BASF : Corporate Governance (BASF Report 2024) (BASF Report 2024 Corporate Governance)

At a Glance	Combined Management's Report	Consolidated Financial Statements	Further Information

1.2 Corporate Governance1

Corporate Governance Report

Corporate governance refers to the entire system for managing and supervising a company. This includes its organization, values, corporate principles and guidelines as well as internal and external control and monitoring mechanisms. Effective and transparent corporate governance ensures that BASF is managed and supervised responsibly with a focus on value creation and sustainability. It fosters the confidence of our investors, the financial markets, our customers and other business partners, employees, other groups affiliated with our company (stakeholders) as well as the public in BASF.

The fundamental elements of BASF SE's corporate governance system are: its two-tier management system, with a transparent and clear separation of company management and supervision between BASF's Board of Executive Directors and the Supervisory Board; the equal representation of shareholders and employee representatives on the Supervisory Board; and the shareholders' rights of coadministration and supervision at the Annual Shareholders' Meeting.

Board of Executive Directors

ESRS 2 GOV-1 ESRS 2 GOV-2

Direction and management by the Board of Executive Directors

The Board of Executive Directors is responsible for managing the company and represents BASF SE in business undertakings with third parties. BASF's Board of Executive Directors is strictly separated from the Supervisory Board, which monitors the Board of Executive Directors' activities and decides on its composition: A member of the Board of Executive Directors cannot simultaneously be a member of the Supervisory Board. As the central duty of company management, the Board of Executive Directors defines the corporate goals and strategic direction of the BASF Group as well as its individual business areas, including the sustainability strategy. In doing so, the Board ensures that the opportunities and risks associated with social and environmental factors for our company (outside-in perspective) as well as the ecological and societal impacts of BASF's corporate activities (inside-out perspective) are systematically identified and evaluated. 〈 In addition to long-term economic goals, the corporate strategy appropriately takes environmental and social objectives into account, too. The corporate planning defined on this basis comprises financial and sustainability-related goals.〉

Furthermore, the Board of Executive Directors determines the company's internal organization and decides on the composition of management positions on the levels below the Board. It also manages and monitors BASF Group business by planning and setting the corporate budget, allocating resources and management capacities, monitoring and making decisions on significant individual measures, and supervising operational management.

The Board's actions and decisions are geared toward the company's best interests. It is committed to the goal of sustainably increasing the company's value and developing the company over the long term, taking into account environmental and social goals as well as economic targets. The Board's responsibilities include the preparation of the Consolidated and Separate Financial Statements of

• With the exception of the "Disclosures according to sections 289a and 315a of the German Commercial Code (HGB) and explanatory report of the Board of Executive Directors according to section 176(1) sentence 1 of the German Stock Corporation Act (AktG)," the content of this section is not part of the statutory audit but is part of a separate audit with limited assurance.

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BASF SE and reporting on the company's financial and nonfinancial performance as well as half-year and quarterly reporting. Furthermore, it must ensure that the company's activities comply with the applicable legislation and regulatory requirements as well as internal corporate requirements (compliance). This includes the establishment of appropriate systems for control, compliance and risk management as well as embedding a company-wide compliance culture with undisputed standards (see page 317).

Decisions that are reserved for the Board as a whole by law, through the Board of Executive Directors' Rules of Procedure or through resolutions adopted by the Board, are made and all important matters of the company are discussed at regularly held Board meetings called by the chair of the Board of Executive Directors. Board decisions are based on detailed information and analyses provided by the operating divisions and Corporate Center units as well the service and research units and, if deemed necessary, by external consultants. The chair of the Board of Executive Directors leads the Board meetings. Board decisions can generally be made via a simple majority. In the case of a tied vote, the chair of the Board of Executive Directors gives the casting vote. However, the chair of the Board of Executive Directors cannot enforce a decision against the Board of Executive Directors' majority vote. The chair of the Board also does not have the right to veto. Outside of matters that are assigned to the entire Board for consultation and decision-making, all members of the Board of Executive Directors are authorized to make decisions individually in their designated areas of responsibility.

