FINANCIAL REVIEW 2022
CONTENTS
Contents
THIS IS NOKIAN TYRES ...........................
Key gures ....................................
Year in brief ...................................
Review by the President & CEO .......................
REPORT BY THE BOARD OF DIRECTORS .........
Key nancial indicators ..............................
FINANCIAL STATEMENTS .........................
Consolidated income statement .....................
Consolidated statement of nancial position ..........
Consolidated statement of cash ows ................
Consolidated statement of changes in equity .........
Accounting policies for the
consolidated nancial statements ....................
Notes to the consolidated nancial statements .......
Signatures of the Board of Directors and
the auditor’s note ...................................
Auditor’s report .....................................
ESEF assurance report ..............................
Information on Nokian Tyres’ share ...................
Nokian Tyres Group structure ........................
CORPORATE GOVERNANCE STATEMENT .........
NON-FINANCIAL INFORMATION STATEMENT ....
REMUNERATION REPORT ........................
INVESTOR INFORMATION AND
INVESTOR RELATIONS ............................
Parent company income statement ..................
Parent company balance sheet .......................
Parent company statement of cash ows .............
Accounting policies for the parent company ...........
Notes to the nancial statements of the
parent company ....................................
2
Nokian Tyres in brief
THIS IS NOKIAN TYRES
Nokian Tyres develops and manufactures premium tires for
people who value safety, sustainability, and predictability.
Our products are used in millions of passenger cars, trucks, and
heavy machinery each day. We have for decades safeguarded
people’s lives and are committed to continuing this eort
through even safer, smarter and more sustainable driving.
Nokian Tyres’ business is divided into three units:
Passenger Car Tyres, Heavy Tyres and Vianor, which is our
chain of tire and car service centers. Our manufacturing
plants are located in Finland and the US. In 2022, we
decided to sell our Russian operations due to the changes
in the operating environment, and started to build a
new production site in Romania, where commercial tire
production is expected to start in 2025.
Nokian Tyres is the inventor of the winter tire. The
diverse portfolio of winter tires is complemented with
summer, all-weather, and all-season tires. Our core
markets are the Nordic countries, where we are the
market leader in premium tires, as well as North America
and Central Europe. Nokian Tyres products are sold in
approximately 60 countries.
The premium quality, safety and eco-friendliness of
our tires is based on constant development and careful
testing both in laboratory and in real driving conditions.
We operate two tire testing centers in Finland and one in
Spain, which allows for year-round tire testing.
Sustainability is an essential part of our business.
We aim to be the safest tire choice for the people and
the planet, and are committed to promoting safe and
responsible driving culture.
NET SALES
1,776
EUR MILLION
SEGMENTS
OPERATING PROFIT
221
EUR MILLION
4,500
PROFESSIONALS
PRODUCTS SOLD IN
60
COUNTRIES
3
20222021202020192018
Net sales Segments
operating prot
Segments
operating prot %
EUR million
Segments operating prot %
0
400
800
1,200
1,600
2,000
0
10
20
30
40
50
20222021202020192018
EUR
Segments earnings
per share
Dividend
per share
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
%
0
5
10
15
20
25
20222021202020192018
KEY FIGURES 2022
EUR million 2022 2021
Net sales ,. ,.
Operating prot –. .
Operating prot % –.% .%
Result before tax –. .
Result for the period –. .
Earnings per share, EUR –. .
Segments EBITDA . .
Segments operating prot . .
Segments operating prot % .% .%
Segments earnings per share, EUR . .
Segments ROCE, % .% .%
Equity ratio, % .% .%
Cash ow from operating activities –. .
Gearing, % .% –.%
Interest-bearing net debt . –.
Capital expenditure . .
Personnel (at the end of year) , ,
LTIF
1)
. .
1)
Lost Time Injury Frequency: the number of lost time injuries occurring in
a workplace per 1 million hours worked.
NET SALES AND SEGMENTS OPERATING PROFIT* SEGMENTS EARNINGS PER SHARE* AND DIVIDEND PER SHARE
NET SALES BY GEOGRAPHICAL AREA, %
NET SALES BY BUSINESS UNIT
1)
, %
1)
Including internal sales
SEGMENTS ROCE*, %
* Comparable Segments Total gures for 2019–2022, earlier years reported based on IFRS
1)
Segments EPS 2019 excl. the impact of the rulings on the tax disputes of
EUR 1.08 were EUR 1.98
2)
The Board’s proposal to the Annual General Meeting on the payment of a
maximum amount of dividend
Key gures 2021
EUR million 2022 2021 2020 2019 2018
Net sales ,.
,. ,. ,. ,.
Segments operating
prot . . . . .
Segments operating
prot % . . . . .
2022 2021 2020 2019 2018
Segments ROCE, % . . . . .
EUR 2022 2021 2020 2019 2018
Segments earnings
per share . . 1.04 .
)
.
Dividend per share .
)
. . . .
2022 2021
Nordic countries
Other Europe
Russia and Asia
Americas
2022 2021
Passenger Car Tyres
Heavy Tyres
Vianor
4
Highlights of the year
YEAR 2022 IN BRIEF
EUR 650 million
World-class factory to Romania
In October, we announced a EUR 650 million investment in a
new passenger car tire factory in Romania – the rst zero CO
2
emission factory in the industry. The factory is a vital element
in getting additional capacity and enabling our future growth,
as we build the new Nokian Tyres without Russia.
Exit from Russia
In June, we made a decision to exit Russia. Due to the war in
Ukraine and the subsequent sanctions it is no longer feasible
nor sustainable for Nokian Tyres plc to continue operations in
Russia. An agreement for the sale of our Russian operations
was signed in October.
3.2
Excellent development
in safety
We made major advances in
occupational safety. Our LTIF gure
decreased from 4.1 to a record
low level of 3.2 and our employees
reported more than 20,600 safety
actions during the year.
93%
The most sustainable consept tire yet
In January, we reached an important milestone as we
introduced our most sustainable tire yet: 93% of the
materials used in the Nokian Tyres Green Step concept
tire are either recycled or renewable. It moves us closer
to our ambitious goal: by the year 2030, 50% of all raw
materials used in Nokian Tyres’ products will be recycled
or renewable.
Record year in Heavy Tyres and Vianor
2022 was a record year for Heavy Tyres and Vianor.
Heavy Tyres delivered the best-ever net sales and
protability, supported by the highest ever productivity.
Vianor delivered all-time high net sales.
Recognition for our sustainability work
We were included in the Dow Jones Sustainability Europe
Index, being one of the top-scoring companies in the
Automobiles and Automotive components industry. In the
CDP Climate Change rating, we were awarded with the
leadership score of A–.
5
BUILDING THE NEW NOKIAN TYRES
AFTER A YEAR OF MAJOR CHANGE
Review by the President & CEO
2022 was a signicant turning point for
Nokian Tyres. We decided to exit Russia,
build a new factory in Romania, and start
producing certain passenger car tires
through contract manufacturing. Amidst
all the change and uncertainty, our
organization showed exceptional resilience,
strength, and condence in turning
challenges into opportunities. The year 2023
will be a new start for Nokian Tyres.
We started 2022 strongly, driven by good demand and new
products. The situation, however, changed rapidly at the end of
February as we witnessed the horric events unfolding in Ukraine.
The war brought about unexpected and rapid developments in
our operating environment, causing exceptionally high levels
of uncertainty and discontinuity. Sanctions imposed during the
spring prohibited, among other things, the import of tires from
Russia into the EU. Our tire imports from Russia to Europe and
North America ended after a transition period in July.
In June, Nokian Tyres’ Board of Directors decided to initiate
a controlled exit from Russia, as it was no longer feasible nor
sustainable for us to continue operating there. In October, we
signed an agreement to sell our Russian operations. As I am
writing this, the sale process is ongoing.
Lower passenger car tire supply volumes and changed factory
mix due to lower production in Russia contributed negatively on
the Passenger Car Tyres business unit and on the Nokian Tyres
Group results in 2022. Despite the many challenges we faced
during the year, we also had many successes. In Heavy Tyres, we
had a record year in terms of net sales, protability and produc-
tivity. Vianor delivered all-time high net sales, and in North
America, we reached the highest ever sales volume of passenger
car tires. We were also able to implement price increases during
6
Even though this is a period of
considerable change, the core of
our business remains the same.
the year to combat the rising cost ination and its impacts. Cost ination is expected
to continue in 2023, which will require careful cost control going forward, while investing
in strategic key projects to restore our growth.
Investing in a new factory in Romania
During the latter half of 2022, we took the rst steps in building the new Nokian Tyres
without Russia. The most signicant step was the decision made in November to
invest approximately EUR 650 million in a new passenger car tire factory in Romania.
This investment is extremely important in terms of additional capacity and our future
growth. We estimate that the rst tires will be manufactured at the new factory during
the latter half of 2024, and that commercial tire production will start in 2025.
At our factories in Finland and the US, we continued to increase production capacity
by adding new machines and modernizing the existing ones. I am proud to say that our
factories are among the most eicient and productive in the tire industry and set a
benchmark in sustainability. For example, our production and administration facilities
in the US have received the LEED certicate which is only awarded to the most energy-
eicient buildings, and our new factory in Romania will be the rst zero CO
2
emission
factory in our industry.
Contract manufacturing provides additional exibility
In addition to increasing production at our own factories, we plan to produce selected
passenger car tires via contract manufacturing. This will further improve our agility and
exibility to meet customer demand.
Tires manufactured by the contract manufacturers will be designed by us and tested
at our own test centers to meet our high requirements for safety and quality. The rst
tires will be available on the Central European market during the latter half of 2023.
Contract manufacturing partners are expected to collectively produce between 1 to 3
million tires annually in 2023 and beyond.
Steps forward in sustainability
Sustainability is one of the cornerstones of Nokian Tyres’ strategy. Last year, our
sustainability work was once again recognized by independent rating agencies. Among
the companies selected into the Dow Jones Sustainability Europe Index, we received
the highest scores in our industry for occupational health and safety. Excellent safety
development is also demonstrated in our LTIF gure that dropped in 2022 to the lowest
level in our company’s history. This is a signicant achievement and underlines the
importance of the safety and well-being of our employees.
We have also been working hard to mitigate climate change by reducing our green-
house gas emissions. Between 2015 and 2022, we have cut carbon dioxide emissions
from our production by over 40%. Our scope 1 and 2 emissions are the lowest in the tire
industry in relation to turnover and production tons. We are also increasing the amount
of renewable and recycled raw materials in our products – without compromising on
safety. Our ambitious target is to increase the proportion of renewable and recycled raw
materials in our products to 50% by 2030. This focus on sustainability is long-term and
requires both new innovations and close cooperation with our partners.
Towards a new Nokian Tyres
The past year was exceptional and demanding in many ways. I am proud of how our team
was able to react to the fast-changing situations, while at the same time caring for
customers and for each other. Today, we are looking ahead with condence and focusing
on building the new Nokian Tyres.
In Passenger Car Tyres, adding new capacity, retaining a competitive premium product
portfolio and serving our customers’ needs are the key priorities to restore growth
and protability. We have the leading position in premium tires in the Nordic countries,
supported by Vianor, and a strong ambition to grow in North America. In Central Europe,
we will have a limited supply of products in 2023. After that, we expect volumes to start
picking up again, driven by contract manufacturing and production ramp-up in the
new Romanian factory. In Heavy Tyres, we see attractive opportunities to continue on a
strong growth track as well as further improving protability. We have a strong nancial
position, allowing us to invest in our future and deliver sustainable stakeholder value.
Even though this is a period of considerable change, the core of our business remains
the same. Sustainably produced premium tires that are reliable and predictable in all
conditions is our key success factor – together with our resilient and talented team. We
have for decades safeguarded people’s lives and are committed to continuing this eort
through even safer, smarter and more sustainable driving.
I want to thank everyone at Nokian Tyres for their valuable work and commitment to
the future of our company during 2022. I also thank our customers, shareholders and
other stakeholders for their continuing support and trust. Let’s build the new Nokian
Tyres together.
Helsinki, February 7, 2023
Jukka Moisio
President & CEO
7
REPORT BY THE BOARD OF
DIRECTORS 2022
Report by the Board of Directors
The year 2022 started o strongly for Nokian Tyres, driven by good
demand and new products. At the end of February, the situation changed
rapidly due to the war in Ukraine, causing signicant uncertainty to the
company’s operating environment.
Nokian Tyres took several measures to manage the impacts of the war
on its personnel and business. In June, the Board of Directors decided to
initiate a controlled exit from Russia. During the second half of 2022, the
rst steps were taken to build the new Nokian Tyres without Russia. These
included a decision to build in a new passenger car tire factory in Romania
and to start collaborating with contract manufacturers.
In 2022, Nokian Tyres made good progress on its sustainability targets.
The company improved workplace safety to the best ever level, introduced
its most sustainable concept tire yet, and continued to reduce its green-
house gas emissions to mitigate climate change.
Net sales and operating prot
Net sales in 2022 increased by 3.6% and amounted to EUR 1,776.1 million (2021: 1,714.1;
2020: 1,313.8). With comparable currencies, net sales decreased by 2.2%. Currency
exchange rates aected net sales positively by EUR 98.9 million.
The year began with good tire demand in all markets. The war in Ukraine started to
impact on the operating environment in late February. On June 28, Nokian Tyres’ Board
of Directors decided to initiate a controlled exit from Russia. Due to the war and the
subsequent, tightening sanctions it is no longer feasible nor sustainable for Nokian
Tyres plc to continue operations in Russia. An agreement for the sale of the Russian
operations was signed in October. The sale process is ongoing.
Tire imports from Russia to Europe and North America ended in July. In April, the EU
imposed sanctions banning tire imports from Russia to the EU, including a transition
period until July 10. Lower tire supply impacted 2022 net sales negatively, specically in
Central Europe.
Net sales by geographical area
EUR million 2022 2021 Change
CC
1)
Change
% of total
net sales
in 2022
% of total
net sales
in 2021
Nordics . . .% .% % %
Other Europe . . –.% –.% % %
Russia and Asia . . .% .% % %
Americas . . .% .% % %
Tota l ,. ,. .% –.% % %
1)
Comparable currencies
Net sales by business unit
EUR million 2022 2021 Change
CC
1)
Change
% of total
net sales
in 2022
2)
% of total
net sales
in 2021
2)
Passenger Car Tyres ,. ,. .% –.% % %
Heavy Tyres . . .% .% % %
Vianor . . .% .% % %
Other operations and
eliminations –. –. –.%
Tota l ,. ,. .% –.%
1)
Comparable currencies
2)
Includes internal sales
Raw material unit costs (EUR/kg) in manufacturing increased by 41% year-over-year,
containing negative currency impact. Logistics costs increased signicantly due to
extraordinary measures to secure tire supply and due to cost ination.
Operating prot was EUR –116.2 million (2021: 268.2; 2020: 120.0). The non-IFRS
exclusions were EUR –337.4 million (–56.7), including impairments and write-downs
of EUR –296.6 million related to the Russia exit process and EUR –4.2 million other
impairments and write-downs. Furthermore, the non-IFRS exclusions include EUR –27.4
million (–31.0) related to the US factory ramp-up and EUR –8.7 million (0.0) related to the
company restructuring mainly in Central Europe. Operating prot percentage of net
sales was –6.5% (2021: 15.6%; 2020: 9.1%).
Segments operating prot amounted to EUR 221.2 million (2021: 324.8; 2020:
190.2), with positive currency impact of approximately EUR 31 million. The decline was
driven by lower passenger car tire supply volumes and changed factory mix due to
8
lower production in Russia. Segments operating prot percentage was 12.5% (19.0%).
Segments ROCE was 10.3% (15.8%).
Segments operating prot by business unit
EUR million 2022 2021
Passenger Car Tyres . .
Heavy Tyres . .
Vianor . .
Other operations and eliminations –. –.
Segments operating prot total . .
Non-IFRS exclusions –. –.
Financial items and taxes
Net nancial expenses were EUR 30.1 million (10.0), including net interest expenses
of EUR 11.8 million (7.2). Net nancial expenses include an expense of EUR 18.3 million
(expense of 2.7) mainly due to the open exposure in ruble as ruble hedging market no
longer exists. Segments result before tax was EUR 208.0 million (314.8). Result before
tax was EUR –146.3 million (258.2) and taxes were EUR 29.2 million (52.0), including write-
downs in the deferred tax assets of EUR –12.2 million in Russia. Segments result for the
period amounted to EUR 179.1 million (254.0). Result for the period amounted to EUR
–175.5 million (206.2). Segments earnings per share were EUR 1.30 (1.84), and earnings per
share were EUR –1.27 (1.49).
Return on equity was –11.5% (2021: 13.1%; 2020: 5.2%).
Guidance given for 2022
In Nokian Tyres’ nancial statement release for 2021 published on February 8, 2022, the
company published the following outlook for 2022:
In 2022, Nokian Tyres’ net sales with comparable currencies are expected to grow
signicantly and segments operating prot is expected to grow. The global car and tire
demand is expected to grow. The COVID-19 pandemic continues to cause uncertainties,
including cost ination and availability challenges, in the whole automotive value chain.
In addition, current geopolitical situation causes uncertainties in 2022.
On February 28, the Board of Directors withdrew the company’s nancial guidance
for 2022 due to the uncertainties caused by the war in Ukraine.
On April 27, the company published the following guidance for 2022: The war in
Ukraine and resulting sanctions cause signicant uncertainty to Nokian Tyres’ operating
environment. Nokian Tyres’ net sales and segments operating prot in 2022 are
expected to decrease signicantly compared to 2021.
On June 17, the outlook was updated as follows: The war in Ukraine and resulting
sanctions cause signicant uncertainty to Nokian Tyres’ operating environment. In
2022, Nokian Tyres’ net sales are expected to decrease or to be at previous year’s level,
and segments operating prot is expected to decrease signicantly compared to 2021.
On October 28, the outlook was updated as follows: The war in Ukraine and resulting
sanctions have a signicant negative impact on Nokian Tyres’ supply capacity and
performance. In 2022, Nokian Tyres’ net sales is expected to be at previous year’s
level or increase, and segments operating prot is expected to decrease signicantly
compared to 2021.
Cash ow
In 2022, cash ow from operating activities was EUR –4.3 million (396.5). Working
capital increased by EUR 257.1 million (increased by 5.5). Inventories increased by EUR
93.4 million (increased by 70.8) and receivables increased by EUR 93.9 million (increased
by 22.0). Payables decreased by EUR 69.8 million (increased by 98.3).
Investments
Investments in 2022 amounted to EUR 129.9 million (119.6). Depreciations and amorti-
zations totaled EUR 154.9 million (140.5). Impairments of EUR 155.7 million (17.0) mainly
related to the Russian xed assets were recorded as part of the Russia exit process.
In June, Nokian Tyres acquired three hectares of land and, in October, an industrial
property in Nokia, Finland to secure future development opportunities at the Nokia
factory.
In November, Nokian Tyres’ Board of Directors made a decision to invest approxi-
mately EUR 650 million in a new passenger car tire factory in Romania - the world’s rst
zero CO
2
emission factory in the tire industry. The site location in Romania supports
this target as there is green energy produced near the site. In addition, Nokian Tyres
is evaluating the production processes to nd the most sustainable ways to produce
tires. The investment is a signicant strategic decision enabling the company’s future
growth. Construction is scheduled to begin in the rst half of 2023 and the rst tires
are estimated to be produced in the second half of 2024. Commercial tire production is
expected to start in 2025.
Financial position on December 31, 2022
EUR million
Dec ,
Dec ,
Cash and cash equivalents . .
Interest-bearing liabilities
2)
. .
of which current interest-bearing liabilities . .
Interest-bearing net debt . –.
Unused credit limits
1)
. .
of which committed . .
Gearing ratio, % .% –.%
Equity ratio, % .% .%
1)
The current credit limits including the EUR 500 million commercial paper program are used to nance
inventories, trade receivables, and subsidiaries in distribution chains, thereby controlling the typical seasonality
in the Group’s cash ow.
2)
The interest-bearing liabilities were increased by EUR 150 million with two bilateral facilities in May.
9
Personnel
2022 2021 2020
Group employees
on average , , ,
at the end of the review period , , ,
in Finland , at the end of the review period , , ,
in Russia, at the end of the review period , , ,
in North America, at the end of the review period
Vianor (own) employees, at the end of the review period
1)
, , ,
1)
Included in Group employee gures
Salaries, incentives, and other related costs in 2022 were EUR 277.3 million (2021: 270.7;
2020: 224.7).
Research and development
Nokian Tyres’ competitive position is based on its ability to continually develop new,
innovative and sustainable products. In 2022, Nokian Tyres introduced several new tire
models. Approximately 50% of R&D investments is allocated to product testing. Nokian
Tyres’ R&D costs in 2022 totaled EUR 29.6 million (2021: 31.9; 2020: 22.7), which is 7.3%
(2021: 11.0%; 2020: 8.0%) of the operating expenses.
Sales and distribution
In 2022, Nokian Tyres continued to develop and optimize its retail network in order
to ensure eicient distribution in the changed operating environment. Nokian Tyres’
distribution network consists of Nokian Tyres’ own Vianor service centers and service
centers run by partners, the Nokian Tyres Authorized Dealer (NAD) partners, the N-Tyre
retailers, and other tire and vehicle retailers as well as online stores. At the end of 2022,
the number of stores was as follows:
• Vianor: 1,008 (1,047) service centers in total, of which 835 (872) partners
• NAD: 2,295 (2,346) stores
• N-Tyre: 99 (110) stores
BUSINESS UNIT REVIEWS
Passenger Car Tyres
EUR million 2022 2021 Change CC
1)
Change
Net sales ,. ,. .% –.%
Operating prot –. .
Operating prot, % –.% .%
Segment operating prot . .
Segment operating prot, % .% .%
1)
Comparable currencies
In 2022, net sales of Passenger Car Tyres totaled EUR 1,233.8 million (1,199.2). With
comparable currencies, net sales decreased by 5.4%. The year began with good tire
demand in all markets. The war in Ukraine started to impact on the operating environ-
ment in late February. In April, the EU imposed sanctions banning tire imports from
Russia to the EU, including a transition period until July 10. Tire imports from Russia to
Europe and North America ended in July. Lower tire supply impacted net sales nega-
tively, specically in Central Europe. Average Sales Price with comparable currencies
increased strongly, especially in Russia.
The share of sales volume of winter tires was 55% (62%), the share of summer tires
was 27% (23%), and the share of all-season tires was 18% (15%).
Segment operating prot was EUR 178.9 million (298.7), with positive currency impact
of approximately EUR 32 million. The decline was driven by lower supply volumes and
changed factory mix due to lower production in Russia. Price increases oset raw
material and other cost ination.
Operating prot was EUR –149.3 million (263.4). The impairments of EUR 280.7 million
related to the Russian assets were recorded as part of the Russia exit process in 2022.
Raw material unit costs (EUR/kg) in manufacturing increased by 41% year-over-year,
containing negative currency impact. Logistics costs increased signicantly due to
extraordinary measures to secure tire supply and due to cost ination.
Production output (pcs) decreased by 23% year-over-year. In 2022, 64% (82%) of
passenger car tires (pcs) were manufactured in Russia. Preparations for a controlled exit
from Russia started in late June. An agreement for the sale of the Russian operations
was signed in October. The sale process is ongoing. To diversify its manufacturing
footprint, the company made in November a decision to invest approximately EUR
650 million in a new passenger car tire factory in Romania, and continued actions to
increase capacity at the existing factories in Finland and the US. In December, Nokian
Tyres signed a contract manufacturing agreement with Qingdao Sentury Tire Co.,
whereby Sentury will start to manufacture selected Nokian Tyres’ passenger car tires for
the Central European market.
In 2022, the company’s Hakkapeliitta winter tire range was extended with the Nordic
non-studded Nokian Tyres Hakkapeliitta R5 for passenger cars and SUVs as well as
10
the Nordic studded Nokian Tyres Hakkapeliitta C4 and Hakkapeliitta CR4 for vans and
delivery vehicles.
Heavy Tyres
EUR million 2022 2021 Change CC
1)
Change
Net sales . . .% .%
Operating prot . .
Operating prot, % .% .%
Segment operating prot . .
Segment operating prot, % .% .%
1)
Comparable currencies
In 2022, net sales of Heavy Tyres totaled EUR 273.5 million (254.0). With comparable
currencies, net sales grew by 6.1% driven by strong demand in most product segments
and higher sales prices. Sales and distribution of heavy tires to Russia were discon-
tinued in the rst quarter due to the war in Ukraine.
Segment operating prot was EUR 43.8 million (40.3). Price increases oset raw
material and other cost ination. Operating prot was EUR 39.2 million (39.1).
Raw material unit costs (EUR/kg) in manufacturing increased by 41% year-over-year,
containing negative currency impact. Logistics costs increased signicantly.
In 2022, Heavy Tyres launched several new tire sizes for wheeled excavators, backhoe
loaders, trucks and busses. In May, the company released a new all-season, all-weather
bus tire, Nokian Tyres Hakka Truck Coach.
Vianor, own operations
EUR million 2022 2021 Change CC
1)
Change
Net sales . . .% .%
Operating prot . –.
Operating prot, % .% –.%
Segment operating prot . .
Segment operating prot, % .% .%
Number of own service centers at
period end
1)
Comparable currencies
In 2022, net sales of Vianor totaled EUR 362.0 million (342.9). With comparable curren-
cies, net sales increased by 7.3%.
Segment operating prot was EUR 3.1 million (4.1). Cost ination was partially oset
by price increases. Operating prot was EUR 2.8 million (–15.0, impacted mainly by
goodwill impairment).
At the end of the review period, Vianor had 173 (175) own service centers in Finland,
Sweden and Norway.
Segments Total to Nokian Tyres Total reconciliation
1–12/2022 Net sales Cost of sales SGA
Other
operating
income/
expenses
Operating
prot
Financial
income/
expenses Taxes
Result
for the
period
Segments Total ,. –,. –. . . –. –. .
US factory ramp-up –. –. –. . –.
Impairments and write-downs of tangible and intangible assets,
and certain other items –. –. –. –. –. –.
Non-operative items and others –. –. –. . –.
Total non-IFRS exclusion –. –. –. –. –. –. –.
Nokian Tyres Total ,. –,. –. –. –. –. –. –.
Nokian Tyres reports non-IFRS gures in addition to its IFRS-reported results. The Segments Total gures exclude costs related to the US factory ramp-up, goodwill impairment charges, restructuring and certain other items,
which are not indicative of Nokian Tyres’ underlying business performance.
11
CORPORATE GOVERNANCE
In its decision-making and administration, Nokian Tyres adheres to the Finnish Limited
Liability Companies Act, the Finnish Securities Markets Act and the rules issued by
Nasdaq Helsinki Ltd, Nokian Tyres’ Articles of Association, and the Finnish Corporate
Governance Code 2020 for listed companies. Nokian Tyres complies with the code
without exceptions. The code is published at www.cgnland./en/.
The Corporate Governance Statement has been prepared pursuant to the Finnish
Corporate Governance Code 2020 for listed companies and the Securities Markets Act
(Chapter 7, Section 7) and it is issued separately from the Board of Directors’ report.
The Board of Directors has reviewed the Corporate Governance Statement, and the
auditor Ernst & Young Oy has veried that the Statement has been issued and that the
description of the main features of the internal control and risk management systems
relating to the nancial reporting process is consistent with the nancial statements.
