Symrise : Remuneration Report 2021

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Remuneration Report 2021

Remuneration Report 2021

A. REVIEW OF THE 2021 FISCAL YEAR	3
1.	Challenges and highlights	3
2.	Discussion of the Executive Board remuneration	4
3.	Composition of the Executive Board in the 2021 fiscal year	4
4.	Composition of the Supervisory Board in the fiscal year	5
B. REMUNERATION OF THE MEMBERS OF THE EXECUTIVE BOARD	5
1. Principles of Executive Board remuneration	5
2.	Overview of the 2015 Executive Board Remuneration System	5
3.	Remuneration of the Executive Board members active in the 2021 fiscal year	7
	3.1 Remuneration granted and owed in the 2021 fiscal year	7
	3.2 Table overview	7
	3.3 Remarks	9
	3.3.1 Variable remuneration performance criteria	9
	3.3.1.1 Annual bonus	9
	3.3.1.2 LTIP	10
	3.3.2 Congruence with the 2015 remuneration system	12
	3.3.3 Benefits and benefit commitments to Executive Board members for early termination	13
	3.3.4 Benefit commitments to Executive Board members for regular termination of service	13
	3.3.5 Benefits and benefit commitments to Executive Board members
	who left in the 2021 fiscal year	14
	3.3.6 No clawbacks in the 2021 fiscal year	14
4.	Remuneration of former Executive Board members	15
C.	APPROPRIATENESS OF EXECUTIVE BOARD REMUNERATION	15
1.	Peer group - horizontal comparison	15
2.	Vertical comparison	16
D.	REMUNERATION OF THE MEMBERS OF THE SUPERVISORY BOARD	16
1.	Overview of the remuneration system for the Supervisory Board members	16
2.	Remuneration granted and owed in the 2021 fiscal year	17
E.	COMPARISON	17
F.	INDEPENDENT AUDITOR'S REPORT	20

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REMUNER ATION REPORT 2021

The Executive Board and Supervisory Board of Symrise AG have prepared a remuneration report in accordance with Section 162 of the German Stock Corporation Act (AktG) as amended by the Act Implementing the Second Shareholders' Rights Directive (ARUG II) for the first time for the 2021 fiscal year. The remuneration report starts out by presenting in a clear and comprehensible manner the principles and essential features of the remuneration system that applies to the Executive Board and the Supervisory Board of Symrise AG. It additionally explains and breaks down the individualized remuneration that was granted or owed to individual current and former members of the Executive Board and Supervisory Board for the 2021 fiscal year.

A . RE VIEW OF THE 2021 FISC AL YE AR

1 . CHALLENGES AND HIGHLIGHTS

Despite enormous challenges and the impact these had on business, the Executive Board and employees together con­ tributed to making the 2021 fiscal year one of the most successful in Symrise history, thus continuing the company's success story in the 2021 fiscal year. This success is symbolized by Symrise being included for the first time in the DAX®, Germany's benchmark stock index, which was expanded to include 40 companies on September 20, 2021.

In addition to the aftermath of the criminal cyberattack from December 2020, Symrise had to overcome hurdles such as rising commodity prices and disrupted supply chains while at the same time maintaining very high capacity utilization. In addition, Symrise continued to be affected by the ongoing coronavirus pandemic in the 2021 fiscal year, with the im­ pacts varying in degree depending on the segment and product. Yet even against this backdrop, Symrise demonstrated in the 2021 fiscal year, as in the previous year, that it is fully operational and capable of delivering in a sustainable way. Symrise was always robust and securely positioned even in a challenging market environment thanks to its global presence, broad customer base and steadily growing and diversified portfolio.

While Symrise had targeted organic sales growth of 5 % to 7 % at the beginning of the fiscal year and communicated this ambition to the capital market, the forecast was raised in August and again in October due to extraordinarily positive business development. In addition, Symrise successfully completed the acquisition of the Fragrances business unit of Sensient and integrated it into the company. This strengthens the backward integration of Symrise in renewable raw ma­ terials and further expands its leading position as a supplier of fragrances for applications in personal care and house­ hold products.

The successful business performance of Symrise in the 2021 fiscal year is clearly demonstrated by the performance of key figures that are particularly important for Symrise. For example, sales had grown 8.7 % to reach € 3,826 million at the end of the fiscal year. In addition, consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) in­ creased to € 814 million (previous year: € 742 million). The EBITDA margin was 21.3 % (previous year: 21.1 %). Furthermore,­ earnings per share increased to € 2.74 (previous year: € 2.27). The increase in relevant profitability indicators further underscores the positive long-term performance of Symrise.

Symrise is about more than running a profitable business - the company places a high priority on fulfilling its respon­ sibility to society, which includes climate and environmental protection and is the reason why we pursue ambitious goals in these areas. Symrise therefore aims to be climate positive with regard to greenhouse gas emissions by 2030. The com­ mitment to the climate, water and forests make Symrise one of the leading sustainable companies worldwide according to the criteria provided by the Carbon Disclosure Project (CDP), a highly regarded not-for-profit charity. For example, Symrise has rated all key suppliers according to sustainability criteria and ensured the traceability of all strategic raw materials. These kinds of measures have earned Symrise the top Triple A score in the CDP's 2021 ranking.

The success of the fiscal year is also apparent in the high degree of target attainment as reflected in the yearly bonus (Short Term Incentive, STI) (103.48 %) and in the 2019 - 2021 LTIP (long-term incentive plan) tranche (145.33 %) of the Boards.