The Board of Executive Directors can set up Board committees to consult and decide on individual issues such as proposed material acquisition or divestiture projects or to prepare decisions to be made by the entire Board. These committees must include at least three members of the Board of Executive Directors. For the preparation of important decisions, such as those on acquisitions, divestitures, investments and personnel, the Board has various commissions at the level below the Board. With the support of the Corporate Center units and the service and research units and independently of the affected operating division, these committees thoroughly assess the planned measures and evaluate the associated opportunities and risks. Based on this information, they report and make recommendations to the Board.

The Board of Executive Directors informs the Supervisory Board regularly, without delay and comprehensively, of all issues important to the company with regard to planning, business development, the risk situation, risk management and compliance. Furthermore, the Board of Executive Directors coordinates the company's strategic orientation with the Supervisory Board (for additional information on risk management, see the forecast report from page 87onward). The Statutes of BASF SE and the Supervisory Board have defined certain transactions that require the Board of Executive Directors to obtain the Supervisory Board's approval prior to their conclusion. Such cases that require approval include the acquisition of enterprises and disposal of parts of enterprises, as well as the issue of bonds or comparable financial instruments. However, this is only necessary if the acquisition or disposal price or the amount of the issue in an individual case exceeds 3% of the equity reported in the most recent approved Consolidated Financial Statements of the BASF Group.

The members of the Board of Executive Directors, including their areas of responsibility and memberships in the supervisory bodies of other companies, are listed from page 141onward.

• Additional information on the compensation of the Board of Executive Directors can be found in the Compensation Report atbasf.com/compensationreport.
• The Rules of Procedure for the Board of Executive Directors can be found atbasf.com/rules-of-procedure.

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At a Glance	Combined Management's Report	Consolidated Financial Statements	Further Information

Competence profile, diversity concept and succession planning for the Board of Executive Directors

The Supervisory Board works hand in hand with the Board of Executive Directors to ensure long-term succession planning for the composition of the Board of Executive Directors. BASF aims to fill most Board positions with leaders from within the company. It is the task of the Board of Executive Directors to propose a sufficient number of suitable individuals to the Supervisory Board.

BASF SE's two-tier management system

Long-term succession planning is guided by the corporate strategy. It is based on systematic management development characterized by the following:

• Early identification of suitable leaders of different professional backgrounds, nationalities and genders
• Systematic development of leaders through the successful assumption of tasks with increasing responsibility, where possible in different business areas, regions and functions
• Desire to shape strategic and operational decisions and proven success in doing so, as well as leadership skills, especially under challenging business conditions
• Role model function in putting corporate values into practice

The aim of systematic management development is to enable the Supervisory Board to ensure a reasonable level of diversity with respect to education and professional experience, cultural background, international representation, gender and age when appointing members of the Board of Executive Directors. Irrespective of these individual criteria, a holistic approach will determine a person's suitability for appointment to the Board of Executive Directors of BASF SE. Both systematic succession planning and the selection process aim to ensure that the Board of Executive Directors as a whole has the following profile, which serves as a diversity concept:

• Many years of leadership experience in scientific, technical and commercial fields
• International experience based on background and/or professional experience
• At least one female Board member
• A balanced age distribution to ensure the continuity of the Board's work and enable seamless succession planning

The first appointment of members of the Board of Executive Directors is for a term of no more than three years. The standard age limit for members of the Board of Executive Directors is 63. The Supervisory Board determines the number of members on the Board of Executive Directors. It is guided by the concept of BASF as a company comprising core businesses and standalone businesses and is

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determined by the needs arising from cooperation within the Board of Executive Directors. The Supervisory Board considers six to be an appropriate number of Board members given the current business composition, future development tasks and the fundamental organizational structure of the BASF Group.

Implementation of the competence profile and the diversity concept for the Board of Executive Directors

The current composition of the Board of Executive Directors meets the competence profile and the requirements of the diversity concept in full. On account of the different educational backgrounds and management experience of its members - in scientific, technical and commercial fields - the Board of Executive Directors as a whole covers the required spectrum of specialist and management expertise and also possesses many years of international experience. In accordance with section 76 (3a) of the German Stock Corporation Act (AktG), one woman sits on the Board of Executive Directors, with suitable consideration of women forming an integral component of succession planning for the Board of Executive Directors. In its current composition, the Board of Executive Directors exhibits a balanced age structure and has an age range of seven years, meaning that sufficient continuity is assured in the work of the Board of Executive Directors. Likewise, no member of the Board of Executive Directors exceeds the standard age limit of 63 years.

