Statement on the setting of salaries and other remuneration to senior employees
Norfund complies with the government guidelines laid down on 13 February 2015 wih respect to the setting of salaries and other remuneration for senior employees. These are based on changes published in the white paper A diverse and value-creating ownership St. meld. 27 (2013-1024).
Guidelines for Norfund on the setting of salaries and other remuneration in 2020
The following guidelines apply to the setting of salaries for senior Norfund employees up to the ordinary General Meeting in 2021.
The salary system is designed to attract and retain competent personnel. In setting salaries, emphasis is placed on the individual’s contribution to fulfilling Norfund’s mandate.
Norfund wishes to promote moderation in executive salaries. The aim in setting salaries is that senior Norfund employees should have pay conditions that are competitive, but not at the top end of the scale.
Norfund considers that a relevant benchline is other government funds such as the National Insurance Scheme Fund, Export Credit Norway and Investinor.
The Board sets the salary of the managing director. The managing director sets the salaries of the corporate heads of department who report to him. This group consists of senior company employees. Norfund’s pay conditions for senior employees consist of fixed salary, pension and insurance schemes and other benefits (newspapers, electronic communications). Norfund has a moderate bonus scheme that covers all company employees except the managing director. Bonuses are awarded twice a year, and individual bonuses vary from NOK 10 000 to NOK 100 000. The highest total bonus allocation in 2020 was NOK 100 000. All members of the management team, with the exception of the managing director, received a bonus of between NOK 75 000 and 100 000 at the end of 2020. The reason for this was the work involved in the exit from SN Power, a record-high commitment level, extraordinary work input in a demanding work situation because of COVID, home office and special incidents. The bonus scheme is in line with the guidelines’ requirement of variable pay. Bonuses awarded are fixed by the managing director.
The fixed pay is subject to regulation with the point of departure in wage developments in the financial sector, represented by reference figures from Finance Norway, the results of the main settlement and for companies Norfund has defined as its peers. In addition, an assessment is made of the individual’s performance and goal achievement in the 2020 accounting year. Annual goals for the individual senior employee are fixed by the managing director in the case of management, and by the Board in the case of the managing director.
Norfund had the following pension and insurance conditions for the 2020 accounting year:
In 2018 Norfund closed the defined benefit pension scheme to new employees, and now offers a defined contribution scheme to all company employees, including managers. As the transition to the new scheme was voluntary for existing employees, this means that in a transitional phase Norfund will have both a defined benefit and a defined contribution scheme. The defined benefit scheme entitles the individual to defined future benefits and depends primarily on the number of qualifying years, pay level on reaching retirement age and the size of National Insurance benefits. For historic reasons, the earlier scheme is being continued for the present, where the full qualifying period is 30 years and pension amounts to 70% of salaries up to 12G. This scheme satisfies the requirements of the Act on Mandatory Occupational Pensions. At present 47 employees are covered by the defined contribution scheme and 30 by the defined benefit scheme. Norfund also has a scheme which entitles employees to pension rights for pay in excess of 12G. This scheme was closed to new members in 2012. This scheme, which is funded from operations, consists of 66% of pay in excess of 12G with a retirement age of 67 and a full qualification period of 30 years, in the calculation base. If the service period is calculated as being less than 30 years, the pension is reduced proportionately. On termination of employment or on reaching retirement age, employees receive a settlement for the value of the amount saved. This scheme currently covers 4 employees. In the defined contribution scheme, 7% of salary is set aside from pay from 0–7 G, and 20% from salaries of 7.1–12 G. The costs of both schemes are included in the calculation of pension expenses.
Senior Norfund employees are covered by insurance schemes that apply to all Norfund employees. Senior employees have a 3-month notice period. The CEO has an agreement for pay after termination of employment equivalent to 6 months’ salary. This arrangement is in line with the guidelines for salary and other remuneration.
Salary policy in the 2020 accounting year has adhered to the principles of the Management Salary Statement as adopted by the General Meeting on 18 June 2018. Salary adjustment for the CEO and other members of management in 2019 was 2.6% on average. In 2019 the management team was increased by one member. In 2019, an assessment was carried out of the pay level for men and women in the management team. The review resulted in an increase in the pay level for woman managers. At 31.12 On 1 January 2020 a revision of the Equality and Anti-Discrimination Act entered into force. The change means that every two years companies must survey pay conditions by gender. The total pay adjustment in 2020 for the management team, including the CEO, amounts to NOK 341 553.
