CSL Ltd Annual Report 2020

In addition to the disclosure of statutory remuneration, we also disclose CEO and Executive KMP ‘realised’ remuneration. Mr Perreault’s ‘realised’ remuneration for 2020 was US$28,224,845 and this is a 21% increase from the prior year (full detail provided in section 7.2, table 12). 2020 CEO Realised Remuneration 0% 20% 40% 60% 80% 100% ● Total Fixed Reward Received ● Total STI Received ● LTI Received – Options (2016) ● LTI Received – Rights (2016) ● LTI Received – Notional Shares (2017) ● LTI Received – Performance Share Units (2018) ● LTI Received – Performance Share Units (2019) Remuneration in 2021 For 2021, the Board has determined that there will be no increase to any component of Mr Perreault’s total target reward – remaining at fixed reward of US$1,751,000, a STI target of 120% and a LTI target of 400%. Mr Perreault’s total target reward will be US$10,856,200 with the maximum potential outcome being US$11,906,800. While total target reward is below the median of the global pharmaceutical/ biotechnology peer group, given the current global economic environment and investor and community sentiment, the Board believes no increase is warranted at this time. For our remaining Executive KMP, in 2021 our Chief Operating Officer Dr Paul McKenzie will receive an increase to his fixed reward and long term incentive target to reflect an increase in responsibilities to include leadership of the Seqirus business. These increases better align Dr McKenzie towards the median of the global pharmaceutical/biotechnology peer group in accordance with our remuneration policy. Internal pay relativity has also been considered by the Board. Professor Cuthbertson’s total reward in 2021 has been adjusted to reflect his reduced responsibilities and he will no longer participate in CSL’s STI and LTI plans. No changes will be made to Mr Lamont’s reward for his remaining period of employment with CSL. He will not receive a LTI grant in September 2020. Following benchmarking with ASX 10 and ASX 25 Non-Executive Director (NED) remuneration, in 2021 there will be a 2.8% increase to Board fees. There will be no payment of the NED travel allowance until international travel of our overseas NEDs resumes. Shareholder Engagement and Review of our Reward Framework in 2021 Over the year, we enjoyed conversations with many of our shareholders and welcomed their feedback on our executive reward framework. In response to this feedback, for the LTI awards granted in 2020, the Board introduced an annual threshold of ROIC performance that must be achieved before vesting can occur – the measure is the Investment Hurdle Rate (IHR). This was added as a gateway condition of the LTI target to ensure the ROIC is delivering an appropriate return each financial year as well as over the seven year rolling average period and aligns with shareholder outcomes. If the ROIC outcome is below the IHR, no vesting will occur in that year. The Board decided not to make any further changes to the framework this year in light of continuing uncertainty in the external market. In 2021, we will undertake a formal review of the framework, ensuring each component is fit for purpose for CSL and enables us to attract, engage and retain talent, compete with larger global pharmaceutical companies and motivate our people to deliver their best performance. We will review the STI and LTI design, making sure our framework drives sustainable long term results and aligns the interests of executives with our shareholders. The review will include the STI framework, LTI measures, tranche structure and vesting schedule. We look forward to engaging with you as we undergo this review process. Thank you to my fellow committee members and thank you for supporting CSL and the patients we serve around the world. Dr Megan Clark AC Chair Human Resources and Remuneration Committee CSL Limited Annual Report 2020 69