For details, please see the matrix below:

Implementation of the competence profile and diversity concept of the Board of Executive Directors

		Dr. Markus
		Kamieth
Member of the		2017
Board of Executive
Directors since

Dr. Dirk		Michael
Elvermann		Heinz
2023		2011

Anup		Dr. Stephan
Kothari		Kothrade
2024		2023

Dr. Katja Scharpwinkel

2024

Position as of

Chairman of the

Member of the

Member of the

Member of the

Member of the

Member of the

December 31, 2024

Board of

Board of

Board of

Board of

Board of

Board of

Executive

Executive

Executive

Executive

Executive

Executive

Directors,

Directors, Chief

Directors,

Directors,

Directors, Chief

Directors,

BASF SE,

Financial Officer

BASF SE,

BASF SE,

Technology

Industrial

Ludwigshafen,

and Chief Digital

Chairman of

Ludwigshafen,

Officer,

Relations

Germany

Officer,

BASF

Germany

BASF SE,

Director, Site

BASF SE,

Corporation,

located in

Director of the

Ludwigshafen,

located in

Ludwigshafen,

Ludwigshafen

Germany

Florham Park,

Germany, and

site, BASF SE,

New Jersey

Singapore

Ludwigshafen,

Germany

Duties and regional

Corporate

Corporate

Agricultural

Catalysts;

Monomers;

European Site &

responsibilities

Development;

Finance;

Solutions;

Coatings;

Performance

Verbund

(2024 business year)

Corporate

Corporate

Nutrition &

Dispersions &

Materials;

Management;

Legal,

Audit;

Health; Care

Resins;

Petrochemicals;

Global

Compliance &

Corporate

Chemicals;

Performance

Intermediates;

Engineering

Insurance;

Taxes & Duties;

North America

Chemicals

Group

Services;

Corporate

Global Business

region; South

Research;

Corporate

Human

Services; Global

America region

Greater China;

Environmental

Resources;

Digital Services;

South & East

Protection,

Corporate

Global

Asia, ASEAN &

Health, Safety &

Communication

Procurement;

Australia/New

Quality; Europe,

s & Government

BASF Venture

Zealand; Mega

Middle East,

Relations;

Capital

Projects Asia

Africa region

Corporate

Investor

Relations;

Senior Project

Net Zero

Accelerator

At BASF since

1999

2003

1984

1999

1995

2010

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Implementation of the competence profile and diversity concept of the Board of Executive Directors

Dr. Markus

Kamieth

Leadership experience within BASF

Scientific		ü
Technical
Commercial		ü
Diversity
Date of birth		November 25,
	1970
Gender		Male
Degree		Chemistry
Nationality		German
International experience
Europe		ü
North/South/Central		ü
America
China		ü
Asia Pacific		ü

Dr. Dirk		Michael
Elvermann		Heinz
		ü
ü		ü
August 13,		February 18,
1971	1964
Male		Male
Law		MBA
German		German
ü		ü
		ü
ü

Anup		Dr. Stephan		Dr. Katja
Kothari		Kothrade		Scharpwinkel
		ü
ü		ü		ü
ü		ü		ü
January 8, 1968		March 13, 1967		September 10,
			1969
Male		Male		Female
Chemical		Chemistry		Chemistry
engineering,
MBA
American		German		German
ü		ü		ü
ü
ü		ü
ü		ü

Experience relevant to the sectors, products, geographical locations and customer industries of BASF

Chemicals

Director,

President,

VP, Distribution

Business Mgmt.

