TeliaSonera cuts bonuses of Finnish managers after unsatisfactory year

Anders Igel

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The President and CEO of the Finnish-Swedish telecoms operator TeliaSonera, Anders Igel, has decided to cut the bonuses of the managers of the company's Finnish arm by 60 percent. The reduction applies to the incentive bonus payments made to some 600 persons.
      In the light of the unsatisfactory 2005 result of EUR 34 million for TeliaSonera's Finnish subsidiary, which saw erosion of more than 300 million euros in profit relative to the previous period, the CEO has reached the conclusion that the payment of the incentive bonuses cannot be justified. Moreover, the outcome for the last quarter of 2005 was already negative.
      The TeliaSonera employee remuneration system comprises both 12-month financial targets and individual achievement goals. In any case, bonuses based on the financial result would not have been paid to Finns this year, but Igel decided to cut back on other emoluments as well.
     
According to the rules of TeliaSonera, the CEO has the right to cut the bonuses if the financial targets are not achieved. In 2003 Igel resolved that no incentive bonuses whatsoever would be paid out within the Swedish branch of the company.
      While understanding the cutting of bonuses, President of TeliaSonera Finland Juho Lipsanen does not wish to comment on the results of Sonera for the first months of the current year. However, he notes that the company is undergoing a development programme in order to improve its results.


Previously in HS International Edition:
  Juho Lipsanen to lead Finnish operations of TeliaSonera (4.8.2005)

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