veikkaus` year 2009

VEIKKAUS’ YEAR
CSR REPORT
ANNUAL REPORT
VEIKKAUS’ YEAR 2009
Veikkaus’ operations and existence are based on responsibility. Veikkaus’
year 2009 is a combined annual report and CSR report. It is aimed at Veikkaus’
stakeholders and covers all Veikkaus’ operations.
In 2009 Veikkaus published its revised vision: to be the world’s leading lottery in
2013. In this report, you can read about the highlights of 2009 and our plans for
the future until 2013.
Veikkaus will celebrate its 70th year of operations in 2010. A Finn to Win!
Veikkaus Oy, the Finnish National Lottery
CONTENTS
2
3
4
Key indicators
Events 2009
CEO’s review
8
10
12
BECOMING THE WORLD’S LEADING LOTTERY THROUGH A STRONG VISION
Veikkaus’ way of operating
Active and interactive stakeholder cooperation
CSR objectives and achievements in 2009 - objectives for 2010
16
17
18
19
20
21
22
26
VEIKK AUS IS SKILLED
Customer knowledge supports responsible gaming
Registered gaming continued to increase
Close connection with customers
Responsibility manifested in everything from game ideas to practice
Internet gaming more and more popular
Open communications, responsible marketing
Objective: an even better workplace
Points of sales from the southernmost Finland to Lapland
30
32
33
VEIKK AUS – RESPONSIBLE PROFITMAKER
Profit for the common good
Veikkaus operates systematically
Many small environmental deeds have big impacts
37
36
38
40
PROFIT TO SOCIET Y
The journey of one euro spent on Veikkaus games in 2009
Words from a representative of the Ministry of Education
Words from beneficiaries
46
48
49
50
53
54
58
60
62
VEIKK AUS AS PART OF SOCIET Y
Reliable and responsible game operator
Operating environment affected by many factors
Veikkaus’ CSR Programme
Comparison with the GRI recommendations
Independent assurance report
Corporate Governance review 2009
Board of Directors 2009
Executive Teams
Organization
64
68
69
70
71
72
75
84
85
86
87
88
FINANCIAL STATEMENT 2009
Board of Directors’ report 2009
Statement of comprehensive income
Balance sheets
Cash-flow statement
Changes in shareholders’ equity
Accounting principles
Notes to the financial statements
Auditors’ report
Statement by the Supervisory Board
Glossary
Content and delineation of the report
Contacts
CSR Report 2009
1
KEY INDICATORS
DEVELOPMENT OF TURNOVER
(EUR MILLION)
1600
BREAKDOWN OF ONE VEIKK AUS EURO
2009
1400
1200
1000
800
PRIZE PAYOUT
4.7 cents
RETAIL COMMISSIONS 5.3 cents
OPERATING COSTS
ARTS
200
0
2005 2006 2007 2008 2009
9.2 cents
11.8 cents
SPORTS
7.1 cents
SCIENCE
5.0 cents
YOUTH WORK
2.6 cents
UNDISTRIBUTED
PRIZES’ FUND
3.5 cents
* The calculations are based on the distribution
of Veikkaus’ turnover between different cost items.
DEVELOPMENT OF FINANCIAL RESULT
(EUR MILLION)
500
2009
1,557.6
464.6
468.8
468.8
30.7
791.1
3 208
82.5
72.6
414.0
2008
1,474.8
440.7
449.1
449.1
30.9
754.6
3 166
80.3
68.3
407.9
Change in %
5.6%
5.4%
4.4%
4.4%
-0.6%
4.8%
1.0%
2.7%
6.3%
1.5%
1,077,566
744,846
355
6.3
42.6
12.8
4
70%
836,097
507,807
354
5.1
43
13
3.9
-
28.8%
46.7%
0.3%
23.5%
-0.9%
-1.5%
2.6%
-
ENVIRONMENTAL RESPONSIBILITY
Electricity consumption at the head office (MWh)
4,400
Heat energy consumption at the head office (MWh)
2,980
4,730
Water consumption at the head office (m3)
CO2 emissions from electricity consumption at the head office 4 757
835
CO2 emissions from heat consumption at the head office 5
Degree of re-utilization of waste at the head office %
99
4,540
2,541
4,230
787
718
95
-3.1%
17.3%
11.8%
-3.8%
16.3%
4.2%
50.8 cents
LOTTERY TAX
400
KEY INDICATORS OF CSR
ECONOMIC RESPONSIBILITY
Turnover (EUR million)
Operating profit (EUR million)
Profit before appropriations
Financial result
Investments (EUR million)
Prize payout to players (EUR million)
Number of POS (end of the year)
Retail commissions (EUR million)
Lottery tax (EUR million)
Return to the Ministry of Education (EUR million) 1
1316 1361 1391 1475 1558
600
*
DISTRIBUTION OF VEIKK AUS FUNDS
2009
401 408 427 449 469
400
SOCIAL RESPONSIBILITY
Registered players (end of the year)
Veikkaus Card holders (end of the year)
Number of employees (end of the year)
Total turnover of employees (%)
Average age of employees (years)
Average length of employment contracts
Total work enjoyment (traditional staff survey)
Total work enjoyment (GPW) 3
1)
300
2)
3)
200
4)
5)
2
In 2009 Veikkaus returned EUR 414 million to the Ministry of Education. In addition, we returned a total of EUR 47.0 million of funds
accumulated in the previous years to the Ministry of Education during the financial year. The Ministry of Education distributed a
total of EUR 461 million to the various beneficiaries during the year under review.
Two staff surveys were carried out in Veikkaus in 2009. The traditional staff survey follows a scale of 1 to 5.
The trust index indicates how many of the respondents agreed or almost agreed with the positive statements concerning the employer.
The CO2 coefficient according to the energy company KSS Energia was 171.97 g g/kWh.
The CO2 coefficient according to the energy company Vantaan Energia was 280.3 g/kWh.
100
0
2005 2006 2007 2008 2009
ARTS
44.4%
incl. LIBRARIES 6.4%
EUR 204.7 million
EUR 13.1 million
SPORTS
EUR 124.4 million
SCIENCE
YOUTH WORK
Total
2
CSR Report 2009
27.0%
Veikkaus has been granted the exclusive right to operate betting and pools games and lotteries in Finland.
18.9%
EUR 87.1 million
The Council of State has also granted the licence to run games to two other gaming organizations: the Finnish
9.7%
EUR 44.8 million
Slot Machine Association RAY and Fintoto. The current gaming licences will be effective until the end of 2011.
EUR 461.0 million
Veikkaus is owned by the Finnish State and the distribution of the funds is laid down by the Ministry of Education.
EVENTS 2009
JANUARY
Long-term cooperation with the Finnish film industry launched
FEBRUARY
VEIKKAUS GAMES
Viking Lotto reformed
MARCH
The European Parliament approved a report on internet gaming and gave its support to the policy of nationally regulated gaming.
APRIL
The final report of the Finnish lottery legislation project was prepared.
MAY
Crosses, i.e. draws as the outcomes of matches, were introduced to betting of Finnish baseball.
The Great Place to Work staff survey was finalised.
Veikkaus passed the EL Responsible Gaming Standards among the first lotteries in Europe.
JUNE
LottoPlus and VikingPlus were launched.
LOTTO
Keno’s reformed TV draws launched
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KENO
MULTIBET ~E$~E&$~ LIVE BETTING
FIXED ODDS BETTING
Veikkaus received the best ratings for reliability and integrity in the CSR survey. (Finnish market research house Taloustutkimus)
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AUGUST
Veikkaus ranked second in the survey Companies and CSR (by TNS Gallup)
SEPTEMBER
The milestone of one million registered customers was achieved.
Veikkaus invited over 5 200 stakeholder representatives to take part in an internet interview.
OCTOBER
Veikkaus instant tickets were reformed and the new Mega-Ässä Instant was introduced.
Lotto and Veikkaus ranked among the 150 most popular Finnish brands
(Markkinointi & Mainonta magazine; Taloustutkimus research house)
NOVEMBER
The Jokers and Fixed Odds Betting were reformed.
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LUCKY WORDS
FOOTBALL POOLS
JULY
Veikkaus made all its games subject to an age limit of 18 years.
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INTERNET
INSTANTS
DECEMBER
Veikkaus’ Loyal Customer Program was rated as the second most recommendable among the most popular loyal customer
programs in Finland (The loyal customer program survey Kanta-asiakasbarometri, 11/2009)
CSR Report 2009
3
CEO’S
REVIEW
A large part of Finns support the current gaming system, based on the State’s exclusive
right to operate games. The comprehensive offerings, responsible operations, and the
financial profit to all citizens are obvious.
While the support Finns show to the current system is among the most unanimous in Europe, even the
European Parliament has given its uncontroversial support to gaming operations that are regulated by
society. In March 2009 the European Parliament voted in favour of state-controlled gaming with the overwhelming majority of 544 to 36. The broad majority of the Parliament – across different nationalities and
party boundaries – definitely turned down the attempt to abolish the exclusive right system. The Parliament justified its position by the special nature of gaming, the related social detriments and risks of crime,
as well as the fact that the financial profit from games belongs to the entire society.
FACING THE JUBILEE IN PERFECT SHAPE
In 2010 Veikkaus will celebrate its glorious 70-year old existence in a better shape than ever before.
Veikkaus generated a profit of EUR 468.8 million last year, i.e. EUR 19.7 million more than in the year
before – which was a record year, too! In 2009, Veikkaus reinforced its position as one of the most profitable companies in Finland. By attaining larger profits, Veikkaus can improve its beneficiaries’ capacity to
operate and offer more options to all Finns to benefit from the company’s profits. Of course, the benefit
Veikkaus generates to society covers much more than the mere economic profit. Above all, it is the principle of responsible gaming that counts. Finns’ respect for Veikkaus’ brand, reflecting Veikkaus’ operations
as a whole, has also increased considerably.
We have managed to swim upstream in a difficult economic situation. In general, even the best gaming
companies in Europe are at the level of 2008 in terms of sales. Veikkaus has been successful because we
have managed to take into account the changes in our operating environment, use the information on our
more than one million loyal customers in an efficient way, and develop our operations in all sectors.
4
CSR Report 2009
According to our new vision, Veikkaus will be the world’s leading lottery
in 2013. Achieving this objective requires that we develop in many fields.
Veikkaus needs to be managed and developed in a way that places us in
the top as a lottery and as a company in general on all parameters. The
focus is on strategic thinking which must anticipate the changes in the
operating environment and influence them. We need to earn full support
and approval from society. For its staff, Veikkaus must offer a challenging and meaningful working environment and a chance to continuous skills
development.
A good company has to operate smoothly and be easily managed. At
the end of the year under review we revised our organization in order to
achieve excellent operational capacity.
A YEAR OF GAME REFORMS
Veikkaus’ success is based on the systematic collection, in-depth analysis, and use of customer knowledge. Our customers can benefit from the
way we use customer information, as we introduce product reforms and
new games.
At the beginning of 2009 Keno’s TV game show was reformed thoroughly
and Viking Lotto was revised. We continued to work on the reform of our
largest game Lotto. In 2007, we raised Lotto’s basic jackpot to at least
one million euros. At the end of the year under review, we launched the
additional prize tiers in Lotto and Viking Lotto, LottoPlus and VikingPlus.
Although Lotto is a game of big dreams, our customers had wished for a
better chance to win even smaller prizes. Finns have definitely welcomed
our latest Lotto reform: currently clearly over fifty percent of the players
opt for the additional prize tiers while playing. All in all, the Plus prize tiers
attracted players for nearly 39 million euros in the first half-year period
during which they were offered.
We reformed all our instant scratch tickets in autumn 2009. The jackpots
were raised and the number of smaller prizes was multiplied. We also
launched a new instant ticket, Mega Ässä Instant, with the largest jackpot
of all the instants: 500 000 euros.
Joker was reformed thoroughly at the end of the year. The number of Joker’s prizes was multiplied by seven, increasing the odds of winning considerably. Joker’s transformation and the new TV game show attracted a lot
of attention. As a result, Joker has gained more publicity and is no longer
overshadowed by Lotto.
We will continue with the reforms in 2010. The internet gaming service will
be reformed thoroughly, and we will keep developing new products as well
as improving our existing games.
RECOMMENDED BY CUSTOMERS
We have over one million registered customers already, playing both on the
internet and with their Veikkaus Cards at the retail outlets. We have been
developing Veikkaus Card’s customer benefits from 2007, and our hard work
is now bearing fruit. In a survey on loyal customer programs carried out at the
end of the year, Veikkaus Card was rated as the second most recommendable
among the most popular loyal customer programs in Finland.
LOTTERIES ACT TO CLARIFY GAMING POLICY
The final report of the Finnish lottery legislation project, prepared in April
2009 proposed that Veikkaus, the Finnish Slot Machine Association RAY,
and Fintoto would be granted a legal monopoly to operate games in Finland. There will only be changes in the distribution of labour between
the gaming organizations as regards horse betting. The lottery legislation working group proposed that starting from the beginning of 2012,
all horse betting should be operated by Fintoto. The amendments should
take effect at the beginning of 2012. We can thus keep developing our
operations in such a way that our beneficiaries’ profit expectations will be
fulfilled even in the future.
RESPONSIBLE, RELIABLE, AND OPEN OPERATIONS
Finns regard Veikkaus as a responsible company and expect us to work for
responsible gaming. Responsibility must show in all our deeds and operations. Veikkaus was among the first gaming companies to carry out an assurance in accordance with the EL Responsibility Standards. In June 2009,
we decided to make the games in all our sales channels subject to an age
limit of 18 years. We did this to prepare for the age limit that will be laid
down in the new Lotteries Act.
Veikkaus belongs to all Finns. That is why we need to listen carefully to
our stakeholders. In autumn 2009 we conducted an extensive stakeholder
survey, which yielded versatile feedback, as well as over 9 000 contentrelated ideas. The most significant stakeholder expectation turned out to
be that our operations should remain reliable and open.
Veikkaus’ strategic focuses for the year 2010 have been identified as CSR,
a moderate increase of the profit, the number of loyal customers, quality
improvement, and the enhancement of the company’s value. As a company,
Veikkaus is even stronger than before, on its way to becoming the world’s
leading lottery.
I wish to thank Veikkaus’ customers, retailers, game sales clerks, partners in
cooperation, and the entire staff for their excellent performance in 2009.
It is thanks to you that Finns can continue to enjoy high-quality culture,
sports, science, and youth work! A Finn to Win!
Risto Nieminen
CSR Report 2009
5
BECOMING THE WORLD’S LEADING
LOTTERY THROUGH A STRONG VISION
Veikkaus revised its vision at the end of 2009. Veikkaus aims at being the world’s leading
lottery in 2013. Veikkaus organizes games responsibly and reliably, channels the demand for
games efficiently, and works to increase its value to its shareholder and all Finns. Our operations are based on openness and transparency. In order that we could attain our objectives, we
need to be the world’s leading lottery in all sectors of our operations.
In order to succeed, we must know our stakeholders well. Veikkaus has an exceptionally stakeholder wide network, covering all Finns. In the year under review, Veikkaus invited representatives from all of its stakeholder groups to participate in an internet interview simultaneously
and using the same interview contents for the first time. On the basis of the responses, we
were able to develop our stakeholder cooperation further and to meet the expectations of the
different stakeholder groups.
CSR Report 2009
7
VEIKKAUS’ WAY OF OPERATING
FROM STRATEGIES TO OBJECTIVES
Veikkaus’ strategies consist of the operating environment, customer relations, development, as well as the service and human resources strategies. The operating environment strategy aims at influencing Veikkaus’ operational capacity in the long term. The objective of the customer relations strategy is to create and develop Veikkaus’
VALUES*
customer relations. The service strategy, in turn, aims at ensuring smooth gaming and easy gaming transactions to our customers. The target of the human resources
strategy, part of the internal operations, is to turn Veikkaus into an excellent workplace.
RESPONSIBLY
RELIABLY
CREATIVELY
FOR THE COMMON GOOD
MISSION
A Finn to Win. Veikkaus generates versatile
value to Finnish society by operating
games reliably and responsibly.
VISION 2013
Veikkaus will be the leading lottery in the world in 2013.
The implementation of this vision is evaluated against,
e.g., the following objectives:
~
Veikkaus operates games responsibly and reliably, and channels Finnish
gaming. Support and approval from society are secured.
~ Veikkaus is managed and developed in a way that ensures our high esteem
as a company. Our objective is to become the best company in our field
of operations.
For its staff, Veikkaus offers a challenging and meaningful
~
working environment, creating opportunities to continuous
skills development.
8
CSR Report 2009
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~ Understanding customer relations
~ Responsibility across the operations
~ Improving the quality and ways of operating
~ Building an efficient and flexible
production structure
~ Excellent workplace
VEIKKAUS’ MOST IMPORTANT OBJECTIVES AND ACHIEVEMENTS
OBJECTIVES FOR 2009
ACHIEVEMENTS
OBJECTIVES FOR 2010
1. POSITION
Customers’ overall satisfaction at a good level (Veikkaus’ internet survey); in the Companies
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is reinforced in the changing operating
and CSR survey Veikkaus ranked second in the series based on the citizens’ opinions on large
~ ATb_^]bXQ[TVa^fcW^U_a^
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environment
companies (TNS Gallup).
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2. SHAREHOLDER VALUE IMPROVED
The Ministry of Education distributed a total of EUR 461 million (+13%) of Veikkaus funds.
3. CORPORATE SOCIAL RESPONSIBILITY
One of our achievements is that the majority of Finns regard Veikkaus as a responsible
is reflected in all our operations
4. Moderate growth of PROFIT
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or a very responsible company (Finnish market research house Taloustutkimus).
Veikkaus attained a financial profit of EUR 469 million (+4.4%)
during the year under review.
5. Quantity and quality of CUSTOMERS AND
The number and share of identified customers of all the players increased.
CUSTOMER RELATIONS DEVELOP
We already have over one million registered customers. Registered playing represented
42% of our total sales at the end of the year.
6. OPERATIONS INCREASINGLY EFFICIENT
*
VALUES
BEHIND
IT ALL
Staff skills and skills improvement have been among our areas of focus. See achievements p. 24.
VEIKKAUS OPERATES FOR THE COMMON GOOD
RELIABLY
Veikkaus generates versatile value to Finns. We offer Finns an oppor-
Veikkaus’ employees can rely on each other in all situations. Open
tunity to participate in the promotion of the common good safely and
interaction is an essential part of reliability. Our customers can always
reliably by playing Veikkaus games. Veikkaus offers Finns a chance to
trust in the game products we offer.
work for the common good. We employ indirectly tens of thousands
of Finns.
RESPONSIBLY
CREATIVELY
CSR is at the very heart of Veikkaus’ strategy and actions in practice.
We want our games, services, and the way we operate reflect creativ-
Our customers must be able to rely on us one hundred percent. Being
ity and joy. We also encourage our staff to be innovative.
responsible for our operations to society, we shall report on our operations widely and openly.
CSR Report 2009
9
ACTIVE AND INTERACTIVE STAKEHOLDER COOPERATION
Veikkaus has an exceptionally extensive and versatile stakeholder network. We aim at open and interactive discussion and cooperation with all
our stakeholders. It is important that we are aware of what our stakeholders expect from us. We are in continuous dialogue with our customers,
game sales clerks, staff, beneficiaries, partners in cooperation, as well
as the media, political decision-makers and officials. Besides distributing
information, we engage in debates, answer questions, take part in seminars, and meet our stakeholders. We want active and regular interaction
with our stakeholders. Knowing our stakeholders and the fact that they
trust in us and our operations are the prerequisites of our success.
STAKEHOLDER EXPECTATIONS INVESTIGATED
In September 2009 for the first time, we invited representatives of all of
our stakeholder groups to take part in an internet interview at the same
time and using the same interview contents, with the topic: “What do you
2
top issues for
our stakeholders
openness
and reliability
expect from Veikkaus in the future?” The different stakeholders thus had
tion to writing down their own expectations, the respondents were given
customers also had very diverging views on many themes; especially the
the chance to tell us freely and effortlessly what and what type of opera-
a chance to express their opinion on other respondents’ views by choos-
exclusive right inspired comments for and against. We will be using the
tions they expected from us.
ing between the options agree – disagree. Thus, we managed to gather
responses and ideas in our efforts to meet our customers’ expectations.
information not only on the stakeholders’ content-related ideas but also
CUSTOMERS OUR LARGEST STAKEHOLDER GROUP
on how much variation there was in the opinions. In all, we received over
STAKEHOLDER UPDATE
The stakeholder representatives were invited to answer the internet in-
9 300 content-related ideas and expectations for Veikkaus’ future.
As a result of the extensive internet interview project in particular, we
terview by email, at Veikkaus’ website, and in Facebook. In a period of two
10
revised the description of Veikkaus’ stakeholders. We made the number
weeks, a total of over 5 200 customers, retailers, game sales clerks, media
VEIKKAUS EXPECTED TO OPERATE OPENLY AND RELIABLY
of our stakeholder groups more concise and updated the expectations.
representatives, political decision-makers, officials, partners in coopera-
The topics to concern our customers the most were games and gaming,
Veikkaus’ way of operating was brought up-to-date and especially
tion, and staff members answered the survey. The group to participate
prizes, and Veikkaus’ profit to society, but the expectations of the differ-
the achievements of the year under review were recorded. During the
in the interview by far the most actively was that of our customers, who
ent respondents showed considerable variation. Among the important is-
stakeholder update we also made use of the staff and sales clerk surveys,
also make up our largest stakeholder group in numbers.
sues, they cited the openness and reliability of our operations, the prizes,
customer feedback, and our staff’s skills and experiences. It is a challenge
the fact that Veikkaus is Finnish, as well as the entertainment and excite-
for us to meet the different and sometimes even conflicting stakeholder
DIFFERENT VIEWS OF VEIKKAUS AND GAMING
ment we offer. Openness and reliability ranked high in the responses of
expectations. Successful stakeholder cooperation requires that we man-
The objective of the internet interview was to gather information about
all stakeholder groups, and the respondents were quite unanimous about
age to balance between the different expectations.
the issues important to Veikkaus’ stakeholders. Different angles and
them. The distribution of the proceeds was another theme that arose
thoughts were suggested on how to answer the question “What do you
from the answers: there were questions on what Veikkaus funds are used
expect from Veikkaus in the future?” The respondents could comment on
for, as well as suggestions on how the funds should be allocated and
and tell about their expectations inspired by one or more angles. In addi-
how the distribution of the funds should be communicated in public. Our
CSR Report 2009
VEIKKAUS’ STAKEHOLDERS
EXPECTATIONS FROM VEIKKAUS
VEIKKAUS ACTIONS
CUSTOMERS
~ Open and reliable operations
~ Interesting games, a harmless pastime,
excitement to everyday life
~ Finnish game operator
~ Profit to a large number of beneficiaries
~
~
~
~
~
Active use of customer information
Advice to customers
Loyal customer magazine X
Responsible and interesting game offerings
Reliable prize payout
~ Satisfaction at a good level according to the customer satisfaction
survey and the loyal customer survey, see pp. 17–18.
~ Number of registered customers exceeded one million.
~ Number of Veikkaus Card holders increased to some 745 000.
~ The tools for self-control of gaming were reformed on the internet.
STAFF
Veikkaus’ staff at the head office and the regional
offices, a total of 355 employees.
~ Transparency and open communications
~ Equal and impartial treatment
~ Fairness
~
~
~
~
~
~
~
~
Outstanding workplace
Staff surveys
Individual and group performance review talks
Staff’s intranet, i.e. Innet
IdeaSampo
Personnel magazine 1X2
Staff’s news and market forums
Investing in the education and development
of different employee groups
~ Two staff surveys were commissioned: the traditional staff
survey *** and the Great Place to Work survey that was carried
out for the first time, for the results, see p. 22.
~ Secretarial forums were organized to support the work of
secretaries and assistants.
RETAILERS AND
VEIKKAUS GAME SALES CLERKS
Retailers in a contractual relationship with Veikkaus,
Veikkaus game sales clerks
~
~
~
~
~
~
BENEFICIARIES
Finns engaged in the arts, sports,
youth work, and science.
All Finns who benefit from Veikkaus’ financial profit.
~ Steady income to the beneficiaries,
securing the continuity of the support.
~ Active communications
~ Cooperation
THE MEDIA
Nation-wide, regional, and local media:
the printed media, radio, and TV.
The social media
~
~
~
~
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Parliament, Council of State,
European Parliament and Commission
Players of Veikkaus games
*
**
***
Good source of income
Versatile game offerings
Customer service
Sales support
Active communications
Information about the beneficiaries of Veikkaus funds
ACHIVEMENTS 2009
~ Successful sales support through
communication and training
~ Smoothly operated game system
~ Interesting game offerings
~ A retailer survey was carried out, together with
POS-internal reviews and audits see p. 26.
~ The game sales clerk training was revised and an
internet learning programme was introduced.
~ The ”Myynet” retailer web service was reformed.
~ Controlled and sustainable growth of profit to
ensure the beneficiaries’ operational capacity.
~ Regular contacts.
~ Game event and marketing cooperation
with associations, leagues, and series.
~ Veikkaus’ profit increased by 4.4%, which guarantees the
planned proceeds for the beneficiaries.
~ A club survey covering the sports beneficiaries was carried out.
~ Veikkaus has been present in the most significant domestic
sports events.
Rapid and open communications
Social responsibility and reliability
Accessibility
Gaming proceeds in a key role in
the operation of Finnish society
~ Press releases and publication of prizes
won in the games
~ Regular meetings with the media
~ Individual meetings with reporters
~ Media follow-up
~ A communications survey to the representatives of the
media was carried out, with excellent outcomes, see p. 21.
~
~
~
~
~
Responsible gaming policy
Being Finnish
Sustainable profit to society
Open and reliable operations
Fighting crime and fraud
~
~
~
~
~
MINISTRIES AND AUTHORITIES
Shareholder Ministry of Education, Ministry of the
Interior, Lotteries and Firearms Unit of the Ministry of
the Interior*, the police**, official supervisors, Ministry
of Social Affairs and Health, National Institute for
Health and Welfare
~
~
~
~
Controlled, sustainable, and secure growth of profit
Responsible gaming
Prevention of social detriments
Prevention of crime and fraud
~ Regular contacts
~ Quarterly financial reports
~ CSR and annual report
~ New games launched and existing games reformed.
~ Veikkaus attained the expectations for the growth of its
profit; financial result improved by 4.4%.
PARTNERS IN COOPERATION
Subcontractors, IT partners, media, advertising, and
communications agencies, retail trade chains, sports
federations and leagues, Peluuri helpline
~ Innovative, versatile, and responsible game offerings
~ Open, reliable, and long-term relationships of cooperation
~ Long-term contracts and
sustainable cooperation
~ Centralised acquisitions
~ Contracts updated.
~ Environmental questionnaire was made part of
the acquisitions processes.
Regular meetings
General meeting
Supervisory Board
Quarterly financial reports
CSR and annual report
~ Veikkaus ranks high in all national and international
comparisons in its field of business, see p. 30.
Lotteries and Firearms Unit of the Ministry of the Interior was in charge of the official duties related to gaming until 31 Dec 2009.
As of 1 Jan 2010, gaming is controlled by the police; the Ministry of the Interior approves the rules of the games.
Veikkaus has carried out a staff survey every year. In 2009 we exceptionally made two staff surveys.
In addition to the annual survey, we carried out the Great Place to Work survey, which will replace the previous staff survey in the future.
CSR Report 2009
11
CSR OBJECTIVES AND ACHIVEMENTS IN 2009 – OBJECTIVES FOR 2010
ECONOMIC RESPONSIBILITY OBJECTIVES AND ACHIEVEMENTS 2009
Moderate growth of profit and funds guaranteed to beneficiaries
SOCIAL RESPONSIBILITY OBJECTIVES AND ACHIEVEMENTS 2009
Registered customers total over one million
4 Veikkaus’ financial profit increased 4.4%, the Ministry of Education distributed 13% more to the beneficiaries than in the previous year.
4 The milestone of one million registered customers was attained in October. At the end of the year under review, Veikkaus had a
total of over 1 077 000 registered customers (some 836 000 in 2008), of whom 745 000 were Veikkaus Card holders.
Veikkaus brand image improved
4 Veikkaus brand ranked 116th in the Brand valuation study 2009, whereas it only ranked 282nd in the year before.
Structure of customer base developed responsibly
4 The number of identified players and their share of the total gaming increased.
Active points of sales 3 200 at the end of the year
4 The active points of sales totalled 3 208 (over 3 150 POS in 2008).
Ethical evaluation of games using the Responsibility Evaluator Tool has been established as part
of the product development process
4 A total of 14 evaluations were carried out during the year under review.
ECONOMIC RESPONSIBILITY OBJECTIVES FOR 2010
~ Moderate growth of profit continues
Veikkaus shall assure the requirements of the EL Responsibility Standard it has signed
4 The EL Responsibility Standard was assured by PricewaterhouseCoopers.
~ Return objective to the Ministry of Education is attained
~ Weekly number of customers at retail outlets increases
Veikkaus conducts the self-audit required by the World Lotteries Association (WLA) concerning
~ Opening hours of stores and the game system are considered in retail sales and the visibility of the points
the implementation of the principles of responsible gaming
4 Using WLA’s criteria, Veikkaus evaluated its level of responsibility as 4 (on the scale from 1 to 4). The self-evaluation was proved
of sales is made more uniform
correct in practice, as we passed the even more demanding EL responsibility standard, which entitles to reaching the level 4 on
WLA’s responsibility scale.
The issues arisen from the Staff Satisfaction Survey 2007 – openness, workload, distribution of labour,
job rotation, and equal opportunities – are developed further in 2009. See also p. 24.