The Corporate Governance Statement will be published the week commencing February
27, 2023.
SHARES AND SHAREHOLDERS
At the end of December 2022, the number of shares was 138,921,750.
Number of shares (million units)
1)
31.12.22 31.12.21
at the end of period , ,
in average , ,
in average, diluted , ,
1)
Excluding treasury shares
Authorizations
In April 2022, the Annual General Meeting authorized the Board of Directors to resolve
to repurchase a maximum of 13,800,000 shares in the company by using funds in the
unrestricted shareholders’ equity. The proposed number of shares corresponds to
approximately 9.9% of all shares in the company. The authorization will be eective
until the next AGM, however at most until June 30, 2023, and it canceled the authoriza-
tion given to the Board of Directors by the Annual General Meeting on March 30, 2021.
In April 2022, the Annual General Meeting authorized the Board of Directors to
resolve to oer no more than 13,800,000 shares through a share issue, or by granting
special rights under Chapter 10, Section 1 of the Finnish Limited Liability Companies
Act that entitle to shares (including convertible bonds), on one or more occasions. The
Board may decide to issue new shares or shares held by the company. The maximum
number of shares included in the proposed authorization accounts for approximately
9.9% of all shares in the company. The authorization will be eective until the next AGM,
however at most until June 30, 2023, and it canceled the authorization given to the
Board of Directors by the Annual General Meeting on March 30, 2021.
In April 2022, the Annual General Meeting authorized the Board of Directors to
resolve on donations in the aggregate maximum amount of EUR 250,000 to be
made to universities, institutions of higher education or to other non-prot or similar
purposes during 2022 and 2023. The donations can be made in one or more instal-
ments. The Board of Directors may decide on the donation recipients, purposes of use
and other terms of the donations.
In March 2021, the Annual General Meeting authorized the Board of Directors to
resolve to repurchase a maximum of 13,800,000 shares in the company by using
funds in the unrestricted shareholders’ equity. The number of shares corresponded to
approximately 9.9% of all shares in the company. The authorization was eective until
the Annual General Meeting of 2022.
In March 2021, the Annual General Meeting authorized the Board of Directors to
resolve to oer no more than 13,800,000 shares through a share issue, or by granting
special rights under Chapter 10, Section 1 of the Finnish Limited Liability Companies
Act that entitle to shares (including convertible bonds), on one or more occasions. The
maximum number of shares included in the proposed authorization accounted for
approximately 9.9% of all shares in the company. The authorization was eective until
the Annual General Meeting of 2022.
The Board did not utilize the authorizations in 2022.
Own shares
No share repurchases were made during the review period, and the company did not
possess any own shares on December 31, 2022.
Nokian Tyres has an agreement with a third-party service provider concerning the
share-based incentive program for key personnel. The third party owns Nokian Tyres’
shares related to the incentive program until the shares are given to the participants
of the program. On December 31, 2022, the number of these shares was 670,426,
reported as treasury shares (December 31, 2021: 697,400). This number of shares
corresponded to 0.48% (0.50%) of the total shares and voting rights in the company.
Trading in shares
A total of 276,602,916 (104,975,922) Nokian Tyres’ shares were traded in Nasdaq Helsinki
in 2022, representing 199% (76%) of the company’s overall share capital. The average
daily volume in 2022 was 1,093,292 shares (416,571). Nokian Tyres’ shares are also traded
on alternative exchanges.
Nokian Tyres’ share price was EUR 9.58 (33.30) at the end of 2022. The volume
weighted average share price in 2022 was EUR 14.42 (31.98), the highest was EUR 34.90
(36.70) and the lowest was EUR 9.27 (27.98). The company’s market capitalization at the
end of 2022 was EUR 1.3 billion (4.6 billion).
At the end of 2022, the company had 76,763 (55,898) registered shareholders.
The percentage of Finnish shareholders was 46.7% (43.2%), and 53.3% (56.8%) were
non-Finnish holders and foreign shareholders registered in the nominee register. Public
sector entities owned 16.8% (15.2%), nancial and insurance corporations 3.7% (7.3%),
12
households 20.3% (13.7%), non-prot institutions 2.0% (3.4%), and private companies
3.8% (3.6%).
Major shareholders on December 31, 2022
(Does not include nominee registered shareholders or treasury shares)
Number of
shares
% of share
capital
1. Solidium Oy ,, .
2. Varma Mutual Pension Insurance Company ,, .
3. Ilmarinen Mutual Pension Insurance Company ,, .
4. Elo Mutual Pension Insurance Company ,, .
5. Nordea Nordic Small Cap Fund ,, .
6. Nordea Bank Abp , .
7. Barry Staines Linoleum Ltd. , .
8. Samfundet Folkhälsan i Svenska Finland , .
9. The State Pension Fund , .
10. Nordea Pro Finland Fund , .
Changes in ownership
Transaction date Shareholder Threshold
% of shares
and voting
rights
% of shares and
voting rights
through nancial
instruments Total, %
February 9, 2022
BlackRock, Inc Above % .% .% .%
February 10, 2022
BlackRock, Inc Below % Below % Below % Below %
February 11, 2022
BlackRock, Inc Above % .% .% .%
February 15, 2022
BlackRock, Inc Below % Below % Below % Below %
February 24, 2022
BlackRock, Inc Above % .% .% .%
February 25, 2022
BlackRock, Inc Below % Below % Below % Below %
March 8, 2022
BlackRock, Inc Above % .% .% .%
March 9, 2022
BlackRock, Inc Below % Below % Below % Below %
March 14, 2022
BlackRock, Inc Above % .% .% .%
March 15, 2022
BlackRock, Inc Below % Below % Below % Below %
March 18, 2022
BlackRock, Inc Above % .% .% .%
April 13, 2022
Amundi Asset
Management
Above % .% .%
April 14, 2022
Amundi Asset
Management
Below % . % .%
April 14, 2022
JPMorgan
Chase & Co.
Above % .% .% .%
April 29, 2022
JPMorgan
Chase & Co.
Below % .% .% .%
May 3, 2022
Société
Générale SA
Above % .% .% .%
May 3, 2022
JPMorgan
Chase & Co.
Above % .% .% .%
Transaction date Shareholder Threshold
% of shares
and voting
rights
% of shares and
voting rights
through nancial
instruments Total, %
May 4, 2022
JPMorgan
Chase & Co.
Below % .% .% .%
May 6, 2022
Société
Générale SA
Below % .% .% .%
May 9, 2022
JPMorgan
Chase & Co.
Above % .% .% .%
May 9, 2022
Amundi Asset
Management
Above % .% .%
May 10, 2022
JPMorgan
Chase & Co.
Below % .% .% .%
May 12, 2022
JPMorgan
Chase & Co.
Above % .% .% .%
May 31, 2022
JPMorgan
Chase & Co.
Above % .% .% .%
June 1, 2022
JPMorgan
Chase & Co.
Below % .% .% .%
June 9, 2022
Amundi Asset
Management
Below % .% .%
June 10, 2022
Amundi Asset
Management
Above % .% .%
June 16, 2022
Amundi Asset
Management
Below % .% .%
June 20, 2022
Société
Générale SA
Above % .% .% .%
September 13, 2022
JPMorgan
Chase & Co.
Above % .% .% .%
September 14, 2022
JPMorgan
Chase & Co.
Below % Below % Below % Below %
September 21, 2022
BlackRock, Inc Below % .% .% .%
September 22, 2022
BlackRock, Inc Above % .% .% .%
September 26, 2022
BlackRock, Inc Below % .% .% .%
October 3, 2022
BlackRock, Inc Above % .% .% .%
October 4, 2022
BlackRock, Inc Below % .% .% .%
October 11, 2022
BlackRock, Inc Above % .% .% .%
October 12, 2022
BlackRock, Inc Below % .% .% .%
October 18, 2022
BlackRock, Inc Above % .% .% .%
October 19, 2022
BlackRock, Inc Below % .% .% .%
October 24, 2022
BlackRock, Inc Above % .% .% .%
October 25, 2022
BlackRock, Inc Below % .% .% .%
October 27, 2022
BlackRock, Inc Above % .% .% .%
October 27, 2022
Société
Générale SA
Below % .% .% .%
November 2, 2022
BlackRock, Inc Below % .% .% .%
November 4, 2022
BlackRock, Inc Above % .% .% .%
November 8, 2022
Société
Générale SA
Above % .% .% .%
November 11, 2022
Société
Générale SA
Below % .% .% .%
13
Transaction date Shareholder Threshold
% of shares
and voting
rights
% of shares and
voting rights
through nancial
instruments Total, %
November 15, 2022
Société
Générale SA
Above % .% .% .%
November 24, 2022
BlackRock, Inc Below % .% .% .%
November 25, 2022
Solidium Oy Above
%
.% .%
November 25, 2022
BlackRock, Inc Above % .% .% .%
November 28, 2022
Norges Bank
(The Central
Bank of
Norway)
Above % .% .% .%
November 29, 2022
Norges Bank
(The Central
Bank of
Norway)
Below % .% .% .%
November 30, 2022
Société
Générale SA
Below % .% .% .%
December 2, 2022
BlackRock, Inc Below % .% .% .%
December 6, 2022
BlackRock, Inc Above % .% .% .%
December 8, 2022
Société
Générale SA
Above % .% .% .%
December 9, 2022
JPMorgan
Chase & Co.
Above % .% .% .%
December 9, 2022
Société
Générale SA
Below % .% .% .%
December 12, 2022
BlackRock, Inc Below % .% .% .%
December 13, 2022
BlackRock, Inc Above % .% .% .%
December 13, 2022
JPMorgan
Chase & Co.
Below % Below % Below % Below %
December 14, 2022
BlackRock, Inc Below % .% .% .%
December 15, 2022
BlackRock, Inc Above % .% .% .%
December 19, 2022
BlackRock, Inc Below % .% .% .%
December 20, 2022
BlackRock, Inc Below % Below % Below % Below %
December 21, 2022
BlackRock, Inc Above % .% .% .%
December 23, 2022
BlackRock, Inc Above % .% .% .%
December 26, 2022
Norges Bank
(The Central
Bank of
Norway)
Above % .% .% .%
December 29, 2022
BlackRock, Inc Below % .% .% .%
December 30, 2022
Norges Bank
(The Central
Bank of
Norway)
Below % .% .% .%
Detailed information on notications of change in shareholding can be found at
www.nokiantyres.com/company/investors/share/agging-notications/.
Shareholdings of the Board of Directors, the President and
CEO, and the Management Team on December 31, 2022
Board of Directors Number of shares
Jukka Hienonen, Chairman
1)
,
Pekka Vauramo, Deputy Chairman ,
Heikki Allonen, member ,
Susanne Hahn, member ,
Veronica Lindholm, member ,
Inka Mero, member ,
Christopher Ostrander, member ,
Jouko Pölönen, member ,
George Rietbergen, member ,
Total ,
1)
In addition, 7,592 shares in an insurance wrapper, with no voting right
President and CEO Number of shares
Jukka Moisio ,
Management Team Number of shares
Päivi Antola, Communications, Investor Relations and Brand ,
Anna Hyvönen, Passenger Car Tyres and Vianor ,
Adrian Kaczmarczyk, Supply Operations ,
Teemu Kangas-Kärki, Finance ,
Jukka Kasi, Products and Innovations ,
Päivi Leskinen, Human Resources
Manu Salmi, Heavy Tyres and Nokia Factory ,
Total ,
On December 31, 2022, Nokian Tyres’ Board members and the President and CEO held a
total of 80,690 Nokian Tyres shares. The shares represent 0.06% of the total number of
votes.
Managers’ transactions
Nokian Tyres announced managers’ transactions on February 9, 10 and 22, March
4, April 29 and May 2. Read more at www.nokiantyres.com/company/publications/
releases/2022/managementTransactions/.
DECISIONS MADE AT THE ANNUAL GENERAL MEETING 2022
On April 28, 2022, the Annual General Meeting (AGM) of Nokian Tyres adopted the
nancial statements for 2021, discharged the members of the Board of Directors
and the President and CEO from liability for the nancial year 2021 and adopted the
company’s Renumeration Report for governing bodies.
14
Dividend
The AGM decided that a dividend of EUR 0.55 per share should be paid for the nancial
year January 1–December 31, 2021. The dividend was paid on May 11, 2022 to share-
holders who were registered in the Company’s shareholders’ register maintained by
Euroclear Finland Oy on the dividend record date on May 2, 2022.
Remuneration for members of the Board of Directors
The AGM decided that the members of the Board of Directors be paid the following
remuneration: to the Chairman of the Board of Directors EUR 110,000 per year; to the
Deputy Chairman and to the Chairs of the Board Committees EUR 75,000 per year
each, and to members EUR 52,500 per year each. 60 per cent of the annual fee will be
paid in cash and 40 per cent in Company shares.
Furthermore, the General Meeting decided on a meeting fee of EUR 700 for each
Board and Board Committee meeting. For Board members resident in Europe, the fee
for each meeting in Europe outside a member’s home country is doubled, and for each
meeting outside Europe the fee is tripled. For Board members resident outside Europe,
the fee for each meeting outside a member’s home country is tripled. If a member
participates in a meeting via telephone or video connection, the remuneration is EUR
700. Travel expenses will be compensated in accordance with the Company’s travel
policy.
Members of the Board of Directors and Auditors
The AGM decided that the number of the members of the Board of Directors shall
be nine. Jukka Hienonen, Heikki Allonen, Veronica Lindholm, Inka Mero, Christopher
Ostrander, Jouko Pölönen, George Rietbergen and Pekka Vauramo were re-elected as
members of the Board of Directors and Susanne Hahn was elected as a new member of
the Board of Directors for a term ending at the closing of the Annual General Meeting
2023. Jukka Hienonen was re-elected as the Chairman and Pekka Vauramo as Deputy
Chairman of the Board of Directors.
Ernst & Young Oy, an authorized public accountant rm, was re-elected as the
company’s auditor for a term ending at the closing of the Annual General Meeting 2023.
Authorizations
The AGM authorized the Board of Directors to resolve to repurchase a maximum of
13,800,000 shares in the company by using funds in the unrestricted shareholders’
equity. The proposed number of shares corresponds to approximately 9.9% of all shares
in the company. The authorization will be eective until the next AGM, however at most
until June 30, 2023, and it canceled the authorization given to the Board of Directors
by the Annual General Meeting on March 30, 2021.
The AGM authorized the Board of Directors to resolve to oer no more than
13,800,000 shares through a share issue, or by granting special rights under Chapter 10,
Section 1 of the Finnish Limited Liability Companies Act that entitle to shares (including
convertible bonds), on one or more occasions. The Board may decide to issue new
shares or shares held by the company. The maximum number of shares included in the
proposed authorization accounts for approximately 9.9% of all shares in the company.
The authorization will be eective until the next AGM, however at most until June 30,
2023, and it canceled the authorization given to the Board of Directors by the Annual
General Meeting on March 30, 2021.
The AGM authorized the Board of Directors to resolve on donations in the aggregate
maximum amount of EUR 250,000 to be made to universities, institutions of higher
education or to other non-prot or similar purposes during 2022 and 2023. The
donations can be made in one or more instalments. The Board of Directors may decide
on the donation recipients, purposes of use and other terms of the donations.
BOARD OF DIRECTORS’ WORKING ARRANGEMENTS
In its organizing meeting on April 28, 2022, the Board of Directors elected Veronica
Lindholm as the Chairman and Jukka Hienonen and Pekka Vauramo as members of the
Personnel and Remuneration Committee. Further, the Board of Directors elected Jouko
Pölönen as the Chairman and Heikki Allonen and Inka Mero as members of the Audit
Committee.
SHAREHOLDERS’ NOMINATION BOARD
In June 2022, the following members were appointed to the Nokian Tyres’ Shareholders’
Nomination Board:
• Mr. Pauli Anttila (Investment Director, Solidium Oy), appointed by Solidium Oy
• Mr. Timo Sallinen (Senior Vice President, Investments, Varma Mutual Pension Insurance
Company), appointed by Varma Mutual Pension Insurance Company
• Mr. Mikko Mursula (Deputy CEO, Investments, Ilmarinen Mutual Pension Insurance
Company), appointed by Ilmarinen Mutual Pension Insurance Company
• Mr. Carl Pettersson (CEO, Elo Mutual Pension Insurance), appointed by Elo Mutual
Pension Insurance
• Mr. Jukka Hienonen, Chairman of the Board, Nokian Tyres plc
The Shareholders’ Nomination Board proposes to the 2023 Annual General Meeting
that the Board consists of nine members, the Chairman and the Deputy Chairman
included, and that of the current Board members Susanne Hahn, Jukka Hienonen,
Veronica Lindholm, Christopher Ostrander, Jouko Pölönen, George Rietbergen and
Pekka Vauramo be re-elected and Markus Korsten and Reima Rytsölä be elected as new
members to the Board of Directors for a term ending at the end of the 2024 Annual
General Meeting. Of the current members, Heikki Allonen and Inka Mero have informed
that they are not available for re-election to the Board of Directors.
Jukka Hienonen is proposed to continue as Chairman and Pekka Vauramo as Deputy
Chairman of the Board of Directors. All candidates have given their consent to the
election. The candidates are independent of the Company and its major shareholders,
15
with the exception of Reima Rytsölä, who is deemed not to be independent of a
signicant shareholder of the Company based on his position as the CEO of Solidium
Oy.
The Shareholders’ Nomination Board notes that the proposed composition of the
Board of Directors, if implemented, will lead to a situation where the composition of the
Company’s Board of Directors in terms of the gender distribution of the members is
not at an optimal level. The purpose of the Shareholders’ Nomination Board is that this
situation will be short-lived and rectied as soon as possible.
With regard to the selection procedure for the members of the Board of Directors,
the Shareholders’ Nomination Board recommends that shareholders take a position
on the proposal as a whole at the General Meeting. This recommendation is based
on the fact that in Nokian Tyres, in line with a good Nordic governance model, the
Shareholders’ Nomination Board is separate from the Board of Directors. The
Shareholders’ Nomination Board, in addition to ensuring that individual nominees for
membership of the Board of Directors possess the required competencies, is also
responsible for making sure that the proposed Board of Directors as a whole has the
best possible expertise and experience for the Company and that the composition of
the Board of Directors meets other requirements of the Finnish Corporate Governance
Code for listed companies.
The annual remuneration to be paid to the members of the Board of Directors to
be elected at the Annual General Meeting for the term of oice ending at the close
of the Annual General Meeting 2024 is proposed to remain at the current level and
be as follows: to the Chairman of the Board of Directors EUR 110,000; to the Deputy
Chairman of the Board and to the Chairmen of the Committees EUR 75,000, and to
other members EUR 52,500.
The Shareholders’ Nomination Board further proposes that 60% of the annual fee be
paid in cash and 40% in Company shares.
The meeting fee is proposed to remain at the current level and thus be EUR 700 for
each Board and Board Committee meeting. For Board members resident in Europe, the
fee for each meeting in Europe outside a member’s home country is doubled, and for
each meeting outside Europe the fee is tripled. For Board members resident outside
Europe, the fee for each meeting outside a member’s home country is tripled. If a
member participates in a meeting via telephone or video connection, the remuneration
is proposed to be EUR 700. Travel expenses are proposed to be compensated in
accordance with the Company’s travel policy.
CORPORATE SUSTAINABILITY
In January, Nokian Tyres introduced the Nokian Tyres Green Step concept tire that is a
masterpiece of sustainable innovation: 93% of the materials used in the tire are either
recycled or renewable. Innovations made during the process of designing the Green
Step will be incorporated in the future tires, moving the company closer to its goal: by
the year 2030, 50% of all raw materials used in the tires made by Nokian Tyres will be
recycled or renewable.
In November, Nokian Tyres announced that it will build the world’s rst zero CO
2
emission factory in the tire industry. The site location in Romania supports this target
as there is green energy produced near the site. In addition, Nokian Tyres is evaluating
the production processes to nd the most sustainable ways to produce tires.
In December, Nokian Tyres was included in the Dow Jones Sustainability Europe Index.
The company scored 75 out of 100 in the 2022 S&P Global’s Corporate Sustainability
Assessment, achieving a full score in the Product Quality and Recall Management,
Environmental Reporting, and Social Reporting criteria. Nokian Tyres was also industry
best in the criterion Occupational Health and Safety.
In December, Nokian Tyres achieved an A- score by CDP in the Climate Change sector
for its actions aimed at decreasing greenhouse gas emissions and mitigating climate
risks. The greenhouse gas emissions (Scope 1 and Scope 2) from Nokian Tyres’ tire
production in relation to turnover and production tons were clearly the lowest of the
companies that have tire industry as their main industry in the CDP reports.
In 2022, Nokian Tyres’ lost time incident frequency rate (LTIF) dropped to 3.2 (2021:
4.1) being at the lowest level in the company’s history. Nokian Tyres aims to reach an LTIF
level of 1.5 by 2025.
Nokian Tyres will publish its Corporate Sustainability Report for 2022 in spring 2023.
Sustainability as part of Nokian Tyres management remuneration
In February 2022, Nokian Tyres plc’s Board of Directors decided to include a climate
related goal as part of the short-term incentive targets of the Group Management
Team. Nokian Tyres develops and manufactures premium tires for consumers and
customers who value safety, sustainability and innovative products. Sustainability is at
the heart of Nokian Tyres business and one of the ve cornerstones of the company’s
strategy. According to the Company’s Board of Directors, it is important that the Group
Management Team targets include not only nancial criteria, but also sustainability.
Non-Financial Information Statement
Nokian Tyres publishes an annual Non-Financial Information Statement in line with
the Requirements of non-nancial information reporting according to the Finnish
Accounting Act. The Non-Financial Information Statement is issued separately from
the Board of Directors’ report. The Board of Directors has reviewed and signed the
Non-Financial Information Statement. The Non-Financial Information Statement will be
published the week commencing February 27, 2023.
CHANGES IN MANAGEMENT AND GROUP STRUCTURE
In June, when Nokian Tyres initiated an exit from Russia, the company announced that
Andrey Pantyukhov, who has been heading Nokian Tyres’ business area Russia and Asia,
would no longer be a member of Nokian Tyres’ Management Team.
In August, Nokian Tyres announced that the company will reorganize the Group’s
organization and management structure to strengthen go-to-market execution. This
is to improve operational eiciency and collaboration, and focus on building the new
16
Nokian Tyres as the company is in the process of investing in new European capacity
and exiting Russia. In the new operating model, Passenger Car Tyres’ commercial
operations are combined under one leadership, with increasing strategic and
operational synergies across the geographical areas. Anna Hyvönen, EVP North America,
Nordics and Vianor and a member of Nokian Tyres’ Management Team, was appointed
EVP Passenger Car Tyres and Vianor. Bahri Kurter, EVP Central Europe and a member of
Nokian Tyres’ Management Team, decided to leave the company to pursue other career
opportunities.
Nokian Tyres’ Management Team as of September 1, 2022:
• Jukka Moisio, President and CEO
• Päivi Antola, Senior Vice President, Communications, Investor Relations and Brand
• Anna Hyvönen, Executive Vice President, Passenger Car Tyres and Vianor
• Adrian Kaczmarczyk, Senior Vice President, Supply Operations
• Teemu Kangas-Kärki, CFO
• Jukka Kasi, Senior Vice President, Products and Innovations
• Päivi Leskinen, Senior Vice President, Human Resources
• Manu Salmi, Executive Vice President, Heavy Tyres and Nokia Factory
SHARE-BASED LONG-TERM INCENTIVE SCHEME 2022–2024 FOR THE
MANAGEMENT AND SELECTED KEY EMPLOYEES OF NOKIAN TYRES PLC
In February 2022, Nokian Tyres announced that the Board of Directors of Nokian Tyres
plc had decided on a share-based long-term incentive scheme for the Company’s
management and selected key employees for years 2022–2024 as a continuation to
the earlier plans decided in 2019, 2020 and 2021. The decision includes Performance
Share Plan 2022 (“PSP 2022”) as the main structure and Restricted Share Plan 2022
(“RSP 2022”) as a complementary structure.
The purpose of the share-based incentive scheme is to align the goals of the
Company’s shareholders and key personnel in order to increase the value of the
Company in the long term and to commit key personnel to the Company and its
strategic targets.
Performance Share Plan 2022
The Performance Share Plan consists of annually commencing individual three-year
Performance Periods, followed by the payment of the potential share reward. The
commencement of each individual Performance Period is subject to a separate
approval by the Board of Directors.
The Performance Period (PSP 2022–2024) commenced eective as of the beginning
of 2022 and the potential share reward thereunder will be paid in the rst half of 2025
provided that the performance targets set by the Board of Directors are achieved.
The potential reward will be paid partly in shares of Nokian Tyres plc and partly in cash.
Cash portion of the reward is intended to cover the taxes arising from the paid reward.
Eligible to participate in PSP 2022–2024 are approximately 235 individuals, including the
members of Nokian Tyres Management Team.
The potential share reward payable under the PSP 2022–2024 are based on the
Segments Earnings Per Share (EPS) and Segments Return on Capital Employed (ROCE).
The possible rewards paid based on the Performance Period of 2022–2024 will be a
maximum of 513,742 gross shares.
If an employee’s employment with Nokian Tyres terminates before the payment date
of the share reward, said employee is not, as a main rule, entitled to any reward based
on the plan.
Restricted Share Plan 2022
The purpose of the Restricted Share Plan is to serve as a complementary long-term
incentive tool, used selectively for retention of Nokian Tyres key employees. It consists
of annually commencing individual Restricted Share Plans, each with a three-year
retention period after which the share rewards granted within the plan will be paid to
the participants in shares of Nokian Tyres plc and partly in cash.
The commencement of each individual plan is subject to a separate approval by the
Board of Directors.
A precondition for the payment of the share reward based on the Restricted Share
Plan is that the employment relationship of a participant with Nokian Tyres continues
until the payment date of the reward. In addition to this precondition, a nancial
performance criteria is applied to Nokian Tyres Management Team. The criteria is a
threshold value for Return on Capital Employed (ROCE), which must be exceeded for a
potential payment of a share reward based on the Restricted Share Plan 2022–2024.
The next plan (RSP 2022–2024) within the Restricted Share Plan structure
commenced eective as of the beginning of 2022 and the potential share reward
thereunder will be paid in the rst half of 2025. The possible rewards paid based on RSP
2022–2024 correspond approximately to a maximum of 120,000 gross shares.
Other terms
Nokian Tyres applies a share ownership policy to the members of Nokian Tyres
Management Team. According to said policy each member of the Management Team
is expected to retain in his/her ownership at least 25% of the shares received under
the share-based incentive programs of the Company until the value of his/her share
ownership in the Company corresponds to at least his/her annual gross base salary.
The Board of Directors anticipates that no new shares will be issued based on the
share-based incentive scheme and that the scheme will, therefore, have no dilutive
eect on the registered number of the Company’s shares.
17
Payments for share-based plans that ended in 2021
In February 2022, The Board of Directors of Nokian Tyres plc approved the share awards
from the Restricted Share Plan 2019–2021.
The three-year restriction period of the Restricted Share Plan 2019–2021 ended after
nancial year 2021. 17 key employees participated in the share-based incentive plan,
including members of the Management Team. The nancial threshold value for Return
on Capital Employed (ROCE) applied for the Management Team members was achieved.
