Compensation 2022 and Share Ownership

Board of Directors

In order to fulfill the reporting needs outlined in the Ordinance against Excessive Compensation (OaEC), the relevant Fair Market Value (FMV) figures as earned by the BoD members for the calendar year are disclosed in the following audited table. All amounts are stated in gross amounts.

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2022 ANNUAL COMPENSATION – EMOLUMENTS TO MEMBERS OF THE BOARD OF DIRECTORS (Fair Market Value = FMV) in CHF

	Günter von Au	Ahmed Mohammed Al Umar¹	Roberto Gualdoni¹	Thilo Mannhardt	Geoffery Merszei	Eveline Saupper	Naveena Shastri¹	Peter Steiner	Claudia Suessmuth Dyckerhoff	Susanne Wamsler	Konstantin Winterstein	Abdullah Mohammed Alissa²	Nader Alwehibi²	Calum MacLean²	Totals 2022
Cash compensation
Honorarium	450 000	135 000	112 500	150 000	150 000	150 000	112 500	150 000	150 000	150 000	150 000	45 000	37 500	37 500	1 980 000
Committee fee	–	22 500	22 500	50 000	40 000	60 000	22 500	110 000	60 000	60 000	70 000	7 500	7 500	7 500	540 000
Social security contribution
Relevant amount	52 562	11 629	–	12 105³	–	25 329	–	–	24 425	25 454	–	13 006	12 764	–	177 274
Shares
Fair Market Value (FMV)	300 000	120 000	100 000	100 000	100 000	100 000	100 000	100 000	100 000	100 000	100 000	–	–	–	1 320 000
Total 2022 (Fair Market Value 2022)	802 562	289 129	235 000	312 105	290 000	335 329	235 000	360 000	334 425	335 454	320 000	65 506	57 764	45 000	4 017 274
¹ New Member of the Board since AGM 2022
² Member of the Board up to AGM 2022
³ Incl. additional social security contributions due to inexistent agreement between countries

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2021 ANNUAL COMPENSATION – EMOLUMENTS TO MEMBERS OF THE BOARD OF DIRECTORS (Fair Market Value = FMV) in CHF

	Günter von Au¹	Abdullah Mohammed Alissa	Hariolf Kottmann²	Calum MacLean	Geoffery Merszei	Eveline Saupper	Peter Steiner	Claudia Suessmuth Dyckerhoff	Susanne Wamsler	Konstantin Winterstein	Nader Alwehibi	Thilo Mannhardt	Totals 2021
Cash compensation
Honorarium	375 000	180 000	112 500	150 000	150 000	150 000	150 000	150 000	150 000	150 000	150 000	150 000	2 017 500
Additional compensation						24 224³							24 224
Committee fee	7 500	30 000	–⁴	30 000	40 000	90 000	110 000	30 000	52 500	62 500	22 500	37 500	512 500
Social security contribution
Relevant amount	25 185	20 391	31 151	38 382	13 601	27 171	–	19 605	20 668	–	17 053	168 463⁵	381 670
Shares
Fair Market Value (FMV)	300 015	120 010	75 000	100 011	100 011	100 011	100 011	100 011	100 011	100 011	100 011	100 011	1 395 124
Total 2021 (Fair Market Value 2021)	707 700	350 401	218 651	318 393	303 612	391 406	360 011	299 616	323 179	312 511	289 564	455 974	4 331 018
¹ Regular Member of the Board until AGM April 2021; Chairman of the Board from AGM April 2021
² Chairman of the Board until 7 April 2021
³ Extra compensation for temporary additional role as independent Lead Director since 24 July 2019 until 7 April 2021
⁴ Not a committee member for the period January-April 2021
⁵ Incl. regular social security contributions and tax gross-up due to inexistent tax agreement between the countries

The compensation disclosed in the tables reflects the respective calendar year (January to December), while at the AGM, stakeholders approve the total compensation to the BoD for a mandate year, i.e., for the period between two AGMs (in general April to March). The total compensation amount paid to BoD members for the mandate year 2021/2022 was CHF 4.2 million and, thus, below the amount approved by stakeholders of CHF 5.0 million. For the mandate year 2022/2023, a total compensation amount of CHF 4.0 million is expected, which would be within the limits of the approved amount of CHF 5.0 million for this mandate year. The final total compensation amounts for the mandate year 2022/2023 will be provided in the Compensation Report 2023.