4 The Staff Satisfaction Survey 2009, carried out in the autumn showed an improvement over the results of the year 2007
in all sectors. New development targets were chosen for 2010.
4 The year 2009 was themed as ”Responsible Veikkaus’ staff”, and the focus of communications was on open and effective
information sharing, meeting practices, community spirit, and good workplace atmosphere.
CSR across all operations
4 Veikkaus passed the assurance of the EL Responsible Gaming Standard.
4 The ethical guidelines of marketing communications were updated.
4 The Responsibility Evaluator Tool was used to analyse the degree of responsibility of a total of 14 game ideas and game reforms.
4 Veikkaus attained a total responsibility index of 114.1 in the Companies and CSR survey, the objective being at least 113.1.
SOCIAL RESPONSIBILITY OBJECTIVES FOR 2010
~ Quantity and quality of customers and customer relations are developed responsibly
~ Number of registered customers and amount of registered gaming continues to increase even at
~ The new features of Veikkaus Card are developed
~ The number of customers using their Veikkaus Cards whilst gaming increases
~ Tools for self-control of gaming are developed
~ A Finn to Win is understood widely as a key concept
~ Following the staff survey, the presence of the company management and the superiors’ work are developed
~ Veikkaus is developed into an even better workplace by improving, e.g., the balance between working life and
the points of sales
leisure, staff skills, mentoring, and preventive occupational health care.
12
CSR Report 2009
ENVIRONMENTAL RESPONSIBILITY OBJECTIVES AND ACHIEVEMENTS 2009
Energy efficiency at the head office improved
4 An energy analysis related to the energy efficiency agreement was carried out.
4 The cooling system of the head office’s backup power centre was reformed and made more energy efficient.
Acquisitions made paying attention to the environmental perspective
4 The environmental position of the suppliers of products and services has been analysed by means of a questionnaire since spring 2009.
The questionnaires are sent to all the suppliers in the bidding process.
4 The development and acquisitions related to the office systems will be carried out paying attention to energy efficiency. The power
saving system of the workstations was piloted successfully; the system will cover all the workstations at the beginning of 2010.
4 A video conference system was introduced to one meeting room at the head office during the year under review.
The consumption of printing and copy paper shall be decreased by 100 000 sheets and
ORGANIZATION OF CSR
Veikkaus’ CSR policy is laid down by the two Executive Committees. The coordination of the practical measures belongs
to the CSR Unit, employing two full-time employees. CSR is
implemented in Veikkaus’ various operational units, where
the specialists implement responsibility in practice. The promotion of responsibility is part of the work of every Veikkaus’
employee.
the printing environment shall be improved.
4 Some of the printers were replaced with newer models during 2009.
4 All the new printers have black-and-white printing and duplex printing as defaults.
4 Veikkaus’ head office managed to save printing and copy paper 105 000 sheets more than in the previous year.
ENVIRONMENTAL RESPONSIBILITY OBJECTIVES FOR 2010
~ Veikkaus’ actual environmental impacts shall be analysed by an external evaluator
~ On the basis of the external analysis, a long-term environment strategy will be prepared for the company.
4 = Objective attained
CSR Report 2009
13
VEIKKAUS IS SKILLED
Veikkaus has been developing its customer relations strategy for several years. From the
perspective of our operations, it is essential that we know our customers and the world of
games and gaming. The number of registered customers is on continuous increase:
the milestone of one million was reached in September.
Veikkaus’ operations are based on the promotion of responsible gaming. In June 2009,
we made all our games subject to an age limit of 18. We have also developed different
self-restriction and gaming control tools on the internet to support responsible gaming.
Satisfied and skilled employees play a key role in our pursuit to achieve the objectives of
our vision. We aim at becoming an even better place to work by 2010. To attain this goal,
we are working on the issues that arose in the staff survey of 2009.
Another cornerstone of Veikkaus’ operations is the skilled game sales staff. Our thousands
of retail outlets around the country guarantee a game sales network of comprehensive
coverage.
CSR Report 2009
15
CUSTOMER KNOWLEDGE SUPPORTS RESPONSIBLE GAMING
Knowing our customers is of central importance whilst we develop our
VERSATILE GAME OFFERINGS
business operations and offerings. The game offerings are developed
Veikkaus’ offerings are divided into dream games, excitement games, and
with the help of a special Customer Relations Strategy. It was introduced
sports games, based on the three types of gaming motivation that our
in 2004 and since then, we have developed the strategy, updating it con-
customers display. We have used the customer information to establish dif-
stantly towards its current form. As laid down in the strategy, Veikkaus
ferent motivational states that provide the basis for product development.
develops its games, services, and game offerings in a customer-focused
manner.
VEIKKAUS’ CUSTOMER PRISM
Stage of life
Setting objectives, targeting measures,
For those falling into the segment of dream players, gaming represents
measuring results by considering the
an opportunity to win big prizes and dream of a change of life. Veikkaus’
The Customer Relations Strategy analyses Finns’ gaming behaviour with
dream game offerings provide people with the opportunity to dream
the help of the Customer Prism. In the Customer Prism, the customers are
big. The games played by those motivated by dreaming are Lotto, Viking
seen in the light of the stage of life they are in, their motivation for gam-
Lotto, and Wednesday and Saturday Jokers.
stages of life our customers are in.
Motives
according to the motives guiding our
Within the motivational state of excitement, Veikkaus’ offerings provide
people with the opportunity to experience positive feelings of excitement
that our offerings match the customers’ expectations. By making
and a bit of cheering up in the midst of their everyday routines. The games
available the best possible offerings that are developed in a customer-
to fall into the excitement segment are Keno and the instant tickets.
focused manner and developed responsibly, we can guarantee Finns’
interest in Veikkaus games and their willingness to keep playing them
In the sports games group, Veikkaus aims at offering the customers the
even in the future.
best possible way of playing, as well as making different sports and cultural events more interesting to follow. The sports game family includes a
total of 12 different games.
4BTTETXZZPdbVP\Tb^]_PVT"P]SPceTXZZPdb
16
CSR Report 2009
Why do our customers play? Creating
game offerings and communicating them
ing, and the value of the customer relation.
From the point of view of Veikkaus’ success, it is extremely important
Who are our customers?
customers’ behaviour.
Value categories
What are our customer relations like?
Classifying the customers on the basis of
customer margins, yet paying attention to
responsibility.
By analysing customer information and behaviour, we can
develop our game offerings to meet our customers’ needs and
expectations in a responsible manner.
REGISTERED GAMING CONTINUED TO INCREASE
Registered gaming provides the basis for Veikkaus’ customer relations.
We also attained the milestone of one million registered customers in
Our customers can play registered either by showing their Veikkaus Cards
September. At the end of the year under review, Veikkaus had a total
at our points of sales, or by logging onto our internet service, or on their
of over 1 077 000 registered customers (in 2008 they were around
mobile phones. Registered gaming offers concrete benefit to the custom-
836 000). Of the registered customers, some 745 000 were holders of
ers, as the winnings are paid directly onto their accounts effortlessly and
Veikkaus Cards. In 2009 over 280 000 Veikkaus Cards were ordered.
without any risks. The Winnings to Bank Account slips were withdrawn
in June 2009. Once they have registered, our customers can also access
In the year under review, Veikkaus carried out a comprehensive customer
a comprehensive set of tools for controlling gaming and following their
survey for the first time, analysing, e.g., customer satisfaction, their posi-
gaming history (see p. 19). Another tangible advantage to the holders of
tion to Veikkaus Card, and their thoughts about jackpots and customer
Veikkaus Cards is Veikkaus’ Customer Loyalty Programme, which offers
communications. The survey was made in August, and it showed that in
versatile customer benefits.
all, Veikkaus’ customers were satisfied with Veikkaus and the services we
offer. Of the respondents, 96% were very or fairly satisfied with Veikkaus.
OUR PROMISE TO THE CUSTOMERS
Veikkaus promises its customers responsible, versatile, and absolutely
reliable game offerings, giving access to dreams, excitement, and
entertainment.
Our Customer Service Strategy aims at offering services to different
types of players in a way that best meets their individual expectations,
by developing our product portfolio and the channels of gaming.
One of our core objectives for 2009 in the field of customer relations was
to increase the share of registered gaming. We managed to achieve this
objective: at the end of the year, registered gaming represented up to
42% of the total gaming (as compared with 34% in 2008).
DISTRIBUTION
OF TOTAL SALES 2009
IDENTIFIED AND NON-IDENTIFIED GAMING
NUMBER OF
VEIKK AUS CARD HOLDERS
1,000,000
87,000 280,000 508,000 745,000
800,000
600,000
400,000
200,000
ELECTRONIC CHANNELS
(veikkaus.fi and mobile gaming)
23%
VEIKKAUS CARD
15%
NON-IDENTIFIED
62%
0
2006
2007
2008
2009
(9-12/2006)
CSR Report 2009
17
CLOSE CONNECTION WITH CUSTOMERS
CUSTOMER LOYALTY PROGRAMME MADE
mation at our website describes what purposes our customers’ personal
MORE VERSATILE AND WIDELY KNOWN
data are used for and how they are stored. We develop our customer rela-
Veikkaus’ Customer Loyalty Programme is an essential part of our Cus-
tions above all by respecting our customers’ wishes and opinions.
tomer Relations Strategy. It aims at making our customers committed to
Veikkaus and communicating our social significance.
We have a special Privacy Policy Team whose task it is to develop and
coordinate the issues related to the data protection of our customers.
In March 2009 we introduced a revised and more versatile Customer
The ways of operating are developed according to the guidelines issued
Loyalty Programme. The different benefit categories were named in a
by the Data Protection Ombudsman. The members of the Privacy Policy
way that corresponds more clearly to their contents: the Monthly Draws,
Team come from different operations and units within Veikkaus.
the Weekly Draws, the Wild Card draws, the Free Admission Benefits and
the Discount Benefits. The benefits we offer each month are of interest
4 5^aUdacWTaX]U^a\PcX^]PQ^dccWT_aXePRh_^[XRhbTTX]5X]]XbW)
to many of our target groups, and they are available widely across the
country. In 2009 over 200 customers took part in the customer events in
the monthly draws. In all, nearly 380 000 Veikkaus’ customers partici-
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VEIKKAUS CRM COMMUNICATIONS 2009
1. Emails:
A total of 6 750 000 messages sent
2. Mobile messages:
A total of 1 280 000 messages sent
3. Letters:
A total of 453 000 letters sent
SMOOTH CUSTOMER SERVICE
A CUSTOMER RELATIONS ASSET
Veikkaus’ customer magazine X is an essential part of Veikkaus’ cus-
Veikkaus games involve hundreds of thousands of gaming transactions
tomer communications. It is mailed to every Veikkaus Card holding
Our efforts to improve the Customer Loyalty Programme proved effec-
every day, so the rapid, up-to-date service in matters concerning the
household, unless the card holders have specifically informed us that
tive: in a Customer Loyalty Programme survey carried out in November,
games, prize payout, and game results is extremely important. It is also a
they do not want to receive the magazine. The customer magazine
Veikkaus’ Customer Loyalty Programme was rated as the second most
top priority for us to serve well the 3 200 points of Veikkaus game sales
X went through a through revision in 2009 and came out in four
recommendable among the most widely known Customer Loyalty Pro-
in order that the possible problems can be solved and smooth gaming
issues. In November, X was rewarded as the second best magazine
grammes in Finland.
transactions can be guaranteed.
in its series in the corporate and community magazine competition
D?C>30C40=3A46D;0A2>=C02CBF8C72DBC><4AB
Veikkaus’ customer service offers advice to customers and game sales
We boosted the customer communications on topical gaming news and
clerks seven days a week during the opening hours of the game system.
increased the campaigns targeted at our registered customers in the year
The customer service receives an average of 14 000 calls from customers
under review. The customers who had granted us the permission to direct
every months and 12 000 calls from game sales clerks. The customer
marketing were contacted using methods of customer relations com-
service contacted customers and game sales clerks around 2 000 times
Over the past few years, Veikkaus’ customer service has received
munication, sending out customer magazines, emails, letters, and mobile
a month on the average. The average waiting time on all the customer
extremely positive feedback on its service-mindedness and good ac-
messages. In 2009 we sent a total of some 9.9 million messages.
service lines (customer service, support service, and sales support) was
cessibility. In the Finnish market research house TNS Gallup’s telephone
50 seconds. This meant an increase in the waiting time as compared to
interview survey covering customers who had contacted Veikkaus’
the previous year (when the waiting time to the customer service was 34
customer service, Veikkaus’ customer service was given the grade 3.8 on
As the number of our registered customers and the amount of customer
seconds on the average and to the game sales clerks’ service 25 seconds
the scale from 1 to 4 (3.6 in 2008). The corresponding grade for sales
information increase, data protection and its development are of primary
on the average). The increased waiting times had to do with enquiries
clerks’ support and sales services was 3.7 (in 2008 the grade for the sup-
importance. Veikkaus makes use of the data in its consumer register in
concerning the reforms and revisions to Veikkaus’ products and game
port services was 3.7). Veikkaus’ game sales clerks, customers, and the
accordance with the Finnish Personal Data Act. The privacy policy infor-
system in 2009.
professional evaluators, all alike, rated Veikkaus’ customer service as one
pated in the loyal customer draws of the different categories.
CUSTOMERS’ PRIVACY PROTECTION VALUED
organized by Procom – the Finnish Association of Communications
Professionals.
of the best in Finland.
18
CSR Report 2009
RESPONSIBILITY MANIFESTED IN EVERYTHING FROM GAME IDEAS TO PRACTICE
AGE LIMIT OF 18 INTRODUCED
GAME IDEAS EVALUATED FROM AN ETHICAL PERSPECTIVE
Besides solid customer knowledge, responsible gaming also entails the
We pay attention to the prevention of gaming problems from the very
prevention of gaming detriments. A safe gaming environment includes
beginning of the process of product development. The ethical evaluation
restrictions and makes available a set of tools for the self-control of gam-
of the games is carried out using the Responsibility Evaluator Tool devel-
ing. One of the gaming restrictions is the age limit.
oped jointly by Veikkaus and the Finnish Slot Machine Association RAY.
The evaluation aims at analyzing new game ideas and reforms of existing
Veikkaus made all of its games subject to an age limit of 18 in June 2009.
games from the point of view of possible gaming addiction.
In the electronic channels, this age limit has been in effect for a few years
already. By raising the age limit, Veikkaus anticipates the requirements of
The Responsibility Evaluator Tool consists of nine parts with special
the new Lotteries Act. The age limit aims at protecting children and young
questions measuring the possible addiction-provoking features related
people against the possible problems related to gaming.
to the game ideas. On the basis of the results of the evaluation, we can
make changes to or remarks on the game ideas; and we can also suggest
A VERSATILE SET OF TOOLS FOR GAMING MANAGEMENT
restrictions on a game or its marketing. In 2009 we carried out a total of
In order that people could continue to enjoy gaming, it is important that
14 responsibility evaluations.
they stay in control. Veikkaus’ internet players can make their gaming
subject to daily, weekly, or monthly gaming limits determined in euros.
Responsibility Evaluator sections:
The internet gaming service also offers the option of a complete self-ban
1) elements of gaming
on gaming for the rest of the day or for the next three months.
2) risk of economic loss
3) prize and stake structure
During the year under review, over 2 700 of our internet players (2 300 in
4) role of skills, coincidence, and rules
2008) made their gaming subject to restrictions of varying euro amounts.
5) attractiveness of the game and its environment
The gaming ban option was used by 935 customers in 2009 (760 in
6) additional attractive features
2008). We will make the gaming restriction and game ban options more
7) social features
versatile in 2010.
8) accessibility
9) marketing
The section ”Do you play too much?” at Veikkaus’ website was revised
and renamed as Game Pause at the end of the year. The new section
For the evaluation of service concepts and distribution channel solutions,
now contains more tools and services related to the self-management of
Veikkaus has developed a special set of ethical questions. It has been
gaming. The players can also take a gaming habit test to evaluate their
derived from the various sections of the Responsibility Evaluator Tool.
gaming. The test, based on our players’ responses, was piloted in autumn
The set of questions was used twice in the year under review.
2009 and it will be launched permanently in 2010.
By using the Responsibility Evaluator Tool and the set of ethical questions, we can make sure that the game products and services ending up
on the market are carefully planned and responsible.
EFFECTIVE RESTRICTIONS ON GAMING
~ The age limit of playing all Veikkaus games is 18.
- both in the internet gaming service and at the points of sales.
~ To order a Veikkaus Card, you must be eighteen.
~ Our games cannot be played in the night time.
~ The games are not sold on credit (Lotteries Act, §10).
Gaming restrictions imposed by
Veikkaus on the players on the internet
~ Each customer can only register one game account.
~ Maximum game account balance 5 000 euros.
~ Internet instant tickets subject to a daily gaming limit of 100 euros.
~ Live Betting subject to the daily and bet-specific limits of
- 100 euros a day; 20 euros a bet.
Optional tools for the self-management of gaming on the internet
~ Gaming ban for the rest of the day
~ Gaming ban for the next three months
(game account cannot be used for gaming or money transfers)
~ Personal gaming restriction for 1, 7, and/or 30 days
- the customers can choose the euro limit independently.
~ Monthly game account statement can be ordered to a personal
email address
~ Summary of game account history, which can include the games
played during the past month, the games lost and won, and the
payout percentages.
~ The gaming habit test, which the players can use to evaluate their
gaming behavior.
~ A website for the management of gaming at eTXZZPdb
_T[X_PdbbX
(Game Pause).
CSR Report 2009
19
INTERNET GAMING MORE AND MORE POPULAR
INTERNET GAMING TURNOVER
More and more of Veikkaus’ players play the games via our internet
EUR MILLION
gaming service; thus, Veikkaus’ internet service continued to increase in
popularity during the year under review. In 2009 veikkaus.fi was the most
popular consumer web store in Finland, posting a turnover of EUR 357
million. From the year 2008, the turnover of the internet service grew
by 19%, and there were an average of 231 000 players every week. Of
Veikkaus’ total turnover, internet gaming represented 23%.
In all, we recorded some 94 million gaming transactions on the internet.
The games to post the biggest turnovers on the internet were Lotto,
Fixed Odds Betting, and Keno. The internet gaming service hit a roundspecific sales record in October (rounds 44/09), attaining sales of EUR
10.5 million. That was 25% of Veikkaus’ total sales on the round.
Veikkaus’ website was developed in 2009 by introducing live broadcasts
from sports events and more videos. Through the videos, Veikkaus aims
at increasing general interest in Finnish game events. In 2010, Veikkaus’
website will go through a profound reform.
FINNS PLAY WITH MODERATE STAKES
160
205 252 299 357
500
Gaming is not just about money. Veikkaus wants to offer Finns
comprehensive and pleasant gaming experiences, a bit of excite-
400
ment, a chance to test their knowledge, and to dream. Finns are
eager players. As many as 85 percent of adult Finns have played
300
Veikkaus games at least sometimes; 73 percent of adult Finns play
at least once a year and around forty percent play once a week.
200
(The Atlas Survey, 1-6/2009).
100
There are plenty of players, but the stakes are reasonable: in
2009, Finns played for an average of EUR 297 per capita, and a
0
2005 2006 2007 2008 2009
total of around 420 million gaming transactions were recorded in
Veikkaus’ game system. This figure covers all the coupon-based
games and the instant tickets.
Since Veikkaus only offers internet games to people living permanently
in Finland, we verify the identity of all those who wish to register as our
players with the Population Register Center.
INTERNET GAMING TURNOVER BY GAME GROUP 2009
EUR million
Share in %
Change in %
Betting games
116.3
33%
10%
Lotto games
101.7
29%
35%
35.4
10%
12%
Other games
104.0
29%
21%
Total
357.4
100.0%
19%
Other sports games
20
CSR Report 2009
OPEN COMMUNICATIONS, RESPONSIBLE MARKETING
Veikkaus communicates openly about corporate matters, the gaming
RESPONSIBLE GAMING ENTAILS RESPONSIBLE MARKETING
products, and the changes in them. We offer actively up-to-date informa-
Veikkaus’ marketing is guided by a set of ethical guidelines that were
tion to both the representatives of the media and our customers. The
updated in the year under review. The guidelines were supplemented
odds of winning in our games are based on random luck, and there is no
with more specific information about the age limits, the random nature of
way of knowing the results in advance. Our marketing and communica-
the odds of winning, the image created by advertising, the targeting of
tions give a realistic picture about the games without creating false
the advertisements, and the Customer Loyalty Programme.
illusions.
In the year under review, Veikkaus spent a total of EUR 13.3 million (EUR
In a survey on corporate communications to Finnish journalists carried
10.6 million in 2008) on product advertising. This represented 0.9% of our
out by the Finnish market research house Taloustutkimus in spring 2009,
total turnover (0.7% in 2008). The numerous product reforms during the
Veikkaus’ communications reached the grade 8.15, the best grade given
year under review raised the expenses of product advertising.
to any company in the large company series. In 2008 Veikkaus’ grade was
8.07. The journalists valued especially the reliability, the professional skills
In the Brand Valuation 2009 survey carried out by the Finnish market
of the communications staff, and the openness of Veikkaus’ communica-
research house Taloustutkimus and the Markkinointi & Mainonta maga-
tions. When all the 237 organizations, public service providers, associa-
zine, Veikkaus’ most valued brands were Veikkaus and Lotto, which ranked
tions, and companies in the survey were counted in, Veikkaus reached the
among the most popular 200 Finnish brands. In the Finnish brands list,
fourth place.
Lotto ranked 77th (203rd in 2008) and Veikkaus ranked 116th (282nd in
VEIKKAUS’ ETHICAL
MARKETING GUIDELINES
Veikkaus’ marketing communications are guided by social responsibility: we respect our customers’ individual liberty and do not idealize big
time gaming or make advertisements that encourage people to play
a lot. Veikkaus’ marketing communications are not targeted at people
under 18 or consumer groups that are especially vulnerable because
of their social status or another special feature.
For the ethical guidelines (in Finnish), see
4eTXZZPdb
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2008); both of them being among the brands to rise the most. Compared
The significance of the social media as part of the customer and market-
with the year 2008, Veikkaus’ brand had also become clearly more widely
ing communications has increased every year. Veikkaus, too, adopted cer-
known (from 60 percent to 78 percent).
tain tools of the social media during the year under review. Since June, we
have had our own fan groups on Facebook and Twitter. In 2010, we plan
to make even wider and more coordinated use of the possibilities offered
by the social media in marketing, communications, and customer service.
8.15
the grade journalists gave
to Veikkaus’ communications
CSR Report 2009
21
OBJECTIVE: AN EVEN BETTER WORKPLACE
Along with the revised vision, even Veikkaus’ human resources strategy
was updated in 2009. Veikkaus aims at becoming an excellent place to
work, offering its staff a challenging and meaningful working environment, and creating continuously new opportunities for the staff to
improve their professional skills. To be an excellent workplace, we must
operate efficiently and smoothly, keep reforming, and offer our employees
competitive salaries and incentives. We also want to be an attractive and
valued employer.
In the Great Place to Work 2009 survey, 70% of Veikkaus’ employees
rated Veikkaus as a ”good” or ”excellent” place to work.
A satisfied, motivated, and skilful staff plays a key role in Veikkaus’ pursuit
to achieve the objectives of its vision. That is why we aim at becoming
an even better workplace in 2010. To achieve this goal, we are working
on the two issues that arose in the staff survey of 2009, i.e. work by
superiors, and interaction and presence of the company management.
In addition, we will reinforce the use of the human resources in 2010, as
well as invest in the skills, work enjoyment, and wellbeing of our staff.
In 2009, we continued to develop the themes that arose from the staff
satisfaction surveys, i.e. equal opportunities, openness, and job rotation.
We also focused on advocating individual responsibility in order to change
the operating culture, and started to develop our operations, anticipating
our vision of 2013.
EARLY INTERVENTION SECURES JOB SATISFACTION
Veikkaus invests in its staff’s wellbeing in many ways. Our occupational
health care aims at a healthy and safe working environment, a smoothly
functioning workplace community, promoting the staff’s health and working and operating capacity. We offer comprehensive occupational health
care services: in addition to the statutory health checkups and analyses,
our staff is entitled to ergonomics checkups, physiotherapy, and specialist
consultations; further, part of their pharmaceutical, dentist’s, and spectacle expenses are reimbursed.
The staff’s work enjoyment is also promoted through early intervention: the superiors follow closely the employees' absence from work and
measures are considered and taken to intervene in recurrent absenteeism
in joint negotiations between the employee, the human resources management, and the occupational health care. Problems in the workplace
community are tackled by arranging specially targeted training sessions.
During the year under review, we focused particularly on the prevention
of sick leaves and the ergonomics of the workstations.
22
CSR Report 2009
The staff’s wellbeing is also improved by the breakfast served at the
company restaurant every day, the flexible working time, and shorter
workdays in summer, as well as the company restaurant services at
the head office and the luncheon vouchers in the regional offices. The
cultural vouchers, club activities, supervised sports classes, the library,
gym and swimming pool at the head office, and the sports vouchers for
the staff of the regional offices, as well as the recreational facilities in
Kirkkonummi in the south and Saariselkä in Lapland support the staff’s
work enjoyment. Veikkaus’ employees have access to all these benefits
after an initial four-month trial period.
Veikkaus’ Health and Safety Committee visited two of our regional
sales offices and different units at the head office in 2009, making
health and safety risk analyses and organizing courses on first aid. A
special health and safety theme day was organized in the autumn, with
a special focus on the balance between working life and free time. The
Health and Safety Committee also arranged a walking test and a Non
Smoking Day campaign in cooperation with the working ability maintaining function.
According to a staff satisfaction survey carried out in August and September, Veikkaus’ employees see their jobs as challenging and objectiveoriented, and they are ready to make an effort in their work one hundred
percent. The majority of the employees think their jobs are not too
mentally burdening and that the physical environment and the working
conditions are good. However, the employees said they wished more focus on the balance between working life and the rest of the life. The main
theme for 2010 is the reinforcement of mental wellbeing. It includes
making sure that people feel at ease in their work, supporting the balance
between working life and free time, as well as the developing preventive
health care, the club activities, and the working ability maintenance function. Rewarding the employees for succeeding in their tasks (see p. 23)
and the cultural vouchers will be continued in 2010.
AIMING AT CONTINUOUS REFORMS
Staff skills development has been recorded in Veikkaus’ Human Resources
Strategy and the company’s objectives card. All Veikkaus’ employees shall
make a self-evaluation of their skills before their objectives and career
development talks, on the basis of which their personal development
objectives are recorded in the objectives cards. The development objectives and skills evaluations serve as the basis for training management.
The skills development focuses on areas of strategic importance. It is
monitored through skills evaluations, which improved by 11 percentage
points in the year under review.
STAFF SURVEYS 2009
Two staff surveys were made in Veikkaus in 2009. In the spring,
our staff’s satisfaction was analysed using the Great Place to Work
survey. In the survey, Veikkaus attained a trust index of 70%. It
means that seventy percent of the respondents thought that the
suggested attributes of a good workplace were well suited or fairly
well suited to Veikkaus.
In the autumn, a staff satisfaction survey was carried out, measuring the development objectives of 2008 and 2009, the company’s
objectives card, and our performance in the Excellence Finland
competition. In the future, the Great Place to Work survey will be the
sole staff survey carried out in Veikkaus. In 2010, we aim at a trust
index of 75%.
The objectives and career development talks consist of three parts: in
the team talks in December, the ongoing year is reviewed, the objectives
for the next year are agreed upon, and the need for skills development is
discussed. Between January and February, each Veikkaus’ employee has
an objectives and career development talk where the employee’s personal
objectives, based on the company’s objectives card, are set and the skills
required for achieving the objectives are determined. The development
objectives are reviewed in a follow-up talk in the summer. In the year under review, the objective and career development talks covered the entire
staff, including all the permanent employees, fixed term employees and
temporary employees. In 2010, the objectives and career development
talks focused on improving the performance towards the new vision.
4BTTP[b^cWTBcaPcTVXRBRWTSd[T_"!
The Game Academy, the special training programme for Veikkaus’ personnel, organized a total of 51 specifically targeted and open access training
events in 2009. During the year, we launched a new curriculum of basic
knowledge about Veikkaus, targeted at all the employees and covering
themes such as Veikkaus’ strategy, governance system, product information, responsibility, and the sales channels. In addition to these themes,
the Game Academy offered, e.g., language and office program training, as
85
%
of Veikkaus’ staff are
proud of their workplace
(Great Place to Work survey, 2009.)
well as training courses on project work, meeting practices, and negotiations and brainstorming techniques. Veikkaus’ internet learning module on
CSR, the “Responsibility Net” is part of the staff initiation training.
Veikkaus’ employees are encouraged to self-development. We support
those who wish to study in addition to their work by granting salaried
study leaves, and the staff are rewarded for attaining degrees. Besides
educating themselves, our employees are offered the opportunity to
develop their skills through internal job rotation and job changing periods,
i.e. a chance to get to know the work of another unit for a couple of days
or weeks. In the course of the year, we also started a pilot project in
mentoring where a dozen of Veikkaus’ employees exchanged some of the
silent knowledge they had acquired in their work. The mentoring project
will be continued, since a large number of Veikkaus’ employees will retire
in the next few years, and new people will take over new tasks within the
company.
SUCCESS DISTRIBUTED IN MANY WAYS
Veikkaus’ salary and incentive scheme covers the entire personnel and
consists of four parts: the basic salary, the personal performance-based
bonuses to the salaries, special perquisites, and performance incentives.