The rewards paid corresponded to a total of 46,600 Nokian Tyres plc gross shares. The
rewards were paid in March 2022. The total number of shares of the Company did not
change. A precondition for the payment of the share reward based on the Restricted
Share Plan was that the employment relationship of a participant with Nokian Tyres
continued until the payment date of the reward.
The targets for the Performance Period 2019–2021 (PSP 2019–2021) were not
achieved and no share rewards were paid to participants.
SIGNIFICANT RISKS AND UNCERTAINTIES AND ONGOING DISPUTES
Nokian Tyres’ business and nancial performance may be aected by several
uncertainties. The Group has adopted a risk management policy, approved by the
Board of Directors, which supports the achievement of strategic goals and ensures
business continuity. The Group’s risk management policy focuses on managing both
the risks pertaining to business opportunities and the risks aecting the achievement
of the Group’s goals in the changing operating environment. The risk management
process aims to identify and evaluate the risks and to plan and implement the practical
measures for each risk. Nokian Tyres describes the overall business risks and risk
management in its annual Corporate Governance Statement.
The war in Ukraine, resulting sanctions and exit from Russia are severely impacting
Nokian Tyres’ operating environment and causing a number of risks for Nokian Tyres’
business. These include, among others, ability to serve customers especially in Central
Europe, cost and supply of raw materials, ability to retain personnel, as well as execu-
tion of the consequent exit. The Group’s assets in Russia may be subject to further
impairments and write-downs. In October, Nokian Tyres signed an agreement to sell
its Russian operations to Tatneft PJSC. The sale process is ongoing. The transaction
is subject to approval by the relevant regulatory authorities in Russia and other
conditions, which creates substantial uncertainties related to the timing, terms and
conditions and the closing of the transaction.
In addition to the risks caused by the war in Ukraine, for example, the following risks
could potentially have an impact on Nokian Tyres’ business:
• Nokian Tyres is subject to risks related to consumer condence and macroeconomic
and geopolitical conditions. Political uncertainties may cause serious disruption and
additional trade barriers and aect the company’s sales and credit risk. Economic
downturns may increase trade customers’ payment problems and Nokian Tyres may
need to recognize impairment of trade receivables.
• The tire wholesale and retail landscape is evolving to meet changing consumer needs.
New technologies are fueling this with increasing digitalization. Failure to adapt to the
changes in the sales channel could have an adverse eect on Nokian Tyres’ nancial
performance.
• Nokian Tyres’ success is dependent on its ability to innovate and develop new
products and services that appeal to its customers and consumers. Despite extensive
testing of its products, product quality issues and failure to meet demands of
performance and safety could harm Nokian Tyres’ reputation and have an adverse
eect on its nancial performance.
• Any unexpected production or delivery breaks at Nokian Tyres’ production facilities
would have a negative impact on the company’s business. Interruptions in logistics
could have a signicant impact on production and peak season sales.
• In order to secure tire supply, Nokian Tyres has decided to invest in new production
capacity in Europe and increase the share of outsourced production. Delay in these
actions could have an adverse eect on Nokian Tyres’ nancial performance.
• Signicant uctuations in raw material prices may impact margins. Nokian Tyres
sources natural rubber from producers in countries such as Indonesia and Malaysia.
Although Nokian Tyres has policies such as the Supplier Code of Conduct and estab-
lished processes to monitor the working conditions, it cannot fully control the actions
of its suppliers. Nokian Tyres continues to expand its supplier portfolio to mitigate
risks related to single source supplying. The non-compliance with laws, regulations
or standards by raw material producers, or their divergence from practices generally
accepted as ethical in the European Union or the international community, could have
a material adverse eect on Nokian Tyres’ reputation.
• Tire industry can be subject to risks caused by climate change, such as changes in
consumer tire preferences, regulatory changes or impact of extreme weather events
on natural rubber producers. Nokian Tyres is committed to reducing GHG emissions
from its operations in order to combat climate change. Nokian Tyres calculates
the GHG emissions from its operations annually and reduces them systematically.
More detailed analysis on Nokian Tyres’ climate change related risks and oppor-
tunities is provided at www.nokiantyres.com/company/sustainability/environment/
climate-change-related-risks-and-opportunities/.
• Foreign exchange risk consists of transaction risk and translation risk. The most
signicant currency risks arise from the Russian ruble, the Swedish and Norwegian
krona, and the US and Canadian dollar. Approximately 65% of the Group’s sales are
generated outside of the euro-zone. In this Financial Statement Release, the following
exchange rates for the Russian ruble have been used: 85.3 at the end of 2021, 98.0
average in January–March 2022, 84.5 average in January–June 2022, 76.3 average in
January–September 2022, 70.4 average in January–December 2022 and 77.9 at the
end of 2022 (source: Renitiv).
18
• The availability of supporting information systems and network services is crucial
to Nokian Tyres. Unplanned interruption in critical information systems or network
services may cause disruption to the continuity of operations. Such systems and
services may also be exposed to cyber attacks that could cause a leakage of
condential information, violation of data privacy regulations, theft of know-how and
other intellectual property, production shutdown or damage to reputation.
• In May 2017, the Finnish Financial Supervisory Authority led a request for investiga-
tion with the National Bureau of Investigation regarding possible securities market
oences. In October 2020, the prosecutor announced the decision to press charges
against a total of six persons who acted as Board members and the President & CEO
of Nokian Tyres in 2015–2016. The prosecutor also claimed a corporate ne against
the company. In addition, four persons who were employees at Nokian Tyres in 2015
were charged for abuse of inside information. The District Court of Helsinki dismissed
all charges and claims by the prosecutor in its ruling in June 2022. The decision is
not yet legally binding, and the prosecutor has appealed against the decision of the
District Court.
• The COVID-19 pandemic represents a short-term risk to Nokian Tyres’ business and
operating environment. The company has proactively taken preventive actions to
minimize the impacts of the pandemic and to ensure business continuity. Despite
these eorts, the uncertainty over the duration of the pandemic, the containment
measures and the resulting slowdown in economic activity can have a negative
impact on Nokian Tyres’ operations and supply chain as well as the demand and
pricing for the company’s products.
Nokian Tyres’ risk analysis also pays special attention on corporate sustainability risks,
the most significant of which are related to product quality, safety, environment, and
human rights. Analyses and projects related to information security, data protection,
and customer information are continuously a special focus area.
Tax disputes
In April 2021, Nokian Tyres received a decision from the Tax Administration concerning
a tax audit for the tax years 2015–2016, according to which the company was obliged
to pay a total of EUR 1.9 million. Taxes were paid and recognized in receivables. Nokian
Tyres considered the tax authority’s view unfounded and appealed against the decision.
In December 2022, Nokian Tyres received a positive decision from The Assessment
Adjustment Board, according to which the additional taxes, punitive tax increase and
late payment interest were removed. The Finnish tax authority refunded these in full
to the company in December 2022 and the company recognized the amount in the
same quarter cash ow. The Finnish Tax Authority has applied for an amendment to the
decision of the Assessment Adjustment Board.
Routine tax audits in Nokian Tyres Group entities may possibly lead to a reassess-
ment of taxes.
WAR IN UKRAINE – SUMMARY OF NOKIAN TYRES’ ACTIONS IN 2022
On February 24, Russia started the war in Ukraine, which has a signicant impact on
Nokian Tyres’ operating environment and manufacturing capacity.
On April 8, the EU announced new sanctions against Russia, impacting Nokian Tyres’
business. The sanctions included a transition period until July 10, and they prohibited
the import of tires from Russia to the EU, prohibited the export of certain raw materials
from the EU to Russia, and limited transportation from and to Russia. Tire imports from
Russia to Europe and North America ended in July.
On June 28, Nokian Tyres’ Board of Directors decided to initiate a controlled exit
from Russia. Due to the war and the subsequent, tightening sanctions it is no longer
feasible nor sustainable for Nokian Tyres plc to continue operations in Russia. An
agreement for the sale of the Russian operations was signed on October 28. The sale
process is ongoing.
Nokian Tyres has decided to invest in new production capacity in Europe and to start
producing certain passenger car tires through contract manufacturing. At the same
time, the company has continued to increase production capacity at its factories in
Nokia, Finland and Dayton, US.
The Heavy Tyres business of Nokian Tyres plc is not impacted by the ban to import
tires from Russia to the EU, as all Nokian Tyres’ heavy tires are produced in Finland.
Sales and distribution of heavy tires to Russia were discontinued in the rst quarter
due to the war. Nokian Tyres has never sold tires to the Russian army, and the Russian
Federation is not a customer of Nokian Tyres.
Nokian Tyres has taken active measures to manage the impacts of the war in Ukraine
to its personnel and business. Below is a list of examples of the measures taken since
February 24:
Health and safety actions
• Continuously communicating about the situation in the organization and providing
support to Nokian Tyres’ employees
• Being in daily contact with the Ukrainian colleagues to help them and their families
stay safe
• Donating to humanitarian eorts in Ukraine
Operational response actions
• Ensuring compliance with applicable sanctions regime
• Establishing a crisis management team and activating contingency plans to limit the
operational and nancial impacts
• Taking care of the personnel and management in Ukraine and Russia
• Stopping investments into the Russian production, and discontinuing all heavy tire
sales and distribution to Russia
• Ending passenger car tire imports from Russia to Europe and North America in July
19
• On June 28, the Board of Directors decided to initiate a controlled exit from Russia.
As part of the process, impairments and write-downs of EUR 300.7 million were
recorded in the second quarter. An agreement for the sale of the Russian operations
was signed on October 28. The sale process is ongoing.
• Expediting plans to diversify manufacturing footprint by investing in new production
capacity in Europe, continuing to increase passenger car tire capacity at the Finnish
and US factories, and starting collaboration with tire contract manufacturers. On
November 1, the Board of Directors made a decision to invest approximately EUR 650
million in a greeneld passenger car tire factory in Romania.
• Implementing cost measures by cutting and delaying activities and reducing discre-
tionary spending.
Financial response actions
• On March 30, the Board of Directors decided to change its dividend proposal to the
Annual General Meeting 2022 from EUR 1.32/share to EUR 0.55/share (2020: EUR
1.20). The changed dividend proposal cut the total dividend payable to shareholders
by EUR 106 million to fund the new capacity in Europe
• Taking measures to secure the company’s liquidity and nancial exibility
• Leveraging the strong balance sheet to support the company in diicult times
EXIT FROM RUSSIA
In October, Nokian Tyres signed an agreement to sell its Russian operations to Tatneft
PJSC. The sale process is ongoing. The debt free and cash free purchase price is
expected to be approximately EUR 400 million. The nal purchase price is aected,
among other things, by net cash and working capital adjustment and changes in RUB/
EUR exchange rate.
The transaction is subject to approval by the relevant regulatory authorities in Russia
and other conditions, which creates substantial uncertainties related to the timing,
terms and conditions and the closing of the transaction. Due to the uncertainties, nal
accounting implications including translation dierences, among other things, can only
be assessed when the transaction has been duly completed.
MATTERS AFTER THE REVIEW PERIOD
Changes in ownership
Transaction
date Shareholder Threshold
% of shares
and voting
rights
% of shares
and voting
rights
through
nancial
instruments
Total, %
January 3, 2023
BlackRock, Inc Below 5% Below % Below % Below %
January 4, 2023 Norges Bank (The
Central Bank of Norway) Above 5% .% .% .%
January 5, 2023
BlackRock, Inc Above 5% .% .% .%
January 9, 2023 Norges Bank (The
Central Bank of Norway) Below 5% .% .% .%
January 10, 2023
BlackRock, Inc Above 5% .% .% .%
January 10, 2023
Société Générale SA Above 5% .% .% .%
January 11, 2023
BlackRock, Inc Below 5% .% .% .%
January 12, 2023
BlackRock, Inc Below 5% Below % Below % Below %
January 12, 2023 Norges Bank (The
Central Bank of Norway) Above 5% .% .% .%
January 16, 2023
BlackRock, Inc Above 5% .% .% .%
January 17, 2023 Norges Bank (The
Central Bank of Norway) Below 5% .% .% .%
January 18, 2023 Norges Bank (The
Central Bank of Norway) Above 5% .% .% .%
January 18, 2023
BlackRock, Inc Above 5% .% .% .%
January 18, 2023
Société Générale SA Below 5% .% .% .%
January 24, 2023
Société Générale SA Above 5% .% .% .%
February 1, 2023
BlackRock, Inc Below 5% .% .% .%
February 2, 2023
BlackRock, Inc Below 5% Below % Below % Below %
February 3, 2023
BlackRock, Inc Above 5% .% .% .%
ASSUMPTIONS FOR 2023
Nokian Tyres’ rst half of the year is expected to be weak due to constrained capacity
causing lower supply of passenger car tires, and seasonality. The second half is
expected to be supported by the winter tire and all-season tire season and the otake
volume.
In heavy tires, the general economic development may have a negative impact on
demand in 2023.
GUIDANCE FOR 2023
In 2023, Nokian Tyres’ segments net sales are expected to be between EUR 1,300–1,500
million and segments operating prot percentage of net sales between 6–8%. It is
20
expected that due to seasonality, the segments operating prot will be generated in
the second half of the year.
As of 2023, segments net sales and segments operating prot exclude Russia and
other items, which are not indicative of Nokian Tyres’ underlying business performance.
THE PROPOSAL FOR THE USE OF PROFITS
BY THE BOARD OF DIRECTORS
The distributable funds in the Parent company total EUR 716.1 million.
The Board of Directors proposes to the Annual General Meeting that the distribut-
able funds are to be used as follows, if a maximum amount of dividends is paid:
A dividend of 0.55 EUR/share
be paid out, totaling EUR 76.0 million
retained in equity EUR 640.1 million
Tot al EUR 716.1 million
The Board of Directors proposes that a dividend of EUR 0.35 per share shall be
paid to the shareholders who are registered in the shareholder register maintained by
Euroclear Finland Oy on the dividend record date of April 28, 2023. The payment date
proposed by the Board of Directors is May 11, 2023.
In addition, it is proposed that the Annual General Meeting would authorize the
Board of Directors to decide on dividend payment of a maximum of EUR 0.20 per share
to be distributed in December. This shall be decided by the Board of Directors in its
meeting scheduled for October 31, 2023. The company will publish the Board decision
on the possible second dividend payment separately, and at the same time conrm the
pertinent record and payment dates.
No material changes have taken place in the nancial position of the company since
the end of the nancial year. The liquidity of the company is good, and the proposed
distribution of prots does not compromise the nancial standing of the company as
perceived by the Board of Directors.
Notice to the Annual General Meeting will be published the week commencing April 3,
2023.
Helsinki, February 7, 2023
Nokian Tyres plc
Board of Directors
21
20222021202020192018
0
1,000
2,000
3,000
4,000
5,000
20222021202020192018
Net sales Segments
operating prot
Segments
operating prot %
EUR million
Segments operating prot %
0
400
800
1,200
1,600
2,000
0
10
20
30
40
50
20222021202020192018
EUR
Segments earnings
per share
Dividend
per share
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
%
0
5
10
15
20
25
20222021202020192018
0
5
10
15
20
25
30
35
20222021202020192018
EUR million
0
50
100
150
200
250
300
20222021202020192018
EUR million
NET SALES BY GEOGRAPHICAL AREA, % NET SALES BY BUSINESS UNIT
1)
, %
2022 2021
Passenger Car Tyres
Heavy Tyres
Vianor
1)
Including internal sales
2022 2021
Nordic countries
Other Europe
Russia and Asia
Americas
NET SALES AND SEGMENTS OPERATING PROFIT* AVERAGE NUMBER OF PERSONNEL
GROSS INVESTMENTS
EUR million 2022 2021 2020 2019 2018
Net sales ,. ,. ,. ,. ,.
Segments operating
prot . . . . .
Segments operating
prot % . . . . .
2022 2021 2020 2019 2018
Personnel , , , , ,
EUR million 2022 2021 2020 2019 2018
Gross Investments . . . . .
SEGMENTS EARNINGS PER SHARE*
AND DIVIDEND PER SHARE
EUR
2022 2021 2020 2019 2018
Segments earnings
per share . . . .
)
.
Dividend per share .
)
. . . .
1)
Segments EPS 2019 excl. the impact of the rulings on the tax disputes of
EUR 1.08 were EUR 1.98
2)
The Board’s proposal to the Annual General Meeting on the payment of a
maximum amount of dividend
2022 2021 2020 2019 2018
Segments ROCE, % .
. . . .
EUR million 2022 2021 2020 2019 2018
R&D expenses . . . . .
SEGMENTS ROCE*
R&D EXPENSES
* Comparable Segments Total gures for 2019–2022, earlier years reported based on IFRS
22
0
20
40
60
80
20222021202020192018
%
–30
–20
–10
0
10
20222021202020192018
%
20222021202020192018
0
10
20
30
40
Net sales Segment
operating prot
Segment
operating prot %
EUR million
Segment operating prot %
0
400
800
1,200
1,600
0
50
100
150
200
250
300
20222021202020192018
0
10
20
30
40
50
60
Net sales Segment
operating prot
Segment
operating prot %
EUR million
Segment operating prot %
0
100
200
300
400
20222021202020192018
0
1
2
3
4
Net sales Segment
operating prot
Segment
operating prot %
EUR million
Segment operating prot %
2022 2021 2020 2019 2018
Equity ratio, % . . . . .
2022 2021 2020 2019 2018
Gearing, % . –. –. . –.
EQUITY RATIOGEARING
PASSENGER CAR TYRES
Net sales and segment operating profit*
VIANOR
Net sales and segment operating profit*
HEAVY TYRES
Net sales and segment operating profit*
EUR million
2022 2021 2020 2019 2018
Net sales ,. ,. . ,. ,.
Segment operating
prot . . . . .
Segment operating
prot % . . . . .
EUR million
2022 2021 2020 2019 2018
Net sales . . . . .
Segment operating
prot . . . . .
Segment operating
prot % . . . . .
EUR million
2022 2021 2020 2019 2018
Net sales . . . . .
Segment operating
prot . . . . .
Segment operating
prot % . . . . .
* Comparable Segment gures for 2019–2022, earlier years reported based on IFRS
23
Figures in EUR million unless otherwise indicated 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013
Net sales 1,776.1 1,714.1 1,313.8 1,595.8 1,595.6 1,572.5 1,391.2 1,360.1 1,389.1 1,521.0
change, % 3.6% 30.5% –17.1% 0.0% 1.5% 13.0% 2.3% –2.1% –8.7% –5.7%
Operating margin (EBITDA)
1)
194.4 425.6 275.9 441.7 465.8 463.7 395.2 378.6 398.5 479.0
Depreciation and amortization 154.9 140.5 131.0 125.2 93.4 98.3 84.7 82.6 89.8 93.5
Impairments
2)
155.7 17.0 24.9
Operating profit (EBIT) –116.2 268.2 120.0 316.5 372.4 365.4 310.5 296.0 308.7 385.5
% of net sales –6.5% 15.6% 9.1% 19.8% 23.3% 23.2% 22.3% 21.8% 22.2% 25.3%
Profit before tax –146.3 258.2 106.0 336.7 361.7 332.4 298.7 274.2 261.2 312.8
% of net sales –8.2% 15.1% 8.1% 21.1% 22.7% 21.1% 21.5% 20.2% 18.8% 20.6%
Return on equity, % –11.5% 13.1% 5.2% 24.6% 20.0% 15.1% 18.7% 19.6% 16.0% 13.0%
Return on capital employed, % –6.0% 13.7% 6.0% 17.6% 23.3% 22.4% 19.9% 20.3% 19.2% 21.8%
Total assets 2,209.7 2,383.5 2,336.7 2,332.6 2,092.9 1,877.4 1,975.7 1,754.8 1,797.0 2,062.9
Interest-bearing net debt 140.9 –98.7 –17.2 41.1 –315.2 –208.3 –287.4 –209.7 –164.6 –56.4
Equity ratio, % 64.9% 68.4% 65.3% 75.9% 71.0% 78.2% 73.8% 70.8% 67.5% 67.6%
Gearing, % 9.8% –6.1% –1.1% 2.3% –21.2% –14.2% –19.7% –16.9% –13.6% –4.1%
Net cash from operating activities –4.3 396.5 422.4 219.8 536.9 234.6 364.4 283.4 323.4 317.6
Capital expenditure 129.9 119.6 149.9 290.1 226.5 134.9 105.6 101.7 80.6 125.6
% of net sales 7.3% 7.0% 11.4% 18.3% 14.2% 8.6% 7.6% 7.5% 5.8% 8.3%
R&D expenditure 29.6 31.9 22.7 22.7 20.8 21.8 20.3 18.7 16.6 16.1
% of net sales 1.7% 1.9% 1.7% 1.3% 1.3% 1.4% 1.5% 1.4% 1.2% 1.1%
Dividends 76.0 182.5 165.9 219.5 218.1 214.2 208.0 202.0 193.5 193.3
Personnel, average during the year 4,947 4,941 4,859 4,942 4,790 4,630 4,433 4,421 4,272 4,194
CONSOLIDATED KEY FINANCIAL INDICATORS
PER SHARE DATA
Key nancial indicators
Figures in EUR million unless otherwise indicated 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013
Earnings per share, EUR –1.27 1.49 0.62 2.89 2.15 1.63 1.87 1.80 1.56 1.39
change, % –185.1% 140.2% –78.5% 78.1% 32.4% –13.0% 3.6% 15.1% 12.9% –45.0%
Earnings per share (diluted), EUR –1.27 1.49 0.62 2.89 2.14 1.61 1.86 1.80 1.56 1.39
change, % –185.1% 140.2% –78.5% 35.2% 32.5% –13.2% 3.2% 15.0% 12.9% –43.5%
Cash flow per share, EUR –0.03 2.87 3.05 3.89 3.91 1.72 2.70 2.12 2.43 2.39
change, % –101.1% –6.0% –21.5% –0.7% 127.2% –36.3% 27.4% –12.7% 1.4% –19.2%
Dividend per share, EUR 0.55
3)
Dividend pay out ratio, % –43.3% 88.5% 192.9% 39.5% 73.9% 96.7% 82.6% 83.9% 92.9% 105.2%
Equity per share, EUR 10.37 11.78 11.01 12.76 10.79 10.74 10.75 9.24 9.07 10.45
P/E ratio –7.5 22.3 46.4 8.9 12.5 23.3 19.0 18.4 13.0 25.2
Dividend yield, % 5.7% 4.0% 4.2% 4.5% 5.9% 4.1% 4.3% 4.5% 7.1% 4.2%
Market capitalisation 31 December 1,330.9 4,626.1 4,003.7 3,560.6 3,702.9 5,188.7 4,814.0 4,458.3 2,708.1 4,647.7
Number of shares during the year, average, million units 138.25 138.22 138.46 138.17 137.26 136.25 134.86 133.63 133.16 132.65
diluted, million units 138.25 138.22 138.46 138.38 138.14 137.28 135.56 133.74 135.10 137.62
Number of shares 31 December, million units 138.25 138.22 138.22 138.72 137.79 136.75 135.68 134.39 133.17 133.29
Number of shares entitled to a dividend, million units 138.25 138.22 138.22 138.92 138.07 137.28 135.93 134.69 133.47 133.34
1)
DA in EBITDA includes impairments from 2020 onwards
2)
Impairments are presented from 2020 onwards
3)
The Board’s proposal to the Annual General meeting
24
Denitions
Return on equity, % =
Prot for the period
× 100
Total equity (average)
Return on capital employed, % =
Prot before tax + interest and other nancial expenses
× 100
Total assets – non-interest-bearing debt (average)
Equity ratio, % =
Total equity
× 100
Total assets – advances received
Gearing, % =
Interest-bearing net debt
× 100
Total equity
Earnings per share, EUR =
Prot for the period attributable to the equity holders of the parent
Average adjusted number of shares
1)
during the year
Earnings per share (diluted
2)
), EUR =
Prot for the period attributable to the equity holders of the parent
Average adjusted and diluted
2)
number
1)
of shares during the year
Cash ow per share, EUR =
Cash ow from operations
Average adjusted number of shares
1)
during the year
Dividend per share, EUR =
Dividend for the year
Number of shares entitled to a dividend
Dividend pay-out ratio, % =
Dividend for the year
× 100
Net prot
Equity per share, EUR =
Equity attributable to equity holders of the parent
Adjusted number of shares
1)
on the balance sheet date
P/E ratio =
Share price, 31 December
Earnings per share
Dividend yield, % =
Dividend per share
Share price, 31 December
1)
without treasury shares
2)
the share options aect the dilution as the average share market price for the nancial year exceeds the dened subscription price
CONSOLIDATED KEY FINANCIAL INDICATORS
25
This report is a translation. The original Finnish is the authoritative version.
FINANCIAL STATEMENTS 2022
Financial statements
26
CONSOLIDATED INCOME STATEMENT, IFRS
EUR million 1.1.–31.12. | Notes | 2022 | 2021 |
Net sales | (1) | ||
Cost of sales | (3)(7)(8) | – | – |
Gross profit | |||
Other operating income | (4) | ||
Selling, marketing and R&D expenses | (7)(8) | – | – |
Administration expenses | (6)(7)(8) | – | – |
Other operating expenses | (5)(7)(8) | – | – |
Operating profit | – | ||
Financial income | (9) | ||
Financial expenses | (10) | – | – |
Result before tax | – | ||
Tax expense | (11) | – | – |
Result for the period | – | ||
| Attributable to: | |||
Equity holders of the parent | – | ||
Earnings per share (EPS) for the profit attributable to the equity holders of the parent: | (12) | ||
Basic, euros | – | ||
Diluted, euros | – |
EUR million 1.1.–31.12. | Notes | 2022 | 2021 |
| Consolidated other comprehensive income | |||
Result for the period | – | ||
Other comprehensive income, items that may be reclassified subsequently to profit and loss, net of tax | |||
| Gains/Losses from hedge of net investment in foreign | |||
operations | (11) | ||
Cash flow hedges | (11) | ||
Translation differences on foreign operations | |||
Total other comprehensive income for the period, net of tax | |||
| Total comprehensive income for the period | – | ||
| Total comprehensive income attributable to: | |||
Equity holders of the parent | – |
Consolidated income statement
27
CONSOLIDATED STATEMENT OF
FINANCIAL POSITION, IFRS
EUR million 31.12. | Notes | 2022 | 2021 |
| ASSETS | |||
| Non-current assets | |||
Property, plant and equipment | (13) | ||
Right of use assets | (15) | ||
Goodwill | (14) | ||
Other intangible assets | (14) | ||
Investments in associates | (17) | ||
Non-current financial investments | (17) | ||
Other receivables | (16)(18) | ||
Deferred tax assets | (19) | ||
| Current assets | |||
Inventories | (20) | ||
Trade and other receivables | (21)(29) | ||
Current tax assets | |||
Cash and cash equivalents | (22) | ||
Total assets | (1) |
EUR million 31.12. | Notes | 2022 | 2021 |
| EQUITY AND LIABILITIES | |||
Equity attributable to equity holders of the parent | (23)(24) | ||
Share capital | |||
Share premium | |||
Treasury shares | – | – | |
Translation reserve | – | – | |
Fair value and hedging reserves | |||
Paid-up unrestricted equity reserve | |||
Retained earnings | |||
Total equity | |||
| Liabilities | |||
| Non-current liabilities | |||
Deferred tax liabilities | (19) | ||
Interest-bearing liabilities | (27)(29) | ||
Other liabilities | |||
| Current liabilities | |||
Trade and other payables | (28) | ||
Current tax liabilities | |||
Provisions | (26) | ||
Interest-bearing liabilities | (27)(29) | ||
Total liabilities | (1) | ||
Total equity and liabilities |
Changes in net working capital arising from operative business are partly covered by EUR 500 million domestic
commercial paper programme.
