General Meeting
Insiders
Auditing of the Accounts
Risk Management
Remuneration
Articles of Association
Disclosure Policy

 

General Meeting

The shareholders take part in the supervision and governance of the company through the resolutions of General Meetings of Shareholders. The Annual General Meeting of Shareholders is the highest decision making body of the company.

The General Meeting of Shareholders is generally convened by the Board of Directors. In addition to this, a General Meeting of Shareholders shall be held if the company’s auditor or shareholders representing a minimum of one-tenth of all outstanding shares in the company demand in writing that a General Meeting be convened.

The general meetings of the company are held in Helsinki, Espoo or Vantaa. The Annual General Meeting shall be held annually within six (6) months from the termination of the financial year.

The notice convening the General Meeting shall be delivered to the shareholders no earlier than three (3) months and no later than three (3) weeks prior to the Meeting, but no later than nine (9) days before the record date of the General Meeting. The notice shall be delivered to the shareholders by means of a notice published on the company's website or at least in one national daily newspaper designated by the Board of Directors.

In order to be entitled to attend the General Meeting, a shareholder must notify the company of its attendance by the date specified in the notice convening the Meeting, which date may not be earlier than ten (10) days prior to the Meeting.

General Meeting 2018

General Meeting 2019

General Meeting 2020

 

Insiders

Rovio observes the Market Abuse Regulation (EU 596/2014, "MAR") and the regulations and guidance given under it, including the insider guidelines of Nasdaq Helsinki Ltd. In addition, the company has issued supplementing internal Insider Rules.

Rovio has defined the members of the Board of Directors, the CEO and other members of the Leadership Team as persons discharging managerial responsibilities (“managerial persons”). The managerial persons and their closely associated persons are required to notify Rovio and the FIN-FSA of every transaction conducted on their own account relating to the Financial Instruments of (or linked to) Rovio without delay and at the latest within three business days after transactions in question were conducted. In addition, Rovio discloses via stock exchange releases and its website information on transactions by managerial persons and their closely associated persons.

The managerial persons may not conduct any transactions on their own account or for the account of a third party, directly or indirectly, relating to Rovio’s shares or other financial instruments during a closed period of thirty (30) calendar days before the announcement of an interim financial report, half year report or a year-end report, including the day of publication of said report.

Rovio has further expanded same trading restrictions during the closed period to cover such employees and other persons, who are not managerial persons but may have access to information on the interim financial report(s) or the year-end report or otherwise have regular access to essential financial information of Rovio due to their position or duties at Rovio (so-called “closed period employees”).

Rovio’s insider list comprises one or more project-based insider lists. Rovio can also create a list of “permanent insiders” who, due to the nature of their role or position, continuously have access to all inside information within the company. Rovio maintains a list of employees and service providers who have access to inside information.

Trading in the shares or other financial instruments of Rovio is always prohibited when holding inside information relating to Rovio or its financial instruments, regardless of whether the person has been entered into an insider list.

Rovio’s General Counsel is responsible for insider guidelines and general insider management in the Company.

 

Auditing of the Accounts

Rovio Entertainment has one official auditor, who shall be an auditing firm approved by the Finnish Patent and Registration Office. The term of the auditor shall be until the conclusion of the first Annual General Meeting following the election.

The Annual General Meeting elects the auditor and decides on their fees.

Ernst & Young Oy, a firm of Authorized Public Accountants, has been the company’s auditor since 2013 with Authorized Public Accountant Mikko Rytilahti as the main auditor.

 

Risk management

Purpose

The Rovio risk management policy defines the objectives and principles, organization, responsibilities and practices of risk management within Rovio.

Risk management objectives

Risk management is an important part of the Rovio Group business management and corporate governance. The objective of Rovio’s risk management is to support the whole organization in achieving its strategic, operational and financial targets. In order to meet the objectives Rovio has incorporated procedures to recognize, assess and manage risks and their consequences. The risk management objective is reached when the Group has identified the uncertainties, risks and opportunities related to the targets and is able to effectively assess and manage the risks.

Rovio enterprise risk management

Risk management principles

Risk management in Rovio aims at ensuring a Group wide risk recognition, assessment, management and control. Risk management is a part of the Rovio day-to-day decision making and operations. Risk management is handled both centrally and in business units to ensure efficiency and visibility across the organization. Key risks are regularly and systematically recognized, assessed and reported to the Board of Directors as a part of the business operations at a Group and business unit level.

Risk definition and risk categories

Rovio divides risks into external and internal risks and further into strategic, operational and financial risks.

Strategic risks are uncertainties mainly related to changes in Rovio’s operating environment and the ability to respond to these changes or to prepare for them. These can be related to e.g. changes in the macro-economic situation, legislative environment, technologies, consumer behaviors and competitive environment.

The target of assessing strategic risks and opportunities is to identify the measures that can and should be taken to achieve objectives by taking controllable risks. Failure in identifying or taking advantage of opportunities also constitutes a risk.