The salaries are determined on the basis of the HAY classification. The
superiors make a performance evaluation in connection with the objective
and career development talks, and excellent performance may entitle to
a performance-based bonus. Every year around ten percent of Veikkaus’
staff are granted performance-based bonuses. A special compensation
may be awarded for an individual good performance. In 2009 a little
fewer than nine percent of Veikkaus’ employees were granted special
compensations.
The performance incentive system is bound to the company’s strategic
objectives and how they are met. The incentives depend on the financial
result, the functioning of the core processes, fulfilling the requirements of
the customer relations standards and the responsibility standards, as well
as attaining the goals determined in the operation plans.
Our staff’s dissatisfaction about the incentive system and recognitions
given to the staff was raised as a point of concern in the Great Place
to Work survey carried out in the spring. Following the survey, special
Focus on Success diplomas, rewarding the employees for success, were
launched in the spring. Anybody can suggest a Focus on Success diploma
to another employee or to a workplace community as a token of gratitude
for a job well done or, e.g., positive influence on the workplace atmosphere. Other recognitions include announcing the idea of the month,
electing the most positive Veikkaus’ employee and the employee who has
best reflected Veikkaus’ values in his or her work. The employees are also
rewarded for achieving service year milestones and congratulated on their
birthdays.
45^aX]RT]cXeTbc^cWTR^\_P]h\P]PVT\T]cbTT_$$$%
THE SEVEN MATCHING POINTS OF
BASIC KNOWLEDGE ABOUT VEIKKAUS
~ Information security and corporate security
~ Shareholder & beneficiaries and CSR
~ Game distribution channels and marketing
~ Customer relations strategy and the system of governance
~ International legal and partnership issues
~ Economy and acquisitions
~ Veikkaus games and product database
EQUAL OPPORTUNITIES IN VEIKKAUS
In Veikkaus we see equal opportunities and fair treatment as wide
concepts where the respect for individuals is in focus. Equal opportunities constituted one of our core targets of development in 2008 and
2009. The staff satisfaction survey made in 2009 showed that Veikkaus’
employees were more satisfied with the current standard of equal opportunities than they were in 2007.
Of Veikkaus’ employees, 55% are women. The Strategic Executive Team
has one woman member and three of the thirteen members of the Operative Executive Team are women. Of the Board of Directors members, 50%
are women, and their share of the Supervisory Board is 38%. The share of
female superiors is 44 %.
In recruitments the most qualified applicant shall be recruited. Whilst recruiting from amongst equally qualified and competent applicants, positive
discrimination shall be complied with, and the applicant representing the minority gender shall be recruited. Jobs with the same requirement standards
shall entitle to the same salary, irrespective of the employee’s gender. The
salaries are determined on the basis of task-specific HAY classification.
GOVERNANCE AND LEADERSHIP
THE NEXT TARGETS OF DEVELOPMENT
Every year a staff satisfaction survey is carried out in Veikkaus, the
results of which are used to raise development targets to be included in
CSR Report 2009
23
81%
of Veikkaus’ employees say they are offered
training and other opportunities to professional
development. (Great Place to Work survey 2009.)
the operation plans. In 2008 and 2009, Veikkaus invested heavily in the
development of the three sectors that had arisen in the staff survey of
2007. They were openness, workload, distribution of labour, job rotation, and equal opportunities. The results of the development project
are displayed on this page. In the staff’s skills development and internal
communications, we focused especially on personal responsibility and a
change in the operational culture: the year was themed as “Responsible
Veikkaus’ Staff” and the employees were reminded about open and efficient information sharing, meeting practices, community spirit, and good
workplace atmosphere. To promote the change in the meeting practices, a
number of employees were trained as meeting change agents.
The staff satisfaction survey, carried out in the autumn, showed an
improvement over the results of the year 2007 concerning all the
development targets. On the basis of the staff satisfaction survey and
the Great Place to Work survey, new development targets were identified
for 2010: superiors’ work and presence and interaction of the company
management.
In the course of the year, the Operative Executive Team took part in a
leadership training programme during which each member of the Executive
Team received an evaluation of their leadership skills. In 2010 the topics of
the continuous development programme will include personal leadership,
the role of the Executive Team, and the management practices.
To improve the work done by Veikkaus’ leadership towards the new vision, the cornerstones of leadership were laid down at the end of 2009:
achieving results, the ability to reform, and interaction. They constitute
24
CSR Report 2009
the topics of the superiors’ training programme in 2010. In the “360 survey” all the superiors received feedback from the members of their team,
their colleagues, and their superiors. The management will follow closely
the implementation of the measures aimed at improving their presence
and interaction with the rest of the staff in 2010.
In accordance with our cornerstones of leadership, we want to make
Veikkaus more engaging and interactive. In the year under review, we
asked Veikkaus’ staff to give their opinions on how the vision could be
attained; on Veikkaus’ future prospects; successful CSR; and the reform
of the Human Resources Strategy. The staff’s opinions are collected
through, e.g., different discussions, surveys, and team work projects.
ACHIEVED DEVELOPMENT
TARGETS 2008–2009
In 2008 and 2009 Veikkaus invested in the development of the three
issues that arose in the staff survey of 2007. As a result of the development work, we have introduced, e.g.:
Openness
~ More frequent forums for communication and staff engagement:
A COMPANY THAT WORKS EFFICIENTLY
As the operating environment changes, even Veikkaus’ organization
needs to operate smoothly and be able to channel the resources in the
right direction. Every year, the operations are evaluated through staff
surveys, from the point of view of expenses, the smoothness of the organization, and the brand perspective. In the year under review we aimed
especially at using the human resources more effectively. The updated
organization took effect at the beginning of 2010.
leadership info events, morning coffee breaks hosted by the company
management, forums for superiors and secretaries
~ Trained Meeting Change Agents, exchanging jobs concept, rewarding
employees for success
~ Development of the steering group work and making the core
processes more clear-cut
~ Regular follow-ups of the key parametres on the intranet
The productivity of our staff, assessed by measuring the relationship
between the turnover and the number of employees, has improved
continuously over the past five years.
Workload, distribution of labour, and job rotation
Attaining the objectives of the vision requires that every member of
Veikkaus’ staff keeps developing continuously and aims at excellent performance. Whilst implementing the vision, we have paid special attention
to individual performance. This is why the performance reviews are in the
focus of the objectives and career development talks in 2010.
~ Mentoring programme
2>34C4A<8=0C8>==46>C80C8>=B8=E48::0DB
Veikkaus had two co-determination negotiations in accordance with the
legislation on co-determination in 2009. The first negotiations covered
the reorganization of the terminal maintenance activities. As the need
for terminal maintenance has decreased, the servicing function was
centralized and transferred entirely to the head office in Vantaa from the
regional offices as of 1 September 2009. As a result of the co-determination, the contract of employment of one employee was terminated on
31 December, three retired, three were transferred to the head office
in Vantaa, and three continued to work in the maintenance units of the
regional offices. The situation of the regional maintenance units will be
reconsidered in autumn 2010.
~ Development of the models for skills and the process for career
development talks
~ Organizational updates on 1 August 2008 and 1 January 2010
Equal opportunities
~ HAY classification of salaries
~ Update of the performance incentive system
~ Detailed guidelines for recruitment
The co-determination negotiations in the autumn covered the activities
of the Graphic Design Unit after the removal of the printing equipment
and the transfer of three jobs from the regional office in Tampere to the
head office. As a result of the co-determination, the Graphic Design Unit
will cease to exist as of 1 September 2010. Three jobs will be transferred
from Tampere to the head office as part of the business operations
organization starting from May 2010. In all, Veikkaus’ co-determination
negotiations covered eighteen people in 2009.
KEY HUMAN RESOURCES INDICATORS
change
Staff
5
Number of employees
women
4
men
5
employees between 30 and 50
4
employees under 30
5
employees over 50
6
average age of staff (years)
6
average duration of contract
of employment (years)
6
permanent
6
fixed term
5
full-time 1
5
part-time 1
6
Change in number of employees
recruited permanent
5
5
recruited fixed term
retired
5
gave their notice
6
laid off 2
new
terminated fixed-term contracts
6
5
Total turnover
Staff expenses and salaries
mean salary 3
5
staff expenses
5
salaries
5
5
indirect staff expenses
funds used for recreational and
leisure-time activities
5
Education
training days total/ whole staff 4
5
expenses of staff education/person/year 5 new
Occupational health care 6
health checkups and follow-ups
5
expenses of occupational health care
5
expenses / employee
5
sick leaves total
5
absenteeism
5
average duration of absence 7
5
work-related injuries 8
6
Staff satisfaction 9
total satisfaction (traditional staff survey) 10
5
total satisfaction (Great Place to Work) 11
new
2009
2008
2007
2006
2005
355
196
159
68%
9%
23%
42.6
354
196
158
68%
8%
25%
43
370
207
163
64%
11%
25%
42.3
373
211
162
62%
10%
26%
42.2
372
214
158
51%
11%
31%
42.5
12.8
338
17
333
22
13
342
12
323
31
12.1
355
15
337
33
12.7
355
18
-
13.1
355
17
-
11
12
14
4
0
4
6.3%
8
2
8
10
8
5.1%
12
15
10
11
9
7.7%
19
14
10
22
7
9.0%
25
13
19
16
8
10.9%
COOPERATION BETWEEN
EMPLOYEES AND EMPLOYER
Of Veikkaus’ staff, 52 percent are members of Veikkauksen Henkilöstö
ry (Veikkaus Staff Association; former Veikkaus’ Officials’ Association),
a trade association under the Trade Union SUORA.
Veikkaus is a member of Employers’ Association of the Special
€ 3,511
€ 3,507
€ 3,324
€ 3,157
€ 3,092
EUR 26.1 million EUR 24.9 million EUR 22.4 million EUR 21.6 million EUR 21.9 million
EUR 20.7 million EUR 19.7 million EUR 17.8 million EUR 18.0 million EUR 16.5 million
EUR 5.4 million EUR 5.2 million EUR 4.5 million EUR 3.6 million EUR 5.4 million
€ 77,373
€ 70,870
€ 73,000
€ 70,309
€ 67,149
550
€ 1,682
512
-
425
-
658
-
454
-
230
€ 423,975
€ 1,194
4,058 days
4.20%
10.5 days
2
188
€ 390,542
€ 1,103
3,809 days
3.80%
9.5 days
6
158
€ 373,143
€ 1,009
4,456 days
4.40%
11.1 days
5
174
€ 340,032
€ 911
5,159 days
5.70%
6.3 days
15
100
€ 398,508
€ 1,071
5,423 days
6.20%
5.6 days
9
4
70%
3.9
-
3.8
-
3.9
-
3.9
-
Branches, which belongs under the umbrella organization Confederation of Finnish Industries.
Veikkaus’ collective bargaining agreement is company-specific and
negotiated centrally at the union level. Further, we have the option of
making local agreements. The collective bargaining agreement signed
in the autumn 2007 was effective between 1 October 2007 and 28
February 2010. The negotiations for the new agreement were started
at the beginning of 2010.
1)
2)
3)
4)
5)
6)
7)
8)
9)
10)
11)
The number of full-time and part-time employees has been reported since 2007.
Following co-determination negotiations, the contract of employment of one person
was terminated on 31 December 2009.
This figure excludes the salaries and performance-based bonuses of the Executive
Teams members. The figures from the earlier years include the performance-based
bonuses, so the figures are not mutually comparable.
In 2008 and before that the figures included just the training organized by the Game
Academy; in 2009 the figures include both the Game Academy training events and
the time card entries covering other training events.
The practice of the time card entries covering participation in training events is not
completely uniform yet.
The training expenses are distributed evenly between the permanent, fixed-term,
and temporary employees; a total of 377 employees as of 31 December.
Covers all the employees having used the health care services, including the temporary employees and summer trainees.
From 2007 to 2009, the sick leave days were divided by the total number of
employees, including the temporary employees and summer trainees. The report of
2008 contained erroneous figures for the years 2007 and 2008; they have been
recalculated. The previous years are not comparable.
The figure of 2009 contains the injuries that led to at least a day’s absence from
work. The figures of the previous years also cover free-time injuries, which is why the
figures are not mutually comparable.
See staff surveys of 2009, p. 22.
Scale 1 to 5
The trust index reveals how many of the employees agreed or almost agreed with the
suggested positive statements about the employer.
CSR Report 2009
25
POINTS OF SALES FROM THE SOUTHERNMOST FINLAND TO LAPLAND
DISTRIBUTION OF
SALES PER POS T YPE
2009
Veikkaus sales network offers a comprehensive network of gaming serv-
REFORMS MANIFESTED IN POINTS OF SALES
ices throughout Finland. Of our turnover, around 77.1% do, in fact, come
In 2009 Veikkaus carried out a large number of reforms which concerned
from the retail outlets. In spite of the severe economic situation, Veikkaus’
the points of sales in particular. The first reform took place at the begin-
retail sales increased by 2.1%, attaining a turnover of over EUR 1.2
ning of June, as the age limit of 18 became effective. Although the age
billion. We had a total of 3 200 retailers at the end of 2009. Each point
limit was raised, the game sales remained at the same level. The age limit
of sales has to reach a minimum sales objective. However, Veikkaus also
reform did not prove too challenging to the points of sales either, and it
guarantees gaming services where it would not necessarily otherwise
did not affect the retail commissions.
be justified to have a retail outlet, including outlying areas, hospitals, and
various institutions of treatment.
In the year under review, the operations of the points of sales were also
affected by a number of game reforms, including the Plus prize tiers in the
Just as in the previous years, Veikkaus continued to work in cooperation
lotto games, the instant ticket reform that was introduced in October, and
with different Finnish trade chains, e.g., Rautakirja, the K-Group, and the
the new Joker that was launched in November. We also invested in the
KIOSKS AND CONVENIECE STORES
39.5%
S-Group in 2009. Kiosks and convenience stores are still the most popular
usability of the game system and adopted new game terminal features
INTERNET
22.9%
outlet type. Following the general overall trend towards centralisation in
that facilitated the sales transactions.
LARGE GROCERY STORES
17.8%
trade, grocery stores and service stations have also increased their shares
SERVICE STATIONS
11.5%
of Veikkaus’ sales. In contrast, smaller points of sales which are not part
In the course of the year, illuminated advertisements were installed in
SMALL GROCERY STORES
4.3%
of trade chains continued to sell less as a result of the ongoing transition
1 000 points of sales and new equipment for instant ticket sales were
CAFÉS, RESTAURANTS
2.3%
of the retail trade. Veikkaus pays its retailers an average sales commission
developed. Further, a pilot project of digital point-of-sales marketing
OTHERS
1.7%
of 6.8%*. In 2009 the retail commissions amounted to a total of EUR 82.5
was launched at the turn of September and October, with the objective
million.
of activating our customers. The digital point-of-sales advertisements
are displayed on large screens that match Veikkaus’ visual design and
In the course of the year under review, we carried out internal audits and
on smaller screens at the checkout counters. The pilot project will be
inspections in the points of sales. They showed that the retailers comply
continued throughout spring 2010.
mostly with the retailer instructions and guidelines and no significant
cases of abuse came up. In the audits concerning the age limit of 18, it
In the autumn the sales clerks’ internet service Myynet was also revised
was found that the retailers need to be reminded of the new age limit
with a new visual design and updated information.
even in 2010.
*
26
CSR Report 2009
The retail commission percentages were calculated on the basis of
the turnover of the retail sales.
NUMEROUS TRAINING OPPORTUNITIES
GAME SALES CLERKS CAN MAKE THEIR VOICES HEARD
Veikkaus’ points of sales employ 15 000 game sales clerks, who play an
The perspective of the points of sales is significant to Veikkaus. In the
important role in our interaction with the customers. Veikkaus assumes
course of the year 2009, we carried out four Retailer Barometer surveys
responsibility for the game sales clerks’ professional skills by offering
concerning the retailers’ views of, e.g., Veikkaus’ services, communica-
them training free of charge. In addition to knowledge on games and
tions, training, and marketing material. The final study of the year proved
selling, the training events also offer the sales staff information on
that the cooperation with Veikkaus continues to develop in a positive
responsible gaming, e.g., issues related to problem gambling. Responsible
way. In addition, the retailers were satisfied with, e.g., the way in which
gaming is regularly dealt with in Veikkaus’ retailer magazine. Veikkaus’
we communicated the game reforms.
NUMBER OF POS AND REGIONAL SHARES
OF TOTAL POS SALES 31 DEC 2009
training staff organized over 400 training events during the year under
review, and a total of some 5 000 game sales clerks took part in them. In
GUIDELINES OF THE RETAIL SALES OF THE FUTURE
addition, over one hundred different training events on new products and
Some of our most important objectives for 2010 are increasing the retail
services were organized. The Veikkaus Cruise, organized every autumn,
sales in a moderate way; developing the new features of Veikkaus Card;
was the most important of the events. Over one thousand sales clerks
increasing the number of customers using their Veikkaus Cards whilst
took part in it.
playing; taking into account the new opening hours of the retail outlets;
F7>;42>D=CAH)
"!'(100%)
and making the points of sales more prominent.
In October a new course titled ”Learning to be a Game Sales Clerk” was
launched in the game sales clerks’ internet service, providing an alterna-
Another core objective is to lay down the guidelines and solutions for fu-
tive to Veikkaus’ game sales clerks’ basic training. By the end of the year,
ture retail sales and points of sales. At the same time we aim to reinforce
170 game sales clerks had passed the internet course as a whole. Further,
the customer experiences in retail sales.
EASTERN AND
=>AC74A=58=;0=3)
888 (28%)
230 sales clerks had attended parts of the course they needed in their
work in particular.
4BTTP[b^eTXZZPdb
\hh]Tc
F4BC4A=58=;0=3)
%$ (36%)
B>DC74A=58=;0=3)
$$ (36%)
CSR Report 2009
27
VEIKKAUS – RESPONSIBLE PROFITMAKER
Veikkaus’ good financial result benefits all Finns in the end – regardless of whether they
play our games or not. Our success is based on a strong focus on customer relations in
particular, and an efficient use of the customer information as we develop our products
and services. As a result of the development work, we carried out several product reforms
during the year under review.
In 2009, Veikkaus’ most essential core processes and the entire organization were updated.
The internal controls and audits make the operation of the processes more secure.
Environmental responsibility is reflected in the work of each Veikkaus’ employee. Veikkaus’
head office has been entitled to use the Green Office label for two years already. In 2009
we were granted the Saver of Natural Resources award as an acknowledgement for
efficient waste sorting.
CSR Report 2009
29
PROFIT FOR THE COMMON GOOD
?A8I4?0H>DCC>?; 0H4AB!$!(
(EUR MILLION)
679 702
713 755
791
In 2009 Finns played Veikkaus games for a record-high amount,
Veikkaus’ success is based on the systematic collection, in-depth analysis,
EUR 1 557.6 million. Over half of this amount (EUR 791.1 million) were
and use of customer knowledge in product development. To our custom-
paid out as prizes to the winners.
ers, this was manifested as several new games and game reforms in
800
2009.
The distribution of Veikkaus’ proceeds is laid down by law, and Veikkaus
700
funds are only allocated to the statutory beneficiaries: to the arts, sports,
LOTTO CONTINUED AS THE FINNISH FAVOURITE
science, and youth work. Veikkaus does not distribute its proceeds by
– THE JOKERS WERE REFORMED
600
itself, nor can it make donations to charity.
Lotto has retained its attractiveness over the years: in 2009, its turnover
500
Veikkaus’ profit for the financial year was EUR 468.8 million. Of the result,
2008, as the basic jackpot was raised to around one million euros. In
Veikkaus returned a total of EUR 414.0 million to the Finnish Ministry of
June 2009 Lotto went through an even bigger change, as we introduced
Education, to be further allocated to the Finnish arts, sports, science, and
the Lotto Plus option. The Plus prize tiers were launched in both Lotto
youth work. The difference between Veikkaus’ profit and the amount
and Viking Lotto, and they attained instant popularity. At the end of the
returned to the Ministry of Education, EUR 54.8 million, will be distributed
year over half of the Lotto and Viking Lotto entries contained the Plus
to the beneficiaries of Veikkaus funds as specified at a later date.
prize tiers. The Plus prize tiers generated a turnover of EUR 38.9 million
amounted to EUR 475.8 million (+1.6%). Lotto was already revised in
400
300
200
between June and December.
The good financial profit positioned Veikkaus among the companies to
100
make the biggest profit in Finland.*
Lotto is a game of big dreams. The largest two prizes of 2009, five million euros each, were won in Helsinki in February (round 9/2009) and in
0
2005 2006 2007 2008 2009
Veikkaus paid EUR 92.6 million of taxes in 2009, including EUR 72.6
Mäntsälä (in southern Finland) in May (round 21/2009). They were the
million of lottery tax and EUR 20.0 million of VAT. Thus, Veikkaus’ total
third biggest Finnish Lotto jackpots ever.
profit to society amounted to EUR 561.4 million. In the European lottery
statistics, Veikkaus has already been among the companies to generate
Joker went through a profound change in November 2009. The payout
the biggest profits to society for several years.**
percentage of the Jokers was raised from 40 to 52, and the number of
prizes was multiplied by seven. The Joker draws were also assigned a
>?4A0C8=6?A>58C!$!(
(EUR MILLION)
500
397 403 421 441 465
The commissions we paid to our retailers amounted to EUR 82.5 million.
special TV studio and a TV game show hosted by a new Joker character.
Veikkaus’ operating expenses totalled EUR 142.7 million, of which the
Joker’s reform was a topic of heated debate, and people’s opinions were
personnel expenses represented EUR 26.1 million.
divided strongly for and against the new Joker. The Joker games posted a
turnover of EUR 83.8 million (+8.9%) in 2009.
*
**
400
Survey by the Kauppalehti business magazine, based on the financial result of 2008.
Based on the profit figures given by the member lotteries of the European Lotteries in
2008.
300
VEIKKAUS’ FINANCIAL PROFIT AND TAXES TO THE STATE IN 2009
200
Return to the Finnish Ministry of Education of the profit for 2009
100
Taxes
Difference between financial profit and return
0
2005 2006 2007 2008 2009
30
CSR Report 2009
Total (36.0% of turnover)
EUR 414.0 million
EUR 92.6 million
EUR 54.8 million
EUR 561.4 million
KENO CONTINUED TO ATTRACT PLAYERS
Fixed Odds Betting is the third most popular of Veikkaus games. Our
Veikkaus’ customers had wished for a special drawing machine and a
customers spent a total of EUR 134.5 million on it (-4.0%) in 2009.
more prominent TV game show for Keno. At the beginning of the year,
we launched direct TV broadcasts of the Keno draws, and a new drawing
INSTANT TICKETS REFORMED THOROUGHLY
machine was adopted. Keno continued to increase its popularity in the
The instant tickets were reformed in October 2009. The odds of winning
year under review. Its position as Veikkaus’ second most popular game
increased in all the instant tickets, since we raised the payout percent-
was reinforced, as it attained a turnover of EUR 332.6 million.
ages. The jackpots were also raised. The reform was the biggest in the
history of Veikkaus’ instant game group: it was the first time all the
FIXED ODDS BETTING CHANGED
instant tickets were reformed so thoroughly at the same time. Along with
Fixed Odds Betting went through a couple of changes during the year
the reform, the game prices were rounded to even-euro amounts. We
under review. In May we reintroduced the option of betting on an even
also launched Mega Ässä Instant for those dreaming about big wins, with
outcome in the Finnish baseball objects offered in Fixed Odds Betting
a jackpot of EUR 500 000. Instant tickets were sold for a total of EUR
after a period of many years. The reform led to a considerable increase in
134.7 million (+4.6%) in 2009.
INDIRECT ECONOMIC IMPACTS
It is estimated that the total employment effects of the three
Finnish gaming organizations Veikkaus, the Slot Machine Association
RAY, and Fintoto, amount to 50 000 person years of employment.
If we count in the multiplier impacts of the production, services,
and consumption, the employment effect is vast.
the game turnover of the baseball objects.
Our internet instant ticket portfolio was supplemented with a couple of
The most significant sports game reform of the year was made in No-
new products in the year under review, of which especially the Lucky
vember, as the number of weekly betting lists in Fixed Odds Betting was
Songs and Jewels Instants attracted our players. The internet instants
raised from two to three. As a result, the number of Fixed Odds Betting
increased their sales from the previous year: they were played for EUR
objects was increased from 300 to 450. In the future, we may raise the
26.3 million (+18.9%).
number of the weekly lists up to seven. Increasing the betting objects
brought new sports series to Fixed Odds Betting and it will enable us to
Veikkaus generated
EUR 561 million
of economic value to society in 2009
offer different special objects more often.
CDA=>E4A>5;>CC>!$!(
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(EUR MILLION)
(EUR MILLION)
(EUR MILLION)
422
430 420
468 476
246 269 295
317 333
500
500
500
400
400
400
300
300
300
200
200
200
100
100
100
2005 2006 2007 2008 2009
139 137
140 135
0
0
0
134
2005 2006 2007 2008 2009
2005 2006 2007 2008 2009
CSR Report 2009
31
VEIKKAUS OPERATES SYSTEMATICALLY
VEIKK AUS’ PROCESS MAP
In international comparisons, Veikkaus ranks as one of the most efficient
lotteries*. Our company of just a couple of hundred of employees generated
a profit of EUR 468.8 million in 2009. Our extraordinary efficiency is based,
e.g., on an ability to apply the newest technologies to gaming and on an
efficient steering, planning, and monitoring of the activities.
CUSTOMERS
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RESULT
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Veikkaus’ operating expenses represented 9.2% of the turnover in 2009,
in addition to which there were expenses related to investments. In order
to retain our competitive ability in the midst of the changing operating
environment, we must be able to develop our operations and products.
This will require further investments in the new technologies and product
development even in the years to come.
The profit expectation for Veikkaus funds is EUR 462.7 million in 2010. As
the demand for games is channelled towards products with greater event
frequency and smaller margins, and as the current financial recession continues, we need to operate in an extremely cost-efficient manner to secure
the growth of our profit.
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OPERATING ENVIRONMENT
*
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CSR Report 2009
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INTERNAL CONTROLS AND AUDITS
SECURE THE RELIABILITY OF THE OPERATIONS
Veikkaus’ internal control function works to assess the sufficiency,
reliability, and effectiveness of the processes of risk management,
supervision, and governance in accordance with the accepted operational
principles. Further, the objective of the internal audit is to develop control
systems related to governance. It also works to ensure the legality of the
operations and to prevent possible abuse. The internal audit is conducted
by Veikkaus’ controller, together with an external partner in cooperation.
Based on the profit figures given by the member lotteries of the European Lotteries in 2008.
PROCESS UPDATE
In order to implement Veikkaus’ Business Operations Strategy and to develop our operations, we have determined three essential core processes:
the service process, the product development process, and the steering
process. These core processes work to ensure that Veikkaus acts in a
customer-focused way and fulfils its customers’ needs every day. Besides
the core processes, we have backup processes that secure the functioning of the core processes.
In the year under review, the core processes were updated and made
more uniform. Our objective was to make our models of operation more
clear-cut, in order to enhance the efficiency of our operations.
During the year under review several external auditors carried out evaluations of, e.g., quality, security, the processes, and the products in Veikkaus.
The audits covered many of our operations. The audits conducted in
2009 showed that Veikkaus continued to fulfill the requirements of the
standards which have been granted to it.
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(SHARE OF TURNOVER %)
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32
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VEIKK AUS’ ANNUAL STRATEGIC SCHEDULE
operative activities are the duty of the Operative Executive Team, led
by the Vice President of Business Operations. In the autumn of 2009,
Veikkaus announced an organizational update which took effect at the beginning of 2010. In connection with the update, Vice President of Business
Operations Olli Sarekoski started as Veikkaus’ new Executive Vice President.
The update also brought with it a set of specifications to the organization
of certain operations, carried out to achieve more efficient entities.
BOARD OF DIRECTORS, SUPERVISORY BOARD,
AND THE EXECUTIVE TEAMS
Veikkaus’ superior administrative organ is the General Meeting, which
appoints the Board of Directors and the Supervisory Board.
Board has two internal committees, the Audit Committee and the Personnel Committee. Veikkaus’ Supervisory Board has 14 members, one of
whom is a representative of the personnel.
The CEO is in charge of the management of Veikkaus’ business operations,
and he is assisted in this task by the Strategic Executive Team. Veikkaus’
8
6
4
2
0
2005 2006 2007 2008 2009
* The increase in the operating expenses
was due to, e.g., write-downs of the projects
related to the game system reform and the
increase in the expenses of the official supervision.
MANY SMALL ENVIRONMENTAL DEEDS HAVE BIG IMPACTS
TWO YEARS OF GREEN OFFICE
Veikkaus’ head office has been entitled to use the Green Office label ever
since autumn 2007. The Green Office label is granted to a company following an environmental programme and paying attention to energy saving,
waste sorting, and recycling, as well as the communication of environmen-
One percent of the sales of Nature Instant are
distributed to the WWF and the Finnish Asso
ciation for Nature Conservation. In 2009, the
funds thus accumulated and distributed to the
two organizations amounted to nearly
and more environmentally friendly models. In the bidding process covering
THE ECOLOGICAL TEAM ENCOURAGES TO SAVE PAPER
the office computers, screens, and printers, we required that the suppliers
Veikkaus’ Ecological Team is a working group set up by the staff to imple-
followed an environmental programme.
ment Veikkaus’ environmental responsibility in practice and to promote
We pay attention to the energy consumption in the office environment
whilst making IT acquisitions, renewing equipment and facilities, and informing the staff about, e.g., the importance of switching off the computer
screens and lights. The computer screens in office use are low energy
euros
models. In 2009, the old office printers were replaced with more modern
66 000
tal responsibility.
FACILITIES
In addition to the head office in Vantaa (33 000 m2) and the district
centre in Tampere, we have small sales offices around the country.
