BASF Report 2021 Corporate Governance – Report of the Supervisory Board 180 The Personnel Committee met three times during the reporting period. All commit- KPMG for such services to a very limited extent, or granted approval in individual tee members attended all meetings. At its meeting on February 24, 2021, the Person- cases. At the meeting on December 15, 2021, the auditors responsible reported nel Committee discussed the targets for the Board of Executive Directors for the 2021 on the status of the annual audit, as well as the focus areas of the audit and the business year and the 2020 Compensation Report. At its meeting on July 21, 2021, most important individual items. The Audit Committee also addressed the effects of the Personnel Committee addressed the status of leadership development at the top the German Financial Market Integrity Strengthening Act on appointing KPMG as levels of management below the Board of Executive Directors and long-term succes- an auditor in the future. Due to the change in the rules on auditor rotation, it is now sion planning for the Board of Executive Directors. At its meeting on December 16, possible to last appoint KPMG for the 2023 business year. 2021, the Personnel Committee discussed the appropriateness of the compensation of the Board of Executive Directors, the assessment of the Board’s performance in Other important agenda items included providing guidance to the Board of Executive 2021 and a proposal for the performance-related variable compensation of the Board Directors on accounting issues, the control system established by the Board of of Executive Directors. Execu tive Directors, and follow-up assessments of acquisition and investment projects. At its meeting on April 27, 2021, the Audit Committee addressed risk man- The Audit Committee met five times during the reporting period. All committee age ment in the BASF Group and the organization of internal environmental, health and members attended all meetings. The Audit Committee is responsible for all the tasks safety audits. Its meetings on July 21, 2021, and December 15, 2021, focused on listed in section 107(3) sentence 2 of the German Stock Corporation Act (AktG) and internal auditing and compliance, respectively. In these meetings, the head of the the recommendations of the German Corporate Governance Code. The Audit Com- Corporate Audit department and the head of the Corporate Compliance unit reported mittee is also responsible for monitoring the internal process for identifying related to the Audit Committee and answered its questions. In all meetings, the Audit Com- party transactions and adopting resolutions to approve related party transactions. mittee also received information on the development of risks from litigation. At the meeting on February 22, 2022, the auditor reported in detail on its audits of The Nomination Committee is responsible for preparing candidate proposals for the BASF SE’s Separate and Consolidated Financial Statements for the 2021 business Supervisory Board members to be elected by the Annual Shareholders’ Meeting. The year, including the corresponding management’s reports, and discussed the results of Nomination Committee is guided by the objectives for the composition of the Super- its audit with the Audit Committee. The committee’s audit also included the Non- visory Board adopted by the Supervisory Board as well as the competence profile and financial Statements of BASF SE and the BASF Group, as well as the Compensation diversity concept for the Supervisory Board resolved at the meeting on December 21, Report of BASF SE in accordance with section 162 AktG, which had been audited by 2017. The Nomination Committee met twice in 2021. Both meetings were attended the external auditor. In preparation for the audit of the Nonfinancial Statements, the by all committee members. Items discussed at the meetings were the current compe- Audit Committee had, following a corresponding resolution by the Supervisory Board, tence profile and diversity concept for the Supervisory Board, the selection of candi- additionally engaged KPMG to perform a limited assurance and issue an assurance dates to succeed Franz Fehrenbach and Anke Schäferkordt, who had announced at report on it. KPMG also reported in detail on the focus, the procedure and the key an early stage that they would resign from the Supervisory Board on conclusion of the findings of this audit. Annual Shareholders’ Meeting 2022. In 2022, they will have been members of BASF’s Supervisory Board for 14 and 12 years, respectively, meaning that both will no longer At the meeting on July 21, 2021, the Audit Committee engaged KPMG AG Wirtschafts- be independent within the meaning of the criteria of the German Corporate Gover- prüfungsgesellschaft – the auditor elected by the Annual Shareholders’ Meeting on nance Code and the criteria for the independence of Supervisory Board members set April 29, 2021 – with the audit for the 2021 reporting year and auditing fees were by the Supervisory Board. The committee identified successor candidates in a struc- agreed upon. The focus areas and scope of the annual audit were discussed and tured process and with external support, and evaluated them according to set criteria. defined together with the auditor. The Audit Committee excluded in principle the Based on the recommendation of the Nomination Committee, the Supervisory Board engage ment of the auditor to perform any services outside of the audit of the annual resolved on December 16, 2021, to propose Alessandra Genco, Chief Financial financial statements, including beyond prevailing legal limitations. For certain nonaudit Officer of Leonardo SpA, and Prof. Dr. Stefan Asenkerschbaumer, Deputy Chairman services, the Audit Committee authorized the Board of Executive Directors to engage of the Board of Management and Chief Financial Officer of Robert Bosch GmbH until