Slide 1: Sika – Committed to Sustainable Performance
SIKA – COMMITTED TO SUSTAINABLE PERFORMANCE NOVEMBER 2022
Slide 2: Table of Contents
TABLE OF CONTENTS 01 CORPORATE GOVERNANCE - STRUCTURES AND RESPONSIBILITIES 02 STRONG CORPORATE CULTURE 03 SIKA IS COMMITTED TO SUSTAINABILITY 04 PRODUCT SUSTAINABILITY 05 SOCIAL RESPONSIBILITY 06 REMUNERATION – WELL-BALANCED COMPENSATION SYSTEM 07 LINKS & ANNEX 2
Slide 3: Corporate Governance – Structures and Responsibilities
CORPORATE GOVERNANCE – STRUCTURES AND RESPONSIBILITIES
Slide 4: Commitment to Openness and Transparency
CORPORATE GOVERNANCE COMMITMENT TO OPENNESS AND TRANSPARENCY Good Corporate Sika provides information on Governance safeguards the Good Openness structures, processes, areas company sustainable Corporate and of responsibility, procedures, development and Governance transparency rights and obliga
Slide 5: Compliant with Standards and Regulations
CORPORATE GOVERNANCE COMPLIANT WITH STANDARDS AND REGULATIONS Adheres to the SIX Swiss Exchange’s Directive on Information Relating to Corporate Governance Follows the principles of the Swiss Code of Best Practice for Corporate Governance Aligned with various international frameworks (GRI, CDP
Slide 6: Corporate Governance Framework
CORPORATE GOVERNANCE FRAMEWORK STRUCTURES AND RESPONSIBILITIES ARTICLES OF ASSOCIATION CODE OF CONDUCT VALUES & PRINCIPLES ORGANIZATIONAL RULES ANNUAL GENERAL MEETING BOARD OF DIRECTORS CEO ASIA/PACIFIC EMEA AMERICAS CONSTRUCTION FINANCE HR & COMPLIANCE INNOVATION & SUSTAINABILITY OPERATIONS, QUALIT
Slide 7: Code of Conduct (CoC)
CODE OF CONDUCT (COC) SIKA CULTURE: INTEGRITY AND ETHICAL CONDUCT Based on Sika’s Values and Principles, available in 44 languages, read and signed by newly hired employees Revised version approved by the BoD and launched in September 2022*, underscoring the strong commitment to sustainable deve
Slide 8: Supplier Code of Conduct (SCoC)
SUPPLIER CODE OF CONDUCT (SCOC) RESPONSIBLE SOURCING Commitment to high ethical standards and sustainability Recurring evaluation and screening processes in place Requirements include compliance with the following standards: Universal Declaration of Human Rights The core conventions of the
Slide 9: Responsible Sourcing: Together for Sustainability
RESPONSIBLE SOURCING ENGAGEMENT IN “TOGETHER FOR SUSTAINABILITY” Initiative based on the UN Global Compact and Responsible Care® principles Sika is a member since 2020 Active collaboration to assess the sustainability performance and positively impact its progress within the supply chain of th
Slide 10: Board Composition and Succession Planning
BOARD RESPONSIBILITIES BOARD COMPOSITION AND SUCCESSION PLANNING The Nomination and Compensation Committee (NCC) holds the responsibility for the succession planning. The duties of NCC includes: Identification and assessment of potential BoD candidates based on predefined criteria Yearly assessm
Slide 11: Board Composition and Succession Planning
BOARD RESPONSIBILITIES BOARD COMPOSITION AND SUCCESSION PLANNING The composition of the Board of Directors should represent the necessary skills, qualifications, and diversity to be able to perform the required duties. Information on key skills and experience of the individual Board members is ava
Slide 12: Risk Management
BOARD RESPONSIBILITIES RISK MANAGEMENT All risks are assessed in terms of a few basic questions: Is the risk global or regional in scope? How high is the probability of losses occurring? What implications does the risk have for the What measures need to be implemented to group? prevent the risk to