They are located in Vaasa on the west coast, Turku in the south,
Kuopio in the east, and Oulu in the north. We also have meeting facilities in the city centre of Helsinki and in Vierumäki Sports Institute,
as well as recreational facilities for the staff in Kirkkonummi on the
south coast (13.3 ha) and in Saariselkä in Lapland (0.3 ha).
the staff’s understanding of environmental matters. It was established
The Green Office label has brought with it many changes in the office
in 2004 and has fifteen members representing the different units and
environment. The latest concrete decision for the reduction of the CO2
offices.
emissions was an update to the company car policy in spring 2009. The
new company cars were made subject to a maximum level of emissions
One of the main objectives of the Ecological Team was to reduce the
of 200g/km. At the same time, it was decided that the staff should be
use of copy and printing paper by 100 000 sheets as compared with the
offered special compensations if they accepted to purchase cars within the
previous year. We attained this objective, managing to save a total of
emission limits of under 150 g/km or 180 g/ km at the maximum. These
105 000 sheets of paper. The staff at Veikkaus’ head office were encour-
instructions will be effective until the end of 2010, after which they will be
aged to save paper by giving them paper saving hints; however, one of
made stricter.
the most important reasons for achieving the paper saving objective
was that the company’s printing environment was reformed thoroughly.
Duplex printing was set as default in the new printers. The office paper
consumption at the head office amounted to 2.7 tons in 2009 (3.8 tons
in 2008).
During the year under review, the Ecological Team arranged a special
clean-up event in the woodland area surrounding the head office, and a
day for recycling old clothes and other items. In October, Veikkaus took
part in the Energy Saving Week organized by Motiva. During the week,
the staff was encouraged to switch off their computer screens and lights,
to use public transportation on their way to work, and to save office
paper. Environmental issues were communicated actively throughout the
year. In 2010, a Green Office audit, carried out every three years, will be
conducted at Veikkaus’ head office.
CSR Report 2009
33
VEIKKAUS PRAISED FOR WASTE SORTING
The amount of energy waste at the head office was 17.7. tons in 2009,
Waste sorting is an established part of Veikkaus’ staff’s activities. All the
i.e. 20% less than in the year before (21.5 tons). The amount of mixed
We only have access to the accurate figures of energy consumption
employees have separate bins for energy waste, office paper, and recy-
waste remained at 1.1 tons.
from the premises owned by Veikkaus, i.e. from Vantaa, Kirkkonummi
clable paper at their workstations. The bins for confidential papers, mixed
and Saariselkä. The specified consumption details of the rented
waste, and biological waste are located in the shared facilities. Thanks
AIMING AT REDUCED ENERGY CONSUMPTION
facilities are not accessible.
to an efficient sorting of waste, the degree of utilization of the waste
A significant share of the environmental impacts of Veikkaus’ operations
generated at Veikkaus’ head office is currently up to 99%, i.e. just one per-
originate from electricity consumption. The operation of the servers of
The largest part of Veikkaus’ energy consumption and waste is
cent of the waste at the head office ends up in a landfill. As recognition
the electronic game system and the cooling system they require consume
generated at the head office, where a total of 314 people, i.e. 88%
for sustainable work and excellent performance, Veikkaus was awarded
energy, and their consumption will probably continue to grow in the
of the staff were working in the year under review.
the Saver of Natural Resources (“Luonnonvarojen säästäjä”) award by
future. Veikkaus signed the Energy Efficiency Agreement for Industries
Helsinki Region Environmental Services Authority. The award is granted
in 2008, thereby undertaking to decrease the consumption of energy
annually to a company or a public organization which has succeeded
resulting from other activities than production at the head office by nine
in reducing significantly the amounts of waste it has generated over a
percent from the level of 2005 by the year 2016. That means a total of
period of several years.
590 MWh of energy saved in the consumption of heat and electricity. As
planned, we carried out an energy analysis in the company in autumn and
The degree of utilization covers the waste that has been utilized for further purposes. The
remaining part of the waste is mixed waste that ends up in a landfill. The degree of utilization is calculated by deducting mixed waste and hazardous waste from the total amount
of waste.
*
winter 2009.
In 2009, Veikkaus head office consumed 4 400 MWh of electricity, three
percent less than in 2008. In contrast, the consumption of district heat
CSR REQUIREMENTS AS PART
OF THE ACQUISITIONS
increased. The air conditioning of the backup power centre of the head
office was renovated and connected to the district heat system instead
of the former electric heating. All the principal cooling systems are cur-
We supplemented our acquisition process with CSR requirements,
rently based on free cooling, and this should be manifested as a decrease
including the analysis of the environmental status of the suppliers
in the consumption of electricity.
of products and services in 2009. We aim to follow the analyses in
2010.
LUONNONVAROJEN
SÄÄSTÄJÄ 2009
DISTRICT HEAT, WATER, AND ELECTRICITY CONSUMED AT VEIKKAUS’ HEAD OFFICE
34
CSR Report 2009
2009
2008
District heat (MWh)
2,980
2,541
Water (m3)
4,730
4,230
Electricity (MWh)
4,400
4,540
Veikkaus’ head office is heated with environmentally friendly district
A42H2;01;4?>8=C>5B0;4B<0C4A80;
heat, the consumption of which amounted to 2 980 MWh in 2009. The
Gaming generates waste mainly in the form of playslips, instant tickets,
head office consumed 4 730 m3 of water. It is hard to pinpoint a single
and receipt rolls of online and instant lottery terminals, and materials used
reason why the consumption increased from 2008, but the consumption
for promotional campaigns. The materials Veikkaus delivers to its points
peaked especially at the beginning of the year, which indicates that the
of sales, such as playslips, receipts, posters, and instruction leaflets,
excavation of the backup power centre consumed a lot of water. All types
together with their cardboard packaging, are all recyclable. We offer the
of energy were consumed considerably less at the end of the year. As the
game sales staff regular guidance on how to sort the materials correctly
reformed systems become established, we can expect that energy will be
as part of the game sales clerk training and in the professional info leaflet
saved.
sent out to the game sales staff.
CO2 EMISSIONS
The CO2 emissions of the electricity consumption at the head office amounted to 757 tons (787 tons in 2008)* and the emissions
resulting from heat consumption amounted to 835 tons (718 tons in
2008).**
*
COMBINED DELIVERY TRANSPORTS
Veikkaus’ promotional events comply with special waste sorting instruc-
DECREASE ENVIRONMENTAL IMPACTS
tions laid down in the year under review. The waste generated during the
Veikkaus aims at well-planned routes and combining several deliveries in
events, including plastic wrapping materials, playslips, receipts, and other
larger one-time transports in all our transportation. For us, the combina-
Veikkaus’ material, are sorted appropriately.
**
CO2 coefficient given by the energy company KSS Energia: 171.97 g/kWh.
CO2 coefficient given by the energy company Vantaan Energia: 280.3 g/kWh
tion of delivery transports is an essential way of operating. It enables
us to decrease not only the burden on the environment but also the ex-
The suppliers of Veikkaus’ playslip, receipt roll, point-of-sales poster
penses, as the delivery kilometres are cut down. In 2009 a total of around
papers, and the game sales staff’s professional info leaflet paper have
300 000 deliveries were transported to the points of sales (over
the right to use an environmental label – either one that is awarded in the
280 000 in 2008). We managed to avoid an increase in the deliveries
Nordic countries or one that is granted within the EU. All of the plastic
by combining delivery transports. However, this caused the deliveries
packaging materials are combustible. The instant tickets returned to
to become heavier, as their average weight increased to 7.6 kg (4.3 kg
Veikkaus from the retail outlets have to be destroyed by shredding for
in 2008). The transportation companies we use follow environmental
security reasons.
programmes.
Veikkaus Cards are made of PVC plastic, which is non-recyclable. The
The game terminals at Veikkaus’ points of sales were renewed in 2007.
card manufacturing process of the card adheres to strict environmental
The new terminals are more durable than the old ones and the need for
regulations. In the year under review, a total of 280 000 Veikkaus Cards
maintenance has decreased. Thus, it is no longer necessary to report
were delivered. Veikkaus Card replaced the Winnings to Bank Account
the Mean Distance Between Failures or the hazardous waste generated
slips made of paper that were withdrawn permanently in June. Previously
from the maintenance services. The total kilometres accumulated on the
a total of 3.5 million Winnings to Bank Account slips were delivered to the
service and other calls to the points of sales made by Veikkaus’ service
points of sales.
staff numbered 225 000 (306 000 in 2008).
CSR Report 2009
35
THE JOURNEY OF ONE EURO SPENT ON VEIKKAUS GAMES IN 2009
1. One of Veikkaus’ customers makes and entry. This time he does
not win, and the euro invested in the game starts its journey.
3. MINISTRY OF EDUCATION
The officials of the ministry prepare a budget proposal.
Veikkaus funds are distributed in accordance with the
Funds Distribution Act.
Arts
EUR 204.7million
Cinema, dance, music,
visual arts, dramatic arts,
photography and architecture,
literature and industrial art,
libraries, museums, cultural
heritage, regional promotion
of arts…
Sports
EUR 124.4 million
Sports federations, clubs,
sports institutes, state funding
to sports (municipalities), sports
site construction, Regional State
Administrative Agencies...
2. VEIKKAUS OY
Veikkaus’ Board of Directors approves the profit expectation
of Veikkaus funds to the Ministry of Education.
Science
EUR 87.1 million
Academy of Finland, research
centres and institutes, scientific
societies and associations…
4. GOVERNMENT BUDGET SESSION
Youth work
EUR 44.8 million
The government considers the proposal drafted by the Ministry of Finance and approves
the budget proposal to be submitted further to Parliament.
5. PARLIAMENTARY DEB
DE B ATE
Parliament issues its comments and change proposals.
6. D IVISIONS OF
O F THE FINANCE COMMITTEE
Budget proposal session and budgetary decision proposals.
7. PARLIAMENT’S DECISION
8. MINISTRY OF EDUCATION
distributes Veikkaus funds to applicants
Public interest organizations,
national youth centres,
municipal youth work,
youth research and education…
PROFIT TO SOCIETY
Veikkaus’ operations benefit all Finns. By using the different recreational
THOUSANDS OF BENEFICIARIES ALL OVER THE COUNTRY
Most of the funds earmarked for youth work were channelled to the
sports facilities, by going to the cinema or theatre, joining the Scout or-
Veikkaus funds were allocated to a total of over 2 800 different com-
promotion of young people’s involvement in various public interest organi-
ganization, or taking part in one of the several other beneficiary activities,
munities in 2009. The beneficiaries in the field of arts included individual
zations and to leisure activities, e.g., young people’s associations.
all Finns have a chance to enjoy Veikkaus funds. Without an accurate and
artists, museums, theatres, the Finnish National Opera, and various
skilfully planned distribution of the euros lost on Veikkaus games, many
musical events.
Veikkaus has a great impact on Finnish society. The valuable work for,
pleasant things would be left undone and many unforgettable experiences would not come true.
e.g., children and young people, in sports associations, and many arts
The funds distributed to sports were allocated to the building of
organizations can be done in the present scope thanks to support from
recreational sports facilities, sports associations, sports research, and
Veikkaus funds. In addition, the communities supported with Veikkaus
Thus, it is good for all of us Finns that the proceeds accumulated from
recreational sports for children and young people. Within science, the
funds employ thousands of people.
gaming are returned to Finnish society, to benefit us all. In 2009 the Min-
most significant beneficiary was the Academy of Finland, which finances
istry of Education distributed a record-high amount of EUR 461.0 million
hundreds of scientific research projects each year.
of Veikkaus funds, i.e. almost nine million euros a week. Veikkaus’ good
financial result meant a considerable increase in the funds distributed to
the beneficiaries. The majority of the funds distributed by the Ministry of
Education to sports (about 97%) and youth work (about 81%) come from
Veikkaus funds. Further, 42 percent of the Ministry’s financial support to
the arts and 26 percent of the funds to science are covered by Veikkaus
funds.
ARTS, SPORTS, SCIENCE, AND YOUTH WORK
The Finnish Ministry of Education distributes Veikkaus funds to Finnish
culture in accordance with the Funds Distribution Act* laid down by the
BENEFICIARY SECTORS’ SHARES OF VEIKKAUS FUNDS DISTRIBUTED BY THE MINISTRY OF EDUCATION (2005-2009)
Parliament of Finland. According to the act, 38.5 percent of the funds
EUR million
2009
%
2008
2007
2006
2005
are allocated to arts, 25 percent to sports, 17.5 percent to science and 9
Arts*
204.7
44.4
189.2
184.8
190.4
185.3
percent to youth work. Further, ten percent of the funds are channelled
Sports
124.4
27.0
104.1
100.2
97.8
89.9
each year to the above-mentioned beneficiaries as separately specified in
Science
87.1
18.9
77.1
76.6
79.5
75.7
the State Budget.
Youth work
44.8
9.7
37.5
36.1
35.2
31.6
461.0***
100.0
407.9
397.7**
401.4
382.6
Total
The shares laid down in the Funds Distribution Act, which was enacted
in 2001, have been introduced gradually by 2010. In 2005, the original
schedule, according to which the budget funding of libraries was to be
*
**
***
The funds to the arts include the funds allocated by the Ministry of Education to libraries. They amounted to EUR 13.1 million.
In 2007 the Ministry of Education distributed an additional EUR 4.2 million from the savings of Veikkaus funds.
In 2009 Veikkaus returned EUR 414 million to the Ministry of Education. In addition, we paid a total of EUR 47.0 million of undistributed funds accumulated during
the previous years to the Ministry of Education. The Ministry of Education distributed a total of EUR 461 million to the various beneficiaries.
excluded from the scope of Veikkaus funds by 2012, was amended by
cutting two years from the transfer period of implementation of the act.
During this period the statutory state funding of libraries was transferred
gradually from being covered by Veikkaus funds back to tax funding. In
2009 Veikkaus funds still covered eleven percent of the whole state
funding to the libraries (EUR 13.1 million).
*
Act on the distribution of proceeds from lotteries, betting and pools games.
SHARE OF VEIKKAUS FUNDS OF ALL FUNDS ALLOCATED BY THE MINISTRY OF EDUCATION IN 2009
Sector
Funds total EUR million
Share of Veikkaus funds in %
Arts
484.4
42.3
Science
334.6
26.0
Sports
127.7
97.4
55.7
80.5
Youth work
CSR Report 2009
37
SPORTING
OPPORTUNITIES
TO FINNS
Hannu Tolonen
Senior Advisor
The Senior Advisor of the Sport Division at the Ministry of Education has
been entrusted with many responsibilities. He is in charge of the activities
of different sports organizations, and plans both recreational sports for
children and young people and professional top-level sports. During one
year, Tolonen presents over 500 proposals for financial support to the
Minister of Culture and Sport.
”We know the amount of funds to be distributed on the basis of the
State Budget. Then we initiate the application process. The applicants
submit a written application to the Ministry of Education, which a Ministry
official processes, making a proposal on the distribution of the funds. The
Minister evaluates the big picture and either approves the proposal or
suggests changes to it”, says Tolonen.
Every year Veikkaus returns its proceeds to the Ministry of Education to
be allocated to science, arts, sports, and youth work. The Ministry officials
do not get to see the actual funds but they are allocated according to the
items laid down in the State Budget.
The Veikkaus funds in Tolonen’s proposals are used to support, e.g.,
the sporting facilities for children and young people. Part of them are,
however, also used to help top-level athletes to achieve international success. Further, the funds are used for guaranteeing a high-standard basis
for various sporting organizations, in order that every Finn would have a
chance to enjoy a rich variety of sporting forms.
”The euros from Veikkaus’ activities are the lifeblood of Finnish sporting
culture. It is important that we foster the wide range of Finnish sports
organizations”, says Tolonen.
In 2009 the Ministry of Education distributed
38
CSR Report 2009
EUR 461 million of Veikkaus funds to Finnish
science, arts, sports, and youth work.
96
%
of Finns consider it is
important that the gaming
funds are channelled to Finns
(The Finnish market research house Taloustutkimus, 2009)
IT IS THE STORY
THAT FASCINATES
40
Film director IPXSP1TaVa^cW{b first full-length film “Skavabölen pojat”
premiered in September. It was welcomed by both the audience and the
critics and granted Jussi awards, the “Oscars” of the Finnish film industry,
for the best screenplay and best sound design.
In addition to focusing on the story, “Skavabölen pojat” invested strongly
in an authentic 1970s setting and good actors. ”The set design and costumes followed the 1970s up to the smallest detail, including the plastic
bags”, says Bergroth, smiling.
Bergroth’s film is based on a play by Antti Raivio, which was played in
front of full house for years at the Finnish Q-teatteri theatre. What fascinated Bergroth in “Skavabölen pojat” was the story, which was turned
into an efficient screenplay.”I think the most important thing in a film is
the screenplay. People love plot-driven stories seasoned with drama”,
Bergroth describes.
”For the roles of the little boys we screen tested 500 boys and ended up
finding two absolutely great little guys. For the adult roles we picked the
best actors we could think of .”
CSR Report 2009
We can expect more films: Bergroth is currently working on two stories.
”While one of them has horror features, telling about a family slightly off
Zaida Bergroth
Film director
their rocker, the other story is a person portrait.” Make sure you remember
the name: Zaida Berghroth is definitely a name we will be hearing about
in the future.
The Finnish Film Foundation granted EUR 700 000 of
Veikkaus funds distributed by the Ministry of Education
to “Skavabölen pojat” in 2008. In 2009, the Finnish film
industry was supported with a total of EUR 18.7 million
of Veikkaus funds.
Kari ”Kapa” Miettinen
Ice hockey coach
LEARNING TEAM WORK
THROUGH ICE HOCKEY
There is a lot of hustle and bustle in locker room 9 at Reebok Arena in
Espoo, a city in the Finnish capital region. Coach :PaX}:P_P}<XTccX]T]
explains on a tactics board to the boys of the team EJK-00 what will happen in tonight’s ice hockey training session. Almost 30 boys are waiting to
get onto the ice, wearing full hockey equipment.
The Responsible Coach praises his team without hesitation. ”These
boys have potential for whatever they want.” According to Miettinen,
ice hockey teaches the children to control their feelings, whether facing
success or failure.”The boys learn how to act in a group, which will prove
useful for them even when they grow older.”
The new ice hockey arena, opened in 2009, has improved the conditions
of EJK-00 and many other teams significantly. ”We now have access to
better training hours. The additional training facilities are purposefully
designed and for once we have a sufficient number of locker rooms and
facilities for drying the equipment”, says Miettinen on his way to the ice
hockey rink.
Miettinen has invented a special machine-free month for his team,
during which the boys do not play on their computers or game consoles.
Participation in the machine-free month is voluntary, and a team jersey is
raffled between all the participants.”February is a great time of the year
to do winter sports outdoors. You don’t want to spend your days at home
in front of a computer screen.”
The games and tournaments are very special in Miettinen’s view. ”It is
unbelievably magnificent to see the boys encourage each other and
experience great moments of joy while facing success.”
The Supporters of Ice Hockey in Espoo (registered
association) was granted a total of EUR 500 000 of
Veikkaus funds in 2008 to cover part of the expenses
of building the ice hockey training arena.
CSR Report 2009
41
Mikko Myllykoski
Experience Director
HEUREKA KEEPS REFORMING
You do not often get to meet people as enthusiastic about their work
as the Finnish Science Centre Heureka’s Experience Director <XZZ^
<h[[hZ^bZX. Myllykoski’s enthusiasm reveals something essential about
Heureka.”The key word in our activities is experience. Research has proved
that experimental learning leads to good results. You learn to ride a bike
better on the saddle than you would on a correspondence course” Myllykoski explains.
Heureka is a well-known brand in the world of science centres.”When
Heureka was founded in 1989, there were 240 science centres; now they
total 2 400. We have been an example to many science centres, among
other things because we have combined the natural sciences and the
humanistic sciences since the very beginning.”
42
CSR Report 2009
Heureka is widely known among Finns, as well. Up to 66 percent have visited the science centre and a further 31 percent know Heureka by name.
The largest visitor group is that of families with children. What makes
Myllykoski especially satisfied is that 75 percent of the visitors have been
to Heureka before.”This shows that we’ve managed to reform all the time
and that our exhibitions are up to date.”
Exhibiton export is, in fact, a central part of Heureka’s operations. ”Right
now you can visit our exhibitions in, .e.g, the Hague, Kuwait, Mexico City,
and Kuala Lumpur”, Myllykoski says.
In 2009 the Ministry of Education distributed
During the jubilee year 2009, Heureka’s young visitors were attracted by
the exhibition titled Move and Play! Veikkaus was one of the partners in
cooperation in the exhibition which encouraged people to move, play, and
innovate together. The next stop of the exhibition will be the Science
Centre Vilvite in Bergen in 2010.
EUR 1.9 million of Veikkaus funds to Heureka.
DANCE COMBINES
ART AND MOTION
Dance School Hurja Piruetti has provided dancing classes in the district of
Raasepori in southern Finland ever since 1995.”Our activities have always
been based on a desire to spread the joy of dancing and to develop
creative expression. There is also a strong focus on working with young
people in whatever we do”, says founder and pillar of the dance school
:PcYP:Ý]VËb.
”Dance is a means of knowing your body; it helps you to get to know
yourself while growing up and even at the later stages of your life. We
have currently some 600 dancers; the youngest of them are four and the
oldest are in their sixties”, Köngäs continues.
”We lay special emphasis on the dance shows. It makes sense to train
when you have a clear objective. It is also useful to learn to master the
excitement before a show. We invest in a full-fledged artistic experience,
and besides the dance we also emphasize the stage setting, costumes,
lights, and music, working together with the young people. We have a
whole range of star roles which the viewers can enjoy as an impressive
and holistic experience”, says Köngäs.
Katja Köngäs and Hurja Piruetti dance school were rewarded for their
work twice in 2009. Katja Köngäs was granted a special cultural award by
the City of Raasepori as recognition for her long-term activity in the field
:PcYP:Ý]VËb
Dance Teacher
of dance. In addition, the Minister of Culture and Education granted the
Young Culture Ambassadors award to the dance school. It is the ambassadors’ task to represent Finnish culture both in Finland and abroad.
Hurja Piruetti’s activities were financed with nearly
EUR 8 000 of Veikkaus funds falling into the beneficiary
sector of youth work. The financial support was coordinated
by the Centre for International Mobility CIMO. CIMO is an independent office under the auspices of the Ministry of Education.
CSR Report 2009
43
VEIKKAUS AS PART OF SOCIETY
According to recent surveys, most Finns are in favour of Veikkaus' exclusive right and the
fact that Veikkaus funds are returned to society. Veikkaus is also generally considered a
responsible company. Veikkaus' CSR was assured during the year under review.
To an overwhelming majority of Finns, gaming constitutes a harmless and enjoyable form
of entertainment. However, all gaming always involves risks that must be identified and
controlled. Veikkaus finances the promotion of responsible gaming in many ways every year,
in order that the detriments caused by gaming would remain as small as possible.
The position of the European Court of Justice is that by appropriate channelling, gaming can
be made to take place within a legally controlled system. Veikkaus is expected to provide a
reliable and interesting alternative to illegal gaming operations.
CSR Report 2009
45
RELIABLE AND RESPONSIBLE GAME OPERATOR
RECOGNIZED RESPONSIBLE OPERATOR
say that the winners outnumber by far those having actually won in our
In a CSR survey carried out in spring 2009, Veikkaus' CSR ranked at the
games. Veikkaus funds, distributed by the Ministry of Education, benefit
top among Finnish companies. According to the Taloustutkimus market
almost all Finns.
research house which carried out the survey, around four out of five
(81%) Finns regarded Veikkaus' gaming monopoly and the fact that our
GAMING HARMLESS ENTERTAINMENT TO MOST
proceeds were returned to society as positive. Up to 96% of the respond-
For an overwhelming majority of Finns, gaming constitutes harmless
ents considered it important or very important that the gaming proceeds
and fun entertainment. Gaming shall not be motivated by earning one's
were channelled to Finns.
living by games, nor shall it endanger the players' financial situation. It
shall be harmless and fun, with a chance of winning a prize of monetary
In another annual survey on CSR, carried out by TNS Gallup in the spring
value –the fact is that, in the end, people play to win.
and titled Companies and CSR, consumers rated Veikkaus as the second
best company when asked to consider all the sectors of CSR. The survey
All gaming involves addiction-provoking elements in principle. The risk
covered the CSR function in thirty significant Finnish companies.
increases in proportion to the event frequency of the games and the extent of the game offerings. The players may also overestimate their skills.
VEIKKAUS' RESPONSIBILITY ASSURED
Besides the economic interest, gaming involves significant entertainment
Veikkaus signed the EL (European Lotteries) Responsible Gaming Stand-
value and belongs more and more clearly to the entertainment offerings.
ard in 2007, engaging to comply with the Responsible Gaming Code of
Conduct. One of its requirements is that the measures taken to reinforce
GAMING DRAWBACKS
responsible gaming are assured. During the year under review, the meas-
Although the largest part of Veikkaus' customers by far play in a com-
ures were assured by an external body.
pletely controlled and moderate manner, some of the players may develop
a gambling problem. Gaming is always associated with certain risks that
Veikkaus was among the first European lotteries to assure their CSR. The
must be identified and controlled. A problem gambler is a person whose
assurance process aimed at ensuring Veikkaus' measures for the promo-
gaming causes economic, social, or health-related problems (to himself or
tion of responsible gaming. This means that we pay attention to respon-
to his family and friends).
Veikkaus' operations are based on a special focus on CSR and its imple-
The expenses incurred by the measures taken to promote responsible gaming amounted to EUR 3.6 million (+7.8%) in 2009. This
includes all the measures through which Veikkaus promoted the
responsibility and integrity of gaming either in its own business
operations or in cooperation with its stakeholders and worked to
increase general awareness about the national gaming system and
its significance. Veikkaus' new responsible gaming measures in 2009
included the introduction of the age limit of 18; the assurance of
the EL Responsibility Standard, and the internet interviews of the
representatives of our various stakeholder groups.
The expenses also covered research projects on the detriments of
gaming, which Veikkaus financed by making payments to the Ministry of Social Affairs and Health, as well as the funding of the Finnish
problem gambling helpline Peluuri. The joint costs of these two fields
of activity amounted to some EUR 762 000 in 2009.
its position as a core nation-wide service helping in gambling problems. In
2009, Peluuri answered over 3 000 calls. Of the callers, 23% were players,
sibility in all our operations, including marketing, game sales, and product
development. EL requires external assurance at three years' intervals.
RESPONSIBLE GAMING
EXPENSES IN VEIKKAUS
A big-time player is not necessarily a problem gambler. Big-time players
12% were gamblers' family members and friends, and the rest were other
can often control their gaming in proportion to their “game wallet” with-
indirect customers, the gaming companies' customers, and prank calls.
out risking their finances.
Among Peluuri's customers, around 5% said they were having problems
mainly with Veikkaus games.
mentation in practice. We promise our shareholder, the Finnish State, that
we generate sustainable and responsible profit to Finnish culture: sports,
arts, science, and youth work. We respond to the demand for games in an
PELUURI – LOW THRESHOLD HELP TO PROBLEM GAMBLING
Peluuri's website contains comprehensive information about gambling
ethically planned and regulated manner. We do not distribute our profit,
The Finnish national gaming organizations work jointly to prevent
problems and offers the eCounselling service where you can ask about
nor can we make donations to the good causes. Starting from the begin-
problem gambling in accordance with the Lotteries Act. They finance the
gaming anonymously and toll free. In 2009 there were over 50 000 visi-
ning of 2010, our operations will be supervised by the police and the
activities of the Finnish Problem Gambling Helpline Peluuri. Peluuri's activi-
tors to Peluuri's website and the eCounselling answered 165 questions
rules of the games are approved by the Ministry of the Interior.
ties are provided by the Finnish Blue Ribbon and the A-Clinic Foundation,
on problem gambling.
which also offer treatment to problem gamblers. Peluuri is a toll-free
46
The favourable consequence of Veikkaus' operations is that Veikkaus
helpline targeted at problem gamblers and their families and friends.
Peluuri also makes available a discussion forum “Valtti”, where problem
funds are channelled to benefit Finnish society as a whole. Thus, we could
During the five years of its existence, Peluuri has managed to establish
gamblers can seek peer support. The discussion on the forum has been
CSR Report 2009
lively. The problem gamblers' family members and friends can seek help on a
RISKS AND INSECURITY FACTORS
special discussion forum ”Tuuletin” (”Fan”). In addition, an sms peer support
ANALYSED AND MONITORED
form “Gambling Power Circle” was launched jointly by Peluuri and the A-Clinic
In Veikkaus, the Strategic Executive Team is assisted by a specially ap-
Foundation, offering a new opportunity to obtain peer support and tools for
pointed Risk Management Group, which develops the risk management
self-help through sms and on the internet. The Time to Fold treatment model,
process and coordinates the risk evaluation and the operation of the
operated by Peluuri, was also continued. Time to Fold is an internet guidance
management measures.
programme for the self-treatment of gambling problems. It consists of eight
sections of independent work on the internet and a brief weekly therapist's
Veikkaus complies with the comprehensive risk management system
guidance. During the year under review, 76 people took the Time to Fold
Enterprise Risk Management (ERM). The ERM framework describes the
programme. The experiences of the treatment have been very encouraging.
risk management process in use in the company, together with the
related responsibilities and procedures. It is integrated into the planning
4BTTP[b^_T[ddaX
processes of Veikkaus’ activities in a way which ensures the regular and
comprehensive assessment of the risks related to the business objectives
NATIONAL AND INTERNATIONAL SECURITY COOPERATION
and the company’s preparedness for tackling them.