Interest-bearing liabilities include EUR 92.6 million of non-current and EUR 36 .5 million of current lease liabilities.
Consolidated statement of nancial position
28
| EUR million 1.1.–31.12. | Notes | 2022 | 2021 |
Result for the period | – | ||
Adjustments for Depreciation, amortization and impairment | (7) | ||
Financial income and expenses | (9)(10) | ||
Gains and losses on sale of intangible assets, other changes | |||
Income Taxes | (11) | ||
Cash flow before changes in working capital | |||
| Changes in working capital | |||
Current receivables, non-interest-bearing, increase (–) / decrease (+) | – | – | |
Inventories, increase (–) / decrease (+) | – | – | |
Current liabilities, non-interest-bearing, increase (+) / decrease (–) | – | ||
Changes in working capital | – | ||
| Financial items and taxes | |||
Interest and other financial items, received | |||
Interest and other financial items, paid | – | – | |
Income taxes paid | – | – | |
Financial items and taxes | – | – | |
Cash flow from operating activities (A) | – | ||
| Cash flows from investing activities | |||
Acquisitions of property, plant and equipment and intangible assets | (13)(14) | – | – |
| Proceeds from sale of property, plant and equipment | |||
and intangible assets | |||
Acquisitions of Group companies | (2) | – | |
Other cash flow from investing activities | – | ||
Cash flows from investing activities (B) | – | – |
| EUR million 1.1.–31.12. | Notes | 2022 | 2021 |
| Cash flow from financing activities: | |||
Change in current financial receivables, increase (–) / decrease (+) | – | ||
Change in non-current financial receivables, increase (–) / decrease (+) | |||
Change in current financial borrowings, increase (+) / decrease (–) | – | ||
Change in non-current financial borrowings, increase (+) / decrease (–) | – | – | |
Payment of lease liabilities | – | – | |
Dividends received | |||
Dividends paid | – | – | |
Cash flow from financing activities (C) | – | ||
Change in cash and cash equivalents, increase (+) / decrease (–) (A+B+C) | – | – | |
Cash and cash equivalents at the beginning of the period | |||
Effect of exchange rate fluctuations on cash held | – | ||
Cash and cash equivalents at the end of the period | (22) |
CONSOLIDATED STATEMENT OF CASH FLOWS, IFRS
Consolidated statement of cash ows
29
CONSOLIDATED STATEMENT OF
CHANGES IN EQUITY, IFRS
Equity attributable to equity holders of the parent
| Paid-up | |||||||||
| Fair value | unrestricted | ||||||||
| Share | Treasury | Translation | and hedging | equity | Retained | ||||
EUR million | Notes | Share capital | premium | shares | reserve | reserves | reserve | earnings | Total equity |
Equity, 1 Jan 2021 | – | – | – | ||||||
Profit for the period | |||||||||
| Other comprehensive income, net of tax: | |||||||||
Cash flow hedges | |||||||||
Net investment hedge | |||||||||
Translation differences | |||||||||
Total comprehensive income for the period | |||||||||
Dividends paid | (23) | – | – | ||||||
Share-based payments | (24) | ||||||||
Other changes | – | ||||||||
Total transactions with owners for the period | – | – | |||||||
Equity, 31 Dec 2021 | – | – | |||||||
Equity, 1 Jan 2022 | – | – | |||||||
Profit for the period | – | – | |||||||
| Other comprehensive income, net of tax: | |||||||||
Cash flow hedges | |||||||||
Net investment hedge | |||||||||
Translation differences | |||||||||
Total comprehensive income for the period | – | – | |||||||
Dividends paid | (23) | – | – | ||||||
Share-based payments | (24) | – | – | ||||||
Other changes | (19) | ||||||||
Total transactions with owners for the period | – | – | |||||||
Equity, 31 Dec 2022 | – | – | |||||||
Consolidated statement of changes in equity
30
Accounting policies for the
consolidated financial statements
31
33
40
41
42
43
46
47
49
Reconciliation of Level 3 fair value measurements
EUR million 2022 2021
Fair value, 1 Jan – –
Rouble derivatives
Transfers into Level 3 14.8 –
Net gains/losses recognized in profit or loss under financial
income and expenses –14.3 –
Fair value, 31 Dec 0.4 –
Sensitivity
As the fair value is based only on the foreign exchange component, the sensitivity of
the fair value is linearly dependent on the changes in the EUR/RUB exchange rate. A
10% base currency appreciation/depreciation against the quote currency would have
an effect of EUR +1.8 million/–1.8 million on the fair value. If orderly transactions could
have been executed based on the observable market data the fair value of the interest
component would have been EUR +1.5 million.
50
51
52
53
54
55
56
57
61
62
66
69
70
72
EUR 1.1.–31.12. Notes 2022 2021
Net sales () ,,. ,,.
Cost of sales ()() –,,. –,,.
Gross profit ,,. ,,.
Selling, marketing and R&D expenses ()() –,,. –,,.
Administration expenses ()()() –,,. –,,.
Other operating expenses ()() –,,. –,,.
Other operating income ,. ,.
Operating profit –,,. ,,.
Financial income and expenses () ,,. ,,.
Profit before appropriations and tax ,,. ,,.
Appropriations () ,,. –,,.
Income tax () –,,. –,,.
Profit for the period ,,. ,,.
PARENT COMPANY INCOME STATEMENT, FAS
Parent company income statement
Parent company balance sheet
PARENT COMPANY BALANCE SHEET, FAS
EUR 31.12. Notes 2022 2021
ASSETS
Fixed assets and other non-current assets
Intangible assets () ,,. ,,.
Tangible assets () ,,. ,,.
Shares in Group companies () ,,. ,,.
Investments in associates () ,,. ,,.
Shares in other companies () ,. ,.
Unquoted securities () ,,. ,,.
Total non-current assets ,,. ,,.
Current assets
Inventories () ,,. ,,.
Non-current receivables () ,,. ,,.
Current receivables () ,,. ,,.
Cash and cash equivalents ,,. ,,.
Total current assets ,,. ,,,.
,,,. ,,,.
EUR 31.12. Notes 2022 2021
LIABILITIES AND SHAREHOLDERS’ EQUITY
Shareholders’ equity ()
Share capital ,,. ,,.
Share premium ,,. ,,.
Treasury shares –,,. –,,.
Paid up unrestricted equity fund ,,. ,,.
Retained earnings ,,. ,,.
Profit for the period ,,. ,,.
Total shareholders’ equity ,,. ,,.
Untaxed reserves and provisions
Accumulated depreciation in excess of
plan () ,,. ,,.
Liabilities
Non-current liabilities () ,,. ,,.
Current liabilities () ,,. ,,.
Total liabilities ,,. ,,.
,,,. ,,,.
EUR million 1.1.–31.12. 2022 2021
Profit for the period . .
Adjustments for
Depreciation, amortization and impairment . .
Financial income and expenses –. –.
Gains and losses on sale of intangible assets, other changes . .
Income Taxes . .
Cash flow before changes in working capital –. .
Changes in working capital
Current receivables, non-interest-bearing, increase (–) / decrease (+) . –.
Inventories, increase (–) / decrease (+) –. –.
Current liabilities, non-interest-bearing, increase (+) / decrease (–) –. .
Changes in working capital –. –.
Financial items and taxes
Interest and other financial items, received . .
Interest and other financial items, paid –. –.
Dividends received . .
Income taxes paid –. –.
Financial items and taxes –. .
Cash flow from operating activities (A) –. .
Cash flow from investing activities
Acquisitions of property, plant and equipment and intangible
assets –. –.
Proceeds from sale of property, plant and equipment and
intangible assets . .
Acquisitions of other investments –. –.
Cash flow from investing activities (B) –. –.
EUR million 1.1.–31.12. 2022 2021
Cash flow from financing activities
Change in current financial receivables, increase (–) / decrease (+) –. –.
Change in non-current financial receivables,
increase (–) / decrease (+) . .
Change in current financial borrowings, increase (+) / decrease (–) . –.
Group contributions paid –. .
Dividends paid –. –.
Cash flow from financing activities (C) –. –.
Change in cash and cash equivalents, increase (+) / decrease (–)
(A+B+C) –. –.
Cash and cash equivalents at the beginning of the period . .
Cash and cash equivalents at the end of the period . .
PARENT COMPANY STATEMENT OF CASH FLOWS, FAS
Parent company statement of cash ows
General
The nancial statements of Nokian Tyres plc, domiciled in the city of Nokia, have been
prepared according to the Finnish Accounting Standards (FAS).
Inventory valuation
Inventories are measured at the lower of cost or the net realisable value. Cost is
primarily determined in accordance with standard cost accounting. The cost of nished
goods and work in progress includes raw material purchase costs, direct manufacturing
wages, other direct manufacturing costs, and a share of production overheads,
borrowing costs excluded. Net realisable value is the estimated sales price in ordinary
activities less the costs associated with the completion of the product and the esti-
mated necessary costs incurred to make the sale of the product. Allowance is recorded
in obsolete items.
Fixed assets and depreciation
Fixed assets are stated in the balance sheets at cost less depreciation according to
plan. The accumulated dierence between the total depreciation charged to the
income statement and depreciation according to plan is shown as a separate item in
untaxed reserves.
Depreciations according to plan are calculated on the basis of the estimated useful
life of the assets using the straight line method.
The depreciation times are as follows:
Intangible assets 3–10 years
Buildings 20–40 years
Machinery and equipment 4–20 years
Other tangible assets 10–40 years
Land property, as well as investments in shares, are not regularly depreciated.
Research and development
Research and development costs are charged to the other operating expenses in the
income statement in the year in which they are incurred. Certain signicant devel-
opment costs with useful life over three years are capitalised and are amortised on a
systematic basis over their expected useful lives. The amortization period is between
three and ve years.
Pensions and coverage of pension liabilities
Pension contributions are based on periodic actuarial calculations and are charged to
the income statement.
In Finland the pension schemes are funded through payments to a pension insur-
ance company.
Equity
The acquisition cost of treasury shares repurchased by the Group is recognised as a
deduction in equity. The consideration received for the treasury shares when sold, net
of transaction costs and tax, is included in equity.
Foreign currency items
Transactions in foreign currencies are recorded at the exchange rates ruling at the
dates of the transactions. At the end of the accounting period unsettled balances on
foreign currency transactions and forward exchange contracts are valued at the rates
published by the European Central Bank as on the nancial statement date.
All foreign currency exchange gains and losses are entered under nancial income
and expenses.
Direct taxes
The income statement includes direct taxes based on the taxable prot and direct
taxes from previous years. The untaxed reserves are shown in full in the balance sheet,
and the deferred tax liability is not recorded.
ACCOUNTING POLICIES FOR THE PARENT COMPANY
Accounting policies for
the parent company
1. NET SALES BY SEGMENTS AND MARKET AREAS
EUR million 2022 2021
Passenger Car Tyres . .
Heavy Tyres . .
Total . .
Finland . .
Other Nordic countries . .
Other European countries . .
Russia and Asia . .
America . .
Other countries . .
Total . .
2. WAGES, SALARIES AND SOCIAL EXPENSES
EUR million 2022 2021
Wages and salaries . .
Pension contributions . .
Other social expenses . .
Total . .
Remuneration of the members of the Board of the Directors and the
Presidents on accrual basis . .
of which incentives . .
No special pension commitments have been granted to the members of the Board and no statutory pension
expense incurs. President and CEO Jukka Moisio does not have a supplementary pension plan and his retirement
age is in accordance to the statutory pension regulations. See also Notes to Consolidated Financial Statements,
note 34 Related party transactions.
Personnel, average during the year 2022 2021
Total
NOTES TO THE FINANCIAL STATEMENTS
OF THE PARENT COMPANY
Notes to the nancial statements
of the parent company
3. DEPRECIATION
EUR million 2022 2021
Depreciation according to plan by asset category
Intangible assets . .
Buildings . .
Machinery and equipment . .
Other tangible assets . .
Total . .
Impairment losses by asset category
Buildings . .
Machinery and equipment . .
Total . .
Depreciation by function
Production . .
Selling, marketing and R&D . .
Administration . .
Total . .
Impairment losses by function
Production . .
Administration . .
Total . .
4. AUDITOR’S FEES
EUR million 2022 2021
Audit fee . .
Tax services – .
Other services . .
Total . .
5. FINANCIAL INCOME AND EXPENSES
EUR million 2022 2021
Dividend income
From the Group companies . .
Total . .
Interest income, non-current
From the Group companies . .
Total . .
Income from shares in companies of the same Group . –
Other interest and financial income
From the Group companies . .
From others . .
Total . .
Exchange rate differences (net) –. –.
Impairment, long-term investments –. –.
Interest and other financial expenses
To the Group companies –. –.
To others –. –.
Other financial expenses –. –.
Total –. –.
Total financial income and expenses . .
6. APPROPRIATIONS
EUR million 2022 2021
Change in accumulated depreciation in excess of plan
Intangible assets . .
Buildings . .
Machinery and equipment –. –.
Other tangible assets . –.
Total –. .
Other appropriations
Group contributions . –.
Total . –.
Total appropriations . –.
7. INCOME TAX
EUR million 2022 2021
Direct tax for the year –. –.
Direct tax from previous years . .
Total –. –.
8. FIXED ASSETS
Intangible assets Tangible assets
EUR million Intangible rights
Other intangible
rights Land property Buildings
Machinery and
equipment
Other tangible
assets
Advances
and fixed
assets under
construction
Accumulated cost, 1 Jan 2022 . . . . . . .
Increase . . . . .
Decrease –. –.
Transfer between items . . . . –.
Accumulated cost, 31 Dec 2022 . . . . . . .
Accum. depr. acc. to plan 1 Jan 2022 –. –. –. –. –.
Accum. depr. on disposals . .
Depreciations for the period –. . –. –. –.
Impairment –. –.
Accum. depr. acc.to plan, 31 Dec 2022 –. –. –. –. –.
Carrying amount, 31 Dec 2022 . . . . . . .
Carrying amount, 31 Dec 2021 . . . . . . .
Accum. depreciation in excess of plan, 31 Dec 2022 . . – . . .
Accum. depreciation in excess of plan, 31 Dec 2021 . . – . . .
9. INVESTMENTS
EUR million
Shares in Group
companies
Investments in
associates
Shares in other
companies
Unquoted
securities
Accumulated cost, 1 Jan 2022 . . . .
Decrease . – . –
Increase . – . –
Impairment losses –. – – –
Exchange differences – – – .
Accumulated cost, 31 Dec 2022 . . . .
Carrying amount, 31 Dec 2022 . . . .
Carrying amount, 31 Dec 2021 . . . .
10. INVENTORIES
EUR million 2022 2021
Raw materials and supplies . .
Work in progress . .
Finished goods . .
Total . .
11. NON-CURRENT RECEIVABLES
EUR million 2022 2021
Loan receivables from the Group companies . .
Loan receivables from others . .
Total long-term receivables . .
The members of the Board of Directors and the President have not been granted loans.
12. CURRENT RECEIVABLES
EUR million 2022 2021
Receivables from the Group companies
Trade receivables . .
Loan receivables . .
Accrued revenues and deferred expenses . .
Total . .
Of the Parent company’s internal receivables EUR 60.2 million are
current receivables and EUR 20.9 million non-current receivables from
Group companies located in Russia.
Trade receivables . .
Other receivables . .
Accrued revenues and deferred expenses . .
Total . .
Total short-term receivables . .
Significant items under accrued revenues and deferred expenses
Financial items . .
Taxes . .
Social payments . .
Capital expenditure in factories . .
Goods and services rendered and not invoiced, subsidiary . .
Group contribution . –
Other items . .
Total . .
13. SHAREHOLDERS’ EQUITY
EUR million 2022 2021
Restricted shareholders’ equity
Share capital, 1 January . .
Emissions – –
Share capital, 31 December . .
Share issue premium, 1 January . .
Emission gains – –
Share issue premium, 31 December . .
Total restricted shareholders’ equity . .
Non-restricted shareholders’ equity
Paid-up unrestricted equity reserve, 1 January . .
Emission gains – –
Paid-up unrestricted equity reserve, 31 December . .
Retained earnings, 1 January . .
Dividends to shareholders –. –.
Retained earnings, 31 December . .
Treasury shares –. –.
Profit for the period . .
Total non-restricted shareholders’ equity . .
Total shareholders’ equity . .
Specification of the distributable funds, 31 December
Retained earnings . .
Treasury shares –. –.
Paid-up unrestricted equity reserve . .
Profit for the period . .
Distributable funds, 31 December . .
14. NON-CURRENT LIABILITIES
EUR million 2022 2021
Interest-bearing
Loans from financial institutions . .
Total . .
Non-interest-bearing
Accrued expenses and deferred revenues . .
Total . .
Total non-current liabilities . .
15. CURRENT LIABILITIES
EUR million 2022 2021
Interest-bearing
Liabilities to the Group companies
Finance loans . .
Commercial papers . –
Total interest-bearing liabilities . .
Non-interest-bearing
Liabilities to the Group companies
Trade payables . .
Accrued expenses and deferred revenues . .
Total . .
Trade payables . .
Liabilities to the others . .
Accrued expenses and deferred revenues . .
Total . .
Total non-interest-bearing liabilities . .
Total current liabilities . .
Significant items under accrued expenses and deferred revenues
Wages, salaries and social security contributions . .
Annual discounts, sales . .
Taxes . .
Financial items . .
Commissions . .
Warranty commitments . .
Group contributions – .
Other items . .
Total . .
The Group or the Parent company themselves do not directly hold any treasury shares.
Nokian Tyres has an agreement from 2017 with a third-party service provider
concerning the share-based incentive program for key personnel. The third party owns
Nokian Tyres’ shares related to the incentive program until the shares are given to
the participants of the program. In accordance with IFRS, these repurchased shares,
480,000 in 2017 and 500,000 in 2020, have been reported as treasury shares in the
Consolidated Statement of Financial Position. On December 31, 2022, the number of
these shares was 670,426. This number of shares corresponded to 0.48% of the total
shares and voting rights in the company.
17. DERIVATIVE FINANCIAL INSTRUMENTS
EUR million 2022 2021
Interest rate derivatives
Interest rate swaps
Notional amount . .
Fair value . –.
Foreign currency derivatives
Currency forwards
Notional amount . .
Fair value . –.
Currency options, purchased
Notional amount . .
Fair value . .
Currency options, written
Notional amount . .
Fair value –. –.
Interest rate and currency swaps
Notional amount . .
Fair value . .
Electricity derivatives
Electricity forwards
Notional amount . .
Fair value . .
Unrealised fair value changes of interest rate and electricity derivatives are not
recognised in prot and loss. The interest rate swap hedges the future interest
payments of a loan from a nancial institution and the electricity forwards hedge the
future electricity purchase prices in Finland. The contractual terms of these derivatives
and the hedged items are congruent. The cash ows of the interest rate swap and
electricity forwards will occur during the next three years.
The fair value of forward exchange contracts is measured using the forward rates
on the reporting date. The fair value of currency options is calculated using an option
valuation model.
The fair values of interest rate and currency swaps and interest rate derivatives are
determined as the present value of the future cash ows based on market interest
rates on the reporting date.
The fair value of electricity derivatives is based on quoted market prices in active
markets on the reporting date.
16. CONTINGENT LIABILITIES
EUR million 2022 2021
For own debt
Pledged assets . .
On behalf of Group companies and investments in associates
Guarantees . .
Pledged assets . .
The amount of debts and commitments mortgaged for total EUR 115.0 million
(2021: EUR 44.8 million).
Other own commitments
Guarantees . .
Leasing and rent commitments
Payments due in . .
Payments due in subsequent years . .
18. ENVIRONMENTAL COMMITMENTS AND EXPENSES
Expenses relating to environment are included to production costs. The company has
duly attended to environmental commitments and has no information on material
environmental liabilities. In addition to the environmental aspects presented in the
Annual Report, Nokian Tyres issued a Corporate Social Responsibility Report in spring
2022.
Helsinki, 7th of February 2023
Jukka Hienonen Pekka Vauramo
Heikki Allonen Susanne Hahn
Veronica Lindholm Inka Mero
Christopher Ostrander Jouko Pölönen
George Rietbergen Jukka Moisio
CEO
SIGNATURES FOR
THE FINANCIAL
STATEMENTS
AND THE REPORT
BY THE BOARD
OF DIRECTORS
Signatures of the Board of Directors and
the auditor’s note
Report on the audit of the nancial statements has been given today.
Helsinki, 8th of February 2023
Ernst & Young Oy
Authorized Public Accountant Firm
Mikko Järventausta, APA
THE AUDITOR’S
NOTE
AUDITOR’S REPORT
(Translation of the Finnish original)
To the Annual General Meeting of Nokian Tyres plc
Report on the Audit of the Financial Statements
Opinion
We have audited the nancial statements of Nokian Tyres plc (business identity code
0680006-8) for the year ended 31 December, 2022. The nancial statements comprise
the consolidated balance sheet, income statement, statement of comprehensive
income, statement of changes in equity, statement of cash ows and notes, including
a summary of signicant accounting policies, as well as the parent company’s balance
sheet, income statement, statement of cash ows and notes.
In our opinion
• the consolidated nancial statements give a true and fair view of the group’s nancial
position as well as its nancial performance and its cash ows in accordance with
International Financial Reporting Standards (IFRS) as adopted by the EU.
• the nancial statements give a true and fair view of the parent company’s nancial
performance and nancial position in accordance with the laws and regulations
governing the preparation of nancial statements in Finland and comply with statu-
tory requirements.
Our opinion is consistent with the additional report submitted to the Audit Committee.
Basis for Opinion
We conducted our audit in accordance with good auditing practice in Finland. Our
responsibilities under good auditing practice are further described in the Auditor’s
Responsibilities for the Audit of the Financial Statements section of our report.
We are independent of the parent company and of the group companies in accor-
dance with the ethical requirements that are applicable in Finland and are relevant to
our audit, and we have fullled our other ethical responsibilities in accordance with
these requirements.
In our best knowledge and understanding, the non-audit services that we have
provided to the parent company and group companies are in compliance with laws and
regulations applicable in Finland regarding these services, and we have not provided
any prohibited non-audit services referred to in Article 5(1) of regulation (EU) 537/2014.
The non-audit services that we have provided have been disclosed in note 6 to the
consolidated nancial statements.
We believe that the audit evidence we have obtained is suicient and appropriate to
provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
signicance in our audit of the nancial statements of the current period. These
matters were addressed in the context of our audit of the nancial statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
We have fullled the responsibilities described in the Auditor’s responsibilities for the
audit of the nancial statements section of our report, including in relation to these
matters. Accordingly, our audit included the performance of procedures designed
to respond to our assessment of the risks of material misstatement of the nancial
statements. The results of our audit procedures, including the procedures performed
to address the matters below, provide the basis for our audit opinion on the accompa-
nying nancial statements.
We have also addressed the risk of management override of internal controls. This
includes consideration of whether there was evidence of management bias that
represented a risk of material misstatement due to fraud.
Auditor’s report
Key Audit Matter How our audit addressed the Key Audit Matter
Revenue recognition
We refer to the accounting policies for the consolidated nancial statements and the note 1.
The Group’s revenue is recognized when control of the good or service is transferred to
the customer. Revenue is a key nancial performance measure which could create an
incentive for revenues to be recognized prematurely. Due to the variety of contractual
terms used across the Group’s markets management judgment is needed to account
for the revenue.
Customer discounts and credits are considered when determining the revenue.
Estimating discounts and credits require also management judgment both at the time
of revenue recognition as well as at the end of each reporting period. Based on above,
revenue recognition, was a key audit matter.
This matter was also a signicant risk of material misstatement referred to in EU
Regulation No 537/2014, point (c) of Article 10(2).
Our audit procedures to address the risk of material misstatement in respect of
revenue recognition, included, among others:
• Assessment of the compliance of the Group’s accounting policies over revenue
recognition, including those relating to discounts and credits, against IFRS standards.
• Assessment of the revenue recognition process especially relating to timing of
revenue recognition, and calculation of discounts and credits.
• Data analytical procedures, for example, analyzing the conversion of revenue to cash
received.
• Familiarizing ourselves with the contractual terms in sales agreements. Testing
the revenue cut-o with analytical procedures and with a sample test of details
on a transaction level on either side of the balance sheet date. Testing of revenue
discounts and credits on a sample basis.
• Analyzing credit notes issued after the prior year balance sheet date.
• Assessment of the Group’s disclosures in respect of revenues.
Operations in Russia
We refer to the accounting policies for the consolidated nancial statements and the notes 1, 14 and 29 as well as to the parent company’s note 12.
Due to the war in Ukraine and the subsequent tightening sanctions the Group
management has stated that it is no longer feasible nor sustainable for the Group to
continue operations in Russia.
As a part of the exit from Russia, impairments of 280,7 M€ related to Russian assets
were recorded in the second quarter of 2022.
In October, Nokian Tyres plc signed an agreement to sell its Russian operations to
Tatneft PJSC. The disposal process is still in progress. The transaction is subject to
approval by the relevant regulatory authorities in Russian and other conditions, which
creates substantial uncertainties related to the nal timing, terms and conditions and
the closing of the transaction.
The accounting and reporting of Russian operations in the nancial statements was
a key audit matter because
• in the consolidated nancial statements the presentation and valuation of Russian
operations; and
• in the parent company’s nancial statements the valuation of intercompany
receivables
include signicant management judgment and estimates.
This matter was also a signicant risk of material misstatement referred to in EU
Regulation No 537/2014, point (c) of Article 10(2).
Our audit procedures to address the risk of material misstatement in respect of
Russian operations included, among others:
• Instructing and coordinating the auditors of the Russian subsidiaries.
• Familiarising ourselves with the disposal agreement between Nokian Tyres plc and
Tatneft PJSC.
• Testing of the impairment calculations prepared by the management relating to
Russian operations and assessing the inherent assumptions.
• Evaluation of the presentation and disclosures in respect of Russian operations.
Responsibilities of the Board of Directors and the
Managing Director for the Financial Statements
The Board of Directors and the Managing Director are responsible for the preparation
of consolidated nancial statements that give a true and fair view in accordance with
International Financial Reporting Standards (IFRS) as adopted by the EU, and of nancial
statements that give a true and fair view in accordance with the laws and regulations
governing the preparation of nancial statements in Finland and comply with statutory
requirements. The Board of Directors and the Managing Director are also responsible
for such internal control as they determine is necessary to enable the preparation of
nancial statements that are free from material misstatement, whether due to fraud or
error.
