Danone // 2020 Universal Registration Document

6 corporate governance 6.3 Compensation and benefits of governance bodies DANONE UNIVERSAL REGISTRATION DOCUMENT 2020 259 As a result, the total compensation granted and paid to the Chairman and Chief Executive Officer in 2020 is consistent with Danone’s compensation policy, insofar as it is: • fixed by the Board of Directors on the recommendations of the Governance Committee; • subject to the approval of the Shareholders’ Meeting on April 29, 2021; • consistent with the caps set in the compensation policy approved by the Shareholders’ Meeting on June 26, 2020; • dependent on the performance condition fulfillment level, which is reviewed and validated by the Board of Directors on the re- commendation of the Governance Committee. Evolution of compensations, equity ratios and Company's performance over the last five years In accordance with Article L.22-10-9 of the French Commercial Code (formerly Article L.225-37-3), the ratios between the level of compensation of the Chairman and Chief Executive Officer (who was Chief Executive Officer until 2017) and of the Chairman of the Board of Directors (until 2017) and the average andmedian compensation of Danone SA employees over the last five years are presented below. The following table reflects the changemade to Danone’s governance effective November 30, 2017: from 2016 to 2017, Mr. Franck RIBOUD was the Chairman of the Board and Mr. Emmanuel FABER was the Chief Executive Officer. Since December 1, 2017, Mr. Emmanuel FABER has been the sole corporate officer (Chairman and Chief Executive Officer). For calculation purposes, their respective 2017 compensation amounts up to November 30 have been annualized. Methodology The ratios have been established by applying themethod proposed by the AFEP in its guidelines published on January 28, 2020. They have been calculated on a full-time equivalent basis and for the Danone SA scope, which has employed an average of 779 employees over the last five fiscal years. The number of employees taken into account for the calculations is based on employees present at December 31 of year N and December 31 of the previous fiscal year, thus ensuring stability over time of the reference sample. Compensation components considered The components of corporate officer compensation taken into account are: • the fixed compensation paid in year N; • the annual variable compensation paid in year N for the previous fiscal year; • the valuation on the grant date of the performance shares granted during the fiscal year, in accordance with IFRS 2; • until 2019, the last year in which GPU were paid, the GPU paid in year N. This compensation was taken into account on a gross basis, including employer contributions and excluding profit-sharing. The amounts corresponding to these compensation components are presented above in the Summary of the financial position of the Chairman and Chief Executive Officer section and, for fiscal years 2016 to 2018, in the 2017 and 2018 registration documents in section 6.3 Compensation and benefits of governance bodies . The components of employee (full-time-equivalent) compensation taken into account are: • the fixed salary paid in year N; • the annual variable compensation paid in year N for the previous fiscal year; • the valuation on the grant date of the performance shares granted during the fiscal year, in accordance with IFRS 2. Benefits in kind, of which the amounts paid to the executive corporate officer are presented in the section Summary of the financial position of the Chairman and Chief Executive Officer above, are not taken into account in the components of corporate officers and employees compensation, given that their amounts are not material. Definition of employees The ratios presented below were calculated taking into account only those employees who have entered into a permanent or fixed-term employment contract with Danone SA and who were continuously employed by the Company from January 1 to December 31 of the fiscal year in question. Employees who have entered into a part- time employment contract with the Company, as well as expatriate employees, were not included for the purposes of these calculations. Company performance The table below also shows, in accordance with the provisions of Article L.22-10-9 of the French Commercial Code, the annual evo- lution of the Company’s performance over the last five fiscal years, according to two additional criteria: • an economic criterion, which is the current net earnings per share, corresponding to the ratio between the recurring net income and the Group share adjusted for hybrid financing divided by the diluted number of shares; and • an ESG criterion, consisting of Danone’s rating established by CDP under its Climate Change program, in line with the commitments made by Danone as part of its “One Planet. One Health” vision. The Carbon Disclosure Project (CDP) is a Non-Governmental Organization that assesses the environmental management of companies, cities and states relative to the risks and opportuni- ties involved in climate change, water and deforestation. CDP is recognized as the leading climate change assessment platform for investors. More than 8,000 companies, representing more than half of world capitalization, send their environmental per- formance data to CDP. Only 2% of companies have an “A” rating on climate change. This “A” rating is only available to businesses that can justify the quality of their carbon footprint metric and robust reduction plans throughout their value chain.