Gaming is always associated with strong economic interests – which lead
to the risks of abuse, fraud, and organized crime – despite comprehensive
4BTTP[b^__$%$&
supervision. We do not have an infallible way to prevent criminal ventures
even in the gaming business. Veikkaus takes into account both the risks
STRONG CONSUMER PROTECTION BENEFITS CONSUMERS
involved in its own operations and those involved in its partnerships. We
High-standard consumer protection is an essential part of all well-
monitor the distribution of stakes carefully, and follow the sports events
administered gaming activities. Through proper consumer protection, we
to which our betting objects are related in order to spot possible devia-
can guarantee our players’ legal rights in possible problematic situations
tions.Veikkaus’ supervision and control systems will give the alarm if they
where the customers feel they have been treated in an unfair way.
detect clear deviations in, e.g., game sales.
Veikkaus’ players can seek assistance in unclear situations concerning
Especially in the international betting operations, the gaming organiza-
prize payout by filing a request for recommended decision with the Min-
tions notify each other and the football organizations if they detect
istry of the Interior. In 2009, we recorded 56 requests for recommended
exceptional gaming behaviour in football matches belonging under
decision (71 in 2008).
the supervision of UEFA and FIFA. In 2009 a new monitoring body,
the European Lotteries Monitoring System (ELMS) was launched. ELMS
For reasons of risk management, both internet gaming and gaming at the
reinforces the regular cooperation and exchange of information between
retail outlets are subject to a daily gaming limit of EUR 3 000. When a
the European state lotteries that operate betting games.
person plays our games for a total of at least EUR 3 000 during one day,
either as a single entry or as several interrelated entries, the sales clerks
During 2009 a number of cases of suspected fraud planned by interna-
must verify the person's identity and fill in a money laundering report in
tional organized crime were detected, the most extensive of which was
accordance with the Money Laundering Act.
found in Germany. In Finland, too, we had a couple of cases of suspected
fraud in football, indicating towards criminal intentions. The controlling
and monitoring work is still continued.
VEIKKAUS' ETHICAL COUNCIL
– EXTERNAL EXPERT PERSPECTIVE
Veikkaus’ Ethical Council is an advisory expert organ nominated by
Veikkaus’ Board of Directors. The Council’s task is to provide Veikkaus’
Board of Directors and operative management with an external perspective to issues related to the ethics of gaming, especially games and their
marketing, as well as other important topics such as gambling addiction.
The Council also makes concrete suggestions and issues ethical statements on various practical issues and debates concerning gaming.
At the beginning of the year under review, Veikkaus Board of Directors appointed five new members to the Ethical Council and three
members of the previous Council. The Ethical Council convened
three times in 2009.
In its meetings during 2009, the Ethical Council discussed, e.g., the
impacts of the new age limit of 18 on Veikkaus' marketing and communications from the beneficiary perspective; Veikkaus' operational
culture, and questions related to the ethics of Veikkaus' marketing,
e.g., in connection with the Joker reform.
<T\QTab^UETXZZPdb4cWXRP[2^d]RX[!(! ~
OLLI ALHO, Professor, Chairman (on the Council since 2004)
~ JAANA HAAPALA, CEO, Folk Finland (new member)
~
OSSI HEINÄNEN, Head of Campaign, Young Finland Association
(new member)
~
TIMO LAITINEN, Chairman, Finnish Sports Federation
(on the Council since 2005)
~ SANNA-MARI MYLLYNEN, Manager of Human Risk and Work
Welfare Services (on the Council since 2005)
~ MATTI RÖNKÄ, News Chief, The Finnish Broadcasting
Corporation YLE (new member)
~
TUULA TAMMINEN, Professor of Child Psychiatry
(acted as a member of the Council in 2004)
~
MATIAS ÅBERG, Matias Åberg, Student/Reporter (new member)
CSR Report 2009
47
OPERATING ENVIRONMENT AFFECTED BY MANY FACTORS
NEW LOTTERIES ACT BEING PREPARED
In 2008 the Committee on Internal Market and Consumer Protection
The current Lotteries Act entered into force at the beginning of 2002.
of the EU started to prepare a report on the integrity and reliability of
Measures to amend it were started at the beginning of 2007. In spring
internet gaming. The European Parliament approved a committee report
2008 the first phase of the Lotteries Act reform was presented to
on internet gaming in March 2009. The European Parliament's decision
Parliament. The government bill proposed an age limit of 18 to all gaming,
can be regarded as an exceptionally strong opinion in favour of state-
marketing restrictions, and the ratification of the authorization of the
controlled gaming policies. It was stated in the decision that gaming
officials. Veikkaus anticipated the raise of the age limit in June, as all
constitutes a special economic activity to which the Internal Market rules
Veikkaus games were made subject to the age limit of 18. The provisions
cannot be applied. Further, the Parliament stated that the member states
of the first phase will take effect during 2010.
should be able to regulate and control their internal gaming markets even
in the future.
The final report of the Lotteries Act project, prepared in April 2009,
proposed that legal monopolies should be granted to Veikkaus Oy, the
ACTIVE INTERNATIONAL ENGAGEMENT
Finnish Slot Machine Association RAY, and Fintoto Oy.
Veikkaus has an active role in the international associations of the gam-
The only changes suggested to the distribution of labour between the
ing sector in Europe (European Lotteries, EL) and worldwide (World Lot-
gaming organizations concern horse betting. The working group proposed
tery Association, WLA). Veikkaus’ CEO Risto Nieminen acts as the Senior
that all horse betting games should be operated by Fintoto from the
Vice President of WLA's Executive Committee. In addition, Nieminen acts
beginning of 2012. According to the proposal, the games offered by the
as the Chairman of the new Sports Committee and is a member of EL's
different gaming organizations should be clearly distinct from each other.
Executive Committee. Nieminen also chairs the European Lotteries Sports
The steering group proposed that the legislation should oblige the gam-
(ELS, former European Football Pool).
ing organizations to make sure that the game offerings will not increase
social and health-related problems. The proposals in the lottery legislation
Veikkaus’ Executive Vice President Jussi Isotalo acted as a Member and
project's final report were circulated for comments widely in April 2009.
Vice President of the EL’s Executive Committee during the year under
The objective is that the amendments should take effect as of the begin-
review. In Veikkaus’ view, the most important task of the cooperative
ning of 2012.
organizations is to promote the general interests involved in the principle
of the national exclusive right applied to gaming.
INDEPENDENT DECISIONS BY EU MEMBER STATES
The European Court of Justice issued its decision in the Liga Portuguesa
case in September 2009. According to the decision, the State of Portugal
can restrict the gaming operations on the internet and make even internet
gaming subject to an exclusive right. The ECJ stated that internet gaming
involves a greater risk of fraud and crime than traditional gaming and that
the restrictive measures were consequently justified.
The EU Member States can choose the gaming system that suits them
best and, in fact, the systems vary from one state to another. They must,
however, fulfil the requirements set in the legal practice of the ECJ.
48
CSR Report 2009
GAMING RESEARCH FOUNDATION
The Gaming Research Foundation engages to promote and support
unprejudiced research into gaming where gaming is seen as a societal and cultural phenomenon. The foundation serves the researchers as one of the domestic links within the growing, multidisciplinary
field of research. It also works to create a profile for Finnish scientific
research in the international setting and encourages debate on gaming by making available reliable research data. In 2009 the Gaming
Research Foundation distributed EUR 197 900 to Finnish research.
It was founded by the Finnish gaming organizations Veikkaus, the
Finnish Slot Machine Association RAY, and Fintoto in spring 2008.
45^a\^aTX]U^a\PcX^]bTT)_T[XbPPcX^
VEIKKAUS' CSR PROGRAMME
VEIKKAUS AIMS at a wide customer basis playing with reasonable
For the ethical evaluation of game ideas and distribution channels,
VEIKKAUS BEARS responsibility for problem gambling by offering
stakes so that the amounts individual customers spend on Veikkaus
VEIKKAUS MAKES use of a responsibility evaluator tool or a related
information about problem gambling at its points of sales and web-
games would not overly burden their finances.
set of ethical questions in order to analyse the responsibility at an
site. Veikkaus makes sure that its staff and sales clerks know what
early stage.
problem gambling is all about and where people suffering from it can
VEIKKAUS AIMS at a moderate and sustained growth of its profit.
seek help. Veikkaus assumes part of the expenses of the
VEIKKAUS’ MARKETING COMMUNICATIONS
Problem Gambling Helpline Peluuri and takes part in its develop-
VEIKKAUS AIMS at increasing the degree of identified gaming by
ADHERE TO STRICT ETHICAL GUIDELINES
ment. Veikkaus finances part of the research into gaming detriments
promoting the use of Veikkaus Cards at the points of sales and the
–
carried out by the Finnish Ministry of Social Affairs and Health.
formation, nor do they offer unrealistic ideas about the chances
number of registered customers on the internet.
VEIKKAUS MAKES its games subject to restrictions and makes
-
to win.
VEIKKAUS AIMS aims at fighting crime and working to promote
In marketing, Veikkaus avoids the idealization of gaming and
measures against money laundering.
advertisements encouraging people to play; and respects the
available tools for voluntary self-control of gaming.
4See p.19 and veikkaus.fi/pelipaussi
Veikkaus’ marketing communications do not give misleading in-
-
consumers’ individual liberty.
VEIKKAUS BEARS environmental responsibility in its own activities
Veikkaus’ marketing communications are not directed towards
and requires its partners in cooperation do so, too.
consumer groups that are especially vulnerable in view of their
age, social status, or other special characteristics.
Promoting VEIKKAUS’ CORPORATE RESPONSIBILITY belongs to
every employee and is a natural part of all our activities and work in
practice.
COMPARISON WITH THE GRI RECOMMENDATIONS
Global Reporting Initiative (GRI) is an international organization which develops and publishes guidelines for
sustainability reporting. GRI’s objective is to promote the reporting of reliable and comparable information for
the needs of different stakeholders and for social debate. The guidelines aim at openness, credibility, clarity and
comparability. The use of the GRI recommendations is completely voluntary, but hundreds of companies in the
INDICATOR
GRI CONTENTS
1.
1.1
1.2
2.
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
2.9
Strategy and analysis
Statement from the CEO
Description of key impacts, risks, and opportunities of CSR
Organizational profile
Name of organization
Primary brands, products and/or services
Operational structure of the organization
Location of organization's headquarters
Geographical location of operations
Nature of ownership and legal form
Markets served
Scale of the reporting organization
Significant changes during the reporting period regarding size, structure, or ownership
2.10
3.
3.1
3.2
3.3
3.4
3.5
3.6-3.8
Awards received in the reporting period
Report parameters
Reporting period
Date of most recent report
Reporting cycle
Contact point for questions regarding the report or its contents
Definition of report content
Boundary of the report, specific limitations on the scope or boundary of the report,
and basis for reporting on joint ventures, subsidiaries, leased facilities,
and outsourced operations.
Data measurement and calculation principles
3.10
3.11
INCLUDED
PAGE
Yes
In part
4-5
4-5, 12-13, 48, 49
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
3
62
33
33
2, 54
20, 26-27
2
32
Yes
18, 34
Yes
Yes
Yes
Yes
Yes
Yes
87
87
87
88
87
87
Yes
87
Re-statements of information provided in earlier reports
Yes
87
Yes
87
Yes
Yes
50-52
53, 87
Yes
Yes
Yes
Yes
32, 54-55
54
54
54
Yes
23, 55
Performance Reward Scheme
Yes
In part
54
58
Insider reports
Yes
In part
8-9, 49
54
Yes
54
4.11
Significant changes from previous reporting periods in the scope, boundary,
or measurement methods applied in the report
GRI content comparison
Policy and current practice with regard to seeking external assurance for the report
Governance, Commitments, and Engagement
Governance
Governance structure of the organization
Position of the Chairman of the Board of Directors
Independence of the Members of the Board of Directors
Mechanisms of shareholders and employees to provide recommendations or
direction to the Board of Directors
Linkage between compensation for members of the Board of Directors, senior managers,
and executives, and the organization's performance in the field of corporate responsibility
Processes in place for the Board of Directors to ensure conflicts of interest are avoided
Qualifications and expertise of the Board of Directors in the fields of strategic leadership
and corporate responsibility
Mission, values, and codes of conduct
Procedures of the Board of Directors for overseeing the organization's management
of corporate responsibility, including risk management
Processes for evaluating the Board of Directors' own performance
Commitments to external initiatives
Application of the precautionary principle
Yes
46-47, 56
4.12
Commitments to external initiatives of social responsibility
Yes
34, 46
4.13
Memberships in associations and advocacy organizations
Yes
48
3.9
3.12
3.13
4.
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
4.9
4.10
50
world are already using the guidelines to report the economic, environmental, and social facets of their activities
according to the GRI reporting recommendations. The contents and reporting principles used in Veikkaus’ annual
report comply, where applicable, with the recommendations of the GRI guidelines.
CSR Report 2009
REMARKS
POS, Internet games only for Finnish residents
Veikkaus announed an organizational update in the autumn effective
as of the beginning of 2010.
The environmental data are reported mainly just for the head office.
Calculation principles are specified separately in connection with
the key indicators.
Re-statements of information provided in earlier reports are specified
separately in connection with the key indicators.
No significant changes
The Board of Directors' Audit Committee supervises the compliance with
the internal codes of conduct and the risks that have arisen.
Responsible gaming code of conduct.
Gaming supervision and monitoring; risk management
International agreements on responsible gaming signed by Veikkaus;
the Energy Efficiency Agreement
INDICATOR
GRI CONTENTS
4.14
4.15
4.16
4.17
5.
Stakeholder engagement
Organization's stakeholder groups
Identification and selection of stakeholders
Forms of stakeholder engagement
Key topics and concerns that have been raised through stakeholder engagement
Governance and key indicators
Approach to managing economic responsibility
INCLUDED
PAGE
REMARKS
Yes
Yes
Yes
Yes
10-11
10-11
10-11
10, 24, 27, 31
Yes
12, 32, 47, 49, 54-57
Objectives and achievements of economic responsibility, core processes,
risk management, Veikkaus' CSR programme, Corporate Governance
Yes
2, 30, 36-37
Breakdown of one Veikkaus euro; journey of one Veikkaus euro;
profit to society. Veikkaus cannot make donations to good causes.
Not relevant to Veikkaus' activities
Yes
No
55, 81
Notes to the financial statement 16. Liabilities from employee benefits
Not relevant to Veikkaus' activities
In part
No
No
25
Average wage and collective bargaining agreement
Not relevant to Veikkaus' activities
Not relevant to Veikkaus' activities
INDICATORS OF ECONOMIC RESPONSIBILITY
Financial performance
Economic value generated and distributed
EC1*
EC2*
Financial implications and other risks and opportunities for
the organization's activities due to climate change
Coverage of the organizational pension commitments
Significant financial assistance received from the government
Market presence
Smallest entry level wage within the organization compared to national minimum wage
Purchases from locally-based suppliers
Procedures for local hiring of personnel
Indirect economic impacts
Investments in the infrastructure
Indirect economic impacts
Approach to managing environmental responsibility
EC3*
EC4*
EC5
EC6*
EC7*
EC8 *
EC9
No
No
Yes
Yes
31, 36-37
13, 33, 49
Veikkaus' CSR Programme, objectives of environmental responsibility,
Green Office, Ecological Team
INDICATORS OF ENVIRONMENTAL RESPONSIBILITY
EN1*
EN2*
EN3*
EN4*
EN5
EN7
EN8 *
EN11
*
EN12
*
EN16*
EN17*
EN18
EN19 *
EN20 *
EN21*
EN22*
EN23*
EN26*
EN27*
EN28
EN29
*
Materials
Use of materials
Use of recycled materials
Energy
Direct energy consumption
Indirect energy consumption
Energy saved due to conservation and efficiency improvements
Initiatives to reduce indirect energy consumption and reductions achieved
Water
Total water withdrawal
Biodiversity
Location and size of land owned, leased, managed in, or adjacent to, protected areas
and areas of high biodiversity value outside protected areas
Description of significant impacts of organization's activities, products, and services on
biodiversity in protected areas and areas of high biodiversity value
Emissions and waste
Total direct and indirect greenhouse gas emissions
Other significant indirect greenhouse gas emissions
Greenhouse gas emissions reduction initiatives.
Emissions of ozone-depleting substances
NOx, SOx and other significant air emissions
Total water discharge
Total weight of waste by type and disposal method
Total number and volume of significant spills
Products and services
Initiatives to mitigate the environmental impacts of products and services
Reclaim, recycling, and reuse of products and packaging materials
Compliance
Fines and non-monetary sanctions for non-compliance with environmental laws and regulations
Transportation
Significant environmental impacts of transportation
In part
No
13, 33
Consumption of office paper at the head office
No
In part
In part
In part
2, 34
13, 33-34
35
Consumption of electricity and district heat at the head office
The Energy Efficiency Agreement
Video negotiations system aqcuired, combining transportations
Yes
2, 34-35
Water consumption at the head office
In part
33
Land owned by Veikkaus
No
In part
No
In part
No
No
No
Yes
No
No
In part
Not relevant to Veikkaus' activities
2, 35
CO2 emissions from electricity and heat consumption at the head office
33
2, 34
Update to the company car policy
Not relevant to Veikkaus' activities
Not relevant to Veikkaus' activities
Not relevant to Veikkaus' activities
Waste generated at the head office, degree of utilization of waste
35
Recyclability of POS materials described
Yes
In part
Non-compliance has not occurred
35
POS Material deliveries, service call kilometres to retail outlets
CSR Report 2009
51
INDICATOR
GRI CONTENTS
INCLUDED
PAGE
REMARKS
Approach to managing social responsibility
Yes
12, 22, 46, 49
CSR objectives and achievements, Veikkaus' CSR Programme,
Human Resources Strategy, Responsible Gaming Code of Conduct
Yes
25
Yes
Yes
24-25
22-23
Number of employees, permanent/fixed-term employees;
full-time/part-time employees
Staff changes; total turnover of employees
Yes
Yes
25
24
Collective bargaining agreements; trade union
Co-determination negotiations reported separately. Veikkaus complies
with the Finnish legislation on cooperation within undertakings.
In part
22
Health and Safety Committee's activities described
Yes
25
Injuries, sick leaves, percentage of absenteeism
Yes
22
Occupational health care described
Yes
Yes
Yes
25
22-23
22-23
Total amount of training days for the whole personnel
Training practices described
Yes
23, 25
In part
23
Equal opportunities in Veikkaus; gender and age distribution;
average age of staff
Requirement level of the Equal Opportunities Plan;
basic salary ratio not reported
INDICATORS OF SOCIAL RESPONSIBILITY
Employees and working conditions
Workforce
Total workforce by employment type and employment contract
LA1*
LA2*
LA3
Employee turnover
Employee benefits
Labour/management relations
Percentage of employees covered by collective bargaining agreements
Minimum notice period(s) regarding significant operational changes
LA4*
LA5*
LA13*
Occupational health and safety
Percentage of total workforce represented in formal joint
management-worker health and safety committees
Rates of injury, occupational diseases, lost days, and absenteeism,
and number of work-related fatalities
Education and counselling to assist workforce members regarding serious diseases
Training and education
Average annual hours of training per employee
Programmes for skills management and lifelong learning
Performance and career development reviews
Diversity and equal opportunities
Composition of governance bodies and composition and diversity of employee groups
LA14
Ratio of basic salary of men to women.
LA6
LA7
*
LA8
*
LA10
LA11
LA12
*
*
HR1-2*,
5-7*
HR4*
Yes
No
Not relevant to Veikkaus' activities.
Veikkaus complies with the laws of Finland.
No incidents of discrimination occurred in 2009.
No
Not relevant to Veikkaus' activities
PR1*
Total number of incidents of discrimination and actions taken
SOCIETY
Community
Programmes and practices that assess and manage the impacts of operations on communities
Corruption
Percentage and total number of business units analyzed for risks related to corruption
Percentage of employees trained in organization's anti-corruption policies and procedures
Actions taken in response to incidents of corruption
Public policy
Public policy positions and participation in public policy development and lobbying
Compliance
Monetary value of significant fines and total number of non-monetary sanctions
for non-compliance with laws and regulations
PRODUCT RESPONSIBILITY
Customer health and safety
Life cycle stages in which health and safety impacts of products and services are assessed
Yes
PR3*
Product information
Type of product and service information required by procedures
In part
SO1*
SO2 *
SO3*
SO4*
SO5*
SO8
*
PR5
PR6
*
PR8
PR9 *
*
52
HUMAN RIGHTS
Human rights
Practices related to customer satisfaction, including results of surveys measuring customer satisfaction
Marketing communications
Programmes for adherence to laws, standards, and voluntary codes related to
marketing communications, including advertising, promotion, and sponsorship
Customer privacy
Total number of substantiated complaints regarding breaches of
customer privacy and losses of customer data
Compliance
Monetary value of significant fines for non-compliance with laws and regulations
concerning the provision and use of products and services
Key indicator recommended in the GRI standards
CSR Report 2009
No
No
No
In part
48
Yes
Non-compliance has not occurred
19
Ethical evaluator tool for the assessment of game ideas;
responsibility evaluator of games
The product information required by legislation, especially the Consumer
Protection Act, is available to the customers on the game coupons and
game instructions, as well as at Veikkaus' website.
Yes
17-18
Yes
49
Ethical Guidelines for Marketing
Yes
18
Customer privacy and data protection described.
No breaches occurred in 2009.
Yes
No breaches occurred in 2009.
INDEPENDENT ASSURANCE REPORT
(TRANSLATION FROM THE FINNISH ORIGINAL)
TO THE MANAGEMENT OF VEIKKAUS OY
At the request of Veikkaus Oy’s Management we have performed a limited assurance engagement on the Report
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Oy’s corporate responsibility as part of the business strategy and operations;
titled Veikkaus’ year 2009 (hereinafter the Report) consisting of the economic, social and environmental infor-
~ 8]cTaeXTfTS_Tab^]baTb_^]bXQ[TU^aR^a_^aPcTaTb_^]bXQX[XchaT_^acX]VX]^aSTac^R[PaXUhcWTaT_^acX]V_a^RTbb*
mation on pp. 1-53 within reporting period 1.1.-31.12.2009 (hereinafter Subject Matter).
~ 5P\X[XPaXiTS^dabT[eTbfXcWcWT\P]PVT\T]cP]SaT_^acX]VbhbcT\bP]SS^Rd\T]cbaT[PcX]Vc^X]U^a\PcX^]
Management's responsibility
~ 8]cTaeXTfTS_Tab^]b^]\PcTaXP[Xch^UaT_^acTSX]U^a\PcX^]P]ScWT_aPRcXRTbdbTSU^aSPcPR^\_X[PcX^]P]S
disclosed in the Report;
Veikkaus Oy’s Management is responsible for preparing the Report and collecting and presenting the information
consolidation
within the Report in accordance with the reporting criteria as set out in the company's own reporting guidelines
~ 4eP[dPcTScWTSPcP\P]PVT\T]c_a^RTSdaTbdbTSX]R^\_X[X]VaTR^aSX]VP]SaT_^acX]VcWT`dP]cXcPcXeTSPcP*
as well as the Global Reporting Initiative's (GRI) G3 guidelines.
~ CTbcTScWTX]U^a\PcX^]X]cWTbhbcT\b^]PbP\_[TQPbXbP]SaTRP[Rd[PcTSb^\T^UcWTX]SXRPc^abP]ScTbcTS
Practitioner's responsibility
~ 4eP[dPcTScWTR^]cT]c^UcWTAT_^ac\PcTaXP[Xch^UX]SXRPc^abPbfT[[PbQ^d]SPahbTccX]V^UcWTaT_^ac
the existence of reported information on a sample basis from original documents;
Our responsibility is to express an independent conclusion on the Subject Matter based on our limited assurance
engagement. We are only responsible for our work, the assurance report, and the conclusions we present to
The assurance of information regarding economic responsibility is based on audited information obtained from
Veikkaus Oy, not to any third party.
the financial administration.
We have conducted the engagement in accordance with the assurance engagement standard (ISAE 3000) ‘As-
Our conclusion
surance Engagaments Other than Audits or Reviews of Historical Financial Information'. The ISAE 3000 standard
Based on our work described in this report, nothing has come to our attention that causes us to believe that the
requires that we comply with ethical requirements and plan and perform the assurance engagement to obtain
Subject Matter, in all material respects, based on the aforementioned assurance criteria, is not giving a balanced
limited assurance on whether any matters have come to our attention that cause us to believe that the Subject
and appropriate view of Veikkaus Oy’s corporate responsibility performance.
Matter does not, in all material respects, give a balanced and appropriate view of Veikkaus Oy’s corporate responsibility performance based on the reporting criteria.
Our assurance report should be read in conjunction with the inherent limitations of accuracy and completeness
for corporate responsibility information.This independent assurance report should not be used on its own as a
In a limited assurance engagement the evidence-gathering procedures are more limited than in a reasonable as-
basis for interpreting Veikkaus Oy’s performance in relation to its principles of corporate responsibility.
surance engagement, and therefore less assurance is obtained than in a reasonable assurance engagement. The
choice of the procedures is based on the practitioner's discretion, including an evaluation of the risks that the
Vantaa, 26 February 2010
information in the Report would not in all material respects comply with the reporting criteria. We have planned
and performed our evidence gathering procedures to obtain sufficient appropriate evidence on which to base our
PricewaterhouseCoopers Oy
conclusion. Among other things, we have performed the following evidence gathering procedures:
MIREL LEINO
SIRPA JUUTINEN
Partner, Risk & Compliance
Director, Sustainable Business Solutions
CSR Report 2009
53
CORPORATE GOVERNANCE REVIEW 2009
Veikkaus' mission is to generate versatile value to Finnish society by op-
The tasks and responsibilities of Veikkaus’ Board are determined by
The committees report to the Board on their regular work. In 2009 the
erating games reliably and responsibly. Veikkaus is a state-owned limited
the Finnish Companies Act. The Board considers all issues that have
members of the Audit Committee were: Ari Lahti (Chairman), Jouko Ahtola,
company which belongs under the management of the Finnish Ministry of
far-reaching significance for the company. These include the company’s
Leena Paananen and Riitta Kaivosoja. The members of the Personnel
the Education. The State’s responsibilities for the company’s operations
strategic guidelines and core investments, the annual operation plan, and
Committee were Juha Niemelä (Chairman), Leena Harkimo, Mikael Ingberg,
are determined solely by its share capital.
the budget, as well as the monitoring of all of them. The Board also ap-
and Maija-Riitta Ollila. The Personnel Committee convened four times,
points the CEO and the Vice Presidents operating directly under the CEO,
with an average percentage of attendance of 88 and the Audit Commit-
and determines their salaries and other benefits.
tee five times in the course of the year under review, with an average
Veikkaus’ governance is based on the Lotteries Act (1047/2001) and the
percentage of attendance of 96.
gaming licence granted to it by virtue of the Lotteries Act, as well as the
Finnish Companies Act and the company’s Articles of Association. The
The Board of Directors convened seven times in 2009, and the participa-
Council of State has granted Veikkaus a licence to operate lotteries, bet-
tion percentage in the meetings amounted to an average of 95. The
In accordance with the stock market practices, the members of the Board
ting, and pools games. The current gaming licence entered into force on
Board drafts an annual operational agenda describing, e.g., the core tasks
file annual insider reports, for the evaluation of their independency. Of
1 January 2007 and will be effective until the end of 2011.
of the Board of Directors and the Chairman, the Board of Directors’ Com-
the members of the Board of Directors, Riitta Kaivosoja holds an office
mittees, a schedule of meetings, and the themes handled in them. At the
in the Ministry of Education. The rest of the members of Veikkaus’ Board
GENERAL MEETING
end of the year under review, the Board conducted a self-evaluation of
are independent of the company and the shareholder on the basis of the
Veikkaus’ superior administrative organ is the General Meeting, which
its activities.
reports filed.
with the Articles of the Association. During the period under review, two
The Board has two internal committees, the Audit Committee and the
SUPERVISORY BOARD
General Meetings convened, which were attended by the Minister of
Personnel Committee.
Veikkaus’ Supervisory Board has 14 members, one of whom is a repre-
appoints the Board of Directors and the Supervisory Board in accordance
sentative of the personnel. The General Meeting elects the Supervisory
Culture and Sports as the representative of the Finnish State; officials
from the Ministry of Education, the chairmen of the company’s Board of
The Audit Committee
Board for a two-year term at a time. The Supervisory Board appoints two
Directors and Supervisory Board, members of the Board of Directors, as
~ assesses the financial reporting system;
of its members to be the Chairman and Vice Chairman for one year at a
well as company representatives.
~ works to develop the financial statement and annual report;
time. In 2009 the Supervisory Board convened five times. 2)
~ monitors the adequacy and functioning of the company’s control and
BOARD OF DIRECTORS
risk management systems;
According to the Articles of Association of the company, Veikkaus’ Board
~ supervises the compliance with the laws, regulations, and guidelines;
of Directors has five members at the minimum and eight members at the
and monitors the risks that have emerged, as well as the internal and
maximum. In 2009 the Board of Directors had eight members including
external audits.
the Chairman. The General Meeting appoints the Chairman and Vice ChairThe Personnel Committee
of the Board belong to the company’s operative management. 1)
~ determines the general principles of compensations to the management and the staff;
For personal details of the members of the Board of Directors, see p. 58.
company by the Board of Directors and the CEO, and for issuing a statement
on the financial statement and Auditors’ report to the General Meeting.