In preparing the nancial statements, the Board of Directors and the Managing
Director are responsible for assessing the parent company’s and the group’s ability
to continue as going concern, disclosing, as applicable, matters relating to going
concern and using the going concern basis of accounting. The nancial statements are
prepared using the going concern basis of accounting unless there is an intention to
liquidate the parent company or the group or cease operations, or there is no realistic
alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance on whether the nancial statements
as a whole are free from material misstatement, whether due to fraud or error, and
to issue an auditor’s report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance
with good auditing practice will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually
or in aggregate, they could reasonably be expected to inuence the economic deci-
sions of users taken on the basis of the nancial statements.
As part of an audit in accordance with good auditing practice, we exercise profes-
sional judgment and maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the nancial statements,
whether due to fraud or error, design and perform audit procedures responsive to
those risks, and obtain audit evidence that is suicient and appropriate to provide
a basis for our opinion. The risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances, but not for the purpose
of expressing an opinion on the eectiveness of the parent company’s or the group’s
internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of the Board of Directors’ and the Managing
Director’s use of the going concern basis of accounting and based on the audit
evidence obtained, whether a material uncertainty exists related to events or condi-
tions that may cast signicant doubt on the parent company’s or the group’s ability
to continue as a going concern. If we conclude that a material uncertainty exists, we
are required to draw attention in our auditor’s report to the related disclosures in the
nancial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the parent company or the
group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the nancial statements,
including the disclosures, and whether the nancial statements represent the
underlying transactions and events so that the nancial statements give a true and
fair view.
• Obtain suicient appropriate audit evidence regarding the nancial information
of the entities or business activities within the group to express an opinion on the
consolidated nancial statements. We are responsible for the direction, supervision
and performance of the group audit. We remain solely responsible for our audit
opinion.
We communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit and signicant audit ndings, including any
signicant deciencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have
complied with relevant ethical requirements regarding independence, and communi-
cate with them all relationships and other matters that may reasonably be thought to
bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine
those matters that were of most signicance in the audit of the nancial statements of
the current period and are therefore the key audit matters. We describe these matters
in our auditor’s report unless law or regulation precludes public disclosure about the
matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing
so would reasonably be expected to outweigh the public interest benets of such
communication.
Other Reporting Requirements
Information on our audit engagement
We were rst appointed as auditors by the Annual General Meeting on March 30, 2021,
and our appointment represents a total period of uninterrupted engagement of two
years.
Other information
The Board of Directors and the Managing Director are responsible for the other
information. The other information comprises the report of the Board of Directors
and the information included in the Annual Report, but does not include the nancial
statements and our auditor’s report thereon. We have obtained the report of the Board
of Directors prior to the date of this auditor’s report, and the Annual Report is expected
to be made available to us after that date.
Our opinion on the nancial statements does not cover the other information.
In connection with our audit of the nancial statements, our responsibility is to read
the other information identied above and, in doing so, consider whether the other
information is materially inconsistent with the nancial statements or our knowledge
obtained in the audit, or otherwise appears to be materially misstated. With respect to
report of the Board of Directors, our responsibility also includes considering whether
the report of the Board of Directors has been prepared in accordance with the appli-
cable laws and regulations.
In our opinion, the information in the report of the Board of Directors is consistent
with the information in the nancial statements and the report of the Board of
Directors has been prepared in accordance with the applicable laws and regulations.
If, based on the work we have performed on the other information that we obtained
prior to the date of this auditor’s report, we conclude that there is a material misstate-
ment of this other information, we are required to report that fact. We have nothing to
report in this regard.
Opinions based on assignment of the Audit Committee
We support that the nancial statements should be adopted. The proposal by the
Board of Directors regarding the use of the distributable funds shown in the nancial
statements is in compliance with the Limited Liability Companies Act. We support
that the Members of the Board of Directors and the Managing Director of the parent
company should be discharged from liability for the nancial period audited by us.
Helsinki 8.2.2023
Ernst & Young Oy
Authorized Public Accountant Firm
Mikko Järventausta
Authorized Public Accountant
INDEPENDENT AUDITOR’S REPORT ON NOKIAN RENKAAT
OYJ’S ESEF-CONSOLIDATED FINANCIAL STATEMENTS
ESEF assurance report
To the Board of Directors of Nokian Renkaat Oyj
We have performed a reasonable assurance engagement on the iXBRL tagging of the
consolidated nancial statements included in the digital les tyres-2022-12-31-.zip of
Nokian Renkaat Oyj for the nancial year 1. 1.–31. 12. 2022 to ensure that the nancial
statements are marked/tagged with iXBRL in accordance with the requirements of
Article 4 of EU Commission Delegated Regulation (EU) 2018/815 (ESEF RTS).
Responsibilities of the Board of Directors and Managing Director
The Board of Directors and Managing Director are responsible for the preparation of the
Report of Board of Directors and nancial statements (ESEF nancial statements) that
comply with the ESESF RTS. This responsibility includes:
• preparation of ESEF-nancial statements in accordance with Article 3 of ESEF RTS
• tagging the consolidated nancial statements included within the ESEF- nancial
statements by using the iXBRL mark ups in accordance with Article 4 of ESEF RTS
• ensuring consistency between ESEF nancial statements and audited nancial
statements
The Board of Directors and Managing Director are also responsible for such internal
control as they determine is necessary to enable the preparation of ESEF nancial
statements in accordance with the requirements of ESEF RTS.
Auditor’s Independence and Quality Control
We are independent of the company in accordance with the ethical requirements
that are applicable in Finland and are relevant to the engagement we have performed,
and we have fullled our other ethical responsibilities in accordance with these
requirements.
The auditor applies International Standard on Quality Control (ISQC) 1 and therefore
maintains a comprehensive quality control system including documented policies and
procedures regarding compliance with ethical requirements, professional standards and
applicable legal and regulatory requirements.
Auditor’s Responsibilities
In accordance with the Engagement Letter we will express an opinion on whether the
electronic tagging of the consolidated nancial statements complies in all material
respects with the Article 4 of ESEF RTS. We have conducted a reasonable assurance
engagement in accordance with International Standard on Assurance Engagements
ISAE 3000.
The engagement includes procedures to obtain evidence on:
• whether the tagging of the primary nancial statements in the consolidated nancial
statements complies in all material respects with Article 4 of the ESEF RTS
• whether the tagging of the notes to the nancial statements and the entity identier
information in the consolidated nancial statements complies in all material respects
with Article 4 of the ESEF RTS
• whether the ESEF-nancial statements are consistent with the audited nancial
statements
The nature, timing and extent of the procedures selected depend on the auditor’s
judgement including the assessment of risk of material departures from requirements
sets out in the ESEF RTS, whether due to fraud or error.
We believe that the evidence we have obtained is suicient and appropriate to
provide a basis for our statement.
Opinion
In our opinion the tagging of the consolidated nancial statement included in the ESEF
nancial statement of Nokian Renkaat Oyj for the year ended 31. 12. 2022 complies in all
material respects with the requirements of ESEF RTS.
Our audit opinion on the consolidated nancial statements of Nokian Renkaat Oyj
for the year ended 31. 12. 2022 is included in our Independent Auditor’s Report dated
8. 2. 2023. In this report, we do not express an audit opinion any other assurance on the
consolidated nancial statements.
Helsinki 1. 3. 2023
Ernst & Young Oy
Authorized Public Accountant Firm
Mikko Järventausta
Authorized Public Accountant
(Translation of the Finnish original)
20222021202020192018
0
3
6
9
12
15
pcs million
0
10
20
30
40
50
20222021202020192018
EUR
INFORMATION ON NOKIAN TYRES’ SHARE
Share data
Market Nasdaq Helsinki
Listing date June 1, 1995
Currency euro
ISIN FI0009005318
Symbol TYRES
Reuters symbol TYRES.HE
Bloomberg symbol TYRES:FH
Industry OMXH Large Caps
Sector Consumer goods
Industry Automobiles and parts
Number of shares,
December 31, 2022 138,921,750
Share capital and shares
The company has one class of shares,
each share entitling the shareholder to
one vote and carrying equal rights to
a dividend. On December 31, 2022, the
number of shares was 138,921,750. Read
more: www.nokiantyres.com/company/
investors/share/share-information/
NUMBER OF SHAREHOLDERS ON DECEMBER 31, 2022
Number of
shares
Number of
shareholders
% of share-
holders
Total number of
shares
% of share
capital
1–100 , . ,, .
101–500 , . ,, .
501–1,000 , . ,, .
1,001–5,000 , . ,, .
5,001–10,000 . ,, .
10,001–50,000 . ,, .
50,001–100,000 . ,, .
100,001–500,000 . ,, .
500,001– . ,, .
Total , ,,
SHAREHOLDER STRUCTURE ON DECEMBER 31, 2022
Number of
shares
% of share
capital
Nominee registered and non-Finnish holders ,, .
Households ,, .
General Government ,, .
Financial and insurance corporations ,, .
Non-profit institutions ,, .
Corporations ,, .
Total ,,
Read more: www.nokiantyres.com/company/investors/share/major-shareholders/
Read more: www.nokiantyres.com/
company/investors/share/
share-performance/
SHARE TRADING VOLUMES ON NASDAQ
HELSINKI JAN 1, 2018–DEC 31, 2022
SHARE PRICE DEVELOPMENT ON NASDAQ
HELSINKI JAN 1, 2018–DEC 31, 2022
Information on Nokian Tyres’ share
NOKIAN TYRES
GROUP STRUCTURE
Nokian Tyres Group structure
32.3%
NOKIAN TYRES PLC
NOKIAN DÄCK AB VIANOR HOLDING OY
NOKIAN DEKK AS VIANOR AB
NOKIAN TYRES AG VIANOR AS
NOKIAN TYRES GMBH VIANOR OY
NOKIAN TYRES CANADA INC. NORDIC WHEELS AB
NOKIAN TYRES U.S. HOLDINGS INC
NOKIAN TYRES INC.
NOKIAN TYRES U.S. OPERATIONS LLC
NOKIAN TYRES HOLDING OY
NT TYRE MACHINERY OY
TAA NOKIAN SHINA BELARUS
OOO NOKIAN SHINA, Vsevolozhsk
OOO NOKIAN TYRES, Vsevolozhsk
NOKIAN TYRES TRADING (SHANGHAI) CO LTD
NOKIAN TYRES EUROPE OPERATIONS SRL
NOKIAN TYRES SAS
NOKIAN TYRES S.R.O.
NOKIAN HEAVY TYRES LTD
LEVYPYÖRÄ OY
TOV NOKIAN SHINA
TOO NOKIAN TYRES
OOO HAKKA INVEST
NOKIAN TYRES SPAIN S.L.U
NOKIAN TYRES SP Z O.O.
NOKIAN PORTTI OY
KIINTEISTÖ OY NOKIAN NOSTURIKATU 18
KIINTEISTÖ OY NOKIAN RENGASKATU 4
NOKIANVIRRAN ENERGIA OY
Corporate Governance Statement
CORPORATE GOVERNANCE
STATEMENT 2022
I Introduction
During 2022 Nokian Tyres plc (hereinafter referred to as “Nokian Tyres” or the
“Company”) complied in full with the Corporate Governance Code published by
the Securities Market Association that entered into force on January 1, 2020 (the
“Corporate Governance Code 2020”) and the Company complies with the recommen-
dations in the said code. This Corporate Governance Statement has been prepared in
accordance with the Corporate Governance Code 2020. The Corporate Governance
Code 2020 is available in its entirety at www.cgnland./en/. The Company follows the
Finnish Limited Liability Companies Act, laws and regulations relating to publicly listed
companies in Finland, the Articles of Association, the charters of the Board of Directors
and the committees, the Nasdaq Helsinki rules and regulations, and the orders and
instructions from the European Securities and Markets Authority as well as from the
Financial Supervisory Authority.
The Company publishes its Corporate Governance Statement as a separate
document and as part of the Financial Review. The Company has prepared a
separate remuneration report in accordance with the Corporate Governance Code
2020. The statement and said report are available on the Company’s website at
www.nokiantyres.com under Investors – Corporate Governance.
The Company’s corporate governance is based on the General Meeting, the Articles
of Association, the Board of Directors, the President and CEO, the Group’s Management
CORPORATE GOVERNANCE
STATEMENT 2022
Shareholders
Shareholders’
Nomination Board
Auditors
Internal control
General Meeting
Board
Audit Committee
Personnel and
Remuneration
Committee
President and CEO
Management Team
Team, the legislation and regulations mentioned hereinabove as well as the Group’s
policies, procedures, and practices. The Board of Directors has approved the Corporate
Governance Statement. The Company’s auditor veries that the statement and its
related descriptions of the internal reporting controls and risk management corre-
spond to the nancial reporting process. The statement will not be updated during the
nancial period; however, up-to-date information will be provided on the Company’s
website at www.nokiantyres.com/company/investors/.
II Governance bodies
Nokian Tyres is a Finnish limited liability company and its registered place of business
is Nokia. The parent company Nokian Tyres plc and its subsidiaries form the Nokian
Tyres Group. The administrative bodies of the parent company Nokian Tyres plc, i.e. the
General Meeting, the Board of Directors and the President and CEO, are responsible
for the administration and operation of the Nokian Tyres Group. The General Meeting
elects the members of the Board of Directors, and the Chairman and the Deputy
Chairman of the Board upon the proposal by the Shareholders’ Nomination Board, and
the Board of Directors appoints the Company’s President and CEO. The President and
CEO is assisted by the Group’s Management Team in leading the Company’s operations.
General Meeting
The Company’s highest decision-making power is held by the General Meeting, whose
tasks and procedures are outlined in the Limited Liability Companies Act and the
Articles of Association. The Annual General Meeting decides on such matters as the
conrmation of the Company’s annual accounts, prot distribution, and discharging
the Board of Directors and the President and CEO from liability. Furthermore, the
Annual General Meeting decides on the number of members in the Board of Directors,
the selection of the board members and the auditor, and their remuneration. In
addition, the General Meeting can make decisions on questions such as amendments
to the Articles of Association, share issues, granting warrants, and acquisition of the
company’s own shares.
The Annual General Meeting is held by the end of May of each year on a date
determined by the Board of Directors, either at the Company’s registered place of
business or in the city of Tampere or Helsinki. An extraordinary general meeting is
summoned whenever the Board considers this to be necessary or if an auditor or a
group of shareholders with a holding of a total of at least one-tenth of all the shares in
the Company requires it in writing in order to address a particular issue.
Nokian Tyres’ administrative organization
Shareholders’ Nomination Board
The Company’s Shareholders’ Nomination Board (the “Nomination Board”) was
established in 2020. According to the Charter of the Nomination Board, the duties of
the Nomination Board consist of the preparation of proposals to the General Meeting
concerning the number, composition, Chairman and possible Deputy Chairman of the
Board and the remuneration of the members of the Board and the Board committees.
In addition, the Nomination Board seeks prospective successor candidates for the
members of the Board.
The Nomination Board consists of ve members of which four members represent
the Company’s four largest shareholders who on the rst banking day of June each
year are the largest shareholders as determined on the basis of the shareholders’
register of the Company maintained by Euroclear Finland Oy and wish to nominate
a member to the Nomination Board. The fth member of the Nomination Board is
the Company’s Chairman of the Board. Proposals that have been supported by at
least three members of the Nomination Board, shall constitute the proposals of the
Nomination Board.
The Nomination Board is established to operate until abolished by the decision of
the General Meeting. The term of the members of the Nomination Board shall end
upon the nomination of the following Nomination Board in accordance with the Charter
of the Nomination Board. The members of the Nomination Board are not entitled to
remuneration from the Company on the basis of their membership unless otherwise
decided by the General Meeting.
The following members were appointed to the Nomination Board in 2022:
• Pauli Anttila (Investment Director, Solidium Oy), appointed by Solidium Oy
• Timo Sallinen (Senior Vice President, Investments Varma Mutual Pension Insurance
Company), appointed by Varma Mutual Pension Insurance Company
• Mikko Mursula (Deputy CEO, Investments, Ilmarinen Mutual Pension Insurance
Company), appointed by Ilmarinen Mutual Pension Insurance Company
• Carl Petterson (CEO, Elo Mutual Pension Insurance), appointed by Elo Mutual Pension
Insurance
• Jukka Hienonen, Chairman of the Board, Nokian Tyres plc
During its tenure, the Nomination Board had ve meetings and all members
participated in all meetings.
The proposals by the Nomination Board to the Annual General Meeting 2023 were
published on December 7, 2022.
The Charter of the Nomination Board is available at www.nokiantyres.com/company/
investors/corporate-governance/shareholders-nomination-board/.
The Annual General Meeting for 2022 was held through exceptional procedures
on April 28, 2022 in Helsinki, Finland in accordance with the temporary legislative
act to limit the spread of the Covid-19 pandemic (375/2021), which entered
into force on May 8, 2021. The meeting conrmed the nancial statements,
discharged the Board members and the President and CEO from liability for the
scal year 2021 and decided on the payment of dividend, the composition of
the Board of Directors and their remuneration and the election of the auditor
and its remuneration. Further, the Annual General Meeting authorized the
Board of Directors to decide on the repurchase of the Company’s own shares
as well as on the issuance of shares and special rights entitling to shares and
to decide on donations. In addition, the Annual General Meeting adopted the
Company’s Remuneration Report for governing bodies. All of the documents
related to the Annual General Meeting are available on the Company’s website at
www.nokiantyres.com/company/investors.
The Annual General Meeting for 2023 is scheduled for April 26, 2023 at 10:00
a.m. EET.
According to law, a shareholder has the right to have a matter falling within
the competence of the General Meeting dealt with by the General Meeting, if the
shareholder so demands in writing from the Board of Directors well in advance of the
General Meeting, so that the matter can be mentioned in the notice to the meeting.
The shareholder shall submit the request for having a matter to be dealt with by the
General Meeting by the date indicated on the Company’s website.
The Articles of Association state that the notice of a General Meeting shall be
published on the Company’s website. In addition, the Company publishes the notice of
a General Meeting as a stock exchange release. The invitation lists the agenda of the
meeting.
The Company’s Articles of Association are available on the Company’s website at
www.nokiantyres.com/company/investors/.
Shareholders are entitled to participate in the General Meeting if they are registered
in the Company’s shareholders’ register, maintained by Euroclear Finland Oy, on the
record date separately indicated by the Company. A holder of nominee registered
shares can be temporarily registered in the shareholders’ register of the Company for
purposes of participation in the General Meeting.
According to the Corporate Governance Code 2020, the Chairman of the Board, the
Board members and the President and CEO must be present at the General Meeting,
and the auditor must be present at the Annual General Meeting. Board member
candidates must be present at the General Meeting deciding on their election.
Board of Directors
Operation of the Board of Directors
The Board is responsible for the Company’s corporate governance and the appropriate
organization of its operations pursuant to the Finnish Limited Liability Companies Act
and other regulations. The Board holds the general authority in company-related issues,
unless other company bodies have the authority under the applicable legislation or
the Articles of Association. The policies and key tasks of the Board are dened in the
Finnish Limited Liability Companies Act, the Articles of Association, and the Board’s
charter. The key tasks include:
• Approving consolidated nancial statements, half year reports and interim reports
• Presenting matters to the General Meeting
• Appointing and dismissing the President and CEO
• Organization of nancial control.
In addition, as dened in the Board charter, the Board deals with, and decides on,
matters of principle as well as issues that carry nancial and business signicance, such
as:
• Group strategy and nancial objectives
• The Group’s action, budget, and investment plans
• The Group’s risk management and reporting procedures
• Decisions concerning the structure and organization of the Group
• Signicant individual investments, acquisitions, divestments, and reorganizations
• The Group’s nancing policies
• Reward and incentive schemes for the Group’s management
• Monitoring compliance with the applicable legal and regulatory requirements and the
corporate policies, such as Code of Conduct, approved by the Board
• Appointing Board committees
• Monitoring and evaluating the actions of the President and CEO
The Company has a separate Audit Committee and a Personnel and Remuneration
Committee.
The President and CEO is in charge of ensuring that the Board members have
the necessary and suicient information on the Company’s operations. The Board
assesses its activities and operating methods by carrying out a self-evaluation once a
year. Members of the Board and the President and CEO will not participate in making a
decision where the law states that they must be disqualied.
Composition of the Board
According to the Articles of Association of Nokian Tyres, the Board of Directors
comprises no fewer than four and no more than nine members. The proposal regarding
the composition and remuneration of the Board for the General Meeting is prepared
by the Nomination Board. The number of Board members and the composition of the
Board shall be such that the Board is capable of eiciently carrying out its tasks, while
taking into account the requirements set by the Company’s operations and its stage of
development. The elected Board members must be qualied for the task and able to
devote a suicient amount of time for the Board duties.
Members of the Board are elected at the Annual General Meeting for a one-year
term of oice that begins after the closing of the Annual General Meeting and ends
at the end of the next Annual General Meeting. In 2022, the Annual General Meeting
appointed the Chairman and the Deputy Chairman from among the Board members
upon the proposal by the Nomination Board. The remuneration payable to the Board
members is also decided at the Annual General Meeting based on the proposal by the
Nomination Board.
Information on the Board members
The Annual General Meeting on April 28, 2022 elected nine Board members. The Board
members Jukka Hienonen, Heikki Allonen, Veronica Lindholm, Inka Mero, Christopher
Ostrander, Jouko Pölönen, George Rietbergen and Pekka Vauramo were re-elected.
Raimo Lind was no longer available for re-election. It was resolved to elect Susanne
Hahn as a new member of the Board of Directors. The Annual General Meeting
re-elected Jukka Hienonen as the Chairman and Pekka Vauramo as the Deputy
Chairman of the Board.
Jukka Hienonen,
Chairman of the Board (b. 1961)
Member of the Board since 2020. Member
of the Personnel and Remuneration
Committee. Member of the Shareholders’
Nomination Board.
Education: Master of Science (Economics)
Main occupation: Professional board
member
Key experience:
2010−2014 SRV Plc, CEO
2005−2010 Finnair Plc, CEO
1995−2005 Stockmann Plc, Deputy CEO
2000−2005, Director 1995−2000
1991−1995 Timberjack Oy, VP Marketing
1985−1991 Kaukomarkkinat Oy, Director
1988−1991, Representative, Moscow
1986−1988
Key positions of trust:
Member of the Board: Juuri Partners Oy
Pekka Vauramo,
Deputy Chairman of the
Board (b. 1957)
Member of the Board since 2018. Member
of the Personnel and Remuneration
Committee.
Education: Master of Science (Technology)
Main occupation: President and CEO,
Metso Outotec Corporation
Key experience:
2020– Metso Outotec Corporation,
President and CEO
2018–2020 Metso, President and CEO
2013–2018 Finnair Plc, President and CEO
2007–2013 Various management
positions at Cargotec
1995–2007 Various management
positions at Sandvik AB
1985–1995 Various management positions
at Tamrock Corporation
Heikki Allonen (b. 1954)
Member of the Board since 2016. Member
of the Audit Committee.
Education: Master of Science (Technology)
Main occupation: Professional board
member
Key experience:
2008–2016 Patria Oyj, President and CEO
2004–2008 Fiskars Corporation,
President and CEO
2001–2004 SRV Group Plc, President and
CEO
1992–2001 Wärtsilä Oyj, VP, Corporate
Development, Member of the Board of
Management
1986–1992 Oy Lohja Ab/Metra Oy Ab,
Management positions
Key positions of trust:
Vice Chairman of the Board: Savox Oy Ab
Member of the Board: Lapti Group Oy,
NRC Group ASA and Helsingin Satama Oy
Susanne Hahn (b. 1976)
Member of the Board since 2022.
Education: University Diploma of Economics
Main occupation: Co-Founder and
Managing Partner of 1886Ventures and SKV
Invest (Venture Portfolio Companies)
Key experience:
2013–2020 Top-Management Positions:
Mercedes-Benz AG & Daimler AG, Lab1886
Global Innovation, Advisory Board Member
of ve New-Tech companies in the elds
of Smart Mobility, Applied AI & Data and
Green-Tech (e.g. Volocopter), Director
Corporate Organization and Member of HR
Executive Committee
2007–2012 Several Management positions,
Mercedes-Benz AG (mainly R&D, production)
2000 Entry at Daimler AG with
Management Trainee Program
Key positions of trust: Strategic Advisory
Board Member of Küster Holding GmbH
Member of the Steering Board of Invest BW,
Innovation & Investment funding program
of the state of Baden-Württemberg
Veronica Lindholm (b. 1970)
Member of the Board since 2016. Chair
of the Personnel and Remuneration
Committee.
Education: Master of Science (Economics)
Main occupation: CEO, Indoor Group Oy
Key experience:
2020– Indoor Group Oy, CEO
2015–2019 Finnkino Oy, CEO
2013–2015 Mondelez Finland, CEO
2009–2013 Walt Disney Company Nordic,
VP, Chief Marketing Oicer
2008–2009 Walt Disney Studios, Head of
Digital Distribution EMEA
2000–2008 Walt Disney International
Nordic, Marketing Director
Key positions of trust:
Member of the Board: Finland Chamber of
Commerce
Inka Mero (b. 1976)
Member of the Board since 2014. Member
of the Audit Committee.
Education: M.Sc. (Economics)
Main occupation: CEO & Managing
Partner, Voima Ventures VC Fund
Key experience:
2019– Voima Ventures I & II VC Fund, CEO
& Managing Partner
2008– KoppiCatch Oy, Co-founder and
Chairwoman
2016–2019 Pivot5 Oy (Industryhack Oy),
Co-founder and Chairwoman
2006–2008 Playforia Oy, CEO
2005–2006 Nokia Corporation, Director
2001–2005 Digia Plc, VP, Sales and
Marketing
1996–2001 Sonera Corporation,
Investment Manager
Key positions of trust:
Chair of the Board: KoppiCatch Oy, Voima
Ventures Oy, KuvaSpace Oy and Adamant
Health Oy
Member of the Board: Musti Group Plc,
Betolar Plc, Dispelix Oy, Elfys Oy and
Tactotek Oy
Advisor/Working group member: Finnish
Center of Articial Intelligence, Expert
group for Sustainable Economic Growth
assigned by the Ministry of Economic
Aairs
Christopher Ostrander (b. 1968)
Member of the Board since 2021.
Education: B.Sc. (Mechanical Engineering);
M.Sc. (Engineering Management); MBA
Main occupations: CEO/Managing
Partner, Premier Staffing Solution, LLC;
Partner/Chairman, Kensington Hill Capital,
LLC; Partner/Chairman, Cornerstone
Consulting Organization, LLC
Key experience:
2020– CEO/Managing Partner, Premier
Staffing Solution, LLC
2017– Partner/Chairman, Kensington
Hill Capital, LLC; Partner/Chairman,
Cornerstone Consulting Organization, LLC
2016–2018 CEO and Advisory Board
Chairman, Family Office of Gardner &
Sons
2015–2016 President and Chief Executive
Officer, AP Exhaust Technologies
2011–2015 Senior Vice President and
President, Americas Operations, Cooper
Tire & Rubber Company
2004–2010 Vice President/General
Manager and Vice President of Sales/
Marketing, Eaton Corporation
1998–2004 Vice President of Sales/
Marketing (Distributor Network), The BOC
Group
1991–1997 Captain, United States Army
Corps of Engineers
Key positions of trust:
Kensington Hill Partners II, LLC, and
Kensington Hill Capital, LLC, Chairman of
the Board
Cornerstone Consulting Organization,
LLC, Chairman of the Board
Tamarind Hill Management, LLC Limited
Partner Advisor
University of Findlay, Member of Board
of Trustees, Chairman of the Board of
Trustees
Jouko Pölönen (b. 1970)
Member of the Board since 2021.
