1  Responsibilities and procedures for determining compensation

1.1  Responsibilities of the annual general meeting

In accordance with the articles of association, the Board of Directors will, on a yearly basis, submit a binding proposal to the annual general meeting for the total remuneration to be paid to the members of the Board of Directors and the total fixed remuneration (basic salary and employer’s contributions to the management pension plan) to be paid to Group Management for the current financial year.

Furthermore, the total variable remuneration to be paid to Group Management and, where applicable, the Board of Directors for the past financial year is subject to the binding approval of the annual general meeting.

Accordingly, the annual general meeting of 12 April 2019 will vote on the total remuneration to be paid to the Board of Directors and the total fixed remuneration to be paid to Group Management for the 2019 financial year and the total variable remuneration to be paid to Group Management for the 2018 financial year.

If the annual general meeting refuses to approve individual components of remuneration, the Board of Directors may submit a new proposal or convene a new general meeting.

1.2  Responsibilities of the Board of Directors

Each year, the Board of Directors presents a compensation report to the annual general meeting stating the remuneration paid to the Board of Directors and Group Management for the past year.

1.3  Responsibilities of the Nomination and Compensation Committee

The Nomination and Compensation Committee is responsible for designing, implementing and monitoring the compensation system for the members of the Board of Directors and Group Management on the basis of sector comparisons prepared in-house. It also reviews salary policy for all employees. This was done without calling on the services of any external consultants. Once a year, the Nomination and Compensation Committee will prepare all the background information required by the Board of Directors as a basis for its decisions and will also draft the proposals to be submitted to the annual general meeting.

The proposals for the remuneration to be paid to the members of the Board of Directors and the Group Management are addressed at a meeting of the Board of Directors at which the members of Group Management are not present and thus have neither the right to attend nor to be heard. Each member of the Board of Directors has the right to be heard regarding the discussion of their own compensation; there are no provisions for recusal in this regard.

The annual general meeting of 20 April 2018 appointed Dr Ralph-Thomas Honegger (Chairman), Andrea Sieber (member) and Peter Spuhler (member) to the Nomination and Compensation Committee.