Operational risks are circumstances or events which can prevent or hinder the achievement of objectives or cause damage to people, property, business or information. The target is to avoid or reduce operational risks to an extent, where the cost of measures is in a reasonable proportion to the extent of the risk.

Financial risks are risks related to Rovio’s financial position. These include currency risk, liquidity and funding risk, interest rate risk, credits and counterparty risk. The management of financial risks is based on the Group's finance policy, confirmed by the Board of Directors.

Risk assessments consider also other aspects than purely financial impacts. Reputational risks arise if Rovio’s operations are inconsistent with the expectations of different stakeholder groups, such as the end consumers for Rovio’s products, business partners or the general public. Preventing reputational risks requires compliance with Rovio's internal guidelines and corporate governance. The management of reputational risks relies especially on providing timely and right external communication.

The risks are further divided into group level and business unit (i.e. Games and Brand licensing) level risks.

 

Remuneration

Remuneration decision-making procedure

The remuneration of the Board of Directors

According to the Finnish Limited Liability Companies Act, the Annual General Meeting decides on the fees payable to the members of Rovio’s Board of Directors. The Remuneration Committee is responsible for preparing proposal on remuneration of the Board of Directors to the Annual General Meeting.

The Annual General Meeting of Shareholders on April 9, 2019 resolved that the remuneration of the members of the Board of Directors be kept unchanged and monthly remuneration be paid as follows: to the Chairman of the Board of Directors EUR 9,500, to the Vice Chairman of the Board of Directors EUR 7,500, to the other members of the Board of Directors EUR 5,000 each, and as additional monthly compensation to the Chairman of the Audit Committee EUR 2,500. If the Chairman of the Audit Committee is the Chairman or Vice Chairman of the Board of Directors, no additional compensation be paid. The company will compensate reasonable travel expenses of the Board members and committee members arising from Board or committee work.

Remuneration of the CEO and  the Leadership Team

The Remuneration Committee is responsible for making recommendations to the Board of Directors on compensation matters of the CEO and the members of the Leadership team. The Remuneration Committee also prepares general remuneration principles, short- and long-term incentive schemes and the compensation policy of Rovio Entertainment Oyj, which the Board of Directors approves. The Board of Directors appoints the CEO and approves his/her compensation as well as the nomination and compensation of other members of the Leadership Team.

The remuneration of the CEO and the members of the Leadership Team consists of a fixed monthly salary, fringe benefits and both long- and short-term incentive programs. The Board of Directors determines the incentive plan rules, according to which possible incentives are determined and paid. The CEO and the members of the Leadership Team do not have any supplemental pension arrangements. The CEO’s agreement shall expire by the end of the month of the CEO’s 63rd birthday.

Incentive Programs

Rovio has established both short- and long-term incentive programs, which the Board of Directors of Rovio assesses and confirms annually.

Current Short-Term Incentive Program

In order to support the business strategy by rewarding and incentivizing Leadership Team members and other employees for improvements on short-term performance, Rovio has a unified short-term incentive plan in place for all employees. The bonus pool is capped to 50% of total employee salary expense and the pool size varies between 0-50% depending on either business unit and/or Group’s pre-bonus adjusted EBITDA. In addition, the maximum individual bonus is 100% of base salary. The board sets the thresholds for minimum and maximum bonus annually.

Current Long-term Incentive Program

Rovio’s Board of Directors approved on July 27, 2017 a long-term incentive program consisting of an option plan for all employees, including the CEO and the Leadership Team, and a restricted share plan for selected key employees.

The Board has in May 16, 2018 resolved to update the schedule for the stock options 2018 and 2019 while keeping the maximum total number of stock options 2017-2019 unchanged, as well as to add more gross shares to the restricted share unit plan.

The option plan provides for the issuance of up to 5,000,000 options. Each option entitles its holder to subscribe for one share. The option plan includes three lots of options that can be allocated to 2017, 2018, and 2019.

Stock option plans are intended to reward personnel from the positive change in company’s share value and to align the interest of the employees and shareholders. As of 2017, all new stock option plans are directed to all employees.

The shares subscribed with options have a subscription period of one year:

  • 2017: October 1, 2020–September 30, 2021
  • 2018: June 1, 2021–May 31, 2022
  • 2019: June 1, 2022–May 31, 2023

In the option plans, the subscription prices are the following:

  • 2017: the share’s subscription price during the listing
  • 2018: trade volume weighted average quotation of the share on Nasdaq Helsinki Ltd. May 2–31 2018
  • 2019: trade volume weighted average quotation of the share on Nasdaq Helsinki Ltd. May 2-31 2019.

In general, the Company shall hold the stock options on behalf of the stock option owner until the beginning of the share subscription period. Should a share option owner’s employee relationship cease before the beginning of the subscription period, they shall generally lose their right to the reward.