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REMUNERATION REPORT 2021

2 . DISCUSSION OF THE E XECUTIVE BOARD REMUNER ATION

As a result of the Act Implementing the Second Shareholders' Rights Directive (ARUG II) taking effect on January 1, 2020, the Executive Board remuneration system was submitted to the 2021 Annual General Meeting for approval and approved by this body with a majority of 83.35 % of the votes cast.

With the listing of Symrise on the DAX®, it is very important for the company to ensure that the Executive Board remuner­ ation system is competitive and in line with the market and our investors' expectations. The Supervisory Board therefore meticulously compared the remuneration system that was approved at the 2021 Annual General Meeting with current market practices, investor expectations and relevant regulatory requirements. Feedback received from investors and voting consultants in connection with the 2021 Annual General Meeting was also taken into account. As a result of this review, the Supervisory Board decided at its December 1, 2021 meeting to update the Executive Board remuneration system, which it will submit to the 2022 Annual General Meeting for approval. Key changes in the new draft include, but are not limited to, making the LTIP a performance share plan in the future and extending the performance period to four years to further strengthen the long-term focus of Executive Board remuneration.

3 . COMPOSITION OF THE E XECUTIVE BOARD IN THE 2021 FISC AL YE AR

In the 2021 fiscal year, the Executive Board of Symrise AG was made up of the following members:

• Dr. Heinz-Jürgen Bertram, Chief Executive Officer since August 2008, member of the Executive Board since December 2006
• Olaf Klinger, member of the Executive Board since 2016
• Dr. Jean-Yves Parisot, member of the Executive Board since October 2016
• Heinrich Schaper, member of the Executive Board since October 2016, no longer a member as of March 31, 2021
• Achim Daub, member of the Executive Board since 2006, no longer a member as of March 31, 2021

Heinrich Schaper left the Executive Board for age-related reasons at the end of March 31, 2021. Achim Daub also left the Executive Board at the end of March 31, 2021, to pursue new professional challenges. The Supervisory Board would like to thank Mr. Schaper and Mr. Daub for their many years of successful collaboration.

Executive Board positions were reallocated as of April 1, 2021 as part of a realignment. As of April 1, 2021, the previously separate segments of Flavor and Nutrition were combined into one segment. Dr. Jean-YvesParisot, previously responsible for the Nutrition segment, took over responsibility for the combined Flavor & Nutrition segment effective April 1, 2021.

Dr. Heinz-JürgenBertram took over the Scent & Care segment on an interim basis effective April 1, 2021, after this

­position became vacant when Mr. Daub left on March 31, 2021. On December 1, 2021, the Supervisory Board resolved to

extend­ the appointment of Dr. Heinz-Jürgen Bertram as Chief Executive Officer ahead of schedule by three years until ­October 31, 2025.

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REMUNERATION REPORT 2021

4 . COMPOSITION OF THE SUPERVISORY BOARD IN THE FISC AL YE AR

The Supervisory Board of Symrise AG had the following members in the 2021 fiscal year (shareholder representatives are marked with *, employee representatives are marked with **):

• Michael König, Chairman of the Supervisory Board*
• Harald Feist, Vice Chairman of the Supervisory Board**
• Ursula Buck*
• Jeannette Chiarlitti**
• Horst-OttoGerberding*
• Bernd Hirsch*
• André Kirchhoff**
• Dr. Jakob Ley, joined effective May 5, 2021**
• Gerd Lösing, no longer a member as of May 5, 2021**
• Prof. Dr. Andrea Pfeifer*
• Andrea Püttcher**
• Peter Vanacker*
• Peter Winkelmann**

B . REMUNER ATION OF THE MEMBERS OF THE E XECUTIVE BOARD 1 . PRINCIPLES OF E XECUTIVE BOARD REMUNER ATION

At its Supervisory Board meeting on March 8, 2021, the Supervisory Board of Symrise AG adopted a remuneration system for Executive Board members in accordance with the requirements of the Act Implementing the Second Shareholders' Rights Directive (ARUG II) (the "2021 Executive Board Remuneration System"). The 2021 Annual General Meeting held virtually on May 5, 2021, approved the 2021 Remuneration System with a majority of 83.35 % of the votes.

The 2021 Remuneration System applies to all new Executive Board contracts concluded from 2021 onwards. The previous remuneration system approved by the Annual General Meeting on May 12, 2015 (the "2015 Executive Board Remuner­ ation System") will continue to apply to previously appointed Executive Board members until their contracts are ex­ tended. The 2015 Executive Board Remuneration System thus applies to all Executive Board members active in the 2021 fiscal year.

The following section first provides an overview of the 2015 Executive Board Remuneration System applicable to all Ex­ ecutive Board members in the 2021 fiscal year. It then discusses the individual components of the remuneration of all Executive Board members active in 2021 fiscal year.

2 . OVERVIEW OF THE 2015 E XECUTIVE BOARD REMUNER ATION SYSTEM

Fixed remuneration

Remuneration
component	Objective	Implementation

Fixed remuneration

Supplementary payments

Pension through personal contributions

Competitive remuneration to attract the best available candidates worldwide to develop and execute the corporate strategy and manage the company and retain these ­candidates for the long term.

Ability to accumulate adequate pension savings.

Annual fixed remuneration

• Chief Executive Officer: € 800,000
• Ordinary member of the Executive Board: € 500,000
• Equivalent to 33 % of total target remuneration consisting of fixed remuneration, annual bonus and long-term incentive plan

Supplementary payments mainly contain fringe benefits in the form of non­ -­monetary benefits from the use of a company car, inclusion in group accident insurance in the case of inability to work or death, D&O insurance and contributions to statutory social security insurance

• No company-financed pensions
• Ability to accumulate deferred compensation retirement benefits through salary conversion
• Individual contractual pension commitments for Dr. Bertram and Mr. Schaper based on their previous employment with the company

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