Intermediates;

Business

Acrylics &

Managing

Europe &

Superabsor-

Director Nanjing

Managing

bents North

Verbund site;

Director, BTC

America &

SVP, BASF

Europe GmbH

South America

Antwerpen

N.V./Plant

Operations,

Engineering &

Infrastructure

Materials

SVP, BASF

Antwerpen

N.V./Plant

Operations,

Engineering &

Infrastructure

Industrial Solutions

SVP,

President,

President,

Operations

Head of Sales

Performance

Global

Performance

Manager,

Lubricant

Chemicals

Integration

Chemicals;

Lutonal plant,

Additives

North America;

Team Ciba and

SVP,

Ludwigshafen,

Central Europe,

Director, Ciba

Chief Executive

Performance

Germany

Ciba Specialty

Integration for

Officer Ciba

Chemicals

Chemicals

Performance

North America

Chemicals

Division

Surface

President,

VP, Business

SVP,

Technologies

Coatings

Mgmt. Mobile

Automotive

Emissions

Refinish

Catalysts Asia

Coatings

Pacific;

Solutions

VP, Strategy &

EMEA, BASF

Planning/New

Coatings GmbH

Business

Development

Catalysts

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Implementation of the competence profile and diversity concept of the Board of Executive Directors

		Dr. Markus		Dr. Dirk		Michael
		Kamieth		Elvermann		Heinz
Nutrition & Care				President,
						Global
						Integration
						Team Cognis;
						Product
						Manager PVP
						Polymers

Agricultural Solutions						President, Crop
						Protection;
						Group Vice
						President Global
						Strategic
						Marketing
						Agricultural
						Products
Research &		Research of
Development		special and
		process
		chemicals
Technology

Corporate functions		Staff of member		President,		Managing
		of the Board of		Corporate		Director, BASF
		Executive		Finance;		Mexicana S.A.
		Directors		member of the
				Board,
				Wintershall
				Holding GmbH;
				SVP, Corporate
				M&A Projects;
				Managing
				Director, BASF
				Polska Sp.
				z.o.o.;
				Vice President,
				Legal and Tax
				Asia Pacific
Sustainability-related
specialist		ü		ü		ü
knowledgea

Anup		Dr. Stephan		Dr. Katja
Kothari		Kothrade		Scharpwinkel
President,		Production and		Head of Sales
Nutrition &		research for		Formulation
Health;		water-soluble		Technologies
Global		special		Europe, BASF
Marketing		polymers for		Personal Care
Manager &		cosmetics and		and Nutrition
Business		pharmaceuticals		GmbH;
Manager, Care				Regional Sales
Chemicals				Director
				Functional
				Products
				Europe, Cognis;
				Regional
				Marketing
				Director Care
				Chemicals
				North Europe,
				Cognis

		Production and
		research for
		water-soluble
		special
		polymers for
		cosmetics and
		pharmaceuticals
Technology &		Managing
Capital Program		Director,
Manager, BASF		Nanjing
Corporation		Verbund site;
		SVP, BASF
		Antwerpen
		N.V./Plant
		Operations,
		Engineering &
		Infrastructure
		President,		President,
		Greater China;		Europe, Middle
		President YPC		East and Africa
		Joint Venture,
		Nanjing;
		Corporate
		Strategy &
		Planning;
		Managing
		Director, BASF
		Hungária &
		Southeast
		Europe,
		Budapest,
		Hungary
ü		ü		ü

Automotive industry

ü

üü

ü

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Implementation of the competence profile and diversity concept of the Board of Executive Directors

		Dr. Markus
		Kamieth
Construction industry		ü
Electronics industry
Agriculture
Packaging industry		ü
Energy industry		ü
Pharmaceutical and		ü
cosmetics industry
Household and		ü
cleaning industry

Dr. Dirk		Michael
Elvermann		Heinz
		ü
		ü
		ü
ü
		ü
		ü

Anup		Dr. Stephan
Kothari		Kothrade
ü		ü
ü
ü		ü
ü		ü
ü		ü
ü		ü

Dr. Katja Scharpwinkel

ü

ü

ü

• In particular, taking into account the sustainability topics that are material for BASF, which were identified following the double materiality assessment. Details can be found in the section "Competence of the Board of Executive Directors and Supervisory Board in monitoring sustainability aspects" from page 133onward.

