Committees of the Board of Directors

The Chair of the Board of Directors and the Board of Directors are assisted in the performance of their duties by three permanent Committees: the Audit Committee, the Compensation & Nomination Committee (CNC) and the Sustainability Committee. The Board of Directors may decide at any time – by a majority decision – to set up further or dissolve existing Committees (except for the CNC, which is a committee required by statutory law). The Committees meet on the invitation of their chair as often as business requires, usually immediately before or after an ordinary meeting of the Board of Directors. The practices of the Committees are governed by the respective Committee Charters, which are available on the website of Chocoladefabriken Lindt & Sprüngli AG. Otherwise, the rules applicable to the Board of Directors apply mutatis mutandis to the meetings of the Committees.

• Audit Committee Charter
• Compensation and Nomination Committee Charter
• Sustainability Committee Charter

Audit Committee

The Audit Committee consists of at least three independent members of the Board of Directors, whereby the Chair of the Board of Directors may not be the chair of the Audit Committee. Of the members of the Audit Committee, at least two members must possess substantial expertise and experience in finance and accounting (financial literacy). The other(s) must be familiar with the matters of accounting and audit. The members of the Audit Committee are appointed by the Board of Directors. As of December 31, 2023, the members of the committee were: Dr Thomas Rinderknecht (chair), Dkfm Elisabeth Gürtler and Dr Dieter Weisskopf. The members of the Audit Committee possess sufficient experience and professional knowledge in the areas of finance and risk management to enable them to perform their tasks effectively.

The Audit Committee supports the Board of Directors in its duties, particularly with respect to the main areas of audit, completeness and accuracy of the financial statements, assessment and monitoring of audit findings, compliance with statutory requirements regarding the qualification of the statutory auditor and the individual auditors (including their independence), the performance of the statutory auditor and the risk management of the Group. In addition, the Audit Committee assesses the quality of the financial reporting and the effectiveness of the internal control systems and reviews the internal audit program. The Audit Committee regularly assesses the status of compliance with laws and regulations within the company and reviews the effectiveness of internal processes in this regard. It ensures ongoing communication with the statutory auditor. It also scrutinizes the Group’s risk management principles and the appropriateness of risks taken, particularly in the areas of investments, currencies, raw material procurement, and liquidity. The Audit Committee further assists the Board of Directors in fulfilling its oversight responsibilities relating to the internal audit function.

The Audit Committee reviews the annual financial statements of the company and the consolidated financial statements of the Group for the attention of the Board of Directors and makes a proposal to the Board of Directors regarding their approval and submission for approval to the Annual General Meeting. The Audit Committee reviews and discusses any potential fraud or fraudulent activities, whether or not material, that involve members of the Board of Directors, members of the Group Management or other employees who have a significant role in the Group’s internal controls. Further, the Audit Committee ensures that the Board of Directors is fully informed in the areas the Audit Committee oversees. Additionally, the Audit Committee, with respect to the sustainability report, or, once integrated in the Annual Report, with respect to sustainability reporting, assesses the accuracy, completeness and compliance of sustainability related financial disclosures and the non-financial disclosures, which are subject to audit or assurance, and provides recommendations with regard to the approval to the Sustainability Committee. Similarly, the Audit Committee assesses the accuracy, completeness and compliance of the financial aspects of the Compensation Report that are subject to audit, and provides recommendations with regard to the approval to the CNC. The Audit Committee undertakes preparatory tasks and makes recommendations to the Board of Directors for important decisions in the areas discussed above, such as approval of risk management principles, adoption of the annual financial statements or proposals for the appointment of the statutory auditor. It discusses the CFO’s reporting on the risks taken, on risk-limiting measures, and on the justifiability of the risks taken and reviews the regular risk reports. The Audit Committee itself has, except for the enactment and amendments of the Group Approval Policy, no decision-making powers. It may, however, decide independently to entrust the statutory auditor with special assignments and approve the fee budget for audit tasks submitted by the statutory auditor. The Audit Committee itself does not perform any direct professional auditing.

A detailed description of the Audit Committee’s duties is included in the Audit Committee Charter, which is available on the website of Chocoladefabriken Lindt & Sprüngli AG.

• Audit Committee Charter

The committee meets as often as business requires, but at least four times a year. The actual number of meetings (including physical meetings and conference calls) held and the number of written resolutions taken, if any, by the Audit Committee in the reporting year, as well as information regarding the average attendance by the members, is set out below (meetings, duration and attendance). Members of the Group Management and other members of the Board of Directors regularly attended the meetings of the Audit Committee. The statutory auditor attended two meetings of the Audit Committee. The statutory auditor’s direct access to the Audit Committee is guaranteed at all times. No external consultants took part in meetings of the Audit Committee. All minutes of the Audit Committee are made available to all members of the Board of Directors. The chair of the Audit Committee also reports to the Board of Directors after each meeting of the Audit Committee in the form of a brief summary of the Audit Committee’s activities and findings.

• Information regarding the statutory auditor

Compensation & Nomination Committee (CNC)

According to the Articles of Association and the CNC Charter, the CNC consists, subject to the election of its members by the General Meeting, of a minimum of three and of a maximum of five members of the Board of Directors, the majority of whom shall be independent. The members of the CNC are annually elected by the Annual General Meeting on an individual basis and for a term of office until the end of the next Annual General Meeting. In case of an early retirement or withdrawal during the term of office by a member of the CNC, the Board of Directors may appoint a substitute from among its members to serve until the next Annual General Meeting. As of December 31, 2023, the Committee members comprised Monique Bourquin (chair), Dr Rudolf K. Sprüngli, and Silvio Denz. If necessary, the CNC consults external advisors to perform its duties.

