Remuneration of CEO - Jouko Karvinen 

Remuneration and pension in 2009

* The CEO gave up his right to company-paid housing in London during 2008 and received in exchange a cash allowance equivalent to the housing cost; his cash salary was EUR 834 198 before payment of the cash housing allowance.

** The Short Term Incentive result for performance year in 2007 and 2008 (payable 2008 and 2009) were converted to Restricted Share Awards.

The CEO was employed from 1 January 2007 and took office following the 2007 Annual General Meeting on 29 March 2007, his contract was approved by the Board on his appointment. It has a notice period of 6 months with a severance payment of 12 months salary on termination by the company but with no contractual payments on any change of control. Benefits include a company car and pension provision under a company defined contribution plan that has acceptance from the UK Inland Revenue. The scheme is defined contribution - pension is defined by the contribution paid and the investment result. The company and CEO contributes to the scheme with a fixed contribution of 40 percentage of the CEO’s base salary, of which the company contributes 35% of base salary and CEO contributes 5% of base salary. An additional pension contribution was made in 2007 as compensation for pension benefits lost by the CEO on leaving his former employment. The CEO retires at sixty.

The CEO is entitled to a STI programme decided on by the Board each year giving a maximum 50% of annual fixed salary. The STI programme for 2009, the outcome of which will be assessed in the first quarter of 2010, was related to Group Free Cash Flow.

For the STI payable in 2009 and 2008 the CEO’s STI result was converted to Restricted Share Awards of 31 386 (21 194) shares. Based on the average share price from 1 April to 7 April 2009 the value at the grant date, 30 April 2009, was EUR 93 872 (EUR 163 614). The vesting will be over a three year period from 2010 to 2012.

Option Programmes for CEO

No options were awarded in 2008 or 2009. In 2007 the CEO was granted 157 646 options on joining Stora Enso with the estimated value at the grant date of 2 January 2007 as calculated by the option pricing model being EUR 365 000. During 2009 the CEO did not exercise any of these options.

Long Term Incentive (LTI) programme for CEO
The CEO received an Award under the Performance share plan 2009 of 80 000 shares with the valuation at the grant date of 27 May 2009 being EUR 400 000 based on the share price at the grant date of EUR 5.00 and assuming targets are met.

During the year the number of shares settled on the CEO from earlier awards derived from Restricted Share Programs and Performance Share Programs amounted to 35 105 (16 796) having a cash value of EUR 115 495 (EUR 140 415) at the 1 March 2009 settlement date. Based on the share price of EUR 5.00 (EUR 8.36) at that date.

The CEO did not receive any new Restricted Share Award other than the conversion of his STI payable for 2009 (described above). The aggregated number of outstanding shares derived from previous years restricted share programmes to be settled in 2010 is 18 913. The corresponding number to be settled in 2011 is 15 774.

The CEO is also eligible from 2007 to participate in the Senior Executive section of the Performance Share Plan as detailed above. Vesting period for CEO is four years (March 2008, March 2009, March 2010 and March 2011). The performance criteria for 2009 was EDITDA, Economic Margin and Total Shareholder Return (TSR).

Due to the extraordinary global financial situation GET including the CEO decided to work without pay for one month during 2009, in addition the salary for the CEO remained unchanged. The ordinary annual salary review was postponed from March 1 to December 1 and the annual incentive result for performance year 2009 was decided to be paid in shares and deferred one year from March 2010 to March 2011. GET members with significant change in responsibility during 2009 received their revised salary from May 1, 2009.