2)
man of the Board for one calendar year at a time. None of the members
1)
The Supervisory Board is responsible for supervising the management of the
~ prepares the questions related to the CEO’s salary and compensations
For personal details of the members of the Supervisory Board, see p. 59
COMPANY MANAGEMENT
The CEO is in charge of the management and supervision of the company’s business operations in accordance with the Finnish Companies
and approves the conditions related to the compensations to the
Act and the strategy confirmed by the company’s Board of Directors. The
employees working directly under the CEO;
Strategic and Operative Executive Teams assist the CEO in this task.
~ assesses the CEO’s and the company’s supreme management’s
performance;
The tasks of the Strategic Executive Team include the preparation of the
~ assesses the company’s staff policy;
strategy, the operations plan, and the budget proposal to be submitted
~ and assesses the functioning and structure of the organization.
to the Board of Directors, as well as the monitoring and decision making
concerning significant projects and investments.
54
Annual report 2009
During the year under review, the Strategic Executive Team had seven
members in addition to the CEO. 3) It convened nine times during the year.
BOARD OF DIRECTORS’ MONTHLY AND MEETING COMPENSATIONS IN 2009 (EUROS)
The Operative Executive Team had thirteen members and was chaired by
Monthly compensations
Meeting compensations
Compensations total
the Senior Vice President, Business Operations. The Operative Executive
Chairman
1,600
350
24,340
team convened a total of 43 times.
Vice Chairman
1,200
350
18,840
Other Members
1,000
350
105,640
105,600
43,220
148,820
The Board of Directors appoints Veikkaus’ CEO and the Vice Presidents
working directly under the CEO. The members of the two Executive
2009
Committees file annual stakeholder reports in accordance with the stock
2008
market practices. On the basis of the reports, all the members of the Ex-
*
ecutive Teams were independent of the company’s stakeholders in 2009.
3)
For personal details of the members of the Strategic Executive Team, see p. 60
131,870*
The Board of Directors’ compensations were altered from 1 August 2008. The Chairman’s monthly compensation was raised from EUR 1,400 to EUR 1,600, and the meeting
compensations to all the Members of the Board were raised from EUR 240 to EUR 350.
SUPERVISORY BOARD'S MONTHLY AND MEETING COMPENSATIONS IN 2009 (EUROS)
Monthly compensations
Meeting compensations
Compensations total
1,000
200
12,424
Vice Chairman
600
200
8,200
Other Members
500
200
72,800
84,624
8,800
93,424
BENEFITS, INCENTIVES, AND COMPENSATIONS
Chairman
The employees who joined Veikkaus before 1 January 1994 may retire
at 63 years of age. The Board Members and company management
do not enjoy special benefits, except for the CEO’s and Executive Vice
President’s additional pension schemes, based on retirement at 63 and
2009
a pension objective of 66%. The pension objective is calculated on the
2008
99,800
basis of the income of the five last years. The company executives are not
entitled to options.
SALARIES, WAGES AND OTHER BENEFITS GRANTED TO COMPANY MANAGEMENT 2009 (EUROS)
The period of notice of the CEO is six months and the compensation in a
situation where the CEO’s employment contract is terminated by notice
2009
2009
2008
2008
fixed part **
variable part **
fixed part **
variable part **
equals a salary of twelve months. The period of notice of the Executive
CEO
Team members is two months. The Strategic Team members are entitled
Other Members of the Executive Teams*
to a salary of nine months and the Operative Executive Team members
Total
2,150,404
482,629
1,816,792
303,821
are entitled to a salary of six months as a compensation for the termina-
Total
2,150,404
482,629
1,816,792
303,821
tion of the employment contract by notice.
* In relation to the organizational change on 1 August 2008, two Executive Teams were established: the Strategic Executive Team and the Operative Executive Team. The Executive
Teams had fifteen members at the end of the financial year 2009, whereas they were eight before the organizational reform.
** The fixed part includes the monthly salary, the fringe benefits and the vacation bonus; the variable part covers the performance bonus.
320,849
86,603
295,335
57,620
1,829,555
396,026
1,521,457
246,201
Veikkaus has an incentive scheme that covers the entire personnel. The
scheme includes the discretionary performance-based bonuses to the
COMPENSATIONS TO THE AUDITORS INCLUDED IN THE PURCHASE OF SERVICES 2009 (EUROS)
salaries, special perquisites, and performance incentives. The performance
incentive is an annual one-time payment based on the achievement of
the strategic goals and success of the company. The objectives and pa-
Audit
rameters of the various activities and units are determined as the opera-
Other services
tions are planned. The achievement of the objectives is assessed at the
Total
2009
2008
45,468
41,108
167,707
186,805
213,175
227,913
end of the financial year, and the amount of the incentive is determined
Annual report 2009
55
according to the annual salary of each employee. The maximum incen-
The external auditors of the standards are Det Norske Veritas (DNV),
Veikkaus complies with the comprehensive risk management system En-
tives vary between 7% and 30% of the salary according to the personnel
which audits Veikkaus’ compliance with the World Lottery Association
terprise Risk Management (ERM). The ERM framework describes the risk
group, and in order that the incentive can be paid in whole, all the objec-
Security Standards WLA-SCS:2006, and Inspecta Oy, which audits the
management process in use in the company, together with the related
tives must be attained. For the CEO, the maximum incentive is 40%.
compliance with the Information security standard ISO 27001:2005.
responsibilities and procedures. It is integrated in the planning processes
Veikkaus qualified for the new ISO-9000 at the beginning of 2009.
of Veikkaus’ activities in a way which ensures the regular and comprehen-
The Board of Directors determines the compensations to the members of
Veikkaus' operations are audited in accordance with these standards
sive assessment of the risks related to the business objectives and the
the Strategic Executive Team and the grounds for awarding performance
every year.
company’s preparedness for tackling them.
Veikkaus' internal audit covers all the company's strategies, processes, and
In 2009 the most significant risks reported to the Board of Directors had
organizational structures that help the management and the Board of Di-
to do with the unfavourable economic development and the issues of
SUPERVISION AND INTERNAL AUDITS
rectors to make sure that the objectives set by the company are attained
insecurity related to the implementation and contents of the Lotteries
By virtue of the Lotteries Act (1047/2001), Veikkaus’ lottery, pools and
and that the business operations are carried out ethically and responsibly.
Act. For example, the details concerning the restrictions on the marketing
betting operations are supervised by the Ministry of the Interior. The
The internal audit is not a separate process but an essential part of all
of games and the operation of the gaming organizations only take their
Ministry confirms the rules of the games. Player complaints related to
Veikkaus' operations; it covers all the levels of Veikkaus' organization.
final form as the preparation of the law proceeds.
decisions on them. In 2009 a total of 56 recommended decisions were is-
Veikkaus’ internal audit evaluates the sufficiency, reliability and effective-
It is anticipated that the most significant risks in 2010 will concern the
sued, as compared with 71 in 2008. The gaming activities are supervised
ness of the process of risk management, supervision and management, in
Lotteries Act process, as well as the new products and the issues of in-
by the official supervisors appointed by the Ministry of the Interior. The
accordance with the confirmed operating principles. Further, the objective
security related to the updating of the existing games. The reform of the
official supervisors also confirm the results of the games and the prizes
of the internal audit is to develop control systems related to management,
internet gaming service will entail especially risks related to the schedules
on each round.
ensuring legality and preventing abuse. It also works to ensure the legal-
and the development of the models of operation.
incentives to the entire staff. The special perquisites and performancebased bonuses are determined by the Human Resources Steering Group.
prize payout are processed by the Ministry, which issues recommended
ity of Veikkaus' operations and prevent possible abuse.
MAIN FEATURES OF THE SYSTEMS OF
Since Veikkaus’ games are monitored by external supervisors, even the
staff can play them. As regards the staff’s participation in the games,
The internal audit is conducted by a person nominated by the company,
INTERNAL CONTROL AND RISK MANAGEMENT
specific instructions are followed, which include general guidelines and a
together with an external partner in cooperation. In 2009, the external
RELATED TO FINANCIAL REPORTING
ban on certain employees’ playing of fixed-odd betting games and instant
partner was Ernst & Young Oy. The internal auditors work directly under
The internal controls related to financial reporting have been planned to
lotteries.
the CEO, reporting to the Audit Committee, and covering the entire
ensure reasonable assurance of the reliability of the reporting and its
organization.
compliance with the existing laws, regulations, and accounting standards
As laid down in the company’s Articles of Association, the General Meet-
56
related to the accounting standards. The auditing consists of the proc-
ing appoints one regular auditor, who must be an auditor or an audit firm
RISK MANAGEMENT
esses and methods which the Board of Directors, other management
authorised by the Central Chamber of Commerce (KHT). At the moment,
Veikkaus’ Strategic Executive Team is in charge of the company’s risk
and core employees use to gain sufficient assurance of the company's
this task is carried out by the audit firm KPMG Oy Ab, and the auditor in
management, ensuring that the risk management process is operated
economy and its status.
charge is Authorised Public Accountant Lasse Holopainen. The auditors
smoothly. In this task, the Executive Team is assisted by a specially ap-
are chosen through a bidding process, and appointed to perform their task
pointed Risk Management Group, which develops the risk management
until further notice, in accordance with the company’s Articles of Associa-
process and coordinates risk evaluation and the operation of the manage-
tion. The auditors report to the Board of Directors’ Audit Committee.
ment measures.
Annual report 2009
The ERM framework used by Veikkaus describes the risk management
The most essential risk involved in financial reporting has to do with the
The deviations from the Corporate Governance Code have to do mainly
process in use in the company, together with the related responsibilities
company's game system and the process of recording the gaming transac-
with the company's special ownership structure and cover the following
and procedures. ERM is integrated in the planning processes of Veikkaus’
tions. The process covers a considerable number of gaming transactions,
recommendations of the code, as specified in brackets: recommendation
activities to ensure the regular and comprehensive assessment of the
an average of 5.7 million per week. The process related to the recording
1 (publishing the minutes of the General Meeting); recommendation 4
risks related to the business objectives and the company’s preparedness
of the transactions and the accuracy of the data generated by the game
(attendance at the General Meeting by those running for membership on
for tackling them. The most important risks related to financial reporting
system is assured regularly.
the Board of Directors); recommendation 11 (informing the shareholders
have been taken into account as part of the company's risk management
of the candidates for membership on the Board of Directors); recommenSUPERVISION AND MONITORING
dations 28-30 (setting up and operation of the nomination committee);
Veikkaus' Board of Directors, Audit Committee, and management follow
recommendation 40 (payment of the remuneration of the directors in
The European Union (EU) requires that all public companies within the
the achievement of the objectives on the basis of monthly perform-
shares); recommendation 48 (Compliance with the Guidelines for Insiders
EU should prepare their financial statements in accordance with the IAS/
ance reports and prognoses. The monthly outcome is compared with the
issued for listed companies by the Helsinki Exchange); recommendation
IFRS standards for financial statements. Although the requirement does
budget objectives and the result of the corresponding period of the previ-
49 (information on auditor candidates); as well as recommendation 52
not concern Veikkaus, the company has decided to voluntarily introduce
ous year. The Board of Directors and the Audit Committee also consider
(information at the company's website about data resulting from some of
the IFRS standard. Veikkaus started to prepare the introduction of the
the quarterly reports published by the company.
the above-identified deviations).
process.
IFRS standard in 2005, and the financial statement in this report is the
company’s fourth one to comply with the new standard.
The process of financial reporting is evaluated and updated regularly to
comply with the effective legislation, regulations, auditing standards,
CONTROL ENVIRONMENT
and other requirements for financial reporting. Veikkaus' auditors assess
The Vice President of Finances is responsible for internal supervision
annually the controls of the financial reporting and their usefulness in the
of Veikkaus' financial reporting. The models of financial reporting are
audits during the financial year.
described and determined in the regulations, guidelines, and process
descriptions of the company's financial reporting.
CORPORATE GOVERNANCE CODE AND DEVIATIONS
Veikkaus complies with the Finnish Corporate Governance Code 2008,
The models of operation covering Veikkaus' financial reporting are avail-
following the Comply or Explain principle, as well as the ownership policy
able on the company's intranet and can thus be consulted by all those par-
guidelines issued by the Ministry of Education on 10 December 2008. In
ticipating in the financial reporting. The models of operation, regulations,
addition, the Cabinet Committee on Economic Policy issued guidelines on
and instructions are also communicated through staff training.
the compensation and pension schemes of state-owned companies on
8 September 2009. The report on Corporate Governance has been given
RISK ASSESSMENT AND CORE RISKS
separately, not as part of the Board of Directors' report on operations.
The risks associated with financial reporting are assessed as part of
The Finnish Corporate Governance Code 2008 is freely accessible at
Veikkaus' process of risk management and and risk evaluations. Further,
www.cgfinland.fi.
the aim is to analyse and report the risks related to reporting immediately
after they have been identified.
Annual report 2009
57
BOARD OF DIRECTORS 2009
J U H A N I E M E L Ä , Chairman, b. 1946
M A I J A - R I I T TA O L L I L A , Vice Chairman, b. 1956
J O U KO A H T O L A , b. 1952
L E E N A H A R K I M O , b. 1963
M.Sc. (Econ.),
Dr.Sc. (Econ.), h.c.,
Dr.Sc. (Tech.), h.c.,
Vuorineuvos (Finnish honorary title)
D.Soc.Sc
M.Sc. (Econ.)
Diploma in Business Studies
Fixed-term Professor, Aalto University
Ministerial Adviser, Ministry of Social Affairs and Health
Member of Parliament
Professional experience as researcher, teacher at
various universities; entrepreneur in the field of training
Professional experience from financial administration
and internal audit
Professional experience as the CEO of the Finnish
hockey team Jokerit and several years as an MP
Member of the Board since 1 January 2006,
Member of the Personnel Committee
Member of the Board since 1 January 2006,
Member of the Audit Committee
Member of the Board since 1 January 2008,
Member of the Personnel Committee
Professional experience from the field of forest
industry, from marketing management to business
management
Current memberships of other boards of directors:
National Sports Council, Jokerit HC Oy
Member of the Board since 10 October 2000;
Chairman of the Personnel Committee
Current memberships of other boards of directors:
M-real Oyj, Powerflute Oyj, Green Resources A.S.
M I K A E L I N G B E R G , b. 1951
R I I T TA K A I V O S O J A , b. 1957
A R I L A H T I , b. 1963
L E E N A P A A N A N E N , b. 1950
Ph.D (Econ.)
Master of Laws (trained on the bench)
Lic. Soc. Science
M.Sc. (Econ.)
Professional experience as the CEO of Samfundet
Folkhälsan and Aktia Bank
Director General, Ministry of Education
Managing Director, ICECAPITAL Securities Ltd.
Partner, Ovia Oy
Professional experience as a director and
specialist in the Ministry of Education
Professional experience as a director and specialist in
the financial and capital market
Professional experience as a manager in marketing
communications and media companies
Member of the Board since 1 January 2008,
Member of the Audit Committee
Member of the Board since 1 January 2002,
Chairman of the Audit Committee
Member of the Board since 1 January 2000,
Member of the Audit Committee
Current memberships of other boards of directors:
Wulff Group plc., Companies in the ICECAPITAL Group
Current memberships of other boards of directors:
A-Lehdet Oy, Kalevala Koru Oy, Lapponia Jewellery Oy,
Juuriharja Consulting Group Oy, Hidas Oy
Member of the Board since 1 January 2008,
Member of the Personnel Committee
Current memberships of other boards of directors:
Oral Hammaslääkärit Oyj, Andelslaget Varuboden
58
Annual report 2009
BD?4AE8B>AH1>0A3!(! OFFICIAL SUPERVISORS
Member of Parliament ILKKA KANERVA, Chairman since 11 September 2009
Chief Police Inspector REIJO HYYTIÄINEN
Member of Parliament JARI KOSKINEN, Chairman until 11 September 2009
Administrative Officer HANNELE JUUSELA
Member of Parliament MATTI SAARINEN, Vice Chairman
Chief Police Inspector SEPPO JUVONEN
Member of Parliament MERIKUKKA FORSIUS
Senior Officer KIRSI HACK
Member of Parliament JUKKA GUSTAFSSON
Director, Police College of Finland SEPPO KOLEHMAINEN
Member of Parliament TUOMO HÄNNINEN
Chief Inspector MIA POUTANEN
Member of Parliament HELI JÄRVINEN
Inspector General of the Police REIJO PÖYHÖNEN
Member of Parliament JARI LEPPÄ
Chief Superintendent SEPPO RUOTSALAINEN
Member of Parliament 748::80>;;8;0
Senior Officer KARI SANTALAHTI
Member of Parliament SIRPA PAATERO
Head of Press and Communication Services KAIJA UUSISILTA
Member of Parliament AILA PALONIEMI
Member of Parliament JUHA REHULA
Member of Parliament KARI UOTILA
Member of Parliament ULLA-MAJ WIDEROOS
AUDITORS
Responsible Auditor
Authorised Public Accountant LASSE HOLOPAINEN, KPMG Oy Ab
PERSONNEL REPRESENTATIVES 2010
Head of Communications RIITTA NISSI
Production Controller TEIJO LOIKKANEN, Deputy Personnel Representative
2009
Operational Supervisor TEIJO LOIKKANEN
Head of Business Development RIKU SOININEN,
Deputy Personnel Representative
Annual report 2009
59
STRATEGIC EXECUTIVE TEAM 1 JANUARY 2010
CEO
Executive Vice President
R I S T O N I E M I N E N , b. 1951
J U S S I I S O TA L O , b. 1947
Master of Arts
Diploma in Business and Administration
O L L I S A R E KO S K I , b. 1965
Master of Laws (trained on the bench)
Veikkaus career 1989-2000; and since 2001
Joined Veikkaus in 1988
M.Sc. (Econ.)
In charge of Veikkaus' legal affairs and human resources
Appointed CEO in 2001
Professional experience in the shipping industry and
executive positions in various national organisations
In charge of the management of Veikkaus' operative
and business management
Joined Veikkaus in 2003
Member of the Executive Team since 1988
Joined Veikkaus in 2003
Professional experience as an advocate and positions in
sports organizations
Will retire on 1 April 2010
Professional experience includes various executive
positions
Member of the Executive Team since 2004
Professional experience as a CEO,
Communications Director, and Museum Director
Member of the Executive Team since 1991
Executive Vice President,
Senior Vice President, Business Operations
Vice President, Legal Affairs and Human Resources
P E K K A I L M I VA LTA , b. 1970
Member of the Executive Team since 2003
Vice President, Communications
Vice President, Finances
Vice President, Production
Senior Vice President, Business Development
I L K K A J U VA , b. 1952
M A R I L E N E M Ä K I PÄ Ä , b. 1950
E S A VA LT O N E N , b. 1952
J A R I VÄ H Ä N E N , b. 1965
Joined Veikkaus in 2000
M.Sc. (Econ.), Authorised Public Accountant
B.Sc.
M.Soc.Sc
In charge of Veikkaus' communications, corporate social
responsibility, stakeholder and marketing cooperation
In charge of Veikkaus' internal and external accounting,
accounts ledger and real estate services
In charge of information management, production
services, production technology, and corporate security
In charge of Veikkaus' international affairs and business
development
Professional experience as the Editor-in-chief of LänsiSavo newspaper, and as an Editor of, e.g.,
Uusi Suomi and Turun Sanomat newspapers
Joined Veikkaus in 2002
Joined Veikkaus in 1991
Joined Veikkaus in 1995
Professional experience as a Financial Director in
various small and medium-sized enterprises and as an
Authorised Public Accountant
Professional experience includes positions within
information management and executive positions in
software production
Professional experience as Betting Director and
Acting CEO of the Finnish Trotting and Breeding
Association Hippos
Member of the Executive Team since 2002
Member of the Executive Team since 1997
Member of the Executive Team since 2004
Member of the Executive Team since 2000
60
Annual report 2009
OPERATIVE EXECUTIVE TEAM
Executive Vice President; Senior Vice
President, Business Operations
Senior Vice President,
Business Development
Head of Customer Relations
Management
Vice President,
Legal Affairs and Human Resources
Vice President,
Communications
O L L I S A R E KO S K I , Chairman
J A R I VÄ H Ä N E N , Vice Chairman
A R I A A R N I H U H TA
P E K K A I L M I VA LTA
I L K K A J U VA
Director, Public Relations
Marketing Director
Vice President, Finances
Director, Strategy and Development
Director, Product Management
HANNU K AREINEN
AMI MIET TINEN
M A R I L E N E M Ä K I PÄ Ä
K A R R I P A AV I L A I N E N
ANT TI TIIHONEN
Director, Digital Channels
Vice President, Production
Director, Sales Network
KIMMO TOLONEN
E S A VA LT O N E N
N O R A VÄ H ÄV I R TA
Annual report 2009
61
ORGANIZATION
1 January 2010
CEO
RISTO NIEMINEN
Executive Vice President
JUSSI ISOTALO
(will retire on 1 April 2010)
BUSINESS OPERATIONS
Executive Vice President, Senior Vice President, Business Operations
OLLI SAREKOSKI
Customer Relations and Business Intelligence
Brand and Marketing Communications
Product Management
Sales Network
Digital Channels
Strategy and Development
I N T E R N AT I O N A L A FFA I R S A N D
B U S I N E S S D E VE L O P M E N T
Senior Vice President, Business Development
90A8E«7«=4=
FINANCIAL MANAGEMENT
Vice President, Finances
<0A8;4=4<«:8?««
PRODUCTION
COMMUNICATIONS AND CSR
Vice President, Production
Vice President, Communications
ESA VALTONEN
ILKKA JUVA
Information Management
Production Services
Production Technology
Corporate Security
LEGAL AFFAIRS AND HUMAN RESOURCES
Vice President, Legal Affairs and Human Resources
PEKKA ILMIVALTA
FINANCIAL STATEMENT 2009
Board of Director's report on operations
Statement of comprehensive income
Balance sheets
Cash-flow statement
Changes in shareholders' equity
Accounting principles
64
68
69
70
71
72
Notes to
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
75
76
76
76
77
77
77
78
79
79
80
80
80
80
81
81
82
the financial statement
Turnover by games and motivational states
Development of financial result
Other operating income
Depreciations
Purchase of services
Other operating expenses
Financial income and expenses
Tangible assets and depreciations
Intangible assets and depreciations
Investments and long-term investments
Investments held for sale
Short-term receivables
Liquid assets
Share capital, reserve fund, undistributed prizes' fund
Short-term liabilities
Liabilities from employee benefits
Related party transactions
Contingent liabilities and
amounts payable on other leasing agreements
19. Signatures
20. List of accounting books and record formats
Auditors' report
Statement by the Supervisory Board
83
83
83
84
85
Financial report 2009
63
BOARD OF DIRECTORS' REPORT 2009
TURNOVER BY GAMES 2005—2009
EUR MILLION
1,600
1,316 1,361 1,391 1,475 1,558
COMMUNITY INTERACTION
LEISURE-TIME
1,400
Veikkaus' 69th year of operations was a year of strong growth. The com-
The significant rise in the turnover generated by the dream games can be
pany progressed against the mainstream of the economic fluctuations in
explained especially by the great popularity of the newly introduced Plus
a target-oriented way, and the financial result can be deemed extremely
prize tiers in the lotto games (LottoPlus and VikingPlus). Up to half of the
good in the current economically challenging times. Our success is based
gaming transactions in Lotto and Viking Lotto already contain the Plus
on a strong focus on customer relations and the development of products
prize tier option. The Plus prize tiers that were launched at the beginning
and services by making use of customer knowledge in particular.
of June had generated an additional turnover of EUR 38.9 million by the
EXCITEMENT
DREAMS
1,200
end of the year.
Veikkaus attained a turnover of EUR 1 557.6 million, the largest in the
company’s history. This meant an increase of EUR 82.9 million (+5.6%)
The turnover of the dream games group was also boosted by the product
over the previous year. Veikkaus’ profit for the financial year was EUR
reforms of Viking Lotto and Joker. The reform of Viking Lotto, introduced
468.8 million (+4.4%). The positive profit development can be attributed
at the beginning of the year, raised the Lucky Number jackpots consider-
800
especially to an increase in the turnover of games with large margins.
ably, resulting in an increase of 13.7% in the sales over the previous year.
600
Veikkaus returned EUR 414.0 million to the Ministry of Education, to be
seven times more prizes than before, and the payout percentage was
distributed to Finnish arts, sports, science, and youth work. The difference
raised by 12%. The reform of Joker and its TV game show attracted a
between the financial result and the return to the Ministry of Education,
lot of attention and during the last two months of the year, Joker’s sales
EUR 54.8 million, is distributed by the Ministry of Education to the benefi-
amounted to around 24% more than in the corresponding period in 2008.
ciaries as specified separately. During the financial year, Veikkaus paid a
The Joker brand was reinforced as a result of the reform, and new players
total of EUR 47.0 million of undistributed prize funds accumulated during
were attracted to the game. According to our customer database, an aver-
the previous years to the Ministry of Education.
age of 12% of the weekly players of Joker were newcomers.
In addition to the return to the Ministry of Education, Veikkaus paid EUR
In October, Veikkaus revised all its instant games. The payout percent-
72.6 million of lottery tax (+6.2%) to the State. Veikkaus’ operations are
ages were raised, which meant a considerable increase in the number of
not subject to value added tax, which is why the company cannot deduct
prizes and larger jackpots. The new instant ticket Mega Ässä Instant, with
the VAT on its purchases of goods and services. Veikkaus paid a total of
a jackpot of EUR 500 000 was welcomed by our players. It was sold for
EUR 20.0 million (+15.2%) of VAT to the State in 2009.
up to EUR 9.4 million by the end of the year. After the product reform, the
1,000
Joker was revised at the beginning of November. The new Joker offers
400
200
0
2005 2006 2007 2008 2009
GAME GROUPS’ REL ATIVE SHARES
OF TURNOVER 2009
(SHARE IN 2008)
sales of all the instant games grew by around 27% as compared with the
REFORMED LOTTO GAMES AND JOKERS SALES BOOSTERS
previous year.
Veikkaus games are divided into four groups based on different motivational states: dreams (lotto games and Jokers), leisure-time (sports
Keno has established its position as Veikkaus’ second most popular
games), excitement (Keno and instant tickets) and community interaction
game. The daily live broadcasts of Keno’s TV game shows, started at the
(Veikkaus Bingo and Nature Instant). The turnover of all the game groups
beginning of 2009, made people even more drawn to the game. Keno’s
increased, with the exception of the leisure-time games, where the sales
turnover rose by 5.0% over the previous year.
remained at almost the same level as in 2008. The dream games generDREAMS
44.6% (42.7%)
ated a turnover of EUR 694.8 million (+10.3%); leisure-time games EUR
The year under review was challenging for the sports games group (-1.8%).
EXCITEMENT
31.3% (31.5%)
369.0 million (-1.8%); excitement games EUR 488.2 million (+5.2%); and
This was partly due to the fact that there were no large international
LEISURE-TIME
23.7% (25.5%)
community interaction EUR 5.7 million (+11.9%).
games in the events that are central in betting during the year under re-
COMMUNITY INTERACTION 0.4% (0.3%)
*
64
Specified by games in the financial statement on page 75.
Financial report 2009
view. However, some of the betting games improved their sales during the
year, including Result and Winner Odds Betting games, where the payout
an outstanding ability to understand our customers. A survey carried
centred on the Gaming Research Foundation, established jointly by
percentages had been raised at the end of 2008. In addition, a number of
out in August showed that our customers’ total satisfaction concerning
Veikkaus, the Finnish Slot Machine Association RAY, and Fintoto in 2008.
new gaming options were offered during the year under review.
Veikkaus and our services was at a good level. Of the respondents, 96%
The Gaming Research Foundation promotes multi-disciplinary research
were very or rather satisfied with Veikkaus’ operations; and up to 31%
on gaming as a social and cultural phenomenon. During the year under
were very satisfied.
review, the foundation distributed the first twenty research grants to,
The number of betting objects of Veikkaus’ third most popular game Fixed
Odds Betting was raised significantly in November. The weekly objects
e.g., cultural research related to gaming and research projects in the field
were increased from the former 300 to 450. Along with the increase in
Veikkaus Card, introduced in 2006, is the most prominent part of
the number of objects in Fixed Odds Betting, new sports series were in-
Veikkaus’ customer relations. During the year under review, the use of
troduced. Fixed Odds Betting was played for a total of EUR 134.5 million
Veikkaus Cards and the general awareness about the customer benefits
OPENNESS AND RELIABILITY IN
(-4.0%) during the year under review.
we offer increased considerably. The number of identified customers
THE FOCUS OF RESPONSIBLE OPERATIONS
increased by over 241 000 customers. The milestone of one million
In 2009 Veikkaus continued to invest heavily in the promotion of respon-
OVER 200 000 PRIZES EVERY DAY
registered customers was reached at the beginning of September. The
sible business operations. The justifying grounds for the exclusive right
We pay out an average of over 200 000 prizes to the players every day.
maximum share of registered sales out of the total sales was nearly 42%,
applied to gaming are the prevention of social detriments and fighting
During the year under review, the prizes paid out to the players amounted
in the last week of the year. As registered gaming increases, we will be
crime. Veikkaus offers its customers a safe channel of gaming. It entails
to a total of EUR 791.1 million (+4.8%).
able to listen to our customers’ needs even better. Finns have been glad
strong consumer protection and gaming restrictions that are deemed
to welcome Veikkaus Customer Loyalty Programme. In a Customer Loyalty
necessary, including age and stake limits.
of economics and social research.
Veikkaus’ retail commissions totalled EUR 82.5 million (+2.7%) in 2009.
