive fees and other remuneration for work carried out on behalf of the company, alongside their work on the Board of Directors. Fees at market rates, approved by the Board of Directors, may be payable for such services.