Slide 13: Risk Management Along the Entire Value Chain
RISK MANAGEMENT RISK MANAGEMENT ALONG THE ENTIRE VALUE CHAIN Sika’s risk management process is reviewed and updated on a regular basis, allowing the company to better identify potential risks and secure well-structured mitigation practices. Sika continues to use this risk management process string
Slide 14: Risk Management Focus: Climate Change
RISK MANAGEMENT FOCUS: CLIMATE CHANGE Evaluating climate-related risks and opportunities related to its business and developing appropriate response measures, as required by the TCFD recommendations, are of vital importance to ensure long-term sustainable performance and the business continuity of
Slide 15: Capital Allocation for Sustainable Growth
BOARD RESPONSIBILITIES CAPITAL ALLOCATION FOR SUSTAINABLE GROWTH The strategic planning of capital allocation aims to ensure Sika’s sustainable growth. It is a well-balanced approach which considers the interests of all stakeholders and all drivers for growth and profitability Investments in R&D f
Slide 16: Reliable and Continuous Dividend Payout
CAPITAL ALLOCATION RELIABLE AND CONTINUOUS DIVIDEND PAYOUT Sika’s growth strategy is sustainable. Sales and profits continuously increase. Sika has been able to raise the dividend year after year, proving benefits to shareholders and a sign of reliability 3.50 PERIOD 2012-2021: 3.00 Average payo
Slide 17: Strong Corporate Culture
STRONG CORPORATE CULTURE ® BUILDING TRUST Bs
Slide 18: Sika's Values and Principles
STRONG CORPORATE CULTURE SIKA’S VALUES AND PRINCIPLES Sika’s Values and Principles are the foundation for the Code of Conduct They are put into action through strong leadership and by all employees every day, worldwide Customer first Courage for innovation Sustainability & Integrity Empowerment
Slide 19: Values and Principles: Customer First
VALUES AND PRINCIPLES CUSTOMER FIRST Listen to customers, understand their needs and provide them with solutions that give them a real advantage – keep customers’ success in mind Provide and maintain highest quality standards Build long-lasting and mutually beneficial relationships Provide p
Slide 20: Values and Principles: Courage for Innovation
VALUES AND PRINCIPLES COURAGE FOR INNOVATION Sustainability is an integral part of the innovation process and development of new products Innovation management with focus on the Sika Product Creation Process Close alignment with customer and market needs Actively challenge and accept being c
Slide 21: Values and Principles: Sustainability & Integrity
VALUES AND PRINCIPLES SUSTAINABILITY & INTEGRITY Comply with Sika’s Code of Conduct Align daily business with Sika sustainability strategy Act with respect and responsibility towards all stakeholders Operate with strong focus on safety, quality, environment, fair treatment, social involvemen
Slide 22: Values and Principles: Empowerment & Respect
VALUES AND PRINCIPLES EMPOWERMENT & RESPECT Decentralized, flat organization, decision power delegated very close to customers Believe in the competence and entrepreneurial spirit of employees Train and develop local people. Mainly local nationals running country organizations Foster trustin
Slide 23: Values and Principles: Manage for Results
VALUES AND PRINCIPLES MANAGE FOR RESULTS Aim for success, outstanding results and outperformance Pursue vision and targets with long-term view Functions and projects are clearly assigned, clear accountability Transparent performance management focused on well-defined KPIs Benchmarking/Best
Slide 24: High Employee Loyalty and Engagement