Proportions represented in the Board of Executive Directors according to the aspects of diversity taken into account (as of December 31, 2024)

Proportion of womena	16.7%
Proportion of members with international experience based on their
background or professional experience	83.3%
Proportion of members with many years of leadership experience
-	in scientific fields	33.3%
-	in technical fields	66.7%
-	in commercial fields	100%
Proportion of members under 60 years of age	83.3%

• We do not currently record a third gender in the aspects of diversity represented in the Board of Executive Directors. We will regularly review the relevance of this category in external reporting.

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Supervisory Board

ESRS 2 GOV-1 ESRS 2 GOV-2

Supervision of company management by the Supervisory Board

The Supervisory Board appoints the members of the Board of Executive Directors. It supervises and advises the Board of Executive Directors on management issues and must also be involved in making decisions that are of key importance for the company. This also includes the Board of Executive Directors' consideration of sustainability issues with regard to corporate management. The Supervisory Board is also responsible for auditing BASF SE's and the BASF Group's Annual Financial Statements. As members of the Supervisory Board may not simultaneously be on the Board of Executive Directors, a high level of independence is already structurally ensured with regard to the supervision of the Board of Executive Directors.

In addition to the SE Regulation, the relevant legal basis for the size and composition of the Supervisory Board is provided by the Statutes of BASF SE and the Agreement Concerning the Involvement of Employees in BASF SE (Employee Participation Agreement). The latter also includes the regulations applicable to BASF for implementing the statutory gender quota for the Supervisory Board. The German Codetermination Act does not apply to BASF SE as a European stock corporation (Societas Europaea, SE).

The Supervisory Board of BASF SE comprises 12 members. Six members are elected by the shareholders at the Annual Shareholders' Meeting via a simple majority. Six members are elected by the BASF Europa Betriebsrat (BASF Works Council Europe), the European employee representation body of the BASF Group. Newly elected members of the Supervisory Board are appointed for a term of four years. This ensures that the maximum membership duration of 12 years up to which a Supervisory Board member can be classified as independent in accordance with the German Corporate Governance Code corresponds to a total of three election terms.

Meetings of the Supervisory Board and its four committees are called by their respective chairs and independently, at the request of one of their members or the Board of Executive Directors. The shareholder and employee representatives of the Supervisory Board prepare for Supervisory Board meetings in separate preliminary discussions. Resolutions of the Supervisory Board are passed by a simple majority vote of the participating Supervisory Board members. In the event of a tie, the vote of the chair of the Supervisory Board, who must always be a shareholder representative, gives the casting vote. This resolution process is also applicable for the appointment and dismissal of members of the Board of Executive Directors by the Supervisory Board. Resolutions can, as needed, also be made in writing or through electronic communication outside of the meetings, as long as no Supervisory Board member objects to this form of passing a resolution. The Supervisory Board meets regularly even without the Board of Executive Directors.

The Board of Executive Directors continually informs the Supervisory Board about matters such as the course of business and expected developments, the results of operations, net assets and financial position, material acquisition and divestiture projects, corporate planning, the implementation of the corporate strategy, including the sustainability strategy, business opportunities and risks as well as risk and compliance management and the internal control system. The Supervisory Board has embedded the main reporting requirements in an information policy. The chair of the Supervisory Board is in regular contact with the Board of Executive Directors, especially with its chair, outside of meetings as well.

A list of the members of BASF SE's Supervisory Board indicating which members are shareholder or employee representatives and their appointments to the supervisory bodies of other companies can be found from page 143onward.

• For more information on the Supervisory Board's information policy, seebasf.com/rules-of-procedure

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• Additional information on the compensation of the Supervisory Board can be found atbasf.com/compensationreport.
• The Statutes of BASF SE and the Employee Participation Agreement can be found atbasf.com/statutesand basf.com/en/corporategovernance.

