Skilled and dedicated employees are the key to creating value for Carnegie’s clients and thus contributing to the company’s long-term development and success. Carnegie’s remuneration model is intended to support successful and long-term development of the Group. The model is also intended to reward individual performance and encourage long-term value creation combined with balanced risk-taking.
Remuneration policy
The Board of Directors of Carnegie has adopted a remuneration policy that covers all employees of the Group. The policy is based on a risk analysis performed annually by the Group risk management function under the direction of the CRO. The policy is revised annually.
Fixed remuneration
Fixed remuneration is the base of the remuneration model. Base salary depends on several parameters, such as the employee’s competence, responsibility and long-term performance.
Variable remuneration for the Group and each unit
Total allocations for variable remuneration for the Group as a whole are based on risk-adjusted earnings. The allocation of variable remuneration to the business areas and units is based on the extent to which operational targets have been achieved, market conditions and industry standards taking into account risk-taking and risk management.
The proposal for provision and allocation to the business areas and units is prepared by the Board of Directors’ Remuneration Committee. Particular consideration is given to any risks that may be associated with the proposal. The Committee also analyses the impact on Carnegie’s present and future financial position. This assessment is based on the forecasts from the ICLAAP to ensure that the proposed variable remuneration does not compromise the capital targets set by the Board. Finally, the Committee evaluates whether there is any risk of conflicts of interest and, if so, how the conflicts should be managed. The recommendation from the Remuneration Committee forms the basis of the Board’s final decision on variable remuneration.
Individual performance assessment
Carnegie applies a corporate-wide annual process to evaluate individual employee performance. The assessment is made against predefined objectives and covers both financial and non-financial criteria. Any allocation of variable remuneration and possible increases in fixed salary are determined in relation to the achievement of individual objectives, unit performance and Group performance.
Identified staff
In compliance with regulations, Carnegie identifies individuals whose professional activities have a material impact on the Group’s risk profile (‘Identified Staff’). Identified Staff include executive management, employees in leading strategic positions, employees responsible for control functions and risk takers, as defined by the principles established in Carnegie’s remuneration risk analysis. Variable remuneration to this group may not exceed fixed remuneration.
Employees in control functions
The criteria for variable remuneration to employees who are responsible for control functions are designed to ensure their integrity and independence. T This involves making sure that their pay does not depend on the performance of the units they oversee.
Monitoring and control
Internal Audit performs an annual review to ensure that the Group’s remuneration framework and procedures comply with the remuneration policy and regulatory requirements. Internal Audit reports its findings to the Board no later than in conjunction with approval of the annual accounts.
Partnership
Employees of the Carnegie Group owned around 25 percent of equity in the parent company as of 31 December 2023. Employee ownership is an important aspect of generating commitment to the entire company’s development and ensuring that employees have the same incentives as other owners to create long-term value. There are no ongoing incentive programs in which employees are remunerated in shares or options.