CSL Ltd Annual Report 2021

10.3 Contractual Provisions for Executive KMP Executive KMP are employed on individual service contracts that outline the terms of their employment, which include: Duration of Contract Notice Period Employee Notice Period CSL* Termination Payment No fixed term Six months Six months 12 months *CSL may also terminate at any time without notice for serious misconduct and/or breach of contract. 10.4 Other Transactions No loans or related party transactions were made to Executive KMP or their associates during 2021. No loans were made to NEDs during 2021. All NED related party relationships are based on normal commercial arms’ length terms. None of the NEDs were, or are, involved in any procurement or other Board decision-making regarding the companies or firms which they have an association. CSL is not required to make the following disclosures but for transparency reasons notes the following relationships and transactions: • CSL has entered into a number of contracts, including collaborative research agreements, with Monash University, of which Dr Megan Clark AC is a member of Council; • Financial services provided by Bank of America Merrill Lynch of which Dr Megan Clark AC is a member of the Australian Advisory Board and is a member of the Global Advisory Council of the Bank of America; • CSL has entered into a research collaboration with the Centre of Eye Research Australia, of which Professor Andrew Cuthbertson AO is a director; • CSL has entered into research collaboration and lease arrangements with the University of Melbourne, of which Professor Andrew Cuthbertson AO is a member of the Council; • CSL has entered into a number of contracts, including collaborative research agreements, with the Walter and Eliza Hall Institute for Medical Research (WEHI), of which Ms Marie McDonald is a director; • CSL has entered into a research collaboration with the Baker Heart and Diabetes Institute, of which Ms Christine O’Reilly is a director; • CSL has a corporate account with Medibank Private Limited, of which Ms Christine O’Reilly is a director; and • Mr Pascal Soriot is the CEO of AstraZeneca and was a director of CSL for a portion of the financial year. During that period, CSL entered into an agreement with AstraZeneca for the manufacture and supply of COVID-19 vaccine. Appropriate governance arrangements were in place whilst this contract was being negotiated. CSL did not receive any monies from AstraZeneca under this contract during the period whilst Mr Soriot was a Director of CSL. 10.5 Malus and Clawback Policy CSL operates a Malus and Clawback Policy. ‘Malus’ means adjusting or cancelling all or part of an individual’s variable reward as a consequence of a materially adverse development occurring prior to payment (in the case of cash incentives) and/or prior to vesting (in the case of equity incentives). ‘Clawback’ means seeking recovery of a benefit paid to take into account a materially adverse development that only comes to light after payment, including shares delivered post vesting. The Board, in its discretion, may apply the policy to any incentive provided to a senior executive, including a former senior executive, in the event of a material misstatement or omission in the financial statements of a Group company or the CSL Group, or other material error, or in the event of fraud, dishonesty or other serious and wilful misconduct involving a senior executive, leading to a senior executive receiving a benefit greater than the amount which would have been due based on the corrected financial statements or had the error or misconduct not occurred. In 2021, following a joint review of reward outcomes by both the HRRC and the ARMC, there was no application of the policy. 10.6 Securities Dealing The CSL Securities Dealing Policy prohibits employees from using price protection arrangements (e.g. hedging) in respect of CSL securities, or allowing them to be used. The Policy also provides that no CSL securities can be used in connection with a margin loan. Upon vesting of an award, an employee may only deal in their CSL securities in accordance with the Policy. A breach of the Policy may result in disciplinary action. A copy of the Policy is available at http://www.csl.com.au/ about/governance.htm. 10.7 Minimum Shareholding Guideline To be met within a target of the first five years of appointment, or within five years for current incumbents, and to be held whilst in the role at CSL, the following levels of vested equity must be held: • CEO: Three times base salary; • Executive KMP: One times base salary; and • NEDs: One times base fee. As at 30 June 2021, all KMP hold, or are on track to hold, the minimum shareholding requirement within the relevant time period. CSL Limited Annual Report 2020/21 103