Program Barometer at the end of the year, Veikkaus’ programme was
The costs incurred by the draws and result information amounted to EUR
rated as the second most recommendable among the most widely known
The expenses incurred by the measures Veikkaus took to promote re-
10.5 million (-1.8%) and the playslip and ticket expenses amounted to
customer loyalty programmes in Finland.
sponsible gaming amounted to EUR 3.6 million (+7.8%) in 2009. By these
EUR 8.0 million (+6.4%). We spent EUR 13.3 million (+25.7%) on product
measures we promoted the responsibility and integrity of gaming either
advertising, i.e. 0.9 percent of the turnover. The costs of advertising
RESEARCH AND PRODUCT DEVELOPMENT
in our own business operations or in cooperation with our stakeholders,
increased as a result of the numerous product reforms.
Veikkaus spent a total of EUR 4.9 million (-0.3%) on product development
and worked to increase general knowledge about the national gaming
and research in the year under review. The new game system, introduced
system and its significance. The measures included the introduction of
Game event cooperation cost Veikkaus a total of EUR 3.7 million (-7.4%).
in 2008, and the more efficient product development process enabled
gaming restrictions to the game system; age limit controls; and the pro-
During the year under review, the model of calculating was changed so
the numerous successful game reforms that were carried out in the year
motion of identified gaming. The expenses also covered research projects
that the game event compensation paid to Fintoto was removed from
under review, including the Plus prize tiers, the Jokers, and the instant
on the detriments of gaming, which Veikkaus financed by making pay-
the game event cooperation account group and made part of the account
games. In 2010 the product development operations will focus especially
ments to the Ministry of Social Affairs and Health, as well as the funding
group of supervision and official expenses. The expenses of the new
on the internet environment and the development of new games to be
of the Finnish problem gambling helpline Peluuri. The joint costs of these
account group amounted to EUR 10.2 million (+30.8%) in the year under
introduced on the web.
two fields of activity amounted to some EUR 762 000 in 2009.
A central part of Veikkaus’ product development process is the Respon-
Veikkaus was among the first European lotteries to audit the level of its
sibility Evaluator Tool, which is used to analyse, e.g., the accessibility and
responsibility in accordance with the EL (European Lotteries) standard.
MILESTONE OF ONE MILLION
attractiveness of the games, and their social features. All the new game
The audit was assured by an external assurance body. The auditing
REGISTERED CUSTOMERS ATTAINED
ideas are analysed from an ethical perspective in order to recognize the
process was carried out in order to guarantee Veikkaus’ measures for the
Veikkaus’ good financial result is based on a systematical focus on
possible risk factors.
promotion of responsible gaming.
development of products and services. Veikkaus’ customer relations
Veikkaus’ own research operations focused on the analysis of customer
The proposal for the amendment of the Lotteries Act, which is currently
strategy, which has been developed since 2004, has provided us with
information and customer behaviour. The external research endeavours
being considered by the Finnish Parliament, covers the raise of the gam-
review. The increase in the supervision and official costs was explained
especially by the reforms introduced to the supervision system.
customer relations and an efficient use of customer information in the
Financial report 2009
65
ing age limit to 18 years. Veikkaus anticipated the new legislation by
care, a health and safety system, and activities promoting the staff’s
whereas the share of statutory staff insurances, voluntary pension
introducing the new age limit in June 2009. The objective of the gaming
working capacity. We also have a system of early intervention in place.
expenses, and indirect personnel costs was EUR 5.4 million.
age limit is to protect especially the young consumers better and to
The sick leave days per employee amounted to an average of 10.5 in
anticipate and minimize the possible gaming detriments.
2009. Two work-related injuries were registered, but none of them led to
CONTROL AND RISK MANAGEMENT
a longer period of absence from work.
In accordance with the Finnish Lotteries Act (1047/2001), Veikkaus’
lottery, pools, and betting activities are supervised by the Ministry of the
During the year under review, we continued to develop tools for gaming
control, including the Game Pause website. Veikkaus piloted the “Test
Veikkaus’ new vision brought with it an update to the human resource
Interior. Veikkaus complies with a comprehensive risk management sys-
Your Gaming Habits” test together with six other Nordic lotteries, offering
strategy. Veikkaus aims at becoming an outstanding place to work, of-
tem (ERM). The ERM is integrated in the planning processes of Veikkaus’
our customers a chance to check their own gaming habits. The objective
fering its staff a challenging and meaningful working environment, and
activities in a way which ensures the regular and versatile evaluation
of the test is to make the players spot the possible risks involved in their
creating continuously new opportunities for the staff to improve their
of the risks inherent in the business objectives and the company’s pre-
gaming behaviour at an early stage.
professional skills. To be an excellent workplace, we must keep reforming
paredness for tackling them. The company’s management and different
and offer our employees competitive salaries and incentives. We also
functions are supported by a Risk Management Team, which works to
A key issue in Veikkaus’ CSR is the active interaction with our stakehold-
want to be an attractive and valued employer. Veikkaus’ incentive scheme
ensure the functioning of the risk management system and its continu-
ers. In the autumn Veikkaus made a survey of stakeholder expectations.
covers the entire staff and its different forms are deeply incorporated in
ous development.
A total of over 5 200 people answered the survey, including custom-
the achievement of the company’s strategic objectives.
In the regular evaluation carried out during the period under review, it
ers, retailers, game sales clerks, representatives of the media, political
decision-makers, government officials, partners in cooperation, beneficiar-
In the Great Place to Work 2009 survey, 87% of Veikkaus’ employees
turned out that the core concern in risk management was the insecurity
ies, and members of Veikkaus’ staff. The outcome was that, above all,
regarded Veikkaus as a very good workplace on the whole. Our staff said
related to the contents and delay in the entry into force of the Lotteries
Veikkaus is expected to act openly and reliably. These themes were rated
they were motivated by the meaningfulness of their work to Finnish
Act. For example, the details concerning the restrictions on the market-
as important by all the stakeholder groups.
society. They were satisfied with the benefits and training opportunities
ing of games and the operations of the gaming organizations will only
Veikkaus offered to them.
be specified more clearly as the legislative process continues. Other
significant risks include the insecurity concerning new products and the
Finns put high value on Veikkaus’ responsible operations. In a survey on
updating of existing games.1
CSR by TNS Gallup, consumers rated Veikkaus as the second best Finnish
In 2009, we continued to work on the themes that had arisen from the
company in all sectors of CSR. The survey investigated consumers’ opin-
earlier staff satisfaction surveys: equal opportunities, openness, and job
ions of the responsibility of thirty important Finnish companies.
rotation. In skills development and internal communications, we focused
LOTTERIES ACT AMENDMENT
on advocating individual responsibility and a change in the operating
The Finnish government made a bill concerning the amendment of the
OUTSTANDING WORKPLACE OPERATES EFFICIENTLY
culture. A staff satisfaction survey in the autumn showed that we had
Lotteries Act in 2008. The government bill covered the marketing and age
At the end of 2009 Veikkaus had 355 employees (+1), of whom 333
managed to perform better in all the issues that had been identified as
limits of games, the executive power of the licensing authority, and the
were full-time and 22 part-time employees. Most employees (95.2%) had
deserving special attention in 2008 and 2009.
proposals concerning the penal provisions. It was proposed that a general
age limit of gaming of 18 years should be laid down by the Lotteries Act.
permanent employment contracts. Women’s share of the staff was 196
Veikkaus had two co-determination negotiations in accordance with the
According to the government bill, marketing authorised games and gam-
legislation on co-determination in 2009. They covered the reorganization
ing organizations should be basically allowed if it is done in a responsible
During the year under review, 23 new employees were hired, 14 retired, 4
of the terminal maintenance activities and the activities of the Graphic
manner and its objective is to channel the demand to games that are
gave their notice, and the fixed-term employment contracts of 4 people
Design Unit, after the removal of the printing equipment and the transfer
authorised in Finland. Further, it was proposed that the Lotteries Act
were terminated. The average turnover of the personnel was 6.3% (5.1%
of three jobs from the regional office in Tampere to the head office in
should include a provision reinforcing the ban on illegal gaming operations
in 2008).
Vantaa. In all, the negotiations covered eighteen people.
and marketing by making them subject to a conditional fine. The amended
Veikkaus invests in its staff’s wellbeing in many ways. The employees’
Veikkaus’ personnel expenses amounted to EUR 26.1 million (+4.8%) in
work enjoyment is supported by, e.g., comprehensive occupational health
2009. Salaries represented EUR 20.7 million of the personnel expenses,
and men’s 159.
Lotteries Act will probably enter into force during 2010.
66
Financial report 2009
1
Veikkaus’ supervision and risk management are described in more detail on pages 56 and 57.
In April 2009 the Lotteries Act amendment steering group submitted its
Veikkaus’ business operations are based on an ability to combine respon-
final report to the Minister of the Interior. It was proposed in the report
sibility with customer focus and interesting products as well as possible.
that the status of the gaming system that has been effective in Finland
We aim at increasing our profit responsibly, especially by reaching a wider
for decades should be laid down by law. Further, it was suggested that
customer base and by channelling gaming to games that involve smaller
the legal operators should not compete with each other by providing
risks from the perspective of gaming control. We also aim to increase the
overlapping or too similar games. In order to prevent the games from
number of identified gaming transactions. Veikkaus invests heavily in
overlapping, it was proposed that horse betting games should only be
both the digital and the traditional sales channels.
provided by Fintoto Oy in the future. From Veikkaus’ perspective, this
proposal covers the V5 and V75 Off-track Horse Betting games.
Both the national and the EU legislation have a considerable effect on
the competitive situation in the field of gaming. Veikkaus’ operations are
After the final report had been submitted, the proposals concerning the
also affected by the changes in the economic environment that show in
Lotteries Act amendment were circulated widely for comments. The
consumer behavior and cover even gaming. Competition on the entertain-
objective was that the suggested amendments to the provisions in
ment and leisure-time markets is becoming harder as the number of
the final report could be submitted to Parliament early enough to make
service providers increases. Veikkaus wants to distinguish from others in
them effective by the end of the gaming organizations’ current gaming
the midst of the fervent competition, and to retain its status as part of
licences, i.e. starting 1 January 2012 at the latest.
Finns’ everyday lives. It is important that we retain the general approval
of gaming in Finnish society and manage to increase the company’s value
The European Parliament approved a committee report on internet
through a strong brand and good reputation.
gaming in March 2009. The European Parliament stated in its decision
that gaming constitutes a special economic activity to which the Internal
The profit expectation for Veikkaus funds recorded in the State Budget
Market rules cannot be applied. Further, the Parliament stated that the
for the year 2010 is EUR 462.7 million. In the light of the present situa-
member states should be able to regulate and control their internal gam-
tion, the profit expectation is attainable.
ing markets even in the future. The European Parliament's decision can be
regarded as a strong opinion in favour of state-controlled gaming policies.
BOARD OF DIRECTORS’ PROPOSAL
FOR THE DISTRIBUTION OF THE PROFITS
Finns are in favour of the current system of gaming. In a CSR survey com-
The Board of Directors proposes that EUR 414 026 506.91 of the total
missioned by Veikkaus in spring 2009, the majority of Finns – around four
profit of EUR 468 776 506.91 for the financial year of 2009 be returned
out of five (81%) regarded Veikkaus’ exclusive right to operate games
to the Ministry of Education, while EUR 54 750 000.00 shall be trans-
and the fact that Veikkaus funds are returned to society as good. Up to
ferred to the undistributed prizes’ fund.
96% said they considered it important or very important that the gaming
proceeds should be channelled to Finns.
FUTURE PROSPECTS
Veikkaus’ vision is to be the best lottery in the world in 2013. This vision
guides us towards outstanding performance. The core objectives in the
achievement of the vision include an efficient channelling of the demand
for games, productivity, development of shareholder value, and responsible decision-making.
Financial report 2009
67
STATEMENT OF COMPREHENSIVE INCOME
Euro
1 JAN 2009 – 31 DEC 2009 AND 1 JAN 2008 – 31 DEC 2008
NOTE TO THE FINANCIAL STATEMENT
2009
2008
TURNOVER
1
1,557,633,786.99
1,474,758,880.65
Other operating income
3
2,087,407.35
2,223,968.74
791,087,451.85
754,574,530.28
72,551,654.81
68,285,189.73
Retail commissions
82,478,482.62
80,323,094.70
Payments to authorities and supervision fees
10,184,214.05
7,786,947.00
8,013,060.87
7,531,227.51
10,479,975.33
10,669,565.07
Prizes
Lottery Tax
Raw materials and services
Playslips and lottery tickets
Drawing expenses and result service
Game event cooperation
Product advertising
Data Communications
3,690,741.25
3,987,104.95
13,273,412.69
10,563,584.51
583,090.44
479,575.86
128,702,977.25
121,341,099.60
20,722,228.89
19,671,246.22
Expenses from employee benefits
Salaries and compensations
Pensions
4,366,877.68
4,107,145.66
Other indirect personnel expenses
1,036,543.70
1,140,038.67
26,125,650.27
24,918,430.55
Purchased services
Depreciations and write-downs
Other operating expenses
5
17,017,577.24
17,175,389.30
4,8,9
31,625,313.98
23,318,675.95
6
28,013,631.14
26,624,076.34
464,596,937.80
440,745,457.64
8 391,217.26
OPERATING PROFIT
Financial income and expenses
Financial income
7
4,181,068.88
Financial expenses
7
1,499.77
1,246.64
4,179,569.11
8,389,970.62
468,776,506.91
449,135,428.26
Number of shares
498
498
Income per share (thousand euros)
941
902
NET PROFIT FOR THE FINANCIAL YEAR
Income/share (Income per share has been calculated by dividing the profit for the financial year by the number of shares )
68
Financial report 2009
BALANCE SHEETS
Euro
31 DEC 2009 AND 31 DEC 2008
NOTE TO THE FINANCIAL STATEMENT
2009
2008
Tangible assets
8
38,215,172.68
39,149,701.69
Intangible assets
9
33,000,749.06
33,015,424.53
11
481,647.26
20,416,754.58
352,447,315.48
332,438,085.59
ASSETS
NON-CURRENT ASSETS
Investments available for sale
OTHER RECEIVABLES
Advance payments
Receivables
12
15,105,138.95
13,414,795.44
Liquid funds
13
220,934,338.48
208,136,650.42
660,184,361.91
646,571,412.25
169,320.00
TOTAL ASSETS
SHAREHOLDERS' EQUITY AND LIABILITIES
SHAREHOLDERS' EQUITY
Subscribed capital
14
445,698.01
Reserve funds
14
0.00
276,378.01
Undistributed prizes' fund
14
89,067,449.45
94,867,449.45
Profit for the financial year
468,776,506.91
449,135,428.26
Total shareholders' equity
558,289,654.37
544,448,575.72
LIABILITIES
LONG-TERM LIABILITIES
Liabilities arising from employee benefits
16
2,324,000.00
2,587,000.00
Other long-term liabilities
16
464,616.20
354,625.90
Advances for multi-week subscriptions
15
16,107,133.97
13,292,838.42
Trade payable
15
7,153,117.30
6,200,919.45
Winnings payable
15
25,785,935.92
24,729,385.71
Settlement debts to the State
15
15,558,983.14
17,012,749.85
Accruals and deferred income
15
20,784,932.17
21,341,504.15
Other short-term liabilities
15
13,715,988.84
16,603,813.05
660,184,361.91
646,571,412.25
SHORT-TERM LIABILITIES
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES
Financial report 2009
69
20B75;>FBC0C4<4=C
Thousand euros
NOTE TO THE FINANCIAL STATEMENT
2009
2008
464,597
440,745
41,395
24,745
-1,693
14,644
-47,228
1,056
2PbWU[^fUa^\QdbX]Tbb^_TaPcX^]b
Operating profit
Adjustments
Business operations with no related payment transaction
Change in working capital
Change in non-interest bearing receivables
Change in trade and other payables
Dividends received
Interest received
Interests paid
=TcRPbWU[^fUa^\QdbX]Tbb^_TaPcX^]b
2
2
4,179
8,389
-1
-1
#% !$ #'($'
-30,714
-30,854
10,203
3,075
2PbWU[^fUa^\X]eTbc\T]cb
Investments in tangible and intangible
assets
10
Sales of tangible and intangible
assets and investments
Repayments on loan receivables
=TcRPbWU[^fUa^\X]eTbc\T]cb
2
!$'
!$'
8
!&&&
2PbWU[^fUa^\UX]P]RX]V
Returned to the Ministry of Education
=TcRPbWU[^fUa^\UX]P]RX]V
-415,951
# $($
Change in liquid funds
12,798
45,858
Liquid funds at the beginning of the financial year
208,137
162,279
220,934
208,137
Liquid funds at the end of the financial year
70
-427,945
#!&(#$
#!&(#$
Financial report 2009
CHANGES IN SHAREHOLDERS' EQUITY
Thousand euros
Shareholders' equity 31 Dec 2007
SHARE
CAPITAL
RESERVE
FUND
UNDISTRIBUTED
PRIZES' FUND
RETAINED
EARNINGS
SHAREHOLDERS'
EQUITY TOTAL
169
276
65,217
427,385
493,049
Return to the Ministry of Education
-397,735
Transfer to the undistributed prizes' fund
29,650
Net profit for the financial year
Shareholders' equity 31 Dec 2008
169
276
94,867
Return to the Ministry of Education
Transferring the reserve fund into share capital
449,135
544,449
-407,935
276
Transfer to the undistributed prizes' fund
-276
41,200
Additional transfer to the Ministry of Education
-41,200
-47,000
Net profit for the financial year
Shareholders' equity 31 Dec 2009
-29,650
449,135
468,777
446
89,067
468,777
558,290
Financial report 2009
71
ACCOUNTING PRINCIPLES 2009
CORPORATE INFORMATION
Whilst preparing a financial statement in accordance with international
Veikkaus Oy is a Finnish lottery domiciled in the City of Vantaa. Its
accounting standards, it is necessary to make estimates for the future.
Buildings and constructions .............................................................................................25
operations are regulated in accordance with the Lotteries Act and the
The estimates have an effect on the asset and liability figures in the bal-
Renovations of apartments ................................................................................................. 5
gaming licence, effective until 31 December 2011. Veikkaus is owned by
ance sheet, as well as on the net profits and losses for the financial year.
Machinery, equipment, and instalments in real estates .................................. 5
the Finnish Ministry of Education and supervised by the Ministry of the
The most important estimates in Veikkaus’ financial statement have to do
Other machinery and equipment ..................................................................................... 4
Interior.
with the write-down periods of fixed assets and the assumptions used as
IT software and appliances .............................................................................................4-7
FaXcTS^f]_TaX^Sb^U
gTSPbbTcbhTPab)
a basis for counting the pension-based liabilities. The realized figures may
The Board of Directors of Oy Veikkaus approved this financial statement
deviate from the estimates. Further, applying the accounting principles
The profits and losses resulting from the sales or assignment of fixed
for publication in its meeting of 8 February 2010. According to the Finn-
always requires consideration.
assets are recorded as other operating income and expenses in the state-
ish Companies Act, the owner has the right to approve or reject or decide
ment of comprehensive income. The balance values of fixed assets are
to make changes to the financial statement in a General Meeting follow-
ITEMS IN FOREIGN CURRENCY
ing the publication of the statement.
Veikkaus’ operating currency is euro. Business transactions in foreign
followed in the financial statements to detect possible depreciations.
currency have been recorded as euros using the prevailing exchange
RESEARCH AND DEVELOPMENT
BASIS OF PRESENTATION
rate. Receivables and liabilities have been translated into the operating
Research costs are recorded as expenses for the financial year during
This financial statement was drafted in accordance with the IFRS stand-
currency using the prevailing rate at the date of the financial statement.
which they have occurred. Expenses related to the development of new
ards effective on 31 December 2009. The IFRS standards refer to the
Profits and losses arising from business transactions in foreign currency
products, offerings, and processes are activated if the intangible asset
international accounting standards accepted for use within the EU.
and the translation of the receivables and liabilities have been recorded in
resulting from the development work will generate economic profit in the
the income statement. The translation profits and losses of the business
future. Further, the costs incurred by the development shall be definable
operations are included in the respective items above the net profit.
in a reliable manner.
Currency
Prevailing rate at the date
LEASES
of the financial statement
In accordance with the rental agreements made by Veikkaus, the risks
The notes to the financial statement comply with the requirements of
the Finnish Accounting Act and Companies Act, supplementing the IFRS
standards. Veikkaus has adopted the IAS 1 Presentation of financial
statements standard, which was reformed in 2009. For Veikkaus’ the
reformed standard manifests itself principally in the way the changes in
USD....................................................................................................................................................1.4406
and benefits of ownership are retained by the lessor, and payments made
shareholders’ equity are presented. Further, the income statement has
GBP ....................................................................................................................................................0.8881
under operating leases are charged to the statement of comprehensive
been changed into a statement of comprehensive income. The other
income on a straight-line basis over the period of the lease.
new or reformed standards and interpretations do not affect Veikkaus’
FIXED ASSETS
financial statement.
Fixed assets have been measured at their original acquisition cost, less
FINANCIAL ASSETS AND FINANCIAL LIABILITIES
the accumulated depreciations in the balance sheet. The share of the
Financial assets are divided into different categories at the time of
GENERAL REMARKS
company’s own work, entered into the intangible assets is activated as
acquisition. The categorization depends on the purpose the financial as-
The accounting data are shown in thousand euros, except for the state-
part of the acquisition cost. The expenses concerning an asset at a later
set has been acquired for. The purchases and sales of financial assets are
ment of comprehensive income and the balance sheet, and they are
date are activated when they increase future economic profit. Other
recorded at the date of the transaction.
based on the original acquisition costs, unless otherwise indicated in the
expenses, such as the normal measures of maintenance and repair, are
accounting principles below.
recorded as costs in the income statement at their date of occurrence. In
Long-term investments held for sale include stocks, shares and market-
2009, we introduced a change to our recording system. From now on, the
able interest instruments. They are measured at fair value. The untraded
expenses incurred from the joint testing system of the new game system
stocks are measured at acquisition cost because their fair value cannot be
in connection with the implementation processes, as well as the new
defined reliably.
internet instants, are recorded as expenses at their date of occurrence.
72
Financial report 2009
Loans and other receivables include sales and other receivables, as well as
The items recorded from the benefit-based pension settlements are
OTHER OPERATING INCOME AND EXPENSES
bank deposits. The difference between the retailers’ sales and retail com-
based on actuarial calculations. The calculations are made on the basis of
The other operating income includes indemnifications, profit from sales
missions and the prizes they pay out is recorded in the sales receivables.
assumptions concerning, e.g., the termination of employment of persons
of assets, and profits from operations other than those related to the
belonging to the pension settlement before the age of retirement; the
company’s actual business operations, e.g. income from messaging service
future level of salaries and the discount rate used in the calculations.
and leasing.
The financial liabilities include the short-term liabilities with no interest.
The differences between the assumptions and realizations or the changThe maturity periods for the loans and other receivables group, the short-
es in the realizations generate actuarial gains and losses. To record them,
The other operating expenses include the losses from sales of assets and
term investments held for sale and the financial liabilities are short and
Veikkaus uses a corridor method in accordance with the IFRS standard.
expenses related to the actual business operations.
their fair values are thus considered to correspond to the book values.
At the date of transition to the IFRS standards, all accumulated actuarial
gains and losses are recorded in the shareholders’ equity.
The book value of the investments included in the financial assets is
PRIZES
The statement of comprehensive income includes the prizes in accord-
measured at fair value due to the short term of maturity of the invest-
;>=6C4A<4<?;>H4414=458CB
ance with the game rules charged to the turnover. The prizes unclaimed
ments. The financial assets in the cash-flow statement correspond to the
A one-time compensation equalling a month’s salary is paid as a bonus for
during the previous year and the assets from the rounding of the prizes
financial assets in the balance sheet.
years of service once the employee has served 30, 35, 40 and 45 years at
shall be paid out according to the gaming licence on the later rounds of
Veikkaus. The compensation liability has been counted on the basis of the
different games during the following calendar year at the latest.
ADVANCE PAYMENTS TO THE MINISTRY OF EDUCATION
personnel’s starting years at Veikkaus, by discounting the compensation
Veikkaus makes quarterly advance payments on its result for the financial
liability realized at the end of each year to the present.
year to its owner. The result for the financial year is charged from the
shareholders’ equity following a decision by the General Meeting.
RAW MATERIALS AND SERVICES
The retail commissions consist of compensations paid to the retailers on
>C74AB7>ACC4A<;8018;8C84BC74?A8I45D=3
the basis of their game sales. The commission percentages vary according
The prize fund is not an actual fund, but the company’s liability to the
to the games.
?>BC4<?;>H<4=C14=458CB
players. The cents accumulated by the rounding of the prize sums and
In accordance with the IFRS, the pension settlements are classified as
the share of prizes undistributed in the prize distribution of Veikkaus
The payments to authorities and supervision fees include the game
either payment-based or benefit-based. The payment-based settlements
games in accordance with the gaming licence, are transferred immediately
supervision fees, the round-specific game event compensations paid
include settlements in which Veikkaus pays fixed amounts to a pension
to the prize fund in connection with the prize distribution. After a claim
to Fintoto, the expenses incurred from the follow-up and research of
corporation without an obligation to make additional payments even
period of one year, the unclaimed prizes in the prize distribution of the
problem gambling, and the expenses of the Finnish Problem Gambling
if the fund lacked the sufficient assets to pay the pensions. Payments
different games are transferred to the prize fund. The assets in the prize
helpline Peluuri.
made to the payment-based pension settlements are recorded as pension
fund are used for additional prize distributions in the different games. The
expenses in the income statement. The payments to the TyEL pension
company is liable to distribute the entire prize amounts pursuant to the
The printing expenses of the lottery tickets, playslips, receipt rolls, and the
insurance system are regarded as payment-based.
gaming licence to the players.
expenses related to Veikkaus Card are recorded as expenses at the date
The rest of the pension settlements are benefit-based. Concerning them,
TURNOVER
a liability based on certain assumptions is recorded in the balance sheet,
The sales of Veikkaus games are divided into turnover according to the
The drawing and result information expenses include costs related to
illustrating the pensions to be paid in the future on the basis of the set-
draw date. The draws take place either weekly or daily. The turnover of
game supervision, TV cooperation agreements and other expenses con-
tlement. The pension cost recorded in the income statement illustrates,
Live Betting consists of gaming income less prizes charged to the game
nected with the publishing of the results.
e.g., the increase in liabilities arising from the work performed by the staff
in question.
of acquisition.
during the financial period.
Financial report 2009
73
Game event cooperation covers the expenses arising from the right to
APPLICATION OF NEW OR REVISED IFRS STANDARDS
use the object information of the games. The expenses may be based on
Veikkaus will implement the following standards in 2010 or thereafter:
agreements, or they can be determined totally according to the roundspecific or annual turnover of the games.
The revised IFRS 3 Business combinations: the standard involves
significant changes that affect, e.g., goodwill arising from corporate
TAXES
acquisitions. The contingent purchase price is recognized at fair value
The lottery tax covers 9.5% of the amount of the income from game and
and its later changes are recognized through profit or loss. The expenses
lottery ticket sales allocated to a calendar month in bookkeeping less the
involved in the acquisition, e.g., specialists’ fees, will be recorded as
prizes recorded as expenses on their basis. The amount of funds charged
expenses instead of activating them.
to the prize fund/from the prize fund is added to/deduced from the difference thus received.
The revised IAS 24 Related party disclosures (effective during financial
periods beginning on 1 January 2011 or thereafter). The revised standard
In accordance with section 59 of the Value Added Tax Act, Veikkaus is not
simplifies the disclosure requirements for government related entities and
liable to pay VAT. The company’s expenses and investments include the
clarifies the definition of a related party. The revised standard has not yet
effective VAT.
been approved for application within the EU.
In accordance with section 21 of the Income Tax Act, Veikkaus is only
The other new or revised standards are not significant to Veikkaus’
liable to pay income tax on income other than that which is intended in
financial statement.
the Lottery Tax Act.
74
Financial report 2009
NOTES TO THE FINANCIAL STATEMENTS
1. TURNOVER BY GAMES AND MOTIVATIONAL STATES Thousand euros
2009
2008
share in % of turnover
Lotto
share in % of turnover
475,788
30.5
468,341
LottoPlus
29,690
1.9
-
-
Viking Lotto
96,324
6.2
84,729
5.7
VikingPlus
Joker
Dreams
31.8
9,201
0.6
-
-
83,759
5.4
76,906
5.2
694,762
44.6
629,976
42.7
Football Pools
65,892
4.2
65,692
4.5
V75 Off-track Horse Betting
29,078
1.9
29,754
2.0
V5 Off-track Horse Betting
25,367
1.6
26,147
1.8
92
0.0
22
0.0
Fixed Odds Betting
134,467
8.6
140,012
9.5
Result Odds Betting
32,746
2.1
29,315
2.0
Multibet
70,159
4.5
74,629
5.1
Winner Odds Betting
10,857
0.7
9,828
0.7
295
0.0
280
0.0
368,951
23.7
375,679
25.5
332,604
21.4
316,860
21.5
Medals Game
-
-
1,018
0.1
Ässä Instant
38,983
2.5
39,935
2.7
Mega Ässä Instant
9,371
0.6
-
-
Mini Ässä Instant
8,459
0.5
8,228
0.6
Casino Instant
42,619
2.7
45,211
3.1
Lucky Words Instant
25,030
1.6
23,434
1.6
559
0.0
2,558
0.2
0.3
Other V Games
Live Winner Odds Betting
Leisure time
Keno
Theme instants
Christmas Instant
4,263
0.3
4,625
26,283
1.7
22,099
1.5
488,172
31.3
463,968
31.5
Veikkaus Bingo
329
0.0
303
0.0
Nature Instant
5,420
0.3
4,833
0.3
5,749
0.4
5,136
0.3
1,557,634
100.0
1,474,759
100.0
eInstants
Excitement
Community interaction
Motivational states total
The game turnovers of Viking Lotto, Viking Lotto Plus, Wednesday Joker, V5 Off-track Horse Betting, and the daily drawn games Keno, Veikkaus Bingo,
as well as the betting games played on round 53/09 from 28 to 31 Dec 2009 are included in the turnover of 2009 according to the draw date.
