KN will motivate its employees with the company's shares
KN (AB “Klaipėdos nafta”) – the operator of oil products and liquefied natural gas (LNG) terminals, says it will be the first state-owned company to part of rewards to its employees via the shares of the company. This change in the company’s employee motivation policy must also be approved by the company’s shareholders at the general shareholders’ meeting, which will take place on November 8.
The rules of the company’s share granting submitted to the shareholders for approval specify that in 2019, up to 50% of the annual reward for the 2018 results paid by the company to its employees may consist from the company’s shares. Ordinary shares of the company will be gifted to employees.
According to Mindaugas Jusius, KN CEO, with this decision the company seeks to enhance the employees’ motivation for achievement of long-term goals of the company, enhance the employee involvement and promote the responsibility for common operational results.
“KN focuses on operation in Lithuania as well as on the international scale. Therefore, it is very important for us to unite and preserve a team of ambitious, competent, motivated and loyal employees concerned with the long-term growth of the company. By granting the company’s shares to our employees we give them the possibility to become co-owners of the company and acquire the right to participate in the company management irrespective of their position or status in the organisation,” the head of KN emphasised.
According to Mindaugas Jusius, it is rather difficult for a state-owned company to use only wages to compete for talents with private capital companies, therefore, the organisational philosophy and culture become very important. The planned changes in the motivational system are a part of consistent modification of the KN organisational culture.
With the new generation of employees joining the labour market, we have to show that state-owned companies can be progressive organisations following the recommendations of good governance, which have ambitious aims and provide wide possibilities for employees to grow and improve professionally. That is why we included our team into the process of renewal of the company’s virtues in the end of the last year, and we have been intensively working in pursuance of a business strategy by 2030, revising employees’ wages and measurement system for it to meet the current requirements while enhancing the employees’ personal involvement and motivation,” said Mindaugas Jusius.
After the decision offered by KN is approved by the shareholders, the reserve for own shares from the undistributed profit, which may not exceed 1.5% of the company capitalisation, must be formed. The size of the reserve will be closely related with the internal and long-term aims of the company and its human resources policy.
According to the company’s remuneration guide, the annual reward to the company’s employees will be granted when the company achieves its business goals, and the size of the reward will be established with regard to the employees’ personal achievements within the company.
At the annual awards “Best employer of the year” organised by the daily “Verslo žinios” KN was elected as the best employer of 2018 in the sectors of transport and logistics. Best employers of the year were awarded based on the assessment of 3 groups of indicators: company stability, wages and reputation.
The state owns 72% of KN shares, 10% of shares belong to the concern “Achema”, and 18% of the company’s shares currently belong to minority shareholders and dealing takes place in “Nasdaq Vilnius” stock-exchange.