Norwegian Code of Practise:

• The board of directors is required by law to establish guidelines for the remuneration of the members of the executive management. These guidelines are communicated to the annual general meeting.
• The guidelines for the remuneration of the executive management should set out the main principles applied in determining the salary and other remuneration of the executive management. The guidelines should help to ensure convergence of the financial interests of the executive management and the shareholders.
• Performance-related remuneration of the executive management in the form of share options, bonus programmes or the like should be linked to value creation for shareholders or the company's earnings performance over time. Such arrangements, including share option arrangements, should incentivise performance and be based on quantifiable factors over which the employee in question can have influence.

Guidelines

The Board has drawn up separate guidelines for the stipulation of salaries and other remuneration to executive management. The CEO's terms of employment are set by the Board. Each year, the Board undertakes a thorough review of salary and other remuneration to the CEO. The evaluation is based on market surveys of corresponding positions.

The structure of the incentive system for the other members of corporate management is determined by the Board, and presented to the General Meeting for information purposes. The terms of employment are proposed by the CEO, and subject to the approval of the Chair of the Board.

The Board's attitude to executive management's salaries is that they should be competitive, but not at the top end of the scale.

The incentive system consists of basic wages, bonus, pension and severance schemes, and benefits in kind.

Performance-related remuneration

The Board of Directors adopted a new bonus system in 2006. Performance-related remuneration is linked to value creation for shareholders or the Group's earning performance over time. The prerequisites for the payment of performance-related remuneration are described in Note 31 to the corporate financial statements. Altogether, the Group has about 90 managers who are covered by an incentive system that includes an element of individual performance. The criteria for the assessment encompass changes in the Group's financial results, the business area's or the unit's performance, tied-up capital and the achievement of targets related to improvements and the long-term perspective.

Conditions

Remuneration to executive management and the Board of Directors is described in Note 31 to the corporate financial statements.

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