STRONG CORPORATE CULTURE HIGH EMPLOYEE LOYALTY AND ENGAGEMENT Sika Senior Management roles are normally filled in-house or with managers joining from acquisitions The long-term employee prospects and the corporate culture are among the reasons behind Sika’s low employee turnover Sika is proud
Slide 25: Global but Local: Sika Strategy and Decentralized Implementation
GLOBAL BUT LOCAL THE SIKA STRATEGY AND ITS DECENTRALIZED IMPLEMENTATION 8 >8 25
Slide 26: Employee Survey Confirms Loyalty and Engagement
STRONG CORPORATE CULTURE EMPLOYEE SURVEY CONFIRMS LOYALTY AND ENGAGEMENT Group-wide employee survey conducted in 2019 with a response rate of 78% (14,600 employees) The overall result of the survey showed an extremely high engagement rate with 86 index points out of 100 HIGHLIGHTS EMPLOYEE SUGGEST
Slide 27: Sika Day
STRONG CORPORATE CULTURE SIKA DAY Sika Day 2021 Together, we are committed to leadership, diversity and integrity. Sika Day 2022 We promote a safety culture. Never compromising on safety to protect our people. 27
Slide 28: Talent Development Is Key
EMPLOYEE ENGAGEMENT TALENT DEVELOPMENT IS KEY Consistent employee development with leadership programs on global, regional, and local level as well as for young talents 17,741 Sika learners reached with online trainings in 2021 25.2% women in talent pool 28
Slide 29: Diversity on All Levels
EMPLOYEE ENGAGEMENT DIVERSITY ON ALL LEVELS Commitment of 23.2% 45 Sika leaders female employees nationalities among Senior Managers Build an inclusive and attractive environment Non-discriminatory practices in Balanced age employment Equal opportunities in the recruit- structure 25.0% ment pr
Slide 30: Distribution of Women in Sika
GENDER DIVERSITY DISTRIBUTION OF WOMEN IN SIKA Representation of women in total work force: 23.2% Representation of women according to level Representation of women according to function Above-average Below-average Company Management 19.6% (incl. Senior Managers and local Company Mgmt Teams) represe
Slide 31: Gender Diversity: Examples of Initiatives
GENDER DIVERSITY ATTRACT, ENGAGE AND PROMOTE – EXAMPLES OF INITIATIVES Attract Engage Promote Employer Value Campaign: LATAM: programs for talented Talent list: strong focus on employee testimonials featuring women working in finance and gender diversity on Sika’s talent women in management an
Slide 32: Sika Is Committed to Sustainability
SIKA IS COMMITTED TO SUSTAINABILITY
Slide 33: Sustainable Profitable Growth
SIKA IS COMMITTED TO SUSTAINABILITY SUSTAINABLE PROFITABLE GROWTH Very low CO2 emissions: Strong corporate culture 17.6kg per ton sold in 2021 with extremely high engagement rate and low employee fluctuation (Scope 1&2) Significant contribution to a more sustainable Strong local engagement as well a
Slide 34: Sika's Growth Strategy 2023
SIKA’S GROWTH STRATEGY 2023 SUSTAINABILITY AS A BASIC PRINCIPLE OF THE STRATEGY SUSTAINABILITY Market Penetration 6-8% annual growth 15-18% EBIT margin Until 2020: <15% Innovation Operational Efficiency 25% of sales with new >10% products Operating free cash flow per year as % of net sales Acquisiti
Slide 35: Sustainability Is at the Center of What We Do (1/2)
SUSTAINABILITY STRATEGIC TARGETS SUSTAINABILITY IS AT THE CENTER OF WHAT WE DO (1/2) Sustainability targets 2019-2023 Performance 2019-2021 CLIMATE PERFORMANCE 12% reduction of CO2eq emissions per ton sold –34.6% reduction of CO2eq emissions per ton (scope 1 and 2) sold (scope 1 and 2) ENERGY
Slide 36: Sustainability Is at the Center of What We Do (2/2)
