Frequentis : Consolidