Remuneration

Guidelines for remuneration for the CEO and other senior executives
Approved by the Annual General Meeting on 14 May 2024

The guidelines are to be applied to remunerations agreed and amendments made to previously agreed remunerations following the adoption of the guidelines by the 2024 Annual General Meeting. The guidelines do not encompass remunerations determined by the Annual General Meeting.

The guidelines are intended to promote the company’s business strategy, long-term interests and sustainability

The overarching goal of the business operations is the creation of long-term value growth for the company’s shareholders. Value creation is measured as growth in long-term net asset value per share over a business cycle. This takes place by developing, constructing and managing residential properties in selected locations, working locally in close collaboration with partners and tenants, by having a presence in locations where the company is active, and by collaborating with social planners and public authorities. Sustainability is a key part of the company’s business concept, and the company prioritizes environmental considerations by implementing energy-efficient solutions in its properties and by being a responsible and attractive employer that provides scope for professional development. For more information about the company’s business strategy, long-term interests and sustainability focus, go to the company’s website www.k-fastigheter.com/en.

In order to promote the company’s business strategy, long-term interests and sustainability, and to create long-term positive value growth for its shareholders, the company offers competitive remuneration on market terms, but is not a wage leader in relation to comparable businesses.

Remuneration formats, etc.

Market-based remuneration and terms of employment are a pre-requisite for retaining and, when required, recruiting staff to senior positions with the appropriate competences and experience. Total remuneration shall be based on factors including position, performance and individual qualifications. Remuneration may include the following components: fixed salary, variable or performance-based salary, pension entitlement and other benefits. In addition, the AGM can – independently of these guidelines – decide on share-based and share price-related remuneration.

Fixed salary

Remuneration shall be based on the nature of the relevant assignment, the competences required, previous experience, and performance. Fixed basic salary shall correspond to market-based compensation for satisfactory performance. Fixed basic salary shall be reviewed annually to ensure that it is on market terms and remains competitive.

Variable salary

Variable or performance-based salary to senior executives may correspond to a maximum of 50 percent of fixed salary per calendar year. No variable or performance-based remuneration is payable to the CEO.

Criteria for payment of variable cash remuneration, etc.

Variable cash remuneration shall be linked to pre-determined and measurable criteria that can be financial or non-financial. These may also comprise individualized quantitative or qualitative targets. The criteria shall be designed to promote the company’s business strategy and long-term interests, including its sustainability, for example by having a clear link to the business strategy or by promoting the employee’s long-term progress.

When the measurement period for meeting the criteria for payment of variable cash remuneration has ended, the extent to which the criteria have been met shall be evaluated/determined. The CEO is responsible for evaluating variable cash remuneration to other executives. With regard to financial targets, the evaluation shall be based on the most recent financial information presented by the company.

Pension benefits

Pension provisions can be made for the CEO and senior executives. The pensionable age for the CEO and other members of management is 67. Pension obligations shall be premium-based, implying that the company has no further obligations once annual premiums have been paid.

Other benefits

Other benefits shall be on market terms and contribute to facilitating the senior executive’s ability to carry out relevant assignments. Such benefits can be provided in the form of healthcare insurance and company vehicles, for example.

Termination of employment

For the CEO, a mutual notice period of 12 months applies. Upon termination of employment by the company, the CEO is also entitled to severance pay corresponding to six months’ salary. For other senior executives, market-based and customary termination procedures shall apply and no severance pay shall be payable. Upon termination of employment by the company, the termination period shall be a maximum of 12 months, and upon termination of employment by the employee, a maximum of six months. For senior executives, the terms applied by the company to other Group employees shall apply, either through collective agreement or in the form of individual undertakings to employees.

Salary and terms of employment

When producing the proposals for these remuneration guidelines, salary and employment terms for the company’s employees have been considered by including information regarding total remuneration, components of such remuneration and any increase in remuneration and the rate of increase over time in the Remuneration Committee’s and Board’s decision-making data when evaluating the reasonableness of the guidelines and their ensuing limitations.

Decision-making process for determining, reviewing and implementing the guidelines

The Board has established a Remuneration Committee with the primary task of preparing Board decisions on matters relating to remuneration principles, remuneration and other employment terms for the CEO and senior executives. Accordingly, the Remuneration Committee shall propose guidelines for remuneration to Board members, the CEO and senior executives, which the Board presents to the Annual General Meeting for authorization at least every four years.

Furthermore, the Remuneration Committee shall monitor and evaluate current programs and schemes terminated in the year relating to variable remuneration payable to senior executives, and monitor and evaluate the application of the remuneration guidelines to Board members, the CEO and senior executives, as authorized by the Annual General Meeting, as well as applicable remuneration structures and remuneration levels in the company. The Chairman of the Board can serve as Chairman of the Remuneration Committee. Other members shall be nonaffiliated with the company, the CEO and senior executives. If the Remuneration Committee appoints an external consultant to carry out its work, the Committee shall ensure that there is no conflict of interest regarding other assignments held in relation to the company, CEO or senior executives. The remuneration to the CEO is prepared by the Remuneration Committee and is determined by the Board at regular Board meetings. The CEO does not participate in such decisions. The Board mandates the CEO to negotiate with senior executives in accordance with these guidelines. The Remuneration Committee prepares a proposal to the Board regarding remuneration levels to senior executives on the basis of a proposal from the CEO. If Board members carry out work on behalf of the company, in addition to their regular Board assignments, a consultancy fee and other remuneration shall be payable for such work subject to a special Board resolution. For regular Board work, no remuneration additional to the Directors’ fees determined by the Annual General Meeting shall be payable.

Deviations from the guidelines

The Board may deviate from the guidelines in whole or in part if there are special reasons in individual cases. As indicated above, the Remuneration Committee’s tasks include preparing Board resolutions relating to remuneration, including decisions to deviate from the guidelines. Deviations are only permissible if they are considered necessary to satisfy the company’s long-term interests and sustainability, or to safeguard the company’s financial viability. If the Board deviates from the guidelines for remuneration to Board members, the CEO and senior executives, this shall be reported at the next Annual General Meeting.

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The English version is a translation of the original in Swedish for information purposes only. In case of a discrepancy, the Swedish original will prevail.

Ersättning Remuneration for the Board members was resolved on the AGM on 19 May 2021, based on proposals from the Nomination committee.  styrelseledamöterna beslutades vid årsstämman den 19 maj 2021, baserat på förslag från valberedningen. 

Remuneration of SEK 200,000 shall be payable for the period up until the next Annual General Meeting for each Board member not employed by the company, with the exception of Erik Selin. The Nomination Committee proposes that no fee be payable to Erik Selin. The proposed fees also include remuneration for committee work.

The Nomination Committee proposes that fees to the company’s Auditors are payable in accordance with approved invoice.

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Remuneration report 2024 (in Swedish):  Ersättningsrapport för K-Fast Holding AB avseende verksamhetsåret 2023

Remuneration report 2023 (in Swedish): Ersättningsrapport för K-Fast Holding AB avseende verksamhetsåret 2022

Remuneration report 2022 (in Swedish): Ersättningsrapport för K-Fast Holding AB avseende verksamhetsåret 2021

Remuneration report 2021 (in Swedish): Ersättningsrapport för K-Fast Holding AB avseende verksamhetsåret 2020