Credibility Culture

Remuneration Report

Dear Shareholders,

On behalf of the Board of Directors of BELIMO Holding AG and of the Remuneration and Nomination Committee, I am pleased to present the 2022 Remuneration Report.

Belimo exceeded its growth targets in a challenging environment shaped by considerable uncertainty. With an organic sales growth of 11.9% in local currencies, the year‘s revenue developed ahead of the five-year growth average. Earnings before interest and taxes (EBIT) rose to CHF 152.4 million, equaling to an EBIT margin of 18.0%. Operational excellence, with a robust supply chain performance and highly engaged employees, was the key success factor for these strong results.

The Remuneration Report explains how the performance in 2022 impacted the remuneration awarded to the members of the Executive Committee of Belimo. In addition, it shows that the remunerations awarded to the Board of Directors and the Executive Committee in 2022 were within the limits approved at the Annual General Meeting 2022.

In the reporting year, the Remuneration and Nomination Committee conducted a review and a benchmark analysis of the structure and levels of the remuneration of the Board of Directors and the Executive Committee functions. Based on the outcomes of this analysis, the Remuneration and Nomination Committee proposed an adjustment to the payout model of the Board of Directors‘ fees to the Board. At the Annual General Meeting 2024, Belimo will request that the Board of Director’s fees be paid out partially in cash and partially in shares restricted for a period of three years. However, the level of the fees will remain unchanged.

With regard to the remuneration of the Executive Committee, the Remuneration and Nomination Committee decided not to change the structure of that remuneration at this stage. The potential introduction of sustainability performance targets will be discussed in 2023. Otherwise, the benchmark analysis served as a basis for adjustments to the remuneration level in individual cases, effective for 2023.

More information regarding the review and benchmark analysis can be found in this report.

At the Annual General Meeting 2023, you will be asked to approve the total maximum remuneration for the Board of Directors and Executive Committee for the next financial year (prospective binding votes). In addition, your valued opinion on the Remuneration Report will be sought through a consultative retrospective vote.

At the upcoming Annual General Meeting, you will also be asked to elect Ines Pöschel as a new Board member. We are convinced that Ines is a very competent and knowledgeable addition to our Board and that her presence there will ensure that we are perfectly set up to support the continuous growth and success of Belimo. With Ines, we will increase the proportion of female Board members to 29%. In general, our efforts in increasing diversity in Belimo management are showing solid results. As of now, we also have one woman in the Executive Committee and one woman in the extended Executive Committee. Furthermore, two of our Managing Directors of subsidiaries are women as well, one of whom is a member of the Belimo Leadership Accelerator program.

To gain insights into how we work with one another in our Board as well as into how we interact with the Executive Committee, the Remuneration and Nomination Committee conducted a self-evaluation among the Board of Directors and invited the members of the Executive Committee to participate in the evaluation as well. The results stimulated good discussions and brought forward a number of ideas and measures, some of which involved adjusting risk management more frequently with respect to global developments, optimizing the agenda setting as well as permanently establishing ESG (Environment, Social and Governance) issues in the agenda of Board of Directors meetings.

Each year the Board reviews its members‘ skill matrix, which is used as the basis for the continuous development of our panel. In 2022, a particular focus was put on training in the topic of ESG, which is of strategic importance of Belimo, as laid out in our sustainability report.

The succession planning of the Executive Committee and extended Executive Committee functions was discussed at the December meeting of the Board of Directors. Based on this planning, we were able to fill two recent vacancies in the Executive Committee and extended Executive Committee resulting from retirements with one internal and one external candidate in a timely manner and ensured smooth transitions with appropriate hand-over periods.

We are convinced that our good corporate governance and our remuneration policies help achieve the ambitious Belimo growth strategy. We would like to thank you, dear shareholders, for your ongoing valuable feedback and your continued support. We trust that you find this report to be informative.

Sincerely,