SUSTAINABILITY STRATEGIC TARGETS SUSTAINABILITY IS AT THE CENTER OF WHAT WE DO (2/2) Sustainability targets 2019-2023 Performance 2019-2021 SUSTAINABLE SOLUTIONS All new product developments with «Sustainable Higher performance with additional Solutions» until 2023 sustainability targets COMMUNI
Slide 37: Governance: Leadership and Responsibilities
GOVERNANCE LEADERSHIP AND RESPONSIBILITIES Board of Directors Sustainability Committee (Board level) Head of Group Management Procurement Chief Innovation and Head of HR and Chief Financial Officer Sustainability Officer Compliance ESG Controlling / Sustainability Committee M&A (Internal) Controllin
Slide 38: Materiality Analysis 2022
GOVERNANCE MATERIALITY ANALYSIS 2022 The Materiality Matrix 2022 was approved by the Board of Directors in May 2022 Source: Sika Materiality Analysis 2022_Summary Report 38
Slide 39: Partnerships Overview
PARTNERSHIPS OVERVIEW REPORTING STANDARDS AND FRAMEWORKS INITIATIVES INDICES MEMBERSHIP OF ASSOCIATIONS RATINGS Source: Partnerships (sika.com) 39
Slide 40: Alignment with UN SDGs
PARTNERSHIPS ALIGNMENT WITH UN SDGS Source: UN SDGs (sika.com) 40
Slide 41: Partnerships: Together for Sustainability
PARTNERSHIPS TOGETHER FOR SUSTAINABILITY Sustainability is a combined effort across the value chain. Therefore, Sika needs to partner up, leverage critical mass and expertise of the group WS 2: TfS Assessments WS 3: TfS Audits WS 1: Governance and Partnerships Improve & further develop TfS Improve &
Slide 42: Together for Sustainability – WS5
PARTNERSHIPS TOGETHER FOR SUSTAINABILITY – WS5 The TfS Workstream 5 Scope 3 Greenhouse Gas Emissions (GHG) is composed of four work packages: 1. Product Carbon Footprint (PCF) Guideline: promote PCF Guideline with chemical industry suppliers and ensure acquisition of supplier-specific data for inp
Slide 43: Partnerships: WBCSD
PARTNERSHIPS WBCSD Since 2010, Sika has been a member of the World Business Council for Sustainable Development (WBCSD) In 2022, Sika has started working with WBCSD and other leading companies across all industries in the SOS 1.5 project on climate value accounting (CVA) There is not an establ
Slide 44: Partnerships: TNFD
PARTNERSHIPS TNFD Since September 2022, Sika is supporting the Taskforce on Nature-related Financial Disclosures (TNFD) and joined the TNFD Forum The TNFD Forum is a global multi-disciplinary consultative group of institutions with over 650 members Sika shares the ambition of the TNFD to devel
Slide 45: Committed to Reach Net Zero No Later Than 2050
SIKA WAY TO NET ZERO COMMITTED TO REACH NET ZERO NO LATER THAN 2050 Sika aims to be a driver of the transformation of the construction and manufacturing industry towards net zero and is committed to the net zero target by 2050 based on SBTi (Science Based Target initiative). Over the next 24 mon
Slide 46: SBTi Submission on September 16, 2022
SIKA WAY TO NET ZERO SBTI SUBMISSION ON SEPTEMBER 16, 2022 46
Slide 47: Sika Net Zero Roadmap: Our Key Levers
SIKA NET ZERO ROADMAP OUR KEY LEVERS Education and capacity building to improve material efficiency and circularity Accelerated use Continued of alternative focus on low carbon operational supplies efficiencies Partnerships Development with key of new innovative suppliers who solutions for support S
Slide 48: Scope 1 & 2 Sika Decarbonization Levers
SCOPE 1 & 2 SIKA DECARBONIZATION LEVERS SIKA SBTI ALIGNMENT SCENARIO Commitment to Net Zero by 2050 - 1.5°C aligned: - 42% by 2032 - 90% by 2050 2022 2050 DECARBONIZATION LEVERS UNTIL 2032 Continuous energy efficiency improvements (e.g. sand drying optimization, more efficient machinery, leaka