Chairman of the Audit Committee.
Education: M.Sc. (Econ & Bus. Adm.),
Authorized Public Accountant, eMBA
Main occupation: President and CEO,
Ilmarinen Mutual Pension Insurance
Company
Key experience:
2018– President and CEO, Ilmarinen
Mutual Pension Insurance Company
2013–2018 President and CEO, OP
Corporate Bank plc
2014–2018 President and CEO, Helsinki
Area Cooperative Bank
2011–2014 President, Pohjola Insurance
Ltd, A-Insurance Ltd and Eurooppalainen
Insurance Company Ltd
2009–2010 Chief Financial Oicer,
Pohjola Bank plc
2001–2008 Chief Risk Oicer, Pohjola
Bank plc
1993–2001 Auditor, Authorized
Public Accountant since 1999,
PricewaterhouseCoopers Ltd
Key positions of trust:
Chairman of the Board: The Finnish
Pension Alliance TELA and The Finnish
Foundation for Share Promotion
Member of the Board: The Employment
Pension Executive Committee, Finance
Finland FFI and Suomen Laatuyhdistys ry
George Rietbergen (b. 1964)
Member of the Board since 2017.
Education: Master of Business
Administration
Main occupation: CEO, Koninklijke
Oosterberg
Key experience:
2021– Koninklijke Oosterberg, CEO
2017–2020 5Square Committed Capital,
Partner
2016–2017 Nokian Tyres plc, Advisor to
the Board
2015–2016 Arriva Netherlands, COO
2013–2015 Goodyear Dunlop Tyres, Group
Man. Director DACH
2012–2013 Goodyear Dunlop Tyres EMEA,
Vice president Commercial Tyres
2010–2012 Goodyear Dunlop Tyres, Group
Man. Director UK & Ireland
2001–2010 Goodyear Dunlop Tyres EMEA,
Director Retail and eBusiness
1998–2001 KLM Royal Dutch Airlines,
director eBusiness
Independence of the
Board members
Pursuant to the recommendation of the
Corporate Governance Code 2020, the
Board assesses the independence of
its members annually. According to the
Board’s estimate, all Board members are
independent of the Company and its
major shareholders.
Shares owned by Board members and their controlled
corporations December 31, 2022
Nokian Tyres holdings of the
Company’s current Board members Number of shares
Jukka Hienonen, Chairman ,*
Pekka Vauramo, Deputy Chairman ,
Heikki Allonen, Member ,
Susanne Hahn, Member ,
Veronica Lindholm, Member ,
Inka Mero, Member ,
Christopher Ostrander, Member ,
Jouko Pölönen, Member ,
George Rietbergen, Member ,
Total ,
* In addition 7,592 shares in the insurance wrapper, with no voting right
The Board of Directors meetings, members’ attendance at meetings
and at making resolutions without a meeting (per capsulam)
As of the end of February, the year 2022 was characterized by the war in Ukraine,
causing high uncertainty to Nokian Tyres’ operating environment and manufacturing
capacity. Therefore, in 2022, in addition to its normal duties, Nokian Tyres’ Board of
Directors focused especially on the impacts of the war on Nokian Tyres’ operations and
business strategy. In March, the Board of Directors decided to start expediting plans
to invest in new production capacity in Europe. In June, the Board of Directors decided
to initiate an exit from Russia. In October, the Board of Directors made the decision to
build a new factory in Romania.
The Board convened a total of 15 times and made twice resolutions without a
meeting (per capsulam) in 2022. In addition, the Board had several preparatory
meetings and was in a frequent dialogue with the management due to the war in
Ukraine and its consequences.
Attendance at meetings / per capsulam resolutions by the Company’s
Board members in 2022
Attendance/
meetings or
per capsulam
resolutions
Jukka Hienonen, Chairman /
Susanne Hahn, Member since April 28, 2022 /
Pekka Vauramo, Deputy Chairman /
Heikki Allonen, Member /
Raimo Lind, Member until April 28, 2022 /
Veronica Lindholm, Member /
Inka Mero, Member /
Christopher Ostrander, Member /
Jouko Pölönen, Member /
George Rietbergen, Member /
Diversity of the Board of Directors
The Company sees diversity as a success factor enabling the achievement of Nokian
Tyres’ strategic goals and business growth. In practice, diversity means dierent factors
such as gender, age, nationality, and the complementary expertise of the members,
their education and experience in dierent professional areas and industrial sectors in
which the Group mainly operates. Leadership experience and personal competencies
are also considered.
The Board shall have no fewer than two representatives from both genders. If two
candidates are equally qualied, the candidate from the minority gender has priority.
This goal has been met in the current Board. The Board members have signicant expe-
rience in industry, consumer business and nancial management, among other things.
The status and progress of diversity is monitored by the Shareholders’ Nomination
Board.
The principles concerning the selection of the Board and its diversity are visible on
the Company’s website at www.nokiantyres.com/company/investors/.
Committees of the Board
The Board will decide on the committees and their chairpersons and members each
year at its constituent meeting. In 2022, the Board had two committees: the Personnel
and Remuneration Committee and the Audit Committee. Each committee must include
no fewer than three members having the competence and expertise necessary for
working in the committee. At least one member of the Audit Committee must have
expertise in accounting or auditing. The majority of the members of the Personnel and
Remuneration Committee must be independent of the Company. The majority of the
members of the Audit Committee must be independent of the Company, and at least
one member must be independent of the Company’s major shareholders. The President
and CEO and the other members of the Group Management Team cannot act as
members of the Personnel and Remuneration Committee.
Personnel and Remuneration Committee
The Personnel and Remuneration Committee prepares a proposal to the Board on
the Company’s President and CEO and on the salary and other incentives paid to the
President and CEO. The Personnel and Remuneration Committee also prepares a
proposal to the Board on the nominations, salaries and other incentives of the Group
Management Team members. This committee also reviews and submits a proposal
to the Board on the allocation and criteria of the Nokian Tyres share-based incentive
plans, and on the other incentive plans. In addition, the key duties of the Personnel
and Remuneration Committee include the preparation of the remuneration policy and
the remuneration report for the Board and the President and CEO in accordance with
applicable laws and regulations. The committee has no independent decision-making
power; collective decisions are made by the Board, which is responsible for carrying out
the tasks assigned to the committee.
In 2022, the members of the Personnel and Remuneration Committee were Veronica
Lindholm (Chair), Jukka Hienonen and Pekka Vauramo.
The committee assembled six times in 2022.
All committee members are independent of the Company and of all major share-
holders in the Company.
Audit Committee
The Audit Committee assists the Board of Directors in its regulatory duties and reports
to the Board. The committee has no independent decision-making power; collective
decisions are made by the Board, which is then responsible for carrying out the tasks
assigned to the committee.
According to the committee charter, the committee controls that bookkeeping,
nancial administration, nancing, internal control, internal auditing, audit of the
accounts, risk management and compliance function are appropriately arranged in
the Company. The committee follows and assesses the reporting process for nancial
statements as well as any signicant changes in the recording principles and the items
valued in the balance sheet. The committee also processes the general description of
the mechanisms of internal auditing and risk management of the nancial reporting
process, which forms part of the Corporate Governance Statement. The committee
follows the statutory auditing of the nancial statement and the consolidated nancial
statements and assesses the independence of the statutory auditor and the oering
of services other than auditing services by the auditor. Furthermore, the committee
handles the auditor’s report and possible audit minutes as well as the supplementary
report presented by the auditor to the committee. The committee prepares the draft
resolution on selecting the auditor. In addition, the Audit Committee monitors and
assesses how agreements and other legal acts between the Company and its related
parties meet the requirements of the ordinary course of business and arm’s length
terms in accordance with applicable laws and regulations. The Audit Committee must
have the expertise and experience required for its tasks.
In 2022, the members of the Audit Committee were Raimo Lind (Chairman and
member until April, 28, 2022), Jouko Pölönen (Chairman since April, 28, 2022), Heikki
Allonen and Inka Mero. As a general rule, the Company’s chief auditor participates in the
committee’s meetings.
The committee assembled ve times in 2022.
All committee members are independent of the Company and of all major share-
holders in the Company.
The attendance of Board members at committee meetings in 2022
Personnel and
Remuneration Committee Audit Committee
Jukka Hienonen /
Pekka Vauramo /
Heikki Allonen /
Susanne Hahn
Raimo Lind
(Chairman and member until April 28, 2022) /
Veronica Lindholm (Chair) /
Inka Mero /
Christopher Ostrander
Jouko Pölönen
(Chairman since April 28, 2022) /
George Rietbergen
President and CEO and his/her duties
The President and CEO conducts the Group’s business and manages the Company
operations in accordance with the Finnish Limited Liability Companies Act and the
instructions and guidelines provided by the Board of Directors. The President and
CEO is responsible for informing the Board of Directors regarding the development of
the Company’s business and nancial situation. The President and CEO prepares the
Company´s strategy and objectives for the Board of Directors. The President and CEO is
also responsible for implementing the approved strategy and plans. The President and
CEO is responsible for ensuring the legal compliance of the Company’s bookkeeping
and for arranging reliable asset management. The President and CEO is elected by the
Board of Directors. Jukka Moisio has been the Company’s President and CEO since May
27, 2020.
Jukka Moisio (b. 1961)
Education: Master of Science (Economics), MBA
Position: President and CEO since May 27, 2020
Key experience:
2008–2019 Huhtamäki Oyj, President and CEO
2004–2008 Ahlstrom Oyj, President and CEO
1991–2004 Ahlstrom Oyj, various management positions
1989–1991 McKinsey & Company, Associate
Key positions of trust:
Chairman of the Board: Paulig Oy and Sulapac Oy
Member of the Board: Metsä Board Corporation
Nokian Tyres holdings of the President and CEO and
controlled corporations, December 31, 2022
Number of shares
Jukka Moisio, President & CEO ,
Management Team
The Group’s Management Team is responsible for assisting the President and CEO in
preparing the Company’s strategy and in operative management, and for discussing
matters that involve substantial nancial or other impacts, such as corporate trans-
actions and organization changes. Members of the Management Team carry the main
responsibility for their business areas and functions. The Management Team has no
activities based on the applicable legislation or the Articles of Association. According
to the Group’s meeting practices, the Management Team assembles approximately 11
times per year. In addition to the President and CEO, the heads of the business units,
business areas and functions participate in the meetings.
Jukka Moisio (b. 1961)
• President and CEO
• Master of Science (Economics), Master
of Business Administration
• Number of Shares 18,000
Management Team December 31, 2022
More detailed information concerning the Group’s Management Team is available on the Company’s website at
www.nokiantyres.com/company/investors/corporate-governance/the-groups-management-team/.
Päivi Antola (b. 1971)
• Communications, Investor Relations
and Brand
• Master of Arts, CEFA
• Number of Shares 2,374
Anna Hyvönen (b. 1968)
• Passenger Car Tyres and Vianor
• Licentiate of Science (Technology)
• Number of Shares 16,889
Adrian Kaczmarczyk (b. 1971)
• Supply Operations
• Dipl. Ing. Engineering, Master of
Business Administration
• Number of Shares 1,353
Teemu Kangas-Kärki (b. 1966)
• CFO
• Master of Science (Economics and
Business Administration)
• Number of Shares 9,049
Jukka Kasi (b. 1966)
• Products and Innovations
• Master of Science (Technology)
• Number of Shares 6,455
Päivi Leskinen (b. 1965)
• Human Resources
• Master of Social Sciences
• Number of Shares 0
Manu Salmi (b. 1975)
• Heavy Tyres and Nokia Factory
• Master of Military Sciences, Master of
Science (Economics), Master of Business
Administration
• Number of Shares 18,405
III Descriptions of mechanisms of internal
control and risk management
Internal control
The purpose of the Group’s internal control mechanisms is to ensure that the
Company’s operation is in line with the applicable laws and regulations and the
Company’s Code of Conduct. As regards the nancial reporting process, the purpose of
the Group’s internal control mechanisms is to ensure that the nancial reports released
by the Company have been compiled in accordance with the accounting principles
applied by the Company and that they contain essentially correct information on the
Group’s nancial position, and to ensure that nancial reporting is accurate and reliable.
The Group has dened group-level policies and instructions for the key operative units
specied below in order to ensure eicient and protable Company operations.
The Group’s business consists of Passenger Car Tyres, Heavy Tyres, and Vianor
business units. Passenger Car Tyres is further divided into the following business areas:
Nordics, Other Europe, North America, and Other. Heavy Tyres and Passenger Car Tyres
business units are responsible for their own operations, nancial results, risk manage-
ment, balance sheet and investments, supported by dierent functions. The Group’s
sales companies serve as product distribution channels in local markets.
Subsidiaries are responsible for their daily operations and administration. They report
to the director responsible for the said business area, while the Vianor chain reports to
the director of the Vianor business unit.
The Board of Directors is responsible for the functionality of the internal control
mechanisms, which are managed by the Company’s management and implemented
throughout the organization. Internal control is an integral part of all activities of the
Group at all levels. The Company’s operative management bears the main responsibility
for operational control. Every supervisor is obliged to ensure suicient control over
the activities belonging to his or her responsibility and to continuously monitor the
functionality of the control mechanisms. The Chief Financial Oicer is responsible for
organizing nancial administration and reporting processes and the internal control
thereof. Finance function is responsible for internal and external accounting; its tasks
include, among others, producing nancial information concerning the dierent areas
and ensuring the accuracy of this information.
The preparation process of the consolidated nancial statements (IFRS), the related
control measures, and the task descriptions and areas of responsibility related to the
reporting process are dened. The Company’s Finance function produces the consol-
idations and information for the Group level and the dierent areas. Each legal entity
within the Group produces its own information in compliance with the instructions
provided and in line with local legislation. The Group’s Finance function is centrally
responsible for the interpretation and application of nancial reporting standards as
well as for monitoring compliance with these standards.
Eective internal control requires suicient, timely, and reliable information in order
for the Company’s management to be able to monitor the achievement of targets and
the eiciency of the control mechanisms. This refers to nancial information as well as
other kinds of information received through IT systems and other internal and external
channels. The instructions on nancial administration and other matters are shared on
the Company’s intranet, and training is organized for personnel with regard to these
instructions when necessary. Communication with the business units is continuous.
The Company’s nancial performance is internally monitored by means of monthly
reporting complemented with updated forecasts.
Investor communications
The goal of Nokian Tyres’ investor relations is to regularly and consistently provide the
stock market with essential, correct, suicient, and up-to-date information that is
subsequently used to determine the share value. The operations are based on equality,
openness, and accuracy.
Risk management
The Group has adopted a risk management policy, approved by the Board of Directors,
which supports the achievement of strategic goals and ensures continuity of business.
The Group’s risk management policy focuses on managing both the risks pertaining to
business opportunities and the risks aecting the achievement of the Group’s goals in
the changing operating environment.
The risks are classied as strategic, operational, nancial and hazard risks. Strategic
risks are related to customer relationships, competitors’ actions, political and legislative
risks, reputation, country risks, brand, product development, climate change and
sustainability risks and investments. Operational risks arise as a consequence of
shortcomings or failures in the Company’s internal processes, actions by its personnel
or systems, contractual risks, risk of non-compliance, or external events, such as
unforeseen changes in the operating environment, cyber and information security,
management of the supply chain, or changes in raw material prices. Financial risks are
related to uctuations in interest rate and currency markets, liquidity and renancing,
and counterparty and credit risks. Hazard risks arise from property loss or business
interruption, shortcomings or failures in employee safety or environmental manage-
ment systems.
The war in Ukraine, resulting sanctions and exit from Russia are severely impacting
Nokian Tyres’ operating environment and causing a number of risks for Nokian Tyres’
business. These include, among others, ability to serve customers especially in Central
Europe, cost and supply of raw materials, ability to retain personnel, as well as execu-
tion of the consequent exit. The Group’s assets in Russia may be subject to further
impairments and write-downs. Nokian Tyres announced on October 28, 2022 that it had
signed an agreement to sell its Russian operations to Tatneft PJSC. The transaction is
subject to approval by the relevant regulatory authorities in Russia and other condi-
tions, which create substantial uncertainties related to the timing, terms and conditions
and the closing of the transaction.
In order to secure tire supply, Nokian Tyres has decided to invest in new production
capacity in Europe and increase the share of outsourced production. Delay in these
actions could have an adverse eect on Nokian Tyres’ nancial performance.
In addition to the risks caused by the war in Ukraine, the most signicant risks are
related to consumer condence and macroeconomic and geopolitical conditions.
Political uncertainties may cause serious disruption and additional trade barriers and
aect the Company’s sales and credit risk. The tire market is evolving to meet changing
consumer needs. Failure to innovate and develop new products and services or to adapt
to the changes in the sales channel or new technologies could have an adverse eect
on the nancial performance. Unexpected production or delivery breaks at production
facilities, interruptions in logistics or lack of resources could have a signicant impact
on peak season sales. Tire industry can be subject to risks caused by climate change,
such as changes in consumer tire preferences, regulatory changes or impact of
extreme weather events on natural rubber producers. Nokian Tyres’ risk analysis pays
special attention on corporate social responsibility risks. Analyses and projects related
to information security and data protection are continuously a special focus area.
The risk management process aims to identify and evaluate the risks, and to plan
and implement the practical measures and continuous monitoring for each risk. Among
others, such measures may include avoiding the risk, reducing it in dierent ways or
transferring the risk through insurance policies or agreements. Control functions and
measures are verication or back-up procedures applied to reduce the risks and ensure
the completion of the risk management measures.
Responsibility for identifying, evaluating and to large extent, managing risks is
delegated to business units, business areas and functions. Treasury is responsible for
developing and maintaining risk management processes, methods and tools. Assisted
by the Audit Committee, the Company’s Board of Directors monitors and assesses the
eiciency of the Company’s risk management mechanisms and monitors the assess-
ment and management of risks related to the Company’s strategy and operations.
The Audit Committee monitors that the risk management actions are in line with the
risk management policy. Issues raising in risk analysis are noted in the development of
processes, compliance and control, and in Internal Audit planning. The Company’s Board
of Directors discusses the most signicant risks annually.
IV Other information provided
Internal audit
The Group’s internal audit systematically carries out assessments and audits on the
eiciency of risk management, internal control, and corporate governance processes.
Internal audit is an independent and objective function whose aim is to help the
organization to achieve its goals. The principles for internal audit have been conrmed
in the internal audit’s charter approved by the Board of Directors.
The Group’s Internal Audit function is managed by the Chief Audit Executive
(CAE), who works under the Board of Directors. The focus areas for internal audit are
approved by the Board of Directors each year. The audit assignments are based on
the key strategic focus areas of the Company’s operations and the risks involved. The
operation of Internal Audit covers all business activities, functions and processes within
the Nokian Tyres Group. The CAE reports on their ndings and the agreed further
actions to the Audit Committee, the Board of Directors, the President and CEO, the
Chief Financial Oicer and the management of the Company. The Company’s Board of
Directors follows and monitors the eiciency of the Internal Audit.
In 2022, Internal Audit focused on assessing, among other things, the operations,
controls and risks of various business areas and country organizations, corporate
governance arrangements, risk management, corporate sustainability, information
security matters and the conformity to certain legislations including international
sanctions aecting the company operations, as well as specic misconduct risks and
cases. The Internal Audit function at Vianor focuses on guiding the retail outlets and
ensuring conformity to the Vianor activity management system, and reports to the CAE
and to the country managers.
Related party transactions
The Company has procedures in place to identify and dene its related parties and
assesses and monitors related party transactions to ensure that all conicts of interest
and the Company’s decision-making process are appropriately taken into account. The
Audit Committee monitors and assesses how agreements and other legal acts between
the Company and its related parties meet the requirements of ordinary activities and
arm’s length terms in accordance with applicable laws and regulations. The Group’s
nancial management monitors and supervises related party transactions as part of
the Company’s normal reporting and monitoring procedures and reports to the Audit
Committee on regular basis. The Company only has related party transactions that
are a part of normal business, and the information regarding them is provided in the
Financial Review. The decision-making processes have furthermore been structured in
order to avoid conict of interests. In case the Company would have any transactions
that are not part of the Company’s ordinary course of business or are not implemented
under arm’s length terms, such transactions shall be handled by the Audit Committee
and approved by the Board and provided in the Financial Review.
Insider management
The Company complies with the guidelines for insider trading drawn up by Nasdaq
Helsinki Ltd. Furthermore, the Company has drawn up separate insider guidelines
that have been approved by the Board of Directors and that supplement other insider
regulations as well as include instructions on insiders and insider administration.
Project-specic insider lists are drawn up of people involved in insider projects of the
Company. Persons with insider information are not allowed to trade in the Company’s
nancial instruments until the project has become void or been published. Those
entered into the project-specic list of insiders are notied of their entry into the said
list and the duties it entails, as well as the termination of the insider project.
The Company maintains a separate list of people in managerial positions and their
related persons. In 2022, the persons holding executive positions in the Company, as
dened in the Market Abuse Regulation, were the members of the Board of Directors,
the President and CEO and the Chief Financial Oicer.
Persons holding managerial positions within the Company are allowed to trade in
the Company’s nancial instruments only for 30 days after the publication day of the
Company’s nancial statement report, half year report, or interim report. The same
applies also to the members of the Group’s Management Team and persons who partic-
ipate in the preparation, maintaining, and/or publication of the Company’s nancial
reports. The prohibition on trading mentioned hereinabove also applies to persons who
process the nancial reporting and forecasts of the Nokian Tyres Group.
The Group General Counsel for Nokian Tyres is responsible for the overall manage-
ment of insider matters in the Company and the related communication (limitations
on trade, obligations to announce and publish management transactions). The Group
General Counsel checks the information for the persons holding executive positions
and their related persons at least once per year. The Chief Financial Oicer is the
Group General Counsel’s substitute for insider matters.
Whistleblowing
The Company has dened processes that internal and external parties can use to
notify of any suspected violations of the Company’s insider trading guidelines or
other instructions, or of any other malpractices. External parties can use the email
address whistleblow@nokiantyres.com, among others. All whistleblowing notications
are investigated promptly in a condential manner and protecting the identity of the
whistleblower as far as possible.
Audit
The auditor has an important role as a controlling body appointed by the shareholders.
The audits give shareholders an independent opinion on how the nancial statements
and report by the Board of Directors of the Company have been drawn up and the
accounting and administration of the Company have been managed. The auditor
elected at the Annual General Meeting of 2022 is Ernst & Young Oy, authorized public
accountants, with Mikko Järventausta, Authorized Public Accountant, acting as the
Chief Auditor. The auditor’s term of oice lasts until the end of the following Annual
General Meeting. In addition to his duties under the valid regulations, he reports all
audit ndings to the Group’s management.
The Group’s audit fees in 2022 amounted to EUR 1,046,479.45 (2021: 659,804). The
fees paid to the authorized public accountants for other services totaled EUR 68,200
(2021: 94,282).
Sustainability
Nokian Tyres non-nancial targets focus on bringing new environmental and safety
innovations to products, reducing CO
2
emissions in line with the Science Based Targets,
further improving workplace safety, and monitoring the sustainability of suppliers.
Nokian Tyres will, for example:
• Increase the share of either recycled or renewable raw materials in tires to 50% by
2030
• Reduce CO
2
emissions from both raw materials as well as from tire use phase by 25%
between 2018–2030.
• Decrease accident frequency (LTIF) yearly by 20%
• Sustainability audit 100% of critical active suppliers by 2025.
All non-nancial targets can be found at www.nokiantyres.com/company/sustainability/
fundamentals/our-targets-and-achievements/.
The Company’s sustainability activities are led by a member in the Group’s
Management Team. The Group’s Sustainability Steering Group supervises and monitors
the sustainability work within the Group and comprises of senior representatives from
Supply Chain, Products & Innovations, Finance, Human Resources and Communications.
The duties of all supervisors include day-to-day leadership of sustainability. Targets,
milestones, development items, and other key topics are discussed by the Management
Team at least twice a year, and at least once a year by the Board of Directors.
A separate steering group for greenhouse gas (GHG) emission reduction includes
members from the Group Management Team, functional management and directors of
the factories in Finland, Russia (rst half of 2022) and the US.
Sustainability working group comprises nance, purchasing, communication, environ-
ment, quality, products & innovations, marketing and HR experts. The working group’s
main task is to design and promote measures for improving sustainability. Each unit’s
management team is responsible for implementing the measures according to their
unit strategy.
Safety Management working group, which comprises safety experts and manage-
ment representatives, steers and tracks the safety aspects. Safety and health are also
an integrated part of department and team meeting practices. Globally safety and
health related KPI’s and actions are followed by the Global Safety team and HR.
Environmental working group comprises local environmental representatives from
factory locations, who manage compliance with environmental legislation and chemical
safety. Environmental representatives and other local working groups focus on
improving the everyday environmental work.
Energy Eiciency working group promotes the means for improving energy ei-
ciency and focus in particular on improvement actions in all tire factories.
Sustainable Purchasing working group develops and guides the supply chain
sustainability.
Each Nokian Tyres’ employee is responsible for working and acting ethically as well as
following Nokian Tyres’ Code of Conduct.
Environmental management
Environmental management is guided by the Code of Conduct approved by the
Board of Directors as well as Environmental, Safety and Quality Policy approved by the
President and CEO.
The activity management system at the Nokian Tyres Group is based on the
ISO 9001, IATF 16949, ISO 14001, ISO 45001, and ISO 17025 standards and meets
applicable regulations and customer demands. The Company is also committed to
follow the UN Global Compact principles.
The goal of Nokian Tyres is to manage the environmental impacts of its products
over their entire life cycle and address the safety and quality aspects of the Company’s
operations in a comprehensive and systematic manner. The activity management
system that covers the environmental aspects, safety, and quality serves as a key tool
for this purpose. The Company’s operations manual is ISO 14001 compliant in terms of
the environmental aspects and ISO 9001 compliant as regards quality. Environmental
Protection procedure guides environmental protection eorts.
Environmental targets are specied in the Company’s sustainability strategy, which
is drawn up for a period of ve years and updated annually. Vice President, Quality
& Sustainability is leading the strategy updates along with the Senior Manager,
Sustainability. Working together with environmental experts in Finland, US and in other
locations, the Senior Manager, Sustainability prepares an annual environmental program
for the factories. The program species the detailed targets, actions, schedules, and
responsible persons for the goals presented in the strategy. In addition, individual units
have their own projects for developing the operations and processes.
The development of environmental aspects is reviewed at the meetings of the Group
Management Team.
Environmental eorts at the Nokian Tyres Group are coordinated by the Senior
Manager, Sustainability. Environmental and chemical safety and sustainability aspects
belong to the Quality and Sustainability unit, and the overall eorts are coordinated
globally by Vice President, Quality & Sustainability together with Senior Vice President,
Supply Operations.
Key goals of environmental management are minimizing negative environmental
impacts, accident prevention and good corporate citizenship in all areas of operation.
Environmental experts in all locations take care of practical environmental coordina-
tion and training, for instance regarding chemicals, emissions, and waste.
Complaint mechanisms in environmental responsibility
Nokian Tyres documents the annual environmental impacts of its tire factories,
reports them to the local authorities as required in each country, records feedback to
company’s own register (KETO) and takes necessary corrective actions.
