Directors’ Report and Operating Review – Remuneration Report Feature Description Determination of STI pool The pool determination metrics align with WHSP’s strategic goals to maximise shareholders’ returns. Objective Net Cash Flow From Investments per share Weighting Threshold (80%) Target (100%) Outperformance 50% > 0% and < 4% higher than previous year 4% to < 5% higher than previous year 5% to < 6% = 110% 6% to < 7% = 120% 7% to < 8% = 130% 8% to < 9% = 140% 9% and higher = 150% As dividends are paid out of parent company cash, increasing net cash inflows enable the payment of increasing dividends. Adjusted Net Asset Value (post tax) per share 50% > 0% and < 2% higher than ASX200 Accumulation Index (adjusted for tax) 2% to < 3% higher than ASX200 Accumulation Index (adjusted for tax) 3% to <4% = 110% 4% to < 5% = 120% 5% to < 6% = 130% 6% to < 7% = 140% 7% and higher = 150% Increases in net asset value per share contributes to increases in the WHSP share price. Entitlement to the STI pool Once the STI pool is established by the financial measures described above, the PCRC determines each KMP entitlement to an STI based on individual performance, and the STI pool to be allocated to remaining eligible participants based on management assessment of individual performance. Individual STIs are determined having regard to achievements throughout the year against a number of KPIs. The KPIs encompass a range of financial and non-financial objectives relevant to each participant’s role. See page 44 for KPI categories for KMP. The total of all STIs determined by the PCRC cannot exceed the STI pool. Delivery of STI 100% of the STI awarded is paid in cash following release of the year end results. Board Discretion The Board retains discretion to increase or decrease the STI pool. In exercising this discretion the Board shall take into account, amongst other factors it considers relevant, Company performance from the perspective of shareholders over the relevant year as well as individual performance. Long term incentive plan (LTI Plan) Washington H. Soul Pattinson and Company Limited Rights Plan (LTI plan) The LTI plan was approved by shareholders at the 2017 WHSP AGM. It was designed to reward participants for above market performance over the long term by granting rights that are subject to a TSR and a NAPSG performance condition measured over three years (Vesting Conditions). Staff participate, at the Board’s discretion, in the LTI plan comprising annual grants of performance rights. 48 Feature Description KMP Allocation Reassessed each year based on each individual KMP’s target performance. Target: 100% of Chief Executive Officer’s fixed remuneration for FY23 Target: 75% of Chief Financial Officer’s fixed remuneration for FY23 Number of Performance Rights Number of Rights = Stretch LTI Value ÷ Right Value Where: Stretch LTI Value = Fixed Remuneration x Target LTI % ÷ Target Vesting % Target vesting = 50% Right Value = Share Price – (Annual Dividend x Measurement Period in Years) Share Price = The volume weighted average share price over the 14 days prior to the fifteenth day following the announcement of the previous financial year results of the Company As 100% of Rights to be granted will only vest when stretch performance goals are achieved, it is expected that a lesser percentage will actually vest unless exceptional performance is achieved. Washington H. Soul Pattinson and Company Limited Annual Report 2023