Slide 49: Scope 3 Sika Decarbonization Levers
SCOPE 3 SIKA DECARBONIZATION LEVERS SIKA SBTI ALIGNMENT SCENARIO Commitment to Net Zero by 2050 – well below 2°C aligned: - 25% by 2032 2022 2050 - 90% by 2050 DECARBONIZATION LEVERS UNTIL 2032 Decrease upstream and downstream transport emissions Reduce virgin cement and petrochemicals consu
Slide 50: Scope 3 Methodology Paper
METHODOLOGY SCOPE 3 METHODOLOGY PAPER Each category assessed is described in the Methodology Paper SCOPE 1: 156 The calculation of scope 3 carbon emissions is an evolving topic SCOPE 2: 82 based on various data sources SCOPE 3: 12,315 Sika is continuously TOTAL: 12,553 ktCO2-eq reviewing the c
Slide 51: Sika Enables Decarbonization for a Sustainable Future
SIKA ENABLES DECARBONIZATION FOR A SUSTAINABLE FUTURE Construction Huge opportunity as Automotive 40% of global CO2 emissions potential for progress is Road traffic responsible for attributable to construction 20% of global CO2 and building sector immense Sika possesses the solutions and innovative
Slide 52: Net-Zero Roadmap: Cement Replacement in Mortars
EXAMPLE NET-ZERO ROADMAP DEVELOPMENT FOR SIKA CEMENT REPLACEMENT IN MORTARS – BUSINESS CASE To achieve long-term target of -90% for Scope 3 emissions by 2050, Sika needs to find alternative raw materials that would replace virgin cement. 480 The replacement of 1 ton of Portland cement by 1 ton o
Slide 53: Net-Zero Roadmap: PVC Membrane Recycling
EXAMPLE NET-ZERO ROADMAP DEVELOPMENT FOR SIKA PVC MEMBRANE RECYCLING – BUSINESS CASE RECYCLE OF SOLD PRODUCTS Shifting from incineration to recycling reduces emissions: 1.8 kg CO2 eq per 1 kg of PVC Membranes 49 ktons of CO2 PURCHASED GOODS Replacement of fossil-based polymers by recycled membra
Slide 54: reCO2ver – Sika Breakthrough Innovation
EXAMPLE CIRCULAR ECONOMY – SUSTAINABLE DEVELOPMENT reCO2ver® – SIKA BREAKTHROUGH INNOVATION Segregates concrete back to its original ingredients to be re-used reCO2ver® for new high-grade concrete This unique process includes contributes to circular sequestration of CO2 and produces economy in c
Slide 55: Enabling Our Customers to Save CO2 Emissions
EXAMPLE CIRCULAR ECONOMY – SUSTAINABLE DEVELOPMENT ENABLING OUR CUSTOMERS TO SAVE CO2 EMISSIONS UPCYCLING EXISTING STRUCTURES Retaining 98% of the original core Saving time 7,505 tons of CO2 Saving AUD 130,000,000 emissions saved Sika structural strengthening systems were a major factor in t
Slide 56: Our People Drive Our Sustainable Development
OUR COMMITMENT OUR PEOPLE DRIVE OUR SUSTAINABLE DEVELOPMENT NEEDS SKILLS TAKES A TEAM IS AN OPPORTUNITY 56
Slide 57: Product Sustainability
PRODUCT SUSTAINABILITY ® BUILDING TRUST Bs
Slide 58: Product Sustainability: Contribution to Growth Strategy
PRODUCT SUSTAINABILITY CONTRIBUTION TO GROWTH STRATEGY Sustainability is an integral part of Sika’s innovation strategy. A large part of the portfolio contributes with a positive sustainability impact. Sika’s goal is to manage innovation and sustainability, minimizing risks and maximizing opport
Slide 59: More Performance, More Sustainable
PRODUCT SUSTAINABILITY MORE PERFORMANCE, MORE SUSTAINABLE PERFORMANCE Source: Sustainability Portfolio Management 59
Slide 60: SPM – Product Classification
PRODUCT SUSTAINABILITY SPM – PRODUCT CLASSIFICATION SPM Evaluation Sustainable Solutions 12 Sustainability Categories Clear product labeling for SPM assessed products 6 Performance Categories Source: Sustainability Portfolio Management 60
Slide 61: First Products with SPM Classification Launched