|Wages, salaries and other payroll expenses||Norfund|
|(In 1000s of NOK.)||2020||2019|
|Wages and salaries||91 451||82 055|
|Employer's social security contribution||16 334||15 038|
|Pension expenses||14 694||6 956|
|Other benefits||12 795||9 997|
|Total wages, salaries and other payroll expenses||135 273||114 046|
|Pay for Senior Employees|
|Title||Salary||Bonus||Taxable Portion of Insurance and other Payments in Kind||Pensions||Total|
|Jan Tellef Thorleifsson||CEO||2 909 326||0||23 226||122 841||3 055 393|
|Hege E. Seel up to 01.10.20||EVP Org & HR||1 608 046||0||33 787||669 248||2 311 091|
|Ylva Lindberg||EVP Strategy & Analysis||1 586 274||75 000||21 898||119 708||1 802 880|
|Cathrine Kaasen Conradi||EVP CFRO||1 640 952||75 000||24 067||118 458||1 858 477|
|Thomas Fjeld Heltne||EVP Legal Department||1 596 799||75 000||21 995||119 457||1 813 251|
|Erik Sandersen||EVP Financial Institutions||1 900 568||75 000||22 105||366 865||2 364 538|
|Mark Davis||EVP Clean Energy||2 054 695||100 000||80 797||863 740||3 099 232|
|Ellen C. Rasmussen from 01.03.20||Scalable Enterprises||1 360 888||75 000||18 941||102 067||1 556 895|
|Olaug Svarva||Chair||270 000||0||0||0||270 000|
The Chair has annual remuneration of NOK 270 000 (NOK 260 000) for boardroom work for Norfund. The Board members each receive annual remuneration of NOK 135 000 (NOK 127 500).
In 2020 a Risk and Audit Committee consisting of three Board members was appointed. The committee chairman, Martin Skancke, received remuneration of NOK 37 500 and other members NOK 32 500 in addition to the ordinary Board remuneration.
The company has no share or option schemes for its employees, and there are no plans for such schemes.
Norfund has a variable bonus scheme for all employees excluding the managing director. In all, the scheme accounted for 1.9% of Norfund’s payroll expenses in 2020. Bonuses are paid for extraordinary performance, and the average payment in 2020 to bonus recipients was NOK 49 423. The highest bonus payment represented 13 per cent of salary and is thus far lower than the requirement in Report no. 27 (2013–2014) to the Storting on Diverse and Value-creating Ownership (Eierskapsmeldingen) that bonuses be a maximum of 50 per cent of the employee’s salary.
|(Figures in 1000s of NOK.)||2020||2019|
|Other attestation services||0||49|
Auditor’s fee is inclusive of VAT
In addition, business partners of Deloitte AS in other countries delivered other services expensed in the amount of NOK 4 670 000 (473 000).
The company had 102 (87) employees at the end of 2020, accounting for 100.5 (82.6) full-time equivalents.
In addition to the employee pension plans described in the Executive Pay Statement, local employees at Norfund’s regional offices in South Africa, Ghana, Thailand, Kenya and Costa Rica have defined contribution pension plans. Norfund therefore has no obligations other than what has been paid through the year In 2020, NOK 1 943 140 (1 522 524) was expensed in connection with these schemes.
|Expected return on plan assets||1.70%||2.30%|
|Adjustment of the basic amount (G) in the National Insurance System||2.00%||2.00%|
|Employer's social security contribution||19.10%||19.10%|
|(Figures in 1000s of NOK.)||2020||2019|
|Net present value of pension earned in the period||7 529||9 529|
|Capital cost of previously earned pensions||2070||2.63|
|Expected return on plan assets||-1 737||-1 785|
|Administrative costs||1 133||1 024|
|Accrued employer's social security contribution*||2 438||1 366|
|Net pension liabilities for the year incl. employer's||11 433||12 763|
*Employer’s social security contribution is calculated on the amount paid in.
|Estimated Pension Liabilities|
|Estimated pension liabilities||109 483||20 683||130 166||82 091||8 476||90 567|
|Estimated plan assets*||81 406||0||81 406||69 046||0||69 046|
|Net pension liabilities 31.12||28 078||20 683||48 760||13 045||8 476||21 521|
|Accrued employer's social security contribution**||5 363||3 950||9 313||2 492||1 619||4 111|
|Net pension liabilities 31.12||33 441||24 633||58 074||15 537||10 095||25 632|
*Estimated plan assets consist of paid premiums invested in Nordea Life.
|Reconcilliation Opening/Closing Balance|
|Carrying amount net pension liabilities 01.01 incl. employer's social security contribution||25 632||49 203|
|Net pension expenses for the year incl. employer's social security contribution||10 215||11 409|
|Actuarial gain/loss charged directly to equity 32 469||-19 706||0|
|Pensions paid, early retirement / unfunded, incl. employer's social security contribution||-1 161||-8 123|
|Investment in plan assets, etc., incl. employer's social security contribution||-9 082||-7 152|
|Carrying amount net pension liabilities 31.12. incl. employer's social security contribution||58 074||25 632|
|Nordea Life's Asset Mix*|
|30 September 2020||30 September 2019|
|Bonds at amortised cost||3.50%||12.50%|
|Total financial assets||100.00%||100.00%|
* Known values at calculation date