Nokian Tyres factories’ environmental experts in Finland and in the US are respon-
sible for these records. The purpose of this practice is to collect the feedback on
MANAGING SUSTAINABILITY AT NOKIAN TYRES
STRATEGY, TARGETS AND FOLLOW-UP
BOARD OF DIRECTORS
GROUP’S MANAGEMENT TEAM
SUSTAINABILITY STEERING GROUP GHG STEERING GROUP
ACTION PLANS AND DAY-TO-DAY LEADERSHIP OF SUSTAINABILITY
VP, SUSTAINABILITY & QUALITY
Sustainability
working group
Safety
management
working group
Environmental
working group
Energy
eiciency
working group
Sustainable
purchasing
working group
ALL UNITS AND SUPERVISORS
PERSONNEL
the status of Nokian Tyres environmental aspects and consider stakeholders’ related
requests and opinions.
Nokian Tyres has a two-tiered approach to the management of environmental
complaint procedures. If the complaint is minor in the scope of Nokian Tyres’ produc-
tion, an environmental expert handles it independently and/or the manager decides on
the necessary course of action.
In case of a larger event, the decision to escalate the matter is taken in Nokia,
Finland, by Vice President, Quality & Sustainability and in Dayton, US, by the Plant
Director and in other locations by the line management.
NON-FINANCIAL INFORMATION
STATEMENT 2022
Non-Financial Information Statement
NON-FINANCIAL INFORMATION
STATEMENT 2022
Nokian Tyres develops and manufactures premium tires for consumers and customers
who value safety, sustainability, and innovative products. Sustainability is at the core of
Nokian Tyres’ business and one of the ve cornerstones of the company’s strategy.
Nokian Tyres is a supporting member of the United Nations Global Compact (UNGC)
initiative and is committed to the Sustainable Development Goals (SDG’s) set by the UN.
MANAGING NON-FINANCIAL MATTERS AT NOKIAN TYRES
The company’s sustainability activities are led by SVP, Supply Operations, who is a
member of the Group’s Management Team. The Group’s Sustainability Steering Group
supervises and monitors the sustainability work within the Group and comprises of
senior representatives from Supply Chain, Products & Innovations, Finance, Human
Resources and Communications. The Group’s Greenhouse Gas (GHG) Steering Group
supervises and monitors the progress in reducing greenhouse gas emissions within the
Group. The duties of all supervisors include day-to-day leadership of sustainability.
Targets, milestones, development items, and other key topics are discussed by
the Management Team at least twice a year, and at least once a year by the Board of
Directors. The VP, Quality & Sustainability, shares knowledge and updates to the Board
of Directors about the Company’s impacts.
Nokian Tyres’ business is guided by the ethical principles presented in the
Board-approved Code of Conduct. The document species the principles for Nokian
Tyres’ business, including instructions for various matters related to ethics and the
anti-bribery guidelines. Nokian Tyres does not condone any form of bribery within the
company’s operations.
When reporting a suspected misuse or violation, an employee is advised to
contact either his/her supervisor, Internal Audit, Legal & Compliance, or the HR unit.
Misconducts can also be reported by sending an email to whistleblow@nokiantyres.com
or via regular mail. Internal auditor reports suspected misuses and violations to the
Board’s Audit Committee.
The company requires that all its Sustainability Critical suppliers adhere to Nokian
Tyres’ Supplier Code of Conduct. All raw material suppliers must, at a minimum, have an
ISO 9001 certied quality management system in place. Nokian Tyres prefers suppliers
with an ISO 14001 certied environmental management system.
The risk management policy adopted by Nokian Tyres’ Board of Directors supports
achieving the company’s strategic goals and ensuring business continuity. Read more
about the company’s risk management in the Financial Statement under Signicant
Risks and Uncertainties and in the Corporate Governance Statement.
MANAGING SUSTAINABILITY AT NOKIAN TYRES
STRATEGY, TARGETS AND FOLLOW-UP
BOARD OF DIRECTORS
GROUP’S MANAGEMENT TEAM
SUSTAINABILITY STEERING GROUP GHG STEERING GROUP
ACTION PLANS AND DAY-TO-DAY LEADERSHIP OF SUSTAINABILITY
VP, SUSTAINABILITY & QUALITY
Sustainability
working group
Safety
management
working group
Environmental
working group
Energy
eiciency
working group
Sustainable
purchasing
working group
ALL UNITS AND SUPERVISORS
PERSONNEL
NOKIAN TYRES’ MATERIAL TOPICS
Through continued focus on sustainability at Nokian Tyres, the company is committed
to minimizing its negative impacts and maximizing its positive impacts on the economy,
environment, and people. An essential part of driving this positive change is under-
standing how Nokian Tyres’ stakeholders view sustainability and what sustainability
topics are relevant for society and our business. This is done by conducting materiality
assessments every three years. The assessments form a basis for sustainability at
Nokian Tyres.
The VP, Quality & Sustainability, presents the data from the material assessment to
the Group Management Team and to the Board. The Board reviews and approves the
Non-Financial Information Statement, the topics of which are based on the material
assessment.
The company conducted a comprehensive materiality assessment in 2021. As a result,
the following sustainability topics were considered material to Nokian Tyres’ operations:
1. Sustainable raw materials
2. Actions to mitigate climate change
3. Safety and well-being at Nokian Tyres
4. Promoting human rights in all operations
5. Safety properties of tires
AREAS OF SUSTAINABILITY
PRODUCTS / R&D PEOPLE ECONOMY ENVIRONMENT PROCUREMENT
We develop and manufacture
ecofriendly, safe and high-quality
tires that reach their destination
safely even under demanding
conditions.
We are committed to acting in
the manner required by the UN’s
Guiding Principles for Business and
Human Rights as well as OECD’s
Guiding Principles on Labour and
Human Rights, and to following the
International Labour Organization’s
(ILO) Declaration on Fundamental
Principles and Rights at Work. We
respect human rights and treat all
individuals equally.
Through protable growth, we
enable the further development of
our operations and ensure nancial
security, work and well-being for
our stakeholders.
We consider the product’s entire
life cycle and all of its functions
in terms of environmental
responsibility and are committed to
acting in a way that does not harm
the environment or people. We
aim to show leadership in actions
against climate change.
We are committed to sustainable
procurement and further
developing sustainability in our
supply chain.
ESSENTIAL STANDARDS, GROUP POLICIES AND PROCEDURES RELATED TO SUSTAINABILITY
Tire/vehicle safety regulations
(UN tire regulations), various tire
labelling (consumer information)
regulations and standards (EU
Tyre Labeling regulation), chemical
regulation, UN Global Compact,
Nokian Tyres tire testing policy.
ISO 45001, UN Global Compact,
Policies and procedures related to
safety, well-being, hiring, traveling,
induction, people reviews and
competence development, human
rights and equality.
Stock exchange rules, IFRS, UN
Global Compact, Corporate
Governance, risk management,
Know Your Counterparty, Tax Policy.
ISO 14001, Responsible Care
program, Science Based Targets,
UN Global Compact, Environmental
Management, Chemical Safety
Management.
ISO 9001, ISO 14001, UN Global
Compact, Procurement policy,
Supplier Code of Conduct,
Sustainable Natural Rubber Policy.
LOCAL GUIDELINES AND PROCEDURES
GUIDING PRINCIPLES FOR NOKIAN TYRES’ SUSTAINABILITY
Sustainability is a part of our company’s culture, strategy and goals. The graph below describes the areas of sustainability in the company, our guiding principles, and
the most important standards and policies that guide our work.
SUSTAINABILITY TARGETS
In 2021, Nokian Tyres redened its sustainability targets. They are presented on the
company’s website. The chart describes selected ve key targets, with respective KPIs
and results for 2022.
Area Target KPI Progress in 2022
Safe and
eco-friendly tires:
increasing the
share of sustainable
materials in tires
Increase the
share of recycled
or renewable raw
materials in tires to
50% by 2030
Report annual
improvement
One new recycled
raw material taken
into production use
Climate: reducing
CO
2
emissions in line
with our four Science
Based Targets
Reducing CO
2
emissions from tire
production (scope
1+2) by more than
50% by 2030, base
year 2015
Report annual
improvement
Figures available
in the Corporate
Sustainability Report
in spring 2023
Safety: securing safer
and better work
Accident frequency
LTIF: Decrease from
8.3 (2018) to 1.5 by
2025
20% annual
improvement in LTIF
compared to the
previous year
Positive development.
LTIF decreased from
4.1 to 3.2
Human rights:
auditing all signicant
high-risk suppliers
100% of signicant
high-risk suppliers
audited by 2025
Annual increase in
the share of audited
high-risk suppliers
83% audited (64% in
2021)
Personnel well-being:
developing human
rights policies
Developing human
rights policies
Report annual
improvement in
sentiments about
equal opportunities in
the personnel survey,
base year 2021
Score on equality was
66 on a scale of 0–100
(65 in 2021)*
*both gures exclude BA Russia and Asia
NOKIAN TYRES AS A PART OF SOCIETY
IMPACTS:
Through sustainable business practices and nancial success, Nokian Tyres
oers security, work, and well-being for its personnel and contributes to the well-being
of local communities
.
Nokian Tyres’ objective is to create value for its various stakeholders, such as
consumers, customers, personnel, and shareholders. Nokian Tyres wants to be a good
corporate citizen wherever it operates.
Nokian Tyres’ approach to philanthropy mirrors its purpose, entrepreneurial and
inventive company culture, and sustainable way of doing business. The company does
not support any governmental, political, or religious entities. The company oers
resources to projects based on the Nokian Tyres’ Philanthropy Approach dened in
2020.
In 2022, Nokian Tyres continued to support the traic safety education for local
school children in Nokia, Finland, and donated books for safety education. The company
also oered nancial and other support for our Ukrainian employees and donated to
humanitarian eorts in Ukraine. Vianor supported Save the Children, an international
advocate of children’s rights.
In the US, the company has donations committees in Dayton, Nashville, and
Colchester. In 2022, the Dayton committee gave two college scholarships to high
school graduates in order to support educational eorts, and also participated in nine
other charity projects. In partnership with Powdr Ski Resorts, the company educated
guests and the public about the importance of winter driving safety, and supported
One-Tree-Planted, a non-prot organization, and planted 50,000 trees in areas of the
United States impacted by deforestation.
CLIMATE AND THE ENVIRONMENT
IMPACTS:
Actions to mitigate climate change and reduce emissions, ensuring environ-
mental and chemical safety
Environmental and chemical safety and the coordination of sustainability are the
responsibility of the Quality and Sustainability department. The company promotes
environmental and chemical safety through risk management, continuous improvement
of processes, and new investments. When developing activities, the company applies
best practices and advanced solutions while taking into account human factors and
nancial impacts.
All factories are certied pursuant to the international ISO 14001 environmental
management system standard and the ISO 9001 quality system standard. The company
has also held IATF 16949 approval for the automotive industry since 2013.
The company has dened its climate-related risks and opportunities according to
the recommendations of Task Force on Climate-Related Financial Disclosures (TCFD). In
2022, the risks and opportunities were reassessed.
Climate-related risks
Risk group Sub category Examples of concrete risks
Time
horizon
Financial
impact Adaptation / mitigation plan
Regulatory Emerging regulation Deforestation-related regulation, mostly concerning natural rubber Medium Medium Follow-up of emerging regulation
Green regulation on aviation and maritime fuels can signicantly
increase costs of logistics
Long Medium
Further environmental fees Additional taxes and duties e.g. EU’s CBAM for fossil raw materials
can increase prices. Certication costs
Short Medium Participation in industry sector working
groups
Stricter expectations to
oversight
Increased verication testing of products and emission
measurements
Short Low Follow-up of emerging regulations
Physical Extreme weather events Disruptions in logistics and force majeure situations Short Medium Alternative transportation routes
Extreme weather events Permanent changes in logistics and/or increased force majeure
situations
Long High Alternative transportation routes
Extreme weather events Impact of extreme weather events on natural rubber producers Medium Low Alternative sourcing locations
Extreme temperatures Contamination/lower quality of raw materials Short Low Multiple supply sources
Technological Climate-related demands for
new tire technology
A+ rolling resistance tires required for EVs Medium Low Anticipation of future expectations in R&D
development road maps
150 km/h max speed for EU – demand for UHP (Ultra High
Performance) tires falls
Long Medium
Market and
reputation
Market changes Shift from car ownership to mobility-as-a-service i.e. changing
customer base
Long Medium Update product and service oering
Tire raw materials Increase use of expensive renewable materials Medium High Road map for selective use of renewable and
recyclable raw materials
Energy Green energy prices go up due to strong demand Short Medium Long term power purchasing agreements
Energy Raw material price increases due to higher energy prices Short Medium Long term contracts
Tire raw materials Availability of renewable and recycled raw materials can limit plans
for sustainability
Medium Low Aiming for multiple sources
Tire demand Increased demand for all-season tires and less winter tires Short Low Update product oering
Reputational risk Deforestation scandals (natural rubber) Medium Low Co-operation with supply chain in line with
GPSNR recommendations
Climate-related opportunities
Opportunity
group Sub category Examples of concrete opportunities
Time
horizon
Financial
impact Implementation plan
Innovation Raw materials Innovations with renewable / recycled / local materials Medium Medium Material development road map to reach 50%
share of renewable or recycled raw materials
by 2030
Recycling Co-operation with innovative recycling companies Medium Medium Screening of opportunities and widening of
cooperation
Climate-friendly technology Lower rolling resistance products. Climate-friendly production Short High Product development road map. New zero
CO
2
factory to Romania being implemented
Energy-eicient production Modern machinery used in Nokian Tyres’ factories Short Medium New zero CO
2
factory to Romania being
implemented
Product range Competitive advantage Nokian Tyres is an expert in demanding and challenging weather
conditions. We have a strong share in winter tire markets and
are prepared to increase the share further, should the extreme
weather phenomena increase in the future
Short Medium Developing product portfolio, increasing
consumer awareness
Competitive advantage Increase of all-season tire sales in Europe due to milder winters Medium Medium Developing product portfolio
EU further green regulation Increased focus on sustainable natural rubber Long Low Co-operation within GPSNR
EU further green regulation Tire regulation for wear resistance (abrasion) Medium Medium Product development
Industrial (heavy) tires We have existing expertise to provide climate-friendly solutions,
e.g. intelligent sensor technology
Short Medium Product development
Engagement Consumers Increase awareness of how tires can aect safety and carbon
footprint
Short Medium Consumer education through
communications and marketing
Policy makers Increased preparedness for new regulations or incentives Long High Industry-wide cooperation and information
sharing with decision makers
Shareholders / stakeholders Green / sustainable nancing Short High Transparent sustainability targets, public
reporting, collaboration with nancial
institutions, information sharing with
stakeholders
Regulatory Renewable Energy Directive
and other green regulation
More renewable energy available in EU, prices can decrease Long Low Own investments/partnering for green
energy
Global carbon tax or similar would improve the company’s
competitive position
Long Low Further improvement of corporate carbon
footprint
In 2020, the company was the rst in tire industry to receive approval for its targets
for reducing greenhouse gas emissions from the Science-Based Targets initiative
(SBT). In November 2022 Nokian Tyres sent a new, more ambitious target to SBT for
validation. New scope 1 + 2 emission targets will be aligned with the 1.5 degrees pathway.
The work to reduce the GHG emissions is followed and supported by the Nokian Tyres
Greenhouse Gas Reduction Steering Group, which started operating at the beginning of
2021. The GHG Steering Group convenes four times a year.
The company is a shareholder in Finnish Tyre Recycling Ltd, which centrally
manages the collection and reuse of used tires in Finland. In Finland, nearly 100% of
decommissioned tires are recycled. On average in Europe, the degree of tire recycling is
approximately 95%.
Unfortunately, the VOC emissions (volatile organic compounds, or solvents) of the
Nokian Tyres’ factory in Finland are still above the maximum allowed level. During 2022
we discussed with environmental authorities and in the fall we conducted a spread
modelling of the VOC emissions in order to estimate the impacts of the VOC’s in the
nearby surroundings of the Nokia factory. According to the modelling, the VOC concen-
trations and the environmental eects are minor. Furthermore, our solvent use has
decreased over 40% compared to 2018. As a next step, we will continue negotiations
with the authorities and plan to have our environmental permit updated.
In Finland, Nokian Tyres received one environmental complaint in 2022 concerning
noise at the Finnish factory. The company was also contacted concerning odor emis-
sions from local residents in Sastamala, Finland, where our retreading unit is located.
Nokian Tyres has reported actions related to odor issues monthly to the authority
until May 2022, and discussions with the authorities have continued throughout the
year when necessary. The company received no environmental complaints from other
locations.
Special attention has been paid to improvements in energy eiciency, as well as
chemical safety and sustainability work across dierent elds of business.
At the production facilities, emphasis remained on reusing waste. In 2022, 100% of
production waste was sent to utilization.
EU Taxonomy
The EU’s new Taxonomy Regulation is designed to support the transformation of
the EU economy to meet its European Green Deal objectives, including the 2050
climate- neutrality target. At the core of the Taxonomy Regulation is the denition of a
sustainable economic activity. This denition is based on two criteria. An activity must:
• Contribute to at least one of six environmental objectives listed in the Taxonomy; and
• Do no significant harm to any of the other objectives, while respecting basic human
rights and labor standards.
The Taxonomy regulation has entered partly in force. It classies economic activities,
which can be potentially aligned with EU’s environmental targets. There are six environ-
mental targets in the EU Taxonomy, two of which are now regulated: Climate Change
Mitigation and Climate Change Adaptation.
Tire industry is included in the economic activity group Manufacture of other
low carbon technologies in the EU Taxonomy’s technical screening criteria. After
investigating and consulting on EU Taxonomy’s technical screening criteria, following
conclusions about Nokian Tyres’ economic activities have been made:
• Car and van tires with low rolling resistance ratings which are manufactured by Nokian
Tyres have substantially lower life-cycle carbon footprint than corresponding average
tires. This is a combined result of low use phase emissions and industry’s best-in-class
manufacturing emissions.
• At this stage, we will exclude all heavy professional tires as there is no solid compar-
ison data available of use phase CO
2
emissions for heavy professional tires.
Manufacture of car and van tires with low life-cycle greenhouse gas emissions repre-
sented 30% of Nokian Tyres’ total net sales in 2022. Based on our assessment, these
economic activities are aligned with the EU Taxonomy criteria. Share of Opex within the
scope of EU Taxonomy was 27% and share of Capex within the scope of EU Taxonomy
was 16%.
It has to be noted that the Taxonomy reporting scope and criteria may change in
coming years as this is only the second reporting round, and therefore also the gures
may not be comparable between the reporting periods.
Turnover
Substantial contribution criteria
DNSH criteria
(‘Does Not Signicantly Harm’)
Economic activities Code(s)
Absolute turnover
Currency
Proportion of turnover
%
Climate change mitigation
%
Climate change adaptation
%
Water and marine resources
%
Circular economy
%
Pollution
%
Biodiversity and ecosystems
%
Climate change mitigation
Y/N
Climate change adaptation
Y/N
Water and marine resources
Y/N
Circular economy
Y/N
Pollution
Y/N
Biodiversity and ecosystems
Y/N
Minimum safeguards
Y/N
Taxonomy-aligned proportion of
turnover, year 2022
Percent
Taxonomy-aligned proportion of
turnover, year 2021
Percent
Category (enabling activity)
E
Category ‘(transitional activity)’
T
A. TAXONOMY-ELIGIBLE
ACTIVITIES
%
A.1. Environmentally
sustainable activities
(taxonomy aligned)
Activity 1
.. Manufacture of other
low carbon technologies
. % % % % % % % Y Y Y Y Y Y % E
Turnover of environmentally
sustainable activities
(Taxonomy-aligned) (A.1)
A.2 Taxonomy-eligible but not
environmentally sustainable
activities (not Taxonomy-
aligned activities)
Turnover of Taxonomy-eligible
but not environmentally
sustainable activities (not
Taxonomy-aligned activities)
(A.2)
Total (A.1 + A.2)
B. TAXONOMY-NON-ELIGIBLE
ACTIVITIES
Turnover of Taxonomy-non-
eligible activities (B)
,.
%
Total (A + B)
,.
%
Capex
Substantial contribution criteria
DNSH criteria
(‘Does Not Signicantly Harm’)
Economic activities Code(s)
Absolute CapEx
Currency
Proportion of CapEx
%
Climate change mitigation
%
Climate change adaptation
%
Water and marine resources
%
Circular economy
%
Pollution
%
Biodiversity and ecosystems
%
Climate change mitigation
Y/N
Climate change adaptation
Y/N
Water and marine resources
Y/N
Circular economy
Y/N
Pollution
Y/N
Biodiversity and ecosystems
Y/N
Minimum safeguards
Y/N
Taxonomy-aligned proportion of
CapEx, year 2022
Percent
Taxonomy-aligned proportion of
CapEx, year 2021
Percent
Category (enabling activity)
E
Category ‘(transitional activity)’
T
A. TAXONOMY-ELIGIBLE
ACTIVITIES %
A.1. Environmentally
sustainable activities
(taxonomy aligned)
Activity 1
.. Manufacture of other
low carbon technologies
. % % % % % % % Y Y Y Y Y Y % E
CapEx of environmentally
sustainable activities
(Taxonomy-aligned) (A.1)
A.2 Taxonomy-eligible but not
environmentally sustainable
activities (not Taxonomy-
aligned activities)
CapEx of Taxonomy-eligible
but not environmentally
sustainable activities (not
Taxonomy-aligned activities)
(A.2)
Total (A.1 + A.2)
B. TAXONOMY-NON-ELIGIBLE
ACTIVITIES
CapEx of Taxonomy-non-
eligible activities (B)
.
%
Total (A + B)
.
%
Opex
Substantial contribution criteria
DNSH criteria
(‘Does Not Signicantly Harm’)
Economic activities Code(s)
Absolute OpEx
Currency
Proportion of OpEx
%
Climate change mitigation
%
Climate change adaptation
%
Water and marine resources
%
Circular economy
%
Pollution
%
Biodiversity and ecosystems
%
Climate change mitigation
Y/N
Climate change adaptation
Y/N
Water and marine resources
Y/N
Circular economy
Y/N
Pollution
Y/N
Biodiversity and ecosystems
Y/N
Minimum safeguards
Y/N
Taxonomy-aligned proportion of
OpEx, year 2022
Percent
Taxonomy-aligned proportion of
OpEx, year 2021
Percent
Category (enabling activity)
E
Category ‘(transitional activity)’
T
A. TAXONOMY-ELIGIBLE
ACTIVITIES
A.1. Environmentally
sustainable activities
(taxonomy aligned)
Activity 1
.. Manufacture of other
low carbon technologies
. % % % % % % % Y Y Y Y Y Y % E
OpEx of environmentally
sustainable activities
(Taxonomy-aligned) (A.1)
A.2 Taxonomy-eligible but not
environmentally sustainable
activities (not Taxonomy-
aligned activities)
OpEx of Taxonomy-eligible
but not environmentally
sustainable activities (not
Taxonomy-aligned activities)
(A.2)
Total (A.1 + A.2)
B. TAXONOMY-NON-ELIGIBLE
ACTIVITIES
OpEx of Taxonomy-non-
eligible activities (B)
.
%
Total (A + B)
.
%
Nokian Tyres’ approach to calculate the eligibility for the EU Taxonomy
Net sales
• A: Amount of eligible net sales coming from car and van tires having EU Tyre Labelling
grade A, B or C in rolling resistance.
• Heavy tires will be excluded as there is no solid data (or public benchmark) available
for use phase CO
2
emissions.
• B: Total amount of net sales
• C: Share of net sales within the scope of EU Taxonomy
• C = A/B %
Capex & Opex
• D: Eligible passenger car tires production companies’ Opex: Research and
Development and real estate expenses deducted by depreciation & amortization
• E: Group Opex: Research and Development and real estate expenses deducted by
depreciation & amortization
• F: Share of Opex within the scope of EU Taxonomy
• F = C*D/E %
• Justication: represents share of Opex used for producing low rolling resistance car
and van tires with reasonable accuracy.
• G: Eligible passenger car tires production companies’ tangible Capex
• H: Group Capex including tangible and intangible investments
• I: Share of Capex within the scope of EU Taxonomy
• I = C*G/H %
• Justication: represents share of Capex used for production readiness for low rolling
resistance car and van tires with reasonable accuracy.
• Remark: handpicking and assessing each investment’s relation to EU Taxonomy
separately is regarded not to give much additional accuracy.
PEOPLE
IMPACTS:
Safety and well-being of personnel
The company’s principles in all operations are fair treatment and respect of human
rights when collaborating with its personnel or other stakeholders. This principle of
equality and non-discrimination is an essential part of the company’s operations, and
the management of diversity is based on the concept of equality and equal prerequi-
sites for work.
People Review discussions with all employees focus on managing performance and
employee´s personal development. Internal job rotation, on-the-job learning, and other
learning solutions have a key role in supporting personnel development.
In 2022, Nokian Tyres conducted the personnel survey Drive! to measure well-being,
equality, inclusion and engagement inside the organization. In the company-wide survey,
for the question concerning equality, we received a score of 66 on a scale of 0–100,
which is 7 points below the global benchmark. Improving equality is a priority in our
sustainability work, and our aim is to continuously improve the score. This equality KPI is
being followed annually.
Nokian Tyres’ commitment and eorts related to data protection continued
throughout the year. In particular, the renewed eLearning course was made available for
all Nokian Tyres employees during 2022.
Safety work continues
Nokian Tyres’ goal is to promote occupational health and minimize the number of
occupational accidents. Occupational health and safety are an integral part of the
company’s daily management and operations.
Safety is Nokian Tyres’ rst priority, and the company’s long-term goal is to reduce
lost time injuries 20% annually. In 2022 there were less accidents leading to absences
than ever before. The biggest improvement came from the production units. In
September 2022, the passenger car tire production unit in Nokia celebrated one year
without accidents leading to absences, and in November 2022 Levypyörä celebrated
three years.
Lost-time injury frequency (LTIF)
2018 2019 2020 2021 2022
. . . . .
PRODUCTS
IMPACTS:
Continuous improvement of traic safety of tires and the sustainability of
raw materials in tires
Nokian Tyres’ R&D is constantly developing new ways of replacing fossil-based raw
materials with recycled or renewable materials to enable more sustainable tire manu-
facturing. In January 2022, the company published a concept tire that was made 93%
of either recycled or renewable raw materials. Nokian Tyres aims to increase the share
of recycled or renewable raw materials in its tires to 50% by 2030.
Rolling resistance
Carbon dioxide, CO
2
, is the most signicant greenhouse gas generated by traic. The
higher the rolling resistance of a tire is, the higher the fuel consumption and CO
2
emissions will be.
In 2022, Nokian Tyres updated its goal for developing the rolling resistance of its
tires: By 2028, the company aims to have at least 60 tires in the best rolling resistance
A class of EU Tyre Labelling system.
Nokian Tyres products in the rolling resistance A class *
Status in 2022 Goal for 2028
14 60
* Tires included in the EU Tyre Labelling
Developing wet grip and ice grip
Nokian Tyres participates actively in developing the EU Tyre Labelling test method
standards, such as wet grip and ice grip. Wet grip is a critical safety feature of a tire as it
relates to how quickly a tire can stop on wet roads. The EU Tyre Labelling rates the wet
grip of tires from A to E: A being the shortest braking distances in the wet, E being the
longest braking distance.