In 2021 and 2022, there were no payments to former BoD members after the mandate year. In both years, no loans or credits were outstanding and/or granted to BoD members, former BoD members or their related parties. No compensation for special duties beyond their regular duties was paid to any BoD member in 2022.

The information about the actual share ownership of the Board of Directors is displayed in the next table.

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SHARES HELD BY MEMBERS OF THE BOARD OF DIRECTORS

	Number of shares granted for 2022¹	Number of shares granted for 2021²	Number of privately held shares as of 31 Dec. 2022	Number of privately held shares as of 31 Dec. 2021
Günter von Au	16 667	16 817	90 798	73 981
Ahmed Mohammed Al Umar	6 667	–	–	–
Roberto Gualdoni	5 556	–	8 200	–
Thilo Mannhardt	5 556	5 606	9 445	3 839
Geoffery Merszei	5 556	5 606	17 249	11 643
Eveline Saupper	5 556	5 606	35 112	29 506
Naveena Shastri	5 556	–	–	–
Peter Steiner	5 556	5 606	32 612	27 006
Claudia Suessmuth Dyckerhoff	5 556	5 606	30 212	24 606
Susanne Wamsler	5 556	5 606	1 195 904³	1 190 298
Konstantin Winterstein	5 556	5 606	6 097 627	6 092 021
Abdullah Mohammed Alissa	–	6 727	–	12 667
Nader Alwehibi	–	5 606	–	3 839
Calum MacLean	–	5 606	–	11 643
Total	73 333	73 998	7 517 159	7 481 049
¹ The BoD mandate year runs from one AGM to the next AGM, which typically takes place in April. The final number of shares for the mandate year that began in 2022 will be defined prior to grant in 2023. The underlying assumption here is a share price of CHF 18.00.
² Correction needed due to adjustments of final share price at grant: Underlying assumption was CHF 18.00; Final allocation of shares with CHF 17.84; Total amount of shares granted for 2021 based on the assumed share price of CHF 18.00 as shown in the Compensation Report 2021 was 69,473
³ Thereof 240 271 held by »The Honoré T. Wamsler Trust«

Executive Steering Committee

In 2022 several personnel changes occurred to the Executive Steering CommitteeExecutive Steering CommitteeThe Executive Steering Committee (ESC) is authorized by the Board of Directors to steer the company. It has overall strategic and financial responsibility, including for our profit and loss statement. The ESC consists of the Chief Executive Officer (CEO), the Chief Financial Officer (CFO), and the three Business Presidents.View entire glossary (previously the Executive CommitteeExecutive CommitteeUntil 30 June 2022, the Executive Committee was mainly responsible for implementing and monitoring the Group strategy, for the financial and operational management of the Group, and for the efficiency of the Group’s structure and organization. Effective 1 July 2022, the Executive Committee was replaced by the Executive Steering Committee (ESC).View entire glossary ):

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	Conrad Keijzer	Hans Bohnen	Bernd Högemann	Stephan Lynen	Bill Collins	Angela Cackovich	Jens Cuntze	Christian Vang
Function	Chief Executive Officer	Chief Operational Officer	Chief Transformational Officer	Chief Financial Officer	Chief Financial Officer	Business President AdsorbentsAdsorbentsUsually solid substances which are able to selectively accumulate certain substances from adjacent gaseous or liquid phases.View entire glossary & Additives	Business President Catalysts	Business President Care Chemicals
EC member until		30 June 2022	30 June 2022	30 June 2022
Contract expires		30 June 2023	30 June 2023	30 June 2023
ESC member from	1 January 2021				1 July 2022	1 July 2022	1 July 2022	1 July 2022

The contract expiration of the three EC members whose term ended in 2022 follows the contractually agreed 12-month notice period. No severance payments were or will be paid out to them. The handling of STI and LTI entitlements will follow the defined procedures under the respective plan rules and contractual obligations.

