BASF Report 2021 Corporate Governance – Report of the Supervisory Board 179 chemical market, the project to construct a new Verbund site in southern China, and Compensation and composition of the Board of Executive Directors current business developments, opportunities and challenges in the Petrochemicals division. In several meetings over the 2021 business year, the Supervisory Board discussed and passed resolutions on the compensation of the Board of Executive Directors. The Supervisory Board met on April 28, 2021, one day before the virtual Annual Matters relating to the composition of the Board of Executive Directors did not arise Shareholders’ Meeting, primarily to prepare for the Annual Shareholders’ Meeting. in 2021. Another topic was the shareholding in the Wintershall Dea joint venture. At its meeting on February 24, 2021, the Supervisory Board deliberated and agreed The main agenda items at the meeting on July 22, 2021, were BASF’s leadership on the 2021 targets for the Board of Executive Directors based on the preparations of development and personnel concept, the development and management of pension the Personnel Committee. It also discussed and resolved on the final performance obligations, the development of the Global Business Services unit, and market oppor- factors for the Board of Executive Directors’ short-term and long-term incentives tunities and risks in connection with the European Green Deal. for 2020. At its meeting on December 16, 2021, the Supervisory Board evaluated, based on the discussions and the corresponding recommendation of the Personnel At the strategy meeting on October 21/22, 2021, the Board of Executive Directors Committee, the Board of Executive Directors’ performance in 2021 and set the and the Supervisory Board discussed at length the status of implementation of the performance factor for the short-term incentive 2021 and the strategic performance corporate strategy with a particular focus on growth, strengthening profitability and factors for the deferral compensation components for 2018–2021 and 2019–2022. portfolio development, as well as key aspects of BASF’s strategic development. These The Chairman of the Supervisory Board abstained from the resolution on the factor for included: the performance bonus for 2018–2021 as this affected him personally. For more information on the compensation of the Board of Executive Directors and the Supervisory Board, see the Compensation – The development of research and development activities Report, which has been made publicly available on the company’s website at basf.com/compensationreport – E-mobility and the transformation of the automotive industry as factors influencing the development of the BASF Group – Market prospects and growth opportunities in China as the largest regional market Committees for chemical products; growth projects such as the Verbund site in southern China and the further expansion of the battery materials business The Supervisory Board of BASF SE has four committees: 1. the committee for – Climate change and the European Green Deal and their effects on BASF, as well as personnel matters of the Board of Executive Directors and the granting of loans in the resulting development paths, opportunities and risks accordance with section 89(4) of the German Stock Corporation Act (Personnel – The status, development and prospects of selected BASF business areas Committee); 2. the Audit Committee; 3. the Nomination Committee; and 4. the Strategy Committee. Following each Committee meeting, the chairs of the Commit- At its meeting on December 16, 2021, the Supervisory Board discussed and approved tees reported in detail about the meetings and the activities of the Committees at the the Board of Executive Directors’ operational and financial planning, including the subsequent meeting of the Supervisory Board. investment budget for 2022, and, as in previous years, authorized the Board of Execu- For information on the composition of the committees and the tasks assigned to them by the Supervisory Board, see the tive Directors to procure the necessary financing in 2022 within a set limit. In addition, Corporate Governance Report from page 164 onward the Supervisory Board discussed the Board of Executive Directors’ recommendation that, given the uncertainty surrounding the further development of the coronavirus pandemic and potential restrictions, the Annual Shareholders’ Meeting on April 29, 2022, is also held as a virtual event. The Supervisory Board agreed to this following extensive deliberation and consideration of the resulting, unavoidable restrictions of shareholder rights compared with a physical meeting.