PRODUCT SUSTAINABILITY FIRST PRODUCTS WITH SPM CLASSIFICATION LAUNCHED 100% renewable resources SIKAGARD®- SIKAGARD® FIRST BIOMASS-BASED 80% recycled plastics in the packaging 5500 -5500 CONCRETE PROTECTIVE 30% reduced carbon footprint COATING IN THE MARKET LEED accreditation 20% time savi
Slide 62: Solutions to Drive a Sustainable Future
SIKA ENABLES DECARBONIZATION SOLUTIONS TO DRIVE A SUSTAINABLE FUTURE Durability Clinker reduction Roofing By increasing the lifespan of Sika solutions enable high Sika’s wide range of durable buildings, Sika solutions clinker reduction in cement and and long-lasting roofing contribute to carbon conc
Slide 63: Sika Repair Solutions Prolong the Lifetime of Structures
SIKA ENABLES DECARBONIZATION SIKA REPAIR SOLUTIONS PROLONG THE LIFETIME OF STRUCTURES Sika solutions for repair and refurbishment STRENGTHEN, WATERPROOF, INSULATE, PROTECT, AND REPAIR buildings and structures Sika repair systems PROLONGS LIFETIME, INCREASE SAFETY AND ENERGY EFFICIENCY Sika’s offerin
Slide 64: Using Less Water, Concrete, and Cement with Sika Admixtures
SIKA ENABLES DECARBONIZATION USING LESS WATER, CONCRETE, AND CEMENT WITH SIKA ADMIXTURES Sika cement tehnology allows for significant REDUCTION OF CEMENT CONTENT enabling replacement of cement with supplementary cementitious materials (SCM) High-strength concrete with Sika® ViscoCrete® technology co
Slide 65: Energy-Saving, Durable Roofing Solutions
SIKA ENABLES DECARBONIZATION ENERGY-SAVING, DURABLE ROOFING SOLUTIONS Sika supplies highly durable, root resistant Sika solar-reflective membranes for Durable, reliable, and high- membranes for Green Roofs quality products combined with Cool Roofs know-how and expertise reduce energy Reduce urban
Slide 66: Saving Resources with Innovative Roofing Solutions
SIKA ENABLES DECARBONIZATION SAVING RESOURCES WITH INNOVATIVE ROOFING SOLUTIONS Sika Sarnafil® AT is first Cradle to Cradle CertifiedTM Membrane worldwide Recycling of roof membranes saves resources and reduces burden on climate Used roof membranes are retrieved and processed into granular mat
Slide 67: Enabling Construction of Lightweight and Electric Vehicles
SIKA ENABLES DECARBONIZATION ENABLING CONSTRUCTION OF LIGHTWEIGHT AND ELECTRIC VEHICLES LIGHTWEIGHT vehicle construction, multi- Sika heat-conductive adhesives and materials as well as fire protective coatings material design, and ELECTRIC VEHICLES lead to less fuel comsumption and INCREASE SAFETY A
Slide 68: Sika Enables Water Management
SIKA ENABLES WATER MANAGEMENT CLEAN WATER FOR MILLIONS OF PEOPLE 3% of the total water resources is drinkable water to be used by people, of which only 1% is reachable 80% of all wastewater globally is released without treatment 60,000 water dams in 150 countries, many of which need repair S
Slide 69: Social Responsibility
SOCIAL RESPONSIBILITY ® BUILDING TRUST Bs
Slide 70: Occupational Safety Strategic Target
HEALTH AND SAFETY OCCUPATIONAL SAFETY STRATEGIC TARGET In the sustainability strategy Sika has clearly OCCUPATIONAL communicated its safety targets SAFETY Sika employees leave the Sika employees must leave the workplace healthy workplace healthy Sika Vision zero program to improve leadership c
Slide 71: Sika Safety Campaign 2022
HEALTH AND SAFETY SIKA SAFETY CAMPAIGN 2022 71
Slide 72: Community Engagement: Building Trust and Creating Value
COMMUNITY ENGAGEMENT BUILDING TRUST AND CREATING VALUE Focus on three fields of activity: COMMUNITY ENGAGEMENT Buildings and infrastructure We build trust and create Education and vocational training value with customers, communities, and with Water and climate protection societies TARGET 20
