BASF Report 2021 Corporate Governance – Report of the Supervisory Board 181 December 31, 2021, for election to the Supervisory Board at the Annual Shareholders’ Independence and efficiency review Meeting on April 29, 2022. An important aspect of good corporate governance is the independence of Super- The Strategy Committee, which was established to discuss strategic options for the visory Board members and their freedom from conflicts of interest. The Supervisory further development of the BASF Group, did not meet in 2021. Board based the assessment of the independence of its members on the recommen- dations of the German Corporate Governance Code and the additional criteria for assessing the independence of Supervisory Board members contained in the Rules of Corporate governance and Declaration of Conformity Procedure of the Supervisory Board, which were revised in the Supervisory Board meeting on December 19, 2019. The criteria used to assess independence are pres- The Supervisory Board places great value on ensuring good corporate governance: In ented in the Corporate Governance Report on page 166. According to the Super- 2021, it was therefore once again intensely occupied with the corporate governance visory Board’s assessment, on the basis of these criteria, five of the six shareholder standards practiced in the company and the implementation of the recommendations representatives and four of the six employee representatives – 9 of the 12 members and suggestions of the German Corporate Governance Code in the current version of the Supervisory Board in total – are considered to be independent as of the end dated December 16, 2019. of 2021. All three non-independent Supervisory Board members were classified as such due to the length of their membership on the Supervisory Board, which exceeds In accordance with the recommendations of the German Corporate Governance 12 years in each case. Franz Fehrenbach and Denise Schellemans, two of the mem- Code and the Guiding principles for the dialog between investors and German super- bers to be classified as non-independent, will leave the Supervisory Board on conclu- visory boards, the Chairman of the Supervisory Board again sought dialog with invest- sion of the Annual Shareholders’ Meeting on April 29, 2022; this increases the number ors where appropriate in 2021. of independent members to 11 of 12 members. Above and beyond this, however , the Supervisory Board does not see any indications that the Supervisory Board role is not Special onboarding events are held for new members of the Supervisory Board to performed completely independently. In cases where Supervisory Board members familiarize them with the basics of corporate governance at BASF, the organization hold supervisory or management positions at companies with which BASF has busi- and internal structures of the BASF Group, and the composition of its businesses. ness relations, we see no impairment of their independence. The scope of these Above and beyond this, the company also supports the members of the Supervisory businesses is marginal and furthermore takes place under conditions similar to those Board with training for their activities on the Supervisory Board, whether through of a third party. external offerings such as topic-specific seminars or internal information offerings such as site and plant visits. The Supervisory Board reviews the efficiency of its activities every year in the form of a self-assessment. To this end, the Chairman of the Supervisory Board conducted a At its meeting of December 16, 2021, the Supervisory Board approved the joint written survey of all Supervisory Board members in the fourth quarter of 2021 on the Declaration of Conformity by the Supervisory Board and the Board of Executive Direc- basis of a detailed questionnaire covering the entire range of relevant Supervisory tors in accordance with section 161 of the German Stock Corporation Act (AktG). Board topics. These included, in particular, the preparation and conduct of Super- BASF complies with all recommendations of the German Corporate Governance visory Board meetings, the content and topics of the meetings, cooperation within the Code in the version dated December 16, 2019. The Corporate Governance Report Supervisory Board, and cooperation with the Board of Executive Directors and the provides extensive information on the BASF Group’s corporate governance. auditor. The results of these dialogs, including suggestions to further improve the The full Declaration of Conformity is rendered on page 184 and is available to shareholders on the company website at Supervisory Board’s work, were presented by the Chairman of the Supervisory Board basf.com/en/corporategovernance at the Supervisory Board meeting on December 16, 2021, and thoroughly discussed by the members of the Supervisory Board. Overall, its members again rated the Supervisory Board’s activity as efficient.