In parallel to the personnel changes, the overall compensation levels as well as the compensation mix was adjusted for the newly appointed ESC members. Based on the scope, size, and complexity of the role, each role was benchmarked against market data based on the Mercer Executive Compensation Guide Switzerland and additionally validated against the Mercer Executive Compensation Guide Western Europe. To be able to provide competitive compensation packages and to attract the right candidates for each role, the targeted pay position was defined at around the 75th percentile.

In order to compensate for lost entitlements with previous employers, two ESC members received a cash payment as well as relocation support in 2022. In addition, one ESC member received restricted share units subject to a three year vesting period to compensate for lost LTI entitlements with a previous employer. These amounts are included in the total compensation as shown below.

In accordance with the reporting requirements outlined in the Ordinance against Excessive Compensation (OaEC), the relevant Fair Market Value (FMV) figures are shown in the following audited table. All figures are stated in gross amounts.

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2022 ANNUAL COMPENSATION TO MEMBERS OF the Executive STEERING Committee (Fair Market Value = FMV) in CHF

	Conrad Keijzer	Other ESC members¹	EC members whose term ended in 2022	Totals 2022
Base salary	1 200 000	1 115 000	1 950 000	4 265 000
Cash bonus	1 224 600	864 280	1 648 500⁵	3 737 380
Share-based incentive (FMV)²	1 500 000	–³	574 000⁶	2 074 000
Restricted share units (FMV)⁴	–	262 000	–	262 000
Other benefits⁷	388 458	661 549	848 895	1 898 902
TOTAL	4 313 058	2 902 829	5 021 395	12 237 282
¹ Amounts reflect the compensation for the time served as ESC member
² Allocation of PSUs based on an 30-day average share price prior to grant on 8 April 2022: CHF 15.95 The conversion from PSU into shares is done after a 3-year vesting period, depending on the achievement factor.
³ No grant in 2022 for B. Collins and A. Cakovich due to joining only after the grant date; J. Cuntze and C. Vang only became ESC members after the grant date
⁴ B. Collins received 14,862 restrcited share units subject to a vesting period of three years as compensation for lost entitlements with previous employer.
⁵ The amount includes a pro-rated bonus payout for a departed EC member.
⁶ The amount reflects pro-rated entitlements due to the departure of EC members.
⁷ »Other benefits« include pension contributions, social security contributions, cash payments to selected ESC members for lost entitlements with previous employers, and other benefits.

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2021 ANNUAL COMPENSATION TO MEMBERS OF THE EXECUTIVE COMMITTEE (FAIR MARKET VALUE = FMV) in CHF

	Conrad Keijzer	Other EC members	Totals 2021
Base salary	1 200 000	1 950 000	3 150 000
Cash bonus	1 173 900	1 896 300	3 070 200
Share-based incentive (FMV)¹	1 500 004	2 100 014	3 600 018
Other benefits²	471 154	981 956	1 453 110
Total	4 345 058	6 928 271	11 273 329
¹ Fair Market Value of a PSU under CLIP 2021 grant on 12 April 2021: CHF 13.64 The conversion from PSUs into shares is done after a 3-year vesting period, depending on the achievement factor.
² »Other benefits« include pension contributions for current EC members (43 %), social security contributions for current and former EC members (29 %), and other benefits for current and former EC members (28 %).