The aim of the restricted share plan is to commit the Company’s key persons and to link the long-term interests of the participants and the shareholders. The plan offers selected key personnel an opportunity to receive a predetermined number of company’s shares after specific restriction period, which differs from 12 to 36 months based on needs of business. The plan’s reward will be paid to the participant as soon as possible after the restriction period. The payment of the reward requires that the participant’s employment contract is valid, has not been discontinued or terminated, and it will continue until the end of the restriction period. The payment will be made in company shares and taxes and tax-related costs arising from the reward are deducted from the gross reward. The value of share shall be determined based on volume weighted average share price at the payment date. No payment shall be paid if the employment contract is terminated before the end of the restriction period.

PDF iconRemuneration Report 2018

 

Articles of association

Articles of Association of Rovio Entertainment Oyj

1§ Company name

The name of the company is Rovio Entertainment Oyj. The company's parallel name in English is Rovio Entertainment Corporation.

2§ Registered office of the company

The company's registered office is in Espoo, Finland.

3§ Line of business of the company

The line of business of the company is software design, manufacture, publication, publishing and consultancy. In addition, the company's line of business includes film production, book publishing activities, spinoffs and advertising services. In addition, the company's line of business is to manage and own securities, shares, real estate and other assets in Finland and abroad by itself or through its own companies. The company's line of business is also to provide administrative, financial and other group services to its group companies as well as to provide securities and guarantees on behalf of the group companies.

4§ Book-entry system

 The shares of the company shall belong to the book-entry system after the expiry of the registration period.

5§ Board of Directors

The governance of the company and the appropriate organization of the company's operations is managed by the Board of Directors, which, according to the decision of the Annual General Meeting, includes a minimum of (3) and a maximum of nine (9) ordinary members. The number of deputy members may not exceed three (3). The term of the members of the Board of Directors shall be until the conclusion of the first Annual General Meeting following the election. The Annual General Meeting elects the Chairman and the Vice Chairman of the Board of Directors.

6§ Chief Executive Officer

The company may have a Chief Executive Officer. The Board of Directors shall decide on the appointment and dismissal of the Chief Executive Officer.

7§ Representation

In addition to the Board of Directors, the company is represented by the Chairman of the Board of Directors and the Chief Executive Officer, each alone, and two members of the Board of Directors together.

8§ Financial year

The financial year of the company is the calendar year.

9§ Auditors

The company's auditor shall be an auditing firm approved by the Finnish Patent and Registration Office. The term of the auditor shall be until the conclusion of the first Annual General Meeting following the election.

10§ Notice to General Meeting and registration

The general meetings of the company are held in Helsinki, Espoo or Vantaa. The Annual General Meeting shall be held annually within six (6) months from the termination of the financial year.

The notice convening the General Meeting shall be delivered to the shareholders no earlier than three (3) months and no later than three (3) weeks prior to the Meeting, but no later than nine (9) days before the record date of the General Meeting. The notice shall be delivered to the shareholders by means of a notice published on the company's website or at least in one national daily newspaper designated by the Board of Directors.

In order to be entitled to attend the General Meeting, a shareholder must notify the company of its attendance by the date specified in the notice convening the Meeting, which date may not be earlier than ten (10) days prior to the Meeting.

11§ Annual General Meeting

At the Annual General Meeting the following shall be

presented:

 1. the financial statements and the report of the Board of Directors, as well as

 2. the audit report,

decided:

 3. the adoption of the financial statements, which, in a parent company, also includes the adoption of the consolidated financial statements,

 4. the use of the profit shown on the balance sheet,

 5. the discharge from liability for the members of the Board of Directors and the Chief Executive Officer,

 6. the remuneration of the members of the Board of Directors and of the auditor, as well as

 7. the number of members of the Board of Directors,

elected:

 8. the Chairman, the Vice Chairman and the members of the Board of Directors, as well as

 9. the auditor,

handled:

 10. any other matters possibly contained in the notice to the Meeting.

 

Disclosure policy

General

In its communications, Rovio complies with EU and Finnish legislation, the Market Abuse Regulation (EU No 596/2014) and regulations based on it, the rules and guidelines of Nasdaq Helsinki Ltd, the guidelines of ESMA (European Securities and Markets Authority) and the Finnish Financial Supervisory Authority, the Finnish Corporate Governance Code for listed companies as well as Rovio’s Disclosure Policy.

Rovio’s Disclosure Policy describes the key principles and practices according to which Rovio communicates with the different capital market participants. The principles set out in the disclosure policy apply to the entire Rovio Group.

The objective of Rovio’s financial and investor communications is to ensure that all market participants have simultaneously and without delay an access to equal, fair, sufficient and simultaneous information on the material factors relating to Rovio and its business, which factors may have an effect on the value of Rovio’s financial instruments, and that the information disclosed gives correct and sufficient information on Rovio’s operations.

In accordance with a pre-announced schedule, Rovio discloses information on its financial performance and financial position in its financial statements and reports of the Board of Directors, financial statements releases, half year releases and interim reports.

Rovio discloses to the public primarily the information regarding the group and its reporting segments (Games, Brand Licensing and Other). As a general rule, financial information or key performance indicators of the Company’s other units or legal persons are not published.