Financial report 2009
75
!58=0=280;A4BD;C!$!(Thousand euros
Turnover
Net profit
% of turnover
Result before appropriations
% of turnover
Result for the financial year
% of turnover
2009
2008
2007
2006
2005
1,557,634
1,474,759
1,391,360
1,361,210
1,315,827
464,597
440,745
421,119
403,288
397,229
29.8%
29.9%
30.3%
29.6%
30.2%
468,777
449,135
427,385
407,672
400,672
30.1%
30.5%
30.7%
29.9%
30.5%
468,777
449,135
427,385
407,689
400,397
30.1%
30.5%
30.7%
30.0%
30.4%
3. OTHER OPERATING INCOME Thousand euros
2009
2008
Rental income
10
8
Messaging service income
62
78
332
676
0
56
Indemnifications
Profit from stock sales
Returned prizes from fixed-match gaming
Profit from investments in the retail terminal network's data communications
16
4
940
886
Refund on Sports TV's subordinated debts
576
0
Other income
152
516
2,087
2,224
Total
4. DEPRECIATIONS Thousand euros
2009
2008
23,466
17,870
Buildings and constructions
3,142
1,645
Machinery and equipment
5,017
3,804
31,625
23,319
Intangible assets
Total
Fixed assets are subject to straight-line depreciations according to their economic lifespan. In 2008 a total of EUR 8.4 million were recorded as onetime depreciations of the acquisitions and in 2009, EUR 11.3 million, which are not expected to generate income in the next few years. In addition,
EUR 5.3 million of one-time depreciations were recorded in 2009 in accordance with an amendment to the accounting practices introduced in 2009.
Lands, housing stocks, and works of arts are not subject to depreciations.
76
Financial report 2009
5. PURCHASE OF SERVICES Thousand euros
Purchase of services
2009
2008
17,018
17,175
Auditors' fees included in the purchase of services
Audit
45
41
Other services
168
187
Total
213
228
6. OTHER OPERATING EXPENSES Thousand euros
Other advertising and marketing expenses
2009
2008
6,531
6,579
Other voluntary personnel expenses
1,365
1,329
Travel expenses
1,096
1,182
Representation and negotiation expenses
653
600
Car expenses
662
697
Equipment and freight charges
4,640
4,533
Machinery and equipment
3,467
2,360
Real estate expenses
2,314
2,958
Maintenance and servicing of software
3,951
2,806
Banking expenses
1,633
1,090
Phone expenses
Other office expenses
Total
701
665
1,000
1,825
28,014
26,624
2009
2008
7. FINANCIAL INCOME AND EXPENSES Thousand euros
Dividend income from investments held for sale
2
2
Interest income from investments held for sale
802
710
3,372
7,678
Interest income from loans and receivables
Other financial income
5
1
Total financial income
4,181
8,391
Interest expenses
1
1
Financial expenses total
1
1
4,180
8,390
Total
Financial report 2009
77
8. TANGIBLE ASSETS AND DEPRECIATIONS Thousand euros
Tangible assets
Land and
Buildings and
Machinery and
waters
constructions
equipment
Other
Total
1,906
34,653
73,818
622
110,999
Increase
0
3,770
3,664
0
7,434
Decrease
0
172
294
0
466
1,906
38,252
77,187
622
117,967
Accumulated depreciations 1 Jan 2009
-
15,493
56,356
-
71,849
Depreciations for the financial year
-
3,142
5,017
-
8,159
Accumulated depreciation of the decrease
-
0
257
-
257
Accumulated depreciations 31 Dec 2009
-
18,635
61,116
-
79,751
Book value 31 Dec 2009
1,906
19,616
16,071
622
38,215
Book value 1 Jan 2009
1,906
19,160
17,462
622
39,150
Land and
Buildings and
Machinery and
waters
constructions
equipment
Other
Total
1,906
31,951
70,546
617
105,019
Increase
0
2,702
3,886
5
6,593
Decrease
0
0
614
0
614
1,906
34,653
73,818
622
110,999
Accumulated depreciations 1 Jan 2008
-
13,848
52,552
-
66,400
Depreciations for the financial year
-
1,645
3,804
-
5,449
Accumulated depreciations 31 Dec 2008
-
15,493
56,356
-
71,849
Book value 31 Dec 2008
1,906
19,160
17,462
622
39,150
Book value 1 Jan 2008
1,906
18,103
17,994
617
38,619
Acquisition cost 1 Jan 2009
Acquisition cost 31 Dec 2009
Tangible assets
Acquisition cost 1 Jan 2008
Acquisition cost 31 Dec 2008
78
Financial report 2009
9. INTANGIBLE ASSETS AND DEPRECIATIONS Thousand euros
Intangible assets
2009
2008
Computer software and
Computer software and
activated development costs
Acquisition cost 1 Jan 2009
activated development costs
105,645
Acquisition cost 1 Jan 2008
94,748
14,409
Increase
23,452
Increase
Decrease
3,880
Decrease
Acquisition cost 31 Dec 2009
125,217
3,512
Acquisition cost 31 Dec 2008
105,645
Accumulated depreciations 1 Jan 2009
72,630
Accumulated depreciations 1 Jan 2008
57,333
Depreciations for the financial year
23,466
Depreciations for the financial year
17,870
Accumulated depreciation of the decrease
3,880
Accumulated depreciation of the decrease
2,573
Accumulated depreciations 31 Dec 2009
92,216
Accumulated depreciations 31 Dec 2008
72,630
Book value 31 Dec 2009
33,001
Book value 31 Dec 2008
33,015
Book value 1 Jan 2009
33,015
Book value 1 Jan 2008
37,415
8=E4BC<4=CB0=3;>=6C4A<8=E4BC<4=CBThousand euros
Software
IT appliances
2009
2008
15,000
20,353
63
2,561
Office equipment
220
251
Equipment, other installations
961
1,384
Real estates
Basic improvements
3,930
Machinery, equipment, fittings
1,286
Company cars
Works of art
Investments in progress
Investments
;^]VcTa\X]eTbc\T]cb
Total
6,290
5,215
651
138
6,429
360
0
5
8,603
-10,339
30,714
21,003
30,714
('$
30,854
Financial report 2009
79
11. INVESTMENTS HELD FOR SALE Thousand euros
Untraded shares
Other investments held for sale
Total
13. LIQUID ASSETS Thousand euros
2009
2008
482
566
Cash in hand and at bank
0
19,851
Investments held for sale
482
20,417
Loans and receivables
Total
2009
2008
6,697
10,251
44,087
10,735
170,151
187,150
220,934
208,137
In 2008, the other investments held for sale included a 10-million euro bond, which was waived in 2009. The
Nordea Senior bond of EUR 9.9 million was transferred to short-term investments according to the date of
Investments held for sale are certificates of deposit with short maturity.
maturity of the loan.
Loans and receivables are deposits with short maturity.
Interest rate risk
!B7>ACC4A<A4248E01;4BThousand euros
Short-term financial investments expose Veikkaus' cash-flow to an interest rate risk, but their importance is
Trade receivables
Accrued income
Other receivables
Total
2009
2008
11,256
8,212
3,742
5,065
107
138
15,105
13,415
The trade receivables consist of game fees uncharged from the retailers. The charging period is from Monday
to Sunday and the amount for the previous week is charged by direct debiting on Tuesdays. There are a total
of 3 208 retailers who game fees are charged from every week.
The balance values of the trade receivables did not deviate from the fair values at the date of the financial
2008
Periodic interest income
404
1,910
Periodic game event cooperation and drawing expenses
116
118
2,397
2,873
576
0
157
0
Sanoma Entertainment,
Total
years at the maximum. Investing in stocks is not allowed.
14. SHARE CAPITAL
Undistributed prizes' fund
2009
Other accrued income
According to the guidelines, investments are made securing the capital, without currency risks and for five
The reserve fund has been recorded as share capital in accordance with the General Meeting's decision.
Key items of accrued income
The Finnish Olympic Committee receivables
Investments are made in accordance with guidelines approved by the shareholder and the Board of Directors.
Reserve fund
statement.
refund on Sports TV's subordinated debts
interest rates.
The shares are 498 in number and their nominal value is EUR 445 698,01.
Due to the nature of the trade receivables, there is traditionally no credit risk.
Gtech receivables
low as a whole. The income and operative cash-flows are mainly independent of the changes in the market
93
164
3,742
5,065
The difference between the net profit for the financial year and the return to the Ministry of Education is
entered into the undistributed prizes' fund in accordance with a decision by the General Meeting. The General
Meeting decides how the undistributed prize funds shall be used and the Ministry of Education distributes them
further to the beneficiaries.
According to a decision by the Council of State, the undistributed prize funds can amount to a maximum of
EUR 150 million.
At the date of the financial statement, the undistributed prize funds amounted to EUR 18.2 million of unused
funds from the year 2006; EUR 29.7 million from 2007; EUR 41.2 million from 2008; totalling EUR 89.1 million.
(IAS 1 Capital Management)
80
Financial report 2009
16. LIABILITIES FROM EMPLOYEE BENEFITS Thousand euros
$B7>ACC4A<;8018;8C84BThousand euros
Advance payments for multi-week subscriptions
2009
2008
16,107
13,293
7,153
6,201
1T]TUXcQPbTS_T]bX^]bRWT\Tb
The benefit-based pension schemes include the settlements made for part of Veikkaus' staff including the
benefit pensions and additional pensions that enable the employees in question to retire at an earlier age
Trade payable
without losing part of their pension. The special pension settlements have been awarded to persons having
started their employment at Veikkaus before 1985, and additional pension settlements have been awarded to
Accruals and deferred income
persons having started before 1994.
Allocated personnel expenses
7,259
6,478
Accrued winnings payable
7,333
9,371
Expenses of the cashier line reform, uninvoiced share
1,322
0
413
1,750
International lotto game, uninvoiced share
Other accruals
4,457
3,742
Total
20,785
21,342
Winnings payable
25,786
24,729
13,937
12,846
Withholding tax liability
507
509
Social security liability
32
42
Settlement debt to the State
Lottery tax
Value-added tax
Other short-term liabilities
Total
CWTQT]TUXcQPbTS_T]bX^][XPQX[XcXTbPaTSTcTa\X]TSX]cWTQP[P]RTbWTTcPbU^[[^fb)
Thousand euros
2009
2008
3,769
3,491
Fair value of funds
-1,420
-1,539
Balance underfund
2,349
1,952
-25
635
2,324
2,587
Present value of liabilities
Actuarial gains (+) and losses (-) not yet recorded
1,083
3,616
15,559
17,013
13,716
16,604
99,106
99,181
Net post-employment scheme
liabilities in the balance sheet
=Tc_^bcT\_[^h\T]cbRWT\T[XPQX[XcXTbX]cWTX]R^\TbcPcT\T]c
Thousand euros
2009
Costs based on service during the financial period
2008
37
56
Interest costs
197
190
Winnings payable include uncashed prizes and return payments on betting games, as well as the funds
Expected gain from the funds in the settlement
-79
-67
deposited on the internet players' game accounts. Other short-term liabilities include, e.g., the prize funds. In
Actuarial gains (+) and losses (-)
-48
-19
the balance sheet of 31 Dec 2008, they amounted to a total of EUR 16.4 million. In 2009 a total of EUR 13,6
Total
107
160
million of funds accumulated and they were used for paying out prizes for the worth of EUR 16,5 million. The
funds totalled EUR 13.6 million in the balance sheet of 31 Dec 2009. This balance includes EUR 4.3 million of
Change in present value of pension liabilities in the balance sheet
funds that can only be used for prize payout in Lotto according to the rules.
At the beginning of the financial year
Costs based on service during the financial period
Interest costs
Actuarial gains (+) and losses (-)
Benefits paid
At the end of the financial year
2009
2008
3,491
3,853
37
56
197
190
481
-104
-437
-504
3,769
3,491
Financial report 2009
81
Change in the fair values of the funds in the settlement
Fair value of the funds at the beginning of the financial year
17. RELATED PARTY TRANSACTIONS Thousand euros
2009
2008
1,539
1,525
79
67
Expected gain from the funds in the settlement
Payments made to the settlement
370
400
Benefits paid
-437
-504
Actuarial gains (+) and losses (-)
-131
51
At the end of the financial year
1,420
Veikkaus' related parties include the CEO, the Strategic Executive Team, the Operative Executive Team,
the Board of Directors, the Supervisory Board, and the other state-owned companies.
Salaries paid; compensations and employee benefits
2009
CEO
1,539
Other members of the Executive Team*
353
2,226
1,768
132
Realized gain from the funds in the settlements was EUR -52 000 in 2009 and EUR 118 000 in 2008. The
Board of Directors
149
funds in the settlement consist of the amount accumulated from the pension premiums, belonging to the
Supervisory Board
93
100
2,875
2,352
Total
responsibility of the insurance company.
*
Veikkaus expects to pay EUR 400 000 to the settlement in 2010.
Present value of the liability
Fair value of the funds in the settlement
Balance underfund
Experience-based adjustments to the funds in the settlements
The two Executive Teams had 15 members at the end of the financial year 2009 and 14 at the end of 2008.
The salaries include the salaries for the entire year including performance-based bonuses.
The amounts for the financial year and the previous financial year are as follows:
2009
2008
2007
The CEO has a six-month notice period. In case certain specific conditions are fulfilled, he is entitled to a
3,769
3,491
3,853
compensation corresponding to a twelve-month salary if his contract of employment is terminated by notice.
-1,420
-1,539
-1,525
2,349
1,952
2,328
company and two months for the executives. In case certain specific conditions are fulfilled, the members of
-131
51
-504
the Strategic Executive Team are entitled to a compensation corresponding to the salary of nine months and
The period of notice of the Executive Team members is subject to the Employment Contracts Act for the
the members of the Operative Executive Team are entitled to a compensation corresponding to the salary of
Experience-based adjustments to the liabilities
involved in the settlements
274
151
-669
six months if their employment contracts are terminated by notice.
Neither the members of the Board of Directors nor the company management are entitled to extraordinary
Most important actuarial assumptions made in the settlement
benefits different from those determined in a regular employment contract, with the exception of the
2009
2008
additional pension schemes of the CEO and the Executive Vice President 63 years and a 66-% pension
Discount rate
4.75%
6.00%
objective. The pension objective is calculated on the basis of the salary of the last five years. The company
Expected gain from the funds in the settlement
4.00%
5.30%
management is not granted option rights.
Expected future pay rise
2.60%
3.50%
Other related party transactions
Veikkaus may purchase goods or services from other state-owned companies. The purchasing prices and
>cWTa[^]VcTa\T\_[^hTTQT]TUXcb)Q^]dbU^ahTPab^UbTaeXRT
delivery conditions for the goods and services are the same as with any other group of customers and they are
Veikkaus grants its staff a bonus for years of service, classified as a long-term employee benefit.
small in number.
Liability recorded in the balance sheets
Thousand euros
82
2008
407
2009
2008
At the beginning of the financial year
355
290
Change
110
64
At the end of the financial year
465
355
Financial report 2009
18. CONTINGENT LIABILITIES AND AMOUNTS PAYABLE
19. SIGNATURES OF THE FINANCIAL STATEMENTS
ON OTHER LEASING AGREEMENTS Thousand euros
AND THE BOARD OF DIRECTORS' REPORT
2009
2008
261
259
in five years at the maximum
322
301
Other lease liabilities total
583
561
Lease payments due during the next financial year
Lease payments due at a later date,
Vantaa, 8 February 2010
9D70=84<4;«
<0890A88CC0>;;8;0
Chaiman of the Board
Vice Chairman of the Board
JOUKO AHTOLA
LEENA HARKIMO
MIKAEL INGBERG
RIITTA KAIVOSOJA
maintenance and development of the gaming system until the end of 2013.
ARI LAHTI
LEENA PAANANEN
Veikkaus had a total of 27 000 euros of guarantor's liabilities related to the staff's loans from the company's
RISTO NIEMINEN
financial services office on 31 Dec 2009.
CEO
Most vehicle lease agreements are made for 4 years.
Veikkaus has committed to purchasing 32-50 person years of employment every year for the purposes of
A report on the audit has been issued today.
Vantaa, 8 February 2010
KPMG OY AB
LASSE HOLOPAINEN, Authorised Public Accountant
20. LIST OF ACCOUNTING BOOKS AND RECORD FORMATS
General ledger
in electronic format
Journal
in electronic format
Cash accounting and payment transaction records
printed documents
Travel expense claim records
printed documents
Memorandum records
printed documents
Accounts receivable ledger
printed documents
Onnet accounts receivable ledger
printed documents
Accounts payable ledger
printed documents
Payroll accounting records
printed documents
Depreciation records
printed documents
Prize records
in electronic format
Financial report 2009
83
AUDITORS’ REPORT
TO THE GENERAL MEETING OF VEIKKAUS OY
The audit has been performed in accordance with the generally accepted auditing standards complied with in
We have audited the accounts, the accounting record and the administration of Oy Veikkaus Ab for the financial
Finland. We believe that the audit evidence we have obtained is sufficient and appropriate for our opinion of the
year from 1 January to 31 December 2009. The financial statement includes a balance sheet, income statement,
audit.
cash-flow statement, statement on the changes in shareholders’ equity, and notes to the financial statements.
OPINION ON THE COMPANY’S FINANCIAL STATEMENT
BOARD OF DIRECTORS’ AND CEO’S RESPONSIBILITIES
AND BOARD OF DIRECTORS’ REPORT ON OPERATIONS
The Board of Directors and CEO are responsible for preparing the financial statement and report on operations,
In our opinion, the financial statement gives a true and fair view of the company’s financial position, its financial
as well as ensuring that the financial statement provides correct and sufficient information in accordance with
performance, and cash-flows in accordance with the international audit standards (IFRS) as adopted by the EU.
the international auditing standards (IFRS) as adopted by the EU; and that the financial statement and the report
on operations provide correct and sufficient information in accordance with the laws and regulations governing
The report on operations provides correct and sufficient information on the company’s performance and financial
the preparation of a financial statement and report on operations effective in Finland. The Board of Directors is
position in accordance with the laws and regulations governing the preparation of a report on operations effec-
responsible for the appropriate arrangement of the supervision of the company’s accounts and finances and the
tive in Finland. The information in the report on operations is in harmony with the information in the financial
CEO is responsible for ensuring that the accounting procedures are in compliance with the law and the company’s
statement.
finances have been managed in a reliable manner.
The financial statements can be approved, and the members of the Board of Directors and Supervisory Board,
AUDITOR’S RESPONSIBILITIES
and the CEO can be discharged from liability for the period audited by us. The proposal of the Board of Directors
The auditor’s responsibility is to perform an audit in accordance with the generally accepted auditing standards
on the distribution of profit for the year complies with the Finnish Companies Act.
complied with in Finland and to express an opinion on the financial statement and report on operations. The
generally accepted auditing standards entail compliance with the ethical principles of the auditing profession
Vantaa, 8 February 2010
and the planning and performing of the audit in a way which ensures to a reasonable degree that neither the
financial statement nor the report on operations include material misstatements and that the Members of the
KPMG OY AB
Supervisory Board, the Board of Directors, and the CEO have acted in compliance with the Finnish Companies Act.
LASSE HOLOPAINEN
The audit procedures aim at obtaining evidence that the figures and disclosures in the financial statement and
report on operations are correct. The procedures selected depend on the auditor’s judgement, including the
assessment of the risks of material misstatement in the financial statement, whether due to fraud or error.
Whilst planning the necessary procedures of risk assessment, the auditor shall also consider the internal control
relevant to the preparation and presentation of the financial statement. In addition, the procedures involve assessing the overall presentation of the financial statement and report on operations, the accounting principles,
and the company management’s evaluation applied to the preparation of the financial statement.
84
Financial report 2009
Authorised Public Accountant
STATEMENT BY THE SUPERVISORY BOARD
The Supervisory Board of Veikkaus Oy examined the financial statements for the financial year between
1 January and 31 December 2009 and the Auditors’ report. The Supervisory Board has decided to propose in its
statement to the regular General Meeting that the income statement and balance sheets be approved and the
profit in the financial statement be used in accordance with the Board of Directors’ proposal.
The Supervisory Board finds that its decisions and guidelines have been complied with and that it has received
the information it has deemed necessary from the company’s Board of Directors and CEO.
Helsinki, 10 February 2010
ILKKA KANERVA
Chairman
MATTI SAARINEN
Vice Chairman
MERIKUKKA FORSIUS
JUKKA GUSTAFSSON
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SIRPA PAATERO
AILA PALONIEMI
JUHA REHULA
KARI UOTILA
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Financial report 2009
85
GLOSSARY
Beneficiaries receive support for their activities from Veikkaus funds,
Lotteries Act lays down the rules concerning the operation and supervi-
Request for recommended decision can be filed by Veikkaus’ players
distributed by the Finnish Ministry of Education. In practice, all Finns ben-
sion of lotteries, the accounting and use of lottery funds, as well as the
to the Ministry of the Interior in unclear situations concerning prize payout.
efit from Veikkaus funds. All of us win in Veikkaus games when engaging
control of the allocation of the funds. The Lotteries Act is currently being
In 2009 the Ministry of the Interior processed a total of 56 requests for
in the activities of, e.g., recreational sports facilities, cinemas, theatres,
amended by the Finnish Parliament.
recommended decision.
and the Scout organization.
National exclusive right is based on the Finnish lottery legislation, ac-
Responsibility Evaluator Tool is a tool which has been developed
Ecological Team is a team consisting of staff representatives and an
cording to which each type of game shall be provided by just one operator.
jointly by Veikkaus and the Finnish Slot Machine Association RAY. It is
external consultant. It is in charge of the practical implementation of
The exclusive right provides a means to the authorities to control gaming
used to detect and prevent the possible addiction-provoking features of
environmental responsibility and the motivation and encouragement of
and restrict competition. Veikkaus has been granted the exclusive right to
the games that might lead to problem gambling.
the staff in environmental issues, as well as the communication of them
provide pools and betting games, and lotteries.
Saver of Natural Resources
to the staff.
Offerings include Veikkaus’ products and ways of offering and distribut-
Helsinki Region Environmental Services Authority grants the Saver of
Ethical Council is an advisory expert organ with 12 members from
ing them through multiple channels to the different customer segments
Natural Resources prize every year to a company or public sector operator
outside of the company, set by Veikkaus’ Board of Directors. Its task is to
in different situations. Veikkaus’ offerings are divided into dream, excite-
that has managed to reduce its waste amounts significantly. In 2009,
provide Veikkaus’ Board of Directors and executive management with an
ment, and sports games on the basis of the customers’ motivation for
Helsinki Region Environmental Services Authority granted the Saver of
external perspective on the ethics of the gaming operations.
gaming.
Natural Resources prize to Veikkaus.
European Lotteries and Toto Association (EL) is an organization of
Official supervisors are persons nominated by the Ministry of the
Undistributed prizes fund
the European gaming operators in the gaming sector.
Interior, who supervise gaming activities and confirm the game results
The difference between the profit for the financial year and the share of
and the number of prizes on each round.
the profit returned to the Ministry of Education is recorded in the undis-
Funds Distribution Act is an act on the distribution of funds from
tributed prizes fund as decided by Veikkaus’ General Meeting. The General
lotteries, betting, and pools games. The distribution of the funds, as it
Payout percentage refers to the amount of the game turnover that is
Meeting makes a decision on the use of the undistributed prizes fund and
is specified in the Funds Distribution Act, which was laid down in 2001,
returned to the players as prizes. The payout percentages vary from one
the Ministry of Education allocates them further to the beneficiaries. In
will be introduced gradually by the year 2010. The act determines the
game to another.
accordance with the Council of State’s decision, the total undistributed
distribution of Veikkaus funds as follows: 38.5% of the funds shall be
prizes fund can amount to a maximum of EUR 150 million.
allocated to arts, 25.0% to sports, 17.5% to science, and 9.0% to youth
Peluuri helpline is a toll free helpline for people worried about or
work. Moreover, 10.0% of the funds shall be distributed between the said
suffering from problem gambling, as well as for their families and friends.
Veikkaus Card is Veikkaus’ customer card. It is free of charge and per-
beneficiaries as separately specified.
Veikkaus finances the helpline’s activities jointly with the other national
sonal, and is granted to customers over 18 living permanently in Finland.
gaming organizations in Finland.
Gaming licence has been granted to Veikkaus by the Council of State.
Veikkaus funds are funds that Veikkaus returns to the Ministry of Edu-
As the holder of the gaming licence, Veikkaus has the exclusive right to
Point of sales is a retail outlet where Veikkaus games are sold, including
cation, to be distributed further to the beneficiaries: arts, sports, science,
operate lotteries and pools and betting games by virtue of the Lotteries
all the playslip-based games and instant tickets. The online terminals of
and youth work. In 2009 the Ministry of Education distributed EUR 461
Act. Veikkaus’ present gaming licence will be effective until 2011.
the points of sales enable the real-time registering of the gaming transac-
million of Veikkaus funds.
tions in Veikkaus’ game system.
Green Office
Registered players play Veikkaus games identified, using their
zation of the national gaming organizations with members in over 70
ronment. It helps the workplaces to reduce their environmental load, save
Veikkaus Cards or logging onto Veikkaus’ website. Registered players are
countries. Its mission is to promote safe and controlled gaming around the
money, and slow down the climate change. Veikkaus has been entitled to
also referred to as identified customers.
world.
use the Green Office label since autumn 2007.
86
World Lottery Association (WLA) is a world-wide member organi-
An environmental service created by WWF Finland for use in office envi-
CSR Report 2009
CONTENT AND DELINEATION OF THE REPORT
This report presents all the key economic indicators and the financial statement, as well as the different segments of corporate responsibility, with a
special focus on social responsibility. The journey of one Veikkaus’ euro is illustrated from the perspectives of both the beneficiaries and the Ministry of
Education. The beginning of the report is dedicated to the objectives and achievements according to the traditional division of responsibilities. The final
part of the report presents Veikkaus’ organization, corporate governance, and the different operative organs.
The report consists of five parts, covering the most important sectors of Veikkaus’ corporate responsibility. The most important of the sectors is that of
social responsibility; it is of primary importance for both the customers and the staff. Economic responsibility focuses on the analysis of the value we
generate to society in particular. Environmental responsibility, in turn, involves many significant deeds at the grassroot level that join to make up a larger
entity.
In the course of the reporting period Veikkaus worked to define some of the most essential issues of corporate responsibility. Many members of the
staff were involved in this work. This process of defining the essentials brought with it certain changes to the annual report as compared to the previous year. The process was carried out paying attention to the answers to the stakeholder survey, which analysed the expectations our stakeholders
have regarding our operations. In addition, we carried out some benchmarking against the way other state lotteries had described their CSR function.
By defining the essentials, we wanted to pinpoint the most important CSR issues that serve as the basis for the development of Veikkaus’ corporate
responsibility and responsibility reporting. We also assured the measures taken to promote the CSR operations in accordance with the EL Responsible
Gaming Standard.
The calculating principles are described in connection with the key indicators. If the basis of calculating a given indicator has changed considerably, it is
indicated separately. The information in the section on economic responsibility is based on Veikkaus’ financial reports, gaming transactions, audited accounts, and consolidated financial statement. The key indicators of social responsibility have been obtained from Veikkaus’ human resource information
systems, payroll systems, gaming transactions, service providers, and accounting. The environmental responsibility indicators have been obtained mainly
from service providers
Veikkaus complies with the international reporting recommendations of the Global Reporting Initiative (GRI, G 3) for the sixth year in a row. The personnel indicators comply with the general instructions issued by the Accounting Standards Board. The Corporate Governance section complies with the
Finnish Corporate Governance Code, where applicable, as well as with the ownership policy guidelines issued by the Ministry of Education. The Financial
report was prepared in accordance with the IFRS standard.
Veikkaus’ operations and existence are based on responsibility. We report on our corporate responsibility annually – the previous report was published
in spring 2009. This year, Veikkaus’ corporate responsibility report has been assured for the second time by an external assurance provider, PricewaterhouseCoopers Oy. Veikkaus’ contact information can be found at the end of the report.
CSR Report 2009
87
CONTACTS
Veikkaus’ annual and corporate responsibility report is published in Finnish and English. The
T H E RE PO RT WAS E D I TE D BY
LAYO U T A N D V I SUAL D E S IG N :
report can also be read in Swedish on our website at www.veikkaus.fi /yritys.
Veikkaus’ Communications in cooperation with
Spokesman Oy
Spokesman Oy and PricewaterhouseCoopers Oy.
Up-to-date information on Veikkaus and our corporate responsibility is also available in
I LLU ST RAT I O N:
Veikkaus’ newsletter, Veikkaus’ eNews. To order the newsletter and the annual report,
CO NTAC T I N FO RM AT I O N :
please contact Veikkaus’ Communications at tiedotus@veikkaus.fi or www.veikkaus.fi /yritys.
VEIKKAUS OY
Sakari Tiikkaja/Radiant Graphics Oy
Karhunkierros 4
PH OTO S:
FI-01640
Manu Rantanen and Antti Viitala
Vantaa, Finland
Tel. +358 20 750 750
PRI NTE D AT :
Libris Oy, 2010
www.veikkaus.fi
PA PE R:
Cover: Arctic the Silk 250 g
Inside pages: Munken Polar 130 g
T RA NSLAT I O N I NTO E N G L IS H :
Marja Heikkinen, TransEarly
88
CSR Report 2009
A FINN TO WIN.