CSL Ltd Annual Report 2019

6.7 2020 Executive KMP Remuneration Targets CSL has a global workforce with the majority of our Executive KMP based outside of Australia. We need to attract and retain high calibre global executives in a highly competitive industry. The unique skill set with specialised pharmaceutical and biotechnology expertise and experience that we require is critical to enable us to deliver on our strategy, promise to patients and deliver returns to our shareholders. The talent we require is not readily available in the Australian market and we need to ensure we have a competitive reward offering. Positioning our Executive KMP remuneration in the market range of our global pharmaceutical/biotechnology and general industry geographic peer groups (or blend of both), is key to this, along with the desired balance of the pay mix. Rewarding real achievement under our pay for performance philosophy, the Board has determined that there will be an increase to Fixed Reward for one Executive KMP and no increase to STI opportunity for any Executive KMP in 2020. We continue to shift the risk in our pay-mix towards higher levels of performance based pay as a proportion of Total Reward to better align with our peer reference groups and to build alignment and focus on responsibly achieving what matters. Table 14 below sets out the increases to be applied for 2020 – increases have been made to LTI target opportunity for five Executive KMP and includes the reward changes for the CEO described earlier. The Board considers these increases to be market appropriate and ensures Executive KMP interests remain aligned with the interests of our shareholders. Increases provided ensure our Executive KMP are positioned closer to the median of the market range for LTI. Executive KMP pay mix can be found in section 2.2.3. Table 14: 2020 Adjustments to Executive KMP reward effective from 1 July 2019 Executive % change in FR % change in STI $ opportunity at target % change in LTI $ opportunity at target Total Reward Adjustment % Total Reward Adjustment $ P Perreault 0% 0% 14% 9% 875,500 G Boss 0% 0% 14% 7% 155,280 W Campbell 0% 0% 38% 19% 463,500 A Cuthbertson 0% 0% 0% 0% – D Lamont 0% 0% 8% 3% 91,396 WMezzanotte 0% 0% 38% 19% 562,500 E Walker 3% 3% 3% 3% 46,410 In June 2019, we were pleased to welcome Dr Paul McKenzie to CSL in the role of Chief Operating Officer (COO). Dr McKenzie became Executive KMP from 1 July 2019. Dr McKenzie, an accomplished global leader with diverse biotechnology experience, brings significant experience and leadership capabilities that will continue to drive CSL’s sustainable growth. On commencement of employment, Dr McKenzie received a commencement benefit to the value of US$4,862,500 to compensate for the loss of cash bonus he was eligible for at Biogen (prior employer), along with Biogen equity Dr McKenzie held at the time of cessation. The chart below sets out the award values, vehicle and vesting dates and further detail will be provided in the 2020 Remuneration Report. COO Commencement Benefits (USD) 2022 2021 2020 2019 ● Cash Sign on ● Restricted Share Units ● Performance Share Units 1,039,000 1,445,000 230,000 1,281,000 867,500 CSL Limited Annual Report 2019 82 Directors' Report