Slide 73: Sika Cares Community Engagement Program
COMMUNITY ENGAGEMENT SIKA CARES COMMUNITY ENGAGEMENT PROGRAM Monetary and non-monetary support: products, education, volunteering Thematic Focus Structure Stakeholders Sustainable buildings and better Centralized fund Local residents or area-based infrastructure for social and Owner: CEO gro
Slide 74: Reference Project: Ella Construye, Spain
COMMUNITY ENGAGEMENT REFERENCE PROJECTS ELLA CONSTRUYE, SPAIN ABOUT THE PROJECT Promotion of gender diversity in the construction business. Promote know-how about construction related professions through real experience for women. Objective of the workshops is to approach women to construction-r
Slide 75: Reference Project: Fundación Alianza Suiza, Ecuador
COMMUNITY ENGAGEMENT REFERENCE PROJECTS FUNDACION ALIANZA SUIZA, ECUADOR ABOUT THE PROJECT Sika Ecuador is cooperating with the Fundación Alianza Suiza together with other Swiss multinationals (ABB, Holcim, Nestlé, Novartis, Roche, and Sika). Since 2009, this group of companies has joined effort
Slide 76: Reference Project: Chonburi, Thailand
COMMUNITY ENGAGEMENT REFERENCE PROJECTS CHONBURI, THAILAND ABOUT THE PROJECT The team of Sika Thailand renovated classrooms at the Yan Sue School at the company's Chonburi location. The school comprises five buildings, nine classes, and is designed for 350 students. Thematic Focus SIKA’S CONTRIB
Slide 77: Remuneration – Well-Balanced Compensation System
REMUNERATION – WELL-BALANCED COMPENSATION SYSTEM
Slide 78: Compensation Governance Principles
COMPENSATION GOVERNANCE GOVERNANCE PRINCIPLES There are strong governance principles in place WE DO WE DON’T Conduct an annual review of the compensation policy and Provide discretionary compensation payments programs Reward inappropriate or excessive risk taking or short- Maintain compens
Slide 79: Compensation Benchmarking
COMPENSATION GOVERNANCE COMPENSATION BENCHMARKING Two peer groups are used for different benchmarking purposes in the context of compensation Industrial Swiss listed companies of similar size to Sika in Industrials international companies exposed to similar market terms of market capitalization, rev
Slide 80: Compensation System: Board of Directors
COMPENSATION SYSTEM BOARD OF DIRECTORS (BoD) To strengthen their independence, members of the Board of Directors receive fixed compensation only, paid in cash and restricted share units converted into shares blocked for three years Annual board retainer + Annual committee fees 50% in cash – 50% in c
Slide 81: Compensation System: Group Management
COMPENSATION SYSTEM GROUP MANAGEMENT The compensation system is well-balanced and unique in terms of performance measurement (high proportion of STI and LTI based on performance relative to peers) Performance Time horizon Vehicle Mitigators measurement • Cap on Long-term Absolute + 1 2 3 Equity ince
Slide 82: Total Compensation Approach
TOTAL COMPENSATION APPROACH BoD AND GROUP MANAGEMENT Compensation decisions are made on the basis of a total compensation approach where target compensation is paid for target performance Target compensation is benchmarked against the market median LTI (target) Outperformance results in above-me
Slide 83: Compensation Mix: Group Management
COMPENSATION MIX GROUP MANAGEMENT The compensation system aligns pay with performance without incentivizing excessive risk taking or encouraging unintended behaviors Pay-for-performance Mitigators Cap on incentives (maximum potential at 150% of target) Claw-back and malus provisions in case of fraud
Slide 84: Short-Term Incentive: Group Management