The CNC supports the Board of Directors in its function of succession planning of the Board of Directors, regarding the appointment, dismissal and succession planning of the CEO and other members of the Group Management, and matters relating to the compensation of the Board of Directors and the Group Management.

The CNC reviews the company’s compensation policies and programs for market compatibility, effectiveness and compliance with the Articles of Association, the law and best practices, and submits them or any amendments thereto to the Board of Directors for decision or, where required by law or the Articles of Association, submission to the General Meeting for approval. It reviews the Compensation Report, in collaboration with the Audit Committee with respect to financial disclosures and in collaboration with the Sustainability Committee with respect to aspects of sustainability, and makes recommendations to the Board of Directors regarding the approval and submission to the General Meeting.

Furthermore, the CNC undertakes an annual assessment of the independence of the members of the Board of Directors. Unless expressly provided for otherwise, the CNC assists the Board of Directors with preparatory and supporting activities and issues proposals and recommendations to the Board of Directors.

A detailed description of the duties with regard to both succession planning and compensation can be found in the CNC Charter, which is available on the Company’s website.

• Compensation and Nomination Committee Charter

The CNC meets as often as business requires or at the request of any of its members, respectively, but at least three times a year. The actual number of meetings (including physical meetings and conference calls) held and the number of written resolutions taken, if any, by the CNC in the reporting year as well as information regarding the average attendance by the members is set out below (meetings, duration and attendance). The CNC chair may ask members of management or internal or external matter experts to attend the meetings. To the extent that their own compensation is directly affected (unless the discussion and decisions are about the compensation of the Board of Directors in general), the relevant member of the CNC is excluded from discussions and voting. In the reporting year, the CEO attended one meeting of the CNC but excused himself when his own compensation was concerned. All minutes of the CNC are made available to all members of the Board of Directors. The chair of the CNC also reports to the Board of Directors after each meeting of the CNC in the form of a brief summary of the CNC’s activities and findings. The CNC also informs the Board of Directors regularly about the procedure for the determination of compensation and the outcome of the compensation process.

• Information on responsibilities of the Compensation & Nomination Committee

Sustainability Committee

The Sustainability Committee consists of a minimum of three members of the Board of Directors. These may be both independent and non-independent members of the Board of Directors. The members of the Sustainability Committee are appointed by the Board of Directors. As of December 31, 2023, the Committee members comprised Dr Dieter Weisskopf (chair), Silvio Denz and Ernst Tanner.

The Sustainability Committee supports the Board of Directors in setting strategies, targets and internal policies to ensure compliance with applicable legal requirements and the long-term sustainability of the company in its social and environmental aspirations, and taking into consideration the economic dimension. The Sustainability Committee further supports the Board of Directors in setting the strategic direction and sustainability targets for company activities, aligning the financial interests and business strengths of the company, and social and environmental interests.

The Sustainability Committee guides the Board of Directors with regard to setting up a governance structure and internal policies and processes to ensure compliance with applicable laws and the implementation of the social and environmental sustainability targets and strategies. The Sustainability Committee assesses the accuracy, completeness and compliance of the sustainability report, or, once integrated in the Annual Report, the sustainability reporting, in each case with respect to sustainability related financial disclosures and non-financial disclosures that are subject to audit or assurance based on the recommendation of the Audit Committee, and recommends the report(ing) to the Board of Directors for approval, and where applicable, for submission for approval to the Annual General Meeting. It also reviews sustainability-related aspects in the Compensation Report and makes a recommendation regarding the approval to the CNC. Unless expressly provided otherwise, the Sustainability Committee supports the Board of Directors with preparatory and supporting activities and submits proposals and recommendations to the Board of Directors.

A detailed description of the duties can be found in the Sustainability Committee Charter, which is available on the Company’s website.

• Sustainability Committee Charter

The Sustainability Committee meets as often as business requires, but at least three times a year. The actual number of meetings (including physical meetings and conference calls) held and the number of written resolutions taken, if any, by the Sustainability Committee in the reporting year, as well as information regarding the average attendance by the members, is set out below (meetings, duration and attendance). Members of the Group Management and other members of the Board of Directors regularly attended these meetings. No external consultants were present at the meetings of the Sustainability Committee. Matters discussed included a review of sustainability activities in 2022 and an assessment of the Sustainability Plan, approval of the new Double Materiality Assessment (DMA), approval of the new Deforestation Policy, a review of climate change and a review of the company’s human rights risk assessment, together with the effectiveness of its due diligence process in the reporting year. All minutes of the Sustainability Committee are made available to all members of the Board of Directors. The chair of the Sustainability Committee also reports to the Board of Directors after each meeting of the Sustainability Committee in the form of a brief summary of the Sustainability Committee’s activities and findings.

In order to achieve effective sustainability governance, an additional committee has been created at the Group Management level. In this sense, the Executive Sustainability Committee (ESC) is an agile body whose members act as sustainability experts on behalf of the Group Management. As of December 31, 2023, the ESC consisted of the following members: CFO (chair), Group General Counsel and VP Operations. In addition, the Sustainability Leadership Team is a cross-functional body at Group level that meets regularly and is composed of various functions, chaired by the Head of Group Sustainability.

Meetings, duration and attendance

The following table provides an overview regarding the number and duration of meetings held by the Board of Directors and by each standing Committee, together with certain information on attendance by the members of the Board of Directors and the members of the respective Committee.

Annual performance evaluation

The Board of Directors and its permanent Committees undertake an annual self-evaluation of their performance. In the course of this self-evaluation, they are supported accordingly by the CNC.