Company: SNY
Filing Date: 2025-02-13
Form Type: 20-F
Source: 0001121404-25-000010
Chunk: 226

Company: Sanofi
Filing Date: 2025-02-13
Form: 20-F
Chunk 226
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 of variable compensation, and cannot compensate for underperformance on quantitative criteria. Payment of annual variable compensation in a given year in respect of the previous year is contingent on a favorable shareholder vote at the Annual General Meeting. Equity-based compensation The Chief Executive Officer’s equity-based compensation, which can only be in the form of performance shares, may not exceed 250% of his target short-term compensation (fixed plus variable). The Chief Executive Officer’s equity-based compensation is contingent upon attainment of exacting performance conditions, all of them quantitative, measured over a three-year-period. Such awards ar e contingent upon both: • internal criteria based upon: – business earnings per share (business EPS), free cash flow (FCF), and development of the R&D pipeline, – Affordable Access and Planet Care – extra-financial criteria; and • an external criterion based on Sanofi's total shareholder return (TSR) relative to a benchmark panel of the 12 leading global pharmaceutical companies: Amgen, AstraZeneca plc, Bayer AG, Bristol-Myers Squibb Inc., Eli Lilly and Company Inc., GlaxoSmithKline plc, Johnson & Johnson Inc., Merck Inc., Novartis AG, Novo Nordisk, Pfizer Inc., and Roche Holding Ltd. As indicated in our currently applicable performance share plans, our Board of Directors reserves the right to adjust, both upwards and downwards and within the limits of policy, the performance conditions in exceptional circumstances justifying such an adjustment (if the Compensation Committee so advises), and specifically in the event of (i) a change in the structure of the Sanofi group, (ii) a change in accounting policy, or (iii) any other circumstances that would justify such an adjustment, in the opinion of our Board of Directors. The purpose of such an adjustment would be to ensure that the results of applying performance conditions reflect the above-mentioned changes. Any such adjustments would be justified and disclosed ex-post in our annual report on Form 20-F. Acting on a proposal from the Compensation Committee, the Board of Directors has sought to maintain common criteria for annual variable compensation and equity-based compensation, in order to ensure that short-term performance does not come at the expense of long-term performance. The valuation of performance shares is calculated at the date of grant, weighted between (i) fair value determined using the Monte Carlo model and (ii) the market price of Sanofi shares at the date of grant, adjusted for dividends expected during the vesting period. Each award to our Chief Executive Officer takes into account