FINLAND - The Finnish government has set up a working group to evaluate the remuneration guidelines of state-owned companies, including pension arrangements, and to propose reforms of the system.
The group, which is expected to submit a report by 15 June 2009, is to be chaired by Markku Pohjola, an economist, while the other members will include lawyer Pekka Merilampi and Pekka Nikula, an authorised public accountant.
Earlier this week, Jyri Häkämies, the minister responsible for ownership steering of state-owned companies, admitted while the government has made efforts to develop guidelines to prevent excessive remuneration it has been suggested from "recent dialogue" that the existing levels "may still be excessively high".
Häkämies pointed out that the level of remuneration "has to be reasonable in state-owned companies", and suggested it was time for the establishment of an independent party "to examine how the situation stands".
The current system, last updated in 2006, consists of basic pay, share-based compensation and a performance-based bonus, however because state-owned companies do not currently have their own pension system or benefits, these are included in contracts of management.
The new working group has therefore also been mandated with evaluating the remuneration guidelines for senior management, including their pension arrangements, and to put forward appropriate proposals for reform, including a possible rise in retirement age and the pension criteria to be applied in new contracts of employment.
The government said particular attention would be paid to:
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