Wet grip is one of Nokian Tyres’ R&D’s continuous development targets. This is
aligned with one of our material topics: traic safety of tires. Nokian Tyres’ goal for
2025 is to include 100% of the company’s premium tires in the best wet grip A or B
class in the EU Tyre Labelling. We will report the progress annually.
Percentage of selected tires* in wet grip class A or B
Status in 2022 Goal for 2025
90% 100%
* Selected scope: Tires in price category A and included in the EU Tyre Labelling, the latest generation. Does not
include Nordic winter tires.
As a Scandinavian tire designer and manufacturer, the safety of winter tires is one of
our top priorities in traic safety of tires. As of May 2021, the EU Tyre Labelling includes
a label for snow grip marking as well as ice grip marking. A tire that is approved for
severe snow conditions can have the snow grip marking, and a tire that passes the
international ice grip test method can have the ice grip marking on their label. Our goal
for the winter tire safety performance level was that by 2025, 100% of Nordic Nokian
Tyres Hakkapeliitta winter passenger car and SUV tires fulll the 2021 EU ice grip criteria.
In 2022, we already reached that goal.
SUPPLY CHAIN
IMPACTS:
Sustainable natural rubber procurement, climate change mitigation in supply
chain
Natural rubber is one of the main ingredients of tires. Cooperation with the industry
and other stakeholders is vital in improving the conditions of the employees working in
the natural rubber industry and the state of the environment. Nokian Tyres is a member
of the Global Platform for Sustainable Natural Rubber (GPSNR). It is a platform whose
members include natural rubber farmers, processors and traders, tire makers and other
natural rubber product makers, car makers and other natural rubber product users,
nancial institutions, and civil societies.
In 2021, Nokian Tyres updated its Supplier Code of Conduct, and also adopted a
sustainable natural rubber policy that is fully aligned with the policy framework of the
GPSNR. The company’s sustainability in natural rubber is now developed through the
framework of this policy. In 2022, Nokian Tyres conducted three new sustainability
audits of natural rubber processing plants that are our suppliers.
As part of the Nokian Tyres Science Based Targets for reducing CO
2
emissions, a
new KPI for the supply chain was created. During 2022, at least 40 raw material and 20
transport suppliers were expected to provide Nokian Tyres with a CO
2
emission reduc-
tion plan. The results of this study gave us a good view on the supply chain carbon
emissions management. As a result, for 2023 we created a new KPI to gather Product
Carbon Footprint from suppliers for 40 raw materials.
SIGNATURES FOR THE NON-FINANCIAL
INFORMATION STATEMENT
Helsinki, 7 February 2023
Jukka Hienonen Pekka Vauramo
Heikki Allonen Susanne Hahn
Veronica Lindholm Inka Mero
Christopher Ostrander Jouko Pölönen
George Rietbergen Jukka Moisio
CEO
Signatures of the Board of Directors
Remuneration Report
REMUNERATION REPORT 2022
REMUNERATION REPORT 2022
Personnel and Remuneration Committee – Chair’s greeting
Financial year 2022 was exceptional for Nokian Tyres. The war in Ukraine has had severe
impacts on Nokian Tyres’ operating environment, which led to a decision to initiate a
controlled exit from Russia. In late October 2022, Nokian Tyres signed an agreement
to sell its Russian operations to Tatneft PJSC. During the second half of 2022, the rst
steps were taken to build the new Nokian Tyres without Russia. Nokian Tyres’ Board of
Directors made the decision to invest approximately EUR 650 million in a new greeneld
tire factory in Romania – the rst zero CO
2
emission factory in the tire industry. This
investment with emphasis on an even more sustainable future, is extremely important
in terms of Nokian Tyres’ future growth.
Due to the radical changes in business conditions, modications were made to realign
the interests of Nokian Tyres key personnel and to create motivation and future
retention. The Board of Directors decided to modify the nancial year 2022 incentive
targets, which were set before the war in Ukraine. It was decided that the two main
short-term incentive plans of Nokian Tyres would pay-out on target level for the rst
half of nancial year 2022 and that new targets would be set for the earning period of
the second half of 2022. New group level targets for nancial year 2022 were set for
Segments Operating Prot and Net Sales. To create additional retention, the incentive
pay-outs will take place in two instalments, one in March 2023 and one in June 2023.
An original climate related goal, measured through reduction in CO
2
emission during
nancial year 2022, was kept in place for the President and CEO and the Management
Team. Nokian Tyres showed good performance against both the nancial and climate
related targets, laying a strong foundation for entering nancial year 2023.
Financial year 2022 was exceptional in many ways and the conditions were tough. The
hard work and dedication showed by the Nokian Tyres teams and of the performance
against drastic circumstances is well noted. We will continue to reinforce the stature
of our Remuneration Policy, to use remuneration as means to advance our strategy
execution, business objectives and long-term protability. We will keep on building the
new Nokian Tyres and make sure that our remuneration system oers the best possible
support in doing so.
Veronica Lindholm
Chair of the Personnel and Remuneration Committee of
Nokian Tyres Board of Directors
We will keep on building the new
Nokian Tyres and make sure that
our remuneration entity oers
best possible support in doing so.
Introduction
This remuneration report (the “Remuneration Report”) describes the implementation
of the remuneration policy (the “Remuneration Policy”) of Nokian Tyres plc (the
“Company” or “Nokian Tyres”) for the nancial year 2022. The Remuneration Policy
was presented to and adopted by an advisory resolution in the 2020 Annual General
Meeting and shall be applied until the 2024 Annual General Meeting, unless a revised
policy is presented to the general meeting before that. The Remuneration Policy
describes the remuneration of the Board of Directors and the President and CEO,
and the considerations of determining the policy and operation of the policy. This
Remuneration Report will in turn provide investors with more detailed information
of the development of remuneration and some strategic KPIs within Nokian Tyres as
well as the implementation of the valid Remuneration Policy during the nancial year
2022. The rst new Remuneration Report for the nancial year 2020, prepared in
accordance with the Securities Market Association’s Corporate Governance Code 2020,
was presented to and adopted by the 2021 Annual General Meeting. The 2022 Annual
General Meeting resolved to adopt the Company’s following Remuneration Report 2021,
through an advisory resolution supported by approximately 80% of the votes cast at
the 2022 Annual General Meeting, indicating approval of the Remuneration Report 2021
by the shareholders of the Company.
An index comparison is presented in the next table and a further breakdown of the
development of the remuneration of the Board of Directors and President and CEO
of the Company with a comparison to the development of the average remuneration
of the Company’s employees and to the Company’s nancial development over the
preceding 5 nancial years is presented under the section “Remuneration and nancial
development between 2018 to 2022”.
Index of development between years 2018–2022
Remuneration index 2018 2019 2020 2021 2022
Total Board remuneration – Average annual
fee paid to Board members
2)
% % % % %
President and CEO salaries and nancial
benets % % % % %
Average salary cost per employee
3)
% % % % %
Financial measures index
1)
Operating prot % % % % %
Earnings per share (EPS) % % % % –%
Return of capital employed (ROCE) % % % % –%
1)
Financial measures used for index according to IFRS reporting. Segments gures in accordance to Nokian
Tyres new reporting practices available (2019, 2020, 2021 and 2022) in section “Remuneration and nancial
development between 2018 to 2022”. Stock exchange release about Nokian Tyres new reporting practices April
24th, 2020.
2)
Total Board remuneration - Average annual fee paid to Board members calculated by dividing total amount
of fees paid to Board members each year, by composition of Board (number of members) during each year
(2018–2020: 8 Board members, 2021–2022: 9 Board members) and excluding fees paid to members leaving
during following term. Further details in section ‘’ Remuneration and nancial development between 2018 and
2022’’.
3)
Average cost per employee calculated based on average number of employees during each nancial year,
divided by total amount of salaries, incentives, and other related employee costs for corresponding nancial
year.
Nokian Tyres had strong performance during the nancial year 2021 and entered
nancial year 2022 with solid business outlooks. The war in Ukraine and resulting
sanctions had a signicant negative impact on Nokian Tyres’ supply capacity and
performance. Net sales for nancial year 2022 were 1,776 MEUR and Segments oper-
ating prot was 221 MEUR. The war in Ukraine shifted Nokian Tyres short-term business
objectives and long-term strategy. A controlled exit from Russia was initiated and later
during nancial year 2022, Nokian Tyres announced an EUR 650 million investment in a
new greeneld tire factory in Romania as the company began building the new Nokian
Tyres. To steer collective eorts towards complying with the new business conditions,
targets set for Nokian Tyres two main short-term incentive plans were modied by the
Board of Directors. It was decided to modify the targets set before the war in Ukraine,
which were no longer relevant for the prevalent situation. New Group level targets were
set for Segments operating prot and Net sales, both with an equal weight of 50%.
The earning period linked to the modied targets was the second half of nancial year
2022. The earning period for the rst half of nancial year 2022, will be paid out on
target level. These modications were also applied to President and CEO Jukka Moisio
and the Management Team, whose performance was in addition measured through a
climate related target, which was not adjusted during nancial year 2022.
To create additional retention, the incentive pay-outs will take place in two instal-
ments, one in March 2023 (earning period H1 2022 and climate related incentive) and
one in June 2023 (earning period H2 2022). The modications realigned the focus
of the participating employees and produced positive results against the occurring
business conditions. The Group level goals created a collective objective to strive for
and were in alignment with the adopted Remuneration Policy.
Nokian Tyres has two annually commencing long-term share-based plans, under
discretion of the Board of Directors’ decision. Both plans were renewed in February
2022, for a 3-year period between 2022–2024. Nokian Tyres Performance Share Plan
is the main share-based incentive plan which is measured through Group Segments
Earnings Per Share (EPS) and Group Segments Return on Capital Employed (ROCE).
Nokian Tyres Restricted Share Plan serves as a complementary long-term incentive
tool, used selectively for retention of Nokian Tyres key employees. The Restricted Share
Plan consists of three-year retention period, after which the share awards granted
within the plan, will be paid to the participants. A precondition for the payment of the
share reward based on the Restricted Share Plan is that the employment relationship
of a participant with Nokian Tyres continues until the payment date of the award. In
addition to this precondition, a nancial performance criteria is applied to Nokian Tyres
Management Team, including the President and CEO. In February 2023, the Board of
Director decided to change the nancial performance criteria from ROCE to Segments
ROCE. The change was necessary to reect the radical eects on business conditions,
caused by the war in Ukraine. The average Segments ROCE threshold criteria for
Restricted Share Plan 2020–2022 was met, resulting in delivery of granted shares for
Management Team members and the President and CEO, participating in the plan.
As described above, The Board of Directors has decided to apply a threshold value
for average Segments ROCE over the vesting period for the President and CEO and
Nokian Tyres Management Team, for Restricted Share Plans commencing 2020, 2021,
2022 and 2023. The purpose is to further align the interests of the President and CEO
with the interests of shareholders regarding the nancial development of the Company.
During the nancial year 2022, Nokian Tyres thereby temporarily deviated from the
adopted Remuneration Policy by applying a nancial performance criteria to the
restricted share plans oered for the President and CEO. A further description of the
deviation and clarication of the circumstances supporting the deviation are presented
below under the section “Remuneration of the President and CEO 2022 – Long-term
incentive plans”. Apart from this deviation, the remuneration of the Board of Directors
and the President and CEO complied with the Remuneration Policy and no other
deviations where made.
Remuneration of the Board of Directors 2022
Nokian Tyres 2022 Annual General Meeting decided the following annual fees to be paid
to the Board of Directors serving during the nancial year 2022:
Chairman of the Board:
A fee of EUR 110,000 per year;
Deputy Chairman and to the Chairs of the Audit Committee and Personnel and
Remuneration Committee
A fee of EUR 75,000 per year
Other members of the Board:
A fee of EUR 52,500 per year
For each Board and Board Committee meeting the fee is EUR 700. For Board members
resident in Europe, the fee for each meeting in Europe outside a member’s home
country is doubled, and for each meeting outside Europe the fee is tripled. For Board
members resident outside Europe, the fee for each meeting outside a member’s home
country is tripled. If a member participates in a meeting via telephone or video connec-
tion, the remuneration is EUR 700. Travel expenses are compensated in accordance
with the Company’s travel policy.
Board member Position on the Board
Annual xed fee
(EUR)
1)
Board meeting fees
(EUR)
Committee meeting
fees (EUR) Total fees (EUR)
Shares acquired
with xed annual
fee (number of
shares)
Jukka Hienonen
Chairman of the Board / Member of the Personnel and
Remuneration Committee / Member of the Shareholders’
Nomination Board , , , , ,
Veronica Lindholm
Board member / Chair of the Personnel and Remuneration
Committee , , , , ,
Pekka Vauramo
Deputy Chairman / Member of the Personnel and
Remuneration Committee , , , , ,
Jouko Pölönen Board member / Chairman of the Audit Committee , , , , ,
Christopher Ostrander Board member , , – , ,
Inka Mero Board member / Member of the Audit Committee , , , , ,
Heikki Allonen Board member / Member of the Audit Committee , , , , ,
George Rietbergen Board member , , – , ,
Susanne Hahn Board member , , – , ,
Raimo Lind
Board member / Chairman of the Audit Committee (until
April th, ) – , , , –
1)
60% of the annual xed fee paid in cash and 40% in Company shares. Management transaction stock exchange releases regarding the share acquisitions published on May 2nd, 2022.
The Company paid asset transfer taxes arising from the acquisition of shares.
Remuneration of the President and CEO 2022
President and
CEO
Fixed annual
salary (incl.
holiday
compensation)
Monthly base
salary
Paid salary during
nancial year
2022 (incl. holiday
compensation
and mobile phone
benet)
Paid
performance-
based
bonuses (based
on year 2021)
Due performance-
based bonuses
(based on year
2022)
1)
Total value of
awarded share-
based bonus
Supplementary
pension
contribution
Severance
payment
Total fees paid
during nancial
year 2022
Jukka Moisio
, , , , , – – – ,,
Note: All amounts presented are in EUR.
1)
Due performance-based bonuses (based on year 2022) will be paid during the nancial year 2023.
Short-term incentive opportunities as of
annual base salary
Performance share plan long-term
incentives
1)
Target Max Target Max
50% % % %
1)
Nokian Tyres may in addition oer restricted share plans for the President and CEO in situations like new hire
and retention, at the Board’s discretion.
President and CEO Jukka Moisio did not receive a salary increase during nancial year
2022 and the monthly base salary was thereby 61,800 EUR during the entire year.
President and CEO Jukka Moisio has a Company paid mobile phone benet, with
a value of EUR 20 per month or EUR 240 per annum. Fixed annual salary incl. holiday
compensation is calculated by multiplying the monthly base salary of EUR 61,800 by
12.6.
Short-term incentive plans
President and CEO Jukka Moisio is entitled to short-term incentives as described in the
Remuneration Policy. The short-term incentive on target amount is equivalent to 50%
of the annual base salary and the maximum amount is 100% of the annual base salary.
The performance period is typically one year, unless decided otherwise by the Board.
The possible reward is paid out in the rst half of the year following the performance
period.
By decision of the Board of Directors, the performance measures of President and
CEO Jukka Moisio’s short-term incentives were modied during the earning period of
nancial year 2022. The nancial targets set before the war in Ukraine were adjusted, to
reect the radical changes in business conditions. It was decided that the short-term
incentive for the rst half of nancial year 2022, would be paid at target level and new
Group level targets were set for the earning period of the second half of nancial year
2022. The original climate related goal measured through reduction in CO
2
emission
during nancial year 2022, was kept in place. The weight of the climate related goal was
10% and the achievement of the set goal was 195,0%. The pay-out for this incentive
element is thereby 72,306 EUR (base salary FY 2022 × STI target 50% × weight 10% ×
achievement 195%). The short-term incentive amount of 166,860 EUR for the rst half
of 2022 corresponds to 50% (target level) of the annual base pay between January–
June 2022, multiplied with the weight of 45%. The short-term bonus of 166,860 EUR
for the rst half of 2022 and the climate related incentive of 72,306 EUR will be paid in
March 2023 payroll. The modied performance measures for the earning period of the
second half of nancial year 2022, were tied to Nokian Tyres Segments operating prot
and Nokian Tyres Net sales, both with an equal weight of 50%. The performance period
was the nancial year 2022. The paid base salary during the second half of nancial
year 2022 functioned as the basis for the incentive. The combined achievement
for the set targets for the nancial year is 179.5% (100% being the target level and
200% maximum) and the short-term incentive payout for the second half of 2022 to
President and CEO Jukka Moisio is 299,514 EUR (base salary July–December 2022 × STI
target 50% × weight 45% × achievement 179,5%). The proportion between xed and
variable pay linked to the nancial year 2022 is 41.1% variable pay and 58.9% xed pay.
For retention reasons and by decision of the Board of Directors, the pay-out of the
2022 second half short-term incentive reward will take place in June 2023.
Long-term incentive plans
The President and CEO’s long-term incentives (LTI) consist of share incentive plans. The
value of the performance-based LTI payout is capped at the level of 250% of annual
base salary and the annual target amount is 125% of annual base salary. The value of
paid performance-based LTI reward cannot exceed 250% of annual base salary used
to dene the allocation at grant. President and CEO Jukka Moisio was granted 27,680
performance-based shares from Nokian Tyres Performance Share Plan 2022–2024
during the nancial year 2022. The possible reward will be paid during the rst half
of the nancial year 2025, in case the targets set by the Board of Directors are met.
The targets set for Nokian Tyres Performance Share Plan 2022–2024 are Segments
Earnings per share (EPS) and Segments Return on capital employed (ROCE). Both
performance criteria have an equal weighting of 50%. The potential share rewards will
be paid partly in shares of Nokian Tyres and partly in cash. Cash portion of the reward
is intended to cover the taxes arising from the paid reward. President and CEO Jukka
Moisio was not granted restricted shares during the nancial year 2022.
Nokian Tyres has temporarily deviated from the adopted Remuneration Policy during
the nancial year 2022. The deviation against the adopted Remuneration Policy occurs
in the Long-term incentive (LTI) section, where the statue of Restricted Share Plans
states; “For the possible restricted share plans, there are no nancial performance
criteria, but the share rewards under the restricted share plan will be delivered to
the President and CEO provided that his or her service contract with the Company
continues until the delivery date of the share rewards.” The Board of Directors of the
Company decided to apply a nancial performance criteria to the three-year Restricted
Share Plans commencing during the years 2019, 2020, 2021, 2022 and 2023, as a
result of the appointment of the new President and CEO in May 2020. The criterion
is applied to the Restricted Share Plans of the President and CEO and the Company’s
Management Team. The deviation reinforced the alignment of the President and CEO’s
and the Company’s Management Team’s remuneration to the nancial performance of
the Company, promoted eorts ensuring the long-term interests of the Company, and
further aligned the interests of the President and CEO and the Company’s Management
Team with those of the Company’s shareholders. The nancial performance criterion
was modied by decision of the Board of Directors in February 2023. The threshold is
measured against a pre-set average threshold value for Segments ROCE (a minimum
value that must be achieved in order for the share reward to be delivered), for the
three-year vesting period of each Restricted Share Plan. The previous nancial
threshold was tied to an average value for ROCE (according to IFRS), during the restric-
tion period in question. President and CEO Jukka Moisio has not been granted shares
from the Restricted Share Plan 2022–2024. A threshold value tied to average Segments
ROCE between the nancial years 2022–2024 will be applied to any Management Team
allocations, as well as for the Restricted Share plan commencing in 2023, with a vesting
period between 2023–2025, as described in the Company’s stock exchange release
published on February 7, 2023.
The President and CEO is required to hold at least 25% of the shares received as
rewards from the long-term incentive programs and to accumulate the shares from
the incentive programs until the value of the shares received from the share programs
equals the annual gross base salary of the President and CEO.
Active Long-term incentive plans and shares granted to the President and CEO
Long-term incentive plan and
performance period Gross shares granted Maximum gross share award
1)
Performance criteria Pay-out of possible reward
Restricted share plan 2020–2022 10,000 10,000 Average Segments ROCE 2020–2022 H1/2023
Performance share plan 2021–2023 31,013 62,026 Segments ROCE (50% weight)
& Segments EPS (50% weight)
H1/2024
Performance share plan 2022–2024 27,680 55,360 Segments ROCE (50% weight)
& Segments EPS (50% weight)
H1/2025
Achievement of set targets 100% 200%
1)
The potential share rewards will be paid partly in shares of Nokian Tyres plc and partly in cash. Gross shares is the amount of shares earned, based on performance against set
targets and used to calculate the cash proportion. Actual shares delivered = net shares. Cash portion of the reward is intended to cover the taxes arising from the paid reward.
Pension and information regarding the termination
of the employment of the President and CEO
Pension accumulation and retirement age of the President and CEO is determined by
the practices and terms of the applicable law in the home country of the President and
CEO. An additional dened contribution pension plan that corresponds to the relevant
local market can be arranged by the Company. President and CEO Jukka Moisio does
not have a Company paid supplementary pension arrangement. The retirement age and
the pension are determined in accordance to the Employees Pensions Act.
The President and CEO’s period of notice is 6 months. If the agreement is terminated
by the Company, the President and CEO is entitled to compensation corresponding to
12 months’ salary and other benets, in addition to the notice period’s salary.
Malus and claw back
Based on the terms and conditions of the incentive plans, if the President and CEO
receives a reward based on the remuneration scheme that subsequently turns out to
be incorrectly paid due to intent or negligence by the President and CEO, Nokian Tyres
has the right to retroactively restate the amount and reclaim the excess part of the
rewards paid from the short- and long-term incentives pursuant to rules regarding
unjust enrichment.
The short- and long-term remuneration schemes are discretionary in nature and do
not form part of the terms and conditions of the service contract of the President and
CEO, and the Board of Directors shall decide on the implementation of the schemes
and their terms and conditions at any time.
Nokian Tyres did not exercise any malus or claw back rights during the nancial year
2022.
Remuneration and nancial development between 2018 and 2022
2018 2019 2020 2021 2022
Board remuneration, total pay EUR
Jukka Hienonen – – , , ,
Veronica Lindholm , , , , ,
Pekka Vauramo , , , , ,
Jouko Pölönen – – – , ,
Christopher Ostrander – – – , ,
Inka Mero , , , , ,
Heikki Allonen , , , , ,
George Rietbergen , , , , ,
Susanne Hahn – – – – ,
Raimo Lind , , , , ,
Kari Jordan , , , , –
Petteri Walldén , , , – –
Total (excl. fees paid to leaving members)
1)
, , , , ,
Board size, number of members
Average total pay per member
1)
, , , , ,
Index % .% .% .% .%
President and CEO, total pay EUR
Jukka Moisio May 27, 2020– – – , ,, ,,
Hille Korhonen Jun 1, 2017–May 26, 2020 ,, ,, ,, – –
Total ,, ,, ,, ,, ,,
Index % .% .% .% .%
Employee remuneration, average EUR
Salaries, incentives, and other related costs,
MEUR . . . . .
Group employees on average during
nancial year , ,
)
, , ,
Average per year, k EUR . . . . .
Index % .% .% .% .%
Financial development 2018–2022
Operating prot, MEUR . . . . .
Segments operating prot, MEUR – . . . .
Index
3)
% .% .% .% .%
EPS, EUR . .
)
. . –.
Segments EPS, EUR – .
)
. . .
Index
3)
% .% .% .% –.%
ROCE,% .% .% .% .% –.%
Segments ROCE,% – .% .% .% .%
Index
3)
% .% .% .% –.%
1)
Average total pay per Board member is calculated by
dividing the total fees paid to the Board members,
excl. members who left the Board during the
corresponding term. I.e. fees paid to Petteri Walldén
removed from year 2020 average, Kari Jordan from
2021 average and Raimo Lind from 2022 average.
2)
Figures corrected to include passive employments in
December 2019 (employees on long leaves).
3)
Financial measures used for index according to IFRS
reporting. Segments gures 2019–2022 presented
(not calculated in index) in accordance to Nokian
Tyres new reporting practices Stock exchange
release about Nokian Tyres new reporting practices
April 24th, 2020.
4)
EPS 2019 excl. the impact of the rulings on the tax
disputes of EUR 1.08 were EUR 1.81. Segments EPS
2019 excl. the impact were EUR 1.98.
Annual General Meeting 2023
The Annual General Meeting of Nokian Tyres plc will be held at Messukeskus in Helsinki,
Finland, street address Messuaukio 1, on April 26, 2023, at 10 a.m. EET. Registration of
attendants, the distribution of ballots and a coee service will begin at 8:30 a.m.
More information: nokiantyres.com/annualgeneralmeeting2023
Dividend payment
The Board of Directors proposes to the Annual General Meeting that a dividend of EUR
0.35 per share for the nancial year 2022 would be paid in May and that the AGM would
authorize the Board to decide on the second dividend instalment of a maximum of EUR
0.20 per share to be distributed in December. If a maximum amounf of dividends is paid,
a dividend payout ratio is –43%.
Change of address
Shareholders are advised to inform any changes in their contact information to the
book entry register in which they have a book entry securities account.
Financial information
Nokian Tyres publishes nancial information in Finnish and English. Financial reports,
statements, and stock exchange releases are available at nokiantyres.com/investors.
Comprehensive investor relations pages contain information on Nokian Tyres’ share,
largest shareholders registered in Finland and upcoming IR events, among others.
Nokian Tyres’ stock exchange releases can be subscribed at
nokiantyres.com/company/publications/order-releases/
Financial reports in 2023
• Interim Report January–March: April 25, 2023
• Half-year Financial Report January–June: July 21, 2023
• Interim Report January–September: October 31, 2023
Silent period
Nokian Tyres observes a silent period before issuing nancial statements, interim and
half-year reports.
• Start of the silent period: January 1, April 1, July 1, and October 1.
• End of the silent period: The results of the respective quarter are made public.
During the silent period, the company’s top management and Investor Relations do
not meet representatives of capital markets or nancial media, nor comment on issues
related to the company’s nancial situation or general outlook. If an event occurring
during the silent period requires immediate disclosure, Nokian Tyres will disclose the
information without delay in compliance with disclosure rules and may also comment
on the event concerned.
Flagging notications
Under the provisions of the Securities Markets Act, changes in holdings must be
disclosed when the holding reaches, exceeds or falls below 5%, 10%, 15%, 20%, 25%,
30%, 50%, 2/3 and 90% of the voting rights or the numbers of shares of the company.
Notications of changes in holdings or voting rights must be made without undue
delay. Shareholders are advised to send the agging notications to
aggings@nokiantyres.com
IR contact information
Regarding inquiries and meeting requests, you can send an email to
ir@nokiantyres.com
Päivi Antola, SVP, Communications, Investor Relations and Brand
Tel. +358 10 401 7327
Annukka Angeria, Senior Manager, Investor Relations and Strategic Project
Communications
Tel. +358 10 401 7581
Address:
Nokian Tyres plc
P.O. Box 20
(Visiting address: Pirkkalaistie 7)
FI–37101 Nokia
INVESTOR INFORMATION AND
INVESTOR RELATIONS
Investor information and investor relations
www.nokiantyres.com