Comments on the 2022 Compensation

The total compensation amount of CHF 12.2 million received by the members of the Executive Steering CommitteeExecutive Steering CommitteeThe Executive Steering Committee (ESC) is authorized by the Board of Directors to steer the company. It has overall strategic and financial responsibility, including for our profit and loss statement. The ESC consists of the Chief Executive Officer (CEO), the Chief Financial Officer (CFO), and the three Business Presidents.View entire glossary for 2022 is below the limits of the total compensation amount of CHF 16.0 million for 2022 as approved by the stakeholders at the 2021 AGM.
The newly appointed ESC members did not receive a grant under the CLIP 2022 in their capacity as ESC members. They will only receive PSUs under the next CLIP grant in April 2023.
The 2022 CLIP grants of the EC members whose term ended in 2022 were prorated up to their contractual end date. The Fair Market Value shown for these three members already considers the pro-rated amount.
The total compensation of CHF 12.2 million reflects an increase of CHF 0.9 million compared to the total compensation of CHF 11.3 million paid to EC members for the 2021 financial year. The increase is mainly driven by an increased amount of fixed compensation and other benefits due to the additional members of the Executive Steering CommitteeExecutive Steering CommitteeThe Executive Steering Committee (ESC) is authorized by the Board of Directors to steer the company. It has overall strategic and financial responsibility, including for our profit and loss statement. The ESC consists of the Chief Executive Officer (CEO), the Chief Financial Officer (CFO), and the three Business Presidents.View entire glossary , as well as higher payouts under the company’s short-term incentive plan.
In line with the strong financial performance in 2022, STI target achievements for BU EBITDAEBITDAEarnings before interest, taxes, depreciation, and amortization.View entire glossary , BU Cash Flow, and LC Growth increased for all business units, resulting in an increased average BU achievement of 90.3 % in 2022, compared to 87.9 % in 2021. The target achievement for Top Priorities increased to 100 % in 2022 (88 % in 2021).
Target achievements for the two Group financial KPIs ROIC and Operating Cash Flow were determined at 100 % (100 % in 2021). In accordance with Article 33 of the Articles of Association, the Board has the authority to adapt performance targets in extraordinary cases. In 2022, the BoD decided to adjust the achievements under the incentive plans by excluding impairment charges of CHF 453 million for North American Land Oil divestment and the Podari plant as well as the restructuring charge of CHF 39 million for implementation of new operating model.
Overall, the payout percentage under the short-term incentive plan for the CEO, CFO, and the EC members whose term ended in 2022 increased to 94.2 % for 2022 compared to 90.3 % in 2021. Payout percentages for the Business Presidents under the 2022 short-term incentive plan range from 94.2 % to 100 %.
The actual 2022 compensation for the CEO represents a paymix of 28 % base salary, 28 % cash bonus, 35 % share-based incentive (FMV) and 9 % other benefits. As none of the other ESC members/EC members served a full period, the disclosure of the actual paymix would not be comparable.
In 2021 and 2022, no loans or credits were outstanding and/or granted to the CEO, other EC members, former EC members or their related parties, as stipulated in the Articles of Association.

The chart below shows additional details for the Group KPIs used in the short-term incentive plan for the CEO. For each KPI, the chart includes the target performance, achieved performance, and the resulting payout percentage.

0132022 STI PERFORMANCE SUMMARY

The actual share ownership of the members of the ESC is shown below. No options were held on 31 December 2021 or on 31 December 2022.

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2022 Number of Shares Held by the Members of the Executive STEERING Committee

	Number of PSUs/RSUs granted in	Number of PSUs granted in	Number of unvested PSUs/RSUs as of	Number of unvested PSUs/RSUs as of	Number of privately held shares as of	Number of privately held shares as of
	2022¹	2021	31 Dec. 2022	31 Dec. 2021	31 Dec. 2022	31 Dec. 2021
Conrad Keijzer	94 044	109 971	204 015	109 971	–	–
Bill Collins^{2, 3}	14 862	–	14 862	–	–	–
Angela Cackovich²	–	–	–	–	–	–
Jens Cuntze²	–	–	–	–	55 940	–
Christian Vang²	–	–	–	–	65 799	–
Hans Bohnen⁴	17 964	51 320	114 134	156 737	147 984	131 013
Bernd Hoegemann⁴	17 964	51 320	114 134	125 058	70 623	65 056
Stephan Lynen⁴	–	51 320	–	123 801	101 027	95 913
Total	144 834	263 931	447 145	515 567	441 373	291 982
¹ Performance Share Units represent contingency rights that will be converted into shares, depending on the performance achievement after the 3-year vesting period. Unvested PSUs do not count toward the share ownership requirements.
² No grant in 2021 and 2022; only became members of the ESC as of 1 July 2022 after the CLIP grant 2022
³ B. Collins received 14,862 restrcited share units subject to a vesting period of three years as compensation for lost entitlements with previous employer.
⁴ Amounts reflect pro-rated entitlements or forfeitures due to the departure of EC members.

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