SHORT-TERM INCENTIVE GROUP MANAGEMENT The short-term incentive is an annual cash incentive plan rewarding for company, region and individual performance, which has been successfully in place since 2011. A Group sustainability objective was introduced in 2020 (CO2 emissions reduction target) STI STI
Slide 85: Long-Term Incentive: Group Management
LONG-TERM INCENTIVE GROUP MANAGEMENT Our long-term incentive is a Performance Share Unit (PSU) plan with 3-year cliff vesting conditional upon ROCE and relative TSR performance LTI PSU Vesting = x vesting granted level Maximum vesting level = 150% Relative TSR + ROCE 50% 50% Relative Absolute 85
Slide 86: Long-Term Incentive Performance Measurement
LONG-TERM INCENTIVE PERFORMANCE MEASUREMENT Same approach as in the STI: realistic objective setting and a fair payout formula should align pay and performance and motivate executives to perform outstandingly Payout curve for relative TSR Payout curve for ROCE No vesting below threshold performance
Slide 87: Compensation System Summary
COMPENSATION SYSTEM SUMMARY The BoD is convinced that the current compensation system is appropriate for Sika Compensation of the Board of Directors The compensation system of the Board of Directors strengthens their independence and is aligned with prevalent market practice in Switzerland Governanc
Slide 88: Links & Annex
LINKS & ANNEX ® BUILDING TRUST Bs
Slide 89: Links: Publicly Available Information
LINKS PUBLICLY AVAILABLE INFORMATION (NON-EXHAUSTIVE) Governance Partnerships Board of Directors Partnerships Group Management Together for Sustainability (TfS) Code of Conduct* TfS PCF Guideline 2022 Supplier Code of Conduct WBCSD_SOS 1.5 Together for Sustainability Sika joins T
Slide 90: Annex: Risk Management Along the Entire Value Chain
ANNEX RISK MANAGEMENT ALONG THE ENTIRE VALUE CHAIN 90
Slide 91: Annex: Risk Management Along the Entire Value Chain
ANNEX RISK MANAGEMENT ALONG THE ENTIRE VALUE CHAIN 91
Slide 92: Annex: Risk Management Along the Entire Value Chain
ANNEX RISK MANAGEMENT ALONG THE ENTIRE VALUE CHAIN 92
Slide 93: Annex: Risk Management Along the Entire Value Chain
ANNEX RISK MANAGEMENT ALONG THE ENTIRE VALUE CHAIN 93
Slide 94: Annex: Risk Management Along the Entire Value Chain
ANNEX RISK MANAGEMENT ALONG THE ENTIRE VALUE CHAIN 94
Slide 95: Annex: Risk Management Along the Entire Value Chain
ANNEX RISK MANAGEMENT ALONG THE ENTIRE VALUE CHAIN 95
Slide 96: Annex: Risk Management Along the Entire Value Chain
ANNEX RISK MANAGEMENT ALONG THE ENTIRE VALUE CHAIN 96
Slide 97: Annex: Risk Management Along the Entire Value Chain
ANNEX RISK MANAGEMENT ALONG THE ENTIRE VALUE CHAIN 97
Slide 98: Annex: Risk Management Along the Entire Value Chain
ANNEX RISK MANAGEMENT ALONG THE ENTIRE VALUE CHAIN 98
Slide 99: Annex: Risk Management Along the Entire Value Chain
ANNEX RISK MANAGEMENT ALONG THE ENTIRE VALUE CHAIN 99
Slide 100: Annex: Focus on Eight UN SDGs
ANNEX FOCUS ON EIGHT UN SDGs 100
Slide 101: Annex: Focus on Eight UN SDGs
ANNEX FOCUS ON EIGHT UN SDGs 101
Slide 102: Annex: Focus on Eight UN SDGs
ANNEX FOCUS ON EIGHT UN SDGs 102
Slide 103: Annex: Focus on Eight UN SDGs
ANNEX FOCUS ON EIGHT UN SDGs 103
Slide 104: Thank You
THANK YOU ® BUILDING TRUST Bs
Slide 105: Forward-Looking Statement
FORWARD-LOOKING STATEMENT This presentation contains certain forward-looking statements. These forward-looking statements may be identified by words such as ‘expects’, ‘believes’, ‘estimates’, ‘anticipates’, ‘projects’, ‘intends’, ‘should’, ‘seeks’, ‘future’ or similar expressions or by discussion o