Personnel Committee

Members

Prof. Dr. Stefan Asenkerschbaumer2 (Chairman)

Dr. Kurt Bock2

Prof. Dr. Thomas Carell2

Tatjana Diether2

Sinischa Horvat2

Michael Vassiliadis

Duties

• Prepares the appointment of members to the Board of Executive Directors by the Supervisory Board as well as the service contracts to be entered into with members of the Board of Executive Directors
• When making recommendations for appointments to the Board of Executive Directors, considers professional qualifications, international experience and leadership skills as well as long-term succession planning, diversity, and especially the appropriate consideration of women
• Prepares the resolutions made by the Supervisory Board with regard to the system and amount of compensation paid to members of the Board of Executive Directors

Audit Committee

Members

Alessandra Genco2 (Chairwoman)

Tatjana Diether2

Tamara Weinert2

Michael Vassiliadis

Duties

• Prepares the negotiations and resolutions of the Supervisory Board for the approval of the Financial Statements, the Consolidated Financial Statements and the Management's Reports, including the Nonfinancial Statements and sustainability reporting and discusses the Quarterly Statements and the Half-Year Financial Report with the Board of Executive Directors prior to their publication
• Deals with monitoring the accounting process, the annual audit, including sustainability reporting and its audit, the appropriateness and effectiveness of the internal control system, the risk management system, the internal auditing system and compliance management system as well as compliance issues, including compliance with statutory regulations and internal environmental, health and safety regulations (EHS compliance)
• Is responsible for business relations with the company's auditor and the auditor of the company's sustainability report: prepares the Supervisory Board's proposal to the Annual Shareholders' Meeting regarding the selection of an auditor for the Annual and Consolidated Financial Statements and the audit review of the Half-Year Financial Report, monitors the auditor's independence, defines the focus areas of the audit together with the auditor, discusses the audit risk, audit strategy and audit plan with the auditor, negotiates auditing fees, evaluates the quality of the annual audit, and establishes the conditions for the provision of the auditor's nonaudit services; the chair of the Audit Committee regularly discusses this with the auditor outside of meetings as well and reports to the Committee on such discussions; the Audit Committee regularly consults with the auditor, even without the Chief Financial Officer or another member of the Board of Executive Directors.

• Classified by the Supervisory Board as an "independent" member of the Supervisory Board (see page 122for the criteria used to determine independence)

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• Deals with post-audits of key acquisition and investment projects
• Is responsible for monitoring the internal process of identifying related party transactions and ensuring adherence to statutory approval and disclosure requirements; grants approval of related party transactions
• Is authorized to request any information that it deems necessary from the auditor or from the Board of Executive Directors and has a direct right to information from the heads of the units of the Corporate Center such as Corporate Audit or Corporate Compliance; can also view all of BASF's business documents and examine these and all other assets belonging to BASF. The Audit Committee can also engage experts such as auditors or lawyers to carry out these inspections.

Special expertise in the areas of the annual audit and accounting

The Audit Committee includes two members with expertise (special knowledge and experience within the meaning of the German Corporate Governance Code) in the fields of accounting and auditing. The Chairwoman of the Audit Committee, Alessandra Genco, has deep expertise in accounting, including sustainability reporting, due to her studies in economics, her professional experience working for financial institutions and her current role as chief financial officer of a publicly listed international company based in the EU. Tamara Weinert has special expertise in the field of auditing, including the audit of sustainability reporting, and accounting expertise due to her former role as the Chief Financial Officer for EMEA at Outokumpu and her professional activities in the finance departments of various companies around the world. Both closely monitor current developments in sustainability reporting, particularly the European regulations of the Corporate Sustainability Reporting Directive (CSRD), and its auditing and actively contribute this expertise to the Supervisory Board and Audit Committee.

Nomination Committee

Members

Dr. Kurt Bock3 (Chairman)

Prof. Dr. Stefan Asenkerschbaumer3

Prof. Dr. Thomas Carell3

Liming Chen3

Alessandra Genco3

Tamara Weinert3

Duties

• Identifies suitable individuals for the Supervisory Board based on objectives for the composition decided on by the Supervisory Board
• Prepares the recommendations made by the Supervisory Board for the election of Supervisory Board members representing the shareholders by the Annual Shareholders' Meeting

• Classified by the Supervisory Board as an "independent" member of the Supervisory Board (see page 122for the criteria used to determine independence)

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