Outokumpu’s last year losses for the financial year were proximately EUR 1 billion and still EUR 123 000 worth of bonuses were paid to Mika Seitovirta, the CEO of Outokumpu, for the performance and venture. Compared to the previous year’s performance when losses for the financial year were EUR 0,5 billion Seitovirta received EUR 157 500 as bonuses in his performance share plan. At the time when Seitovirta has been the CEO Company’s performance hasn’t got any better so why do you still get paid for nothing?
There have been setbacks for Outokumpu such as the transaction with ThyssenKrupp for the stainless steel business where the competition authority cancelled the deal on the factory in Tern. Facilities in Tern were the main reason why Outokumpu wanted to make the transaction in the first place. Do you think that a good CEO make this kind of transaction, fail in it and still get his money, well I don’t. I think that you get your bonuses when you are profitable for the company. You have to earn it. Of course there is always something that Seitovirta has done well but how do you explain losses like this.
My opinion is that the system is not healthy when the company’s management doesn’t work and the regular employee has to lose his job because of that. I also think that it is right that the system encourage the leadership do to decisions where are risks, but also on the other hand they should be responsible for the operating profit or in this case, the loss.
I think there will be many changes coming up in the area of rewarding company management but not until new generation will be on the leading positions. There are many cases where bonuses are righteous but also too many of those which are not. I’m hoping that the there will be not much news like this in the future.
Read the news in Kauppalehti and more: http://www.kauppalehti.fi/etusivu/viis+miljarditappiosta+-+seitovirralle+tulospalkkio/201403659037?sort=true