Remuneration Report 

Dear Shareholders

I am honored to present the 2023 Remuneration Report on behalf of the Board of Directors and the Remuneration and Nomination Committee of Belimo Holding AG.

Belimo successfully pursued its long-term growth strategy in a year characterized by a demanding economic environment. Overall, net sales grew by 7.2% in local currencies and earnings before interest and taxes (EBIT) amounted to CHF 152.5 million, equivalent to an EBIT margin of 17.8%. Due to the general slowdown of business momentum in the industry, the business objectives were not fully achieved. Overall, the average target achievement was 95.6%.

This report comprehensively details the influence of our 2023 performance on the remuneration of the Executive Committee. It also affirms that the compensation awarded to both the Board of Directors and the Executive Committee adhered to the limits approved at the 2023 Annual General Meeting.

The Remuneration and Nomination Committee assiduously managed compensation-related topics throughout the year. This included reviewing and setting the Executive Committee’s annual objectives, evaluating end-of-year performance, determining the remuneration for the Board and Executive Committee, and preparing for the say-on-pay votes at the Annual General Meeting.

A key initiative this year involved the Remuneration and Nomination Committee revising the Board’s compensation guidelines to better align them with shareholder interests. If the proposed changes to the Articles of Incorporation are approved by the Annual General Meeting, effective from the 2024 Annual General Meeting, Board members will receive 40% of their annual board fee in Belimo shares, subject to a three-year selling restriction, with the overall fee level remaining constant.

Moreover, the Remuneration and Nomination Committee reviewed the remuneration structure and levels for the Executive Committee. Informed by the 2022 benchmark analysis, the committee opted for targeted adjustments to the incentive programs rather than base salaries, effective from 2024.

The Remuneration and Nomination Committee also decided to revise the compensation-related sections of the Articles of Incorporation to align with best practices and adopt a prospective approval rhythm. If approved, as of the 2024 Annual General Meeting, the Company will propose prospective votes on the maximum total remuneration for the Board of Directors from Annual General Meeting to Annual General Meeting and for the Executive Committee for the next financial year, as well as a retrospective consultative vote on the Remuneration Report. To transition into the new system, four proposals are submitted to the Annual General Meeting ‒ two of them to transition out of the existing approval periods and two to transition into the new, fully prospective vote.

Our dedication to diversity was further highlighted by the election of Ines Pöschel to the Board in 2023, raising female representation to 29%. Our Belimo Leadership Accelerator program continues to enrich our diverse leadership pipeline.

In the Remuneration and Nomination Committee’s discussions with Executive Management, a new Human Resources strategy designed to further attract, develop, and retain top talent was reviewed, shaped, and recommended for approval. Additionally, to underscore the strategic importance of Human Resources to the future success of Belimo, from 2024, our Global Head of Human Resources will be repositioned as a direct report to the CEO, further supporting our growth trajectory.

We also reviewed our Board’s skill set, with a special emphasis on diversity, equity, and inclusion, and core cultural values, aligning them with our growth strategy. Succession planning for the Executive Committee was a focal point of our December Board meeting.

We firmly believe that our robust governance and prudent remuneration policies are crucial for realizing our ambitious growth objectives. We extend our gratitude to you, our esteemed shareholders, for your continued insightful feedback and unwavering support. We trust you will find this report informative and valuable.

Sincerely