BASF Report 2021 Corporate Governance – Corporate Governance Report 163 parts of enterprises, as well as the issue of bonds or comparable Two-tier management system of BASF SE financial instruments. However, this is only necessary if the acquisi- tion or disposal price or the amount of the issue in an individual case Board of Executive Directors Supervisory Board exceeds 3% of the equity reported in the last approved Consoli- dated Financial Statements of the BASF Group. For more information on risk management, see the Forecast from page 151 onward appoints the Board of Executive Directors The members of the Board of Executive Directors, including their areas of responsibility and memberships on the supervisory bodies of other companies, are listed from page 174 onward monitors the Board of Executive Directors Compensation of the Board of Executive Directors is described in the Compensation Report at basf.com/compensationreport advises the Board of Executive Directors Competence profile, diversity concept and succession reports to Supervisory Board planning for the Board of Executive Directors 6 members 12 members appointed by the Supervisory Board 6 shareholder representatives elected by the The Supervisory Board works hand in hand with the Board of Chair Annual Shareholders’ Meeting and appointed by the Supervisory Board 6 employee representatives Executive Directors to ensure long-term succession planning for the Chair composition of the Board of Executive Directors. BASF aims to fill elected by the Supervisory Board most Board positions with leaders from within the company. It is the task of the Board of Executive Directors to propose a sufficient number of suitable individuals to the Supervisory Board. Irrespective of these individual criteria, a holistic approach will ulti- The number of members on the Board of Executive Directors is mately determine a person’s suitability for appointment to the Board determined by the Supervisory Board. It is guided by insights gained BASF’s long-term succession planning is guided by the corporate of Executive Directors of BASF SE. Both systematic succession by BASF as a company with an integrated leadership culture and is strategy. It is based on systematic management development planning and the selection process aim to ensure that the Board of determined by the needs arising from cooperation within the Board characterized by the following: Executive Directors as a whole has the following profile, which of Executive Directors. The Supervisory Board considers six to be serves as a diversity concept: an appropriate number of Board members given the current busi- – Early identification of suitable leaders of different professional ness composition, future responsibilities associated with develop- backgrounds, nationalities and genders – Many years of management experience in scientific, technical and ment and the fundamental organizational structure of the – Systematic development of leaders through the successful commercial fields BASF Group. assumption of tasks with increasing responsibility, where possible – International experience based on background and/or profes- in different business areas, regions and functions sional experience The current composition of the Board of Executive Directors meets – Desire to shape strategic and operational decisions, and proven – At least one female Board member the competence profile and the requirements of the diversity success in doing so, as well as leadership skills, especially under – A balanced age distribution to ensure the continuity of the Board’s concept in full. challenging business conditions work and enable seamless succession planning – Role model function in putting corporate values into practice The first appointment of members of the Board of Executive Direc- The aim is to enable the Supervisory Board to ensure a reasonable tors is for a term of no more than three years. The standard age level of diversity with respect to education and professional experi- limit for members of the Board of Executive Directors is 63. ence, cultural background, international representation, gender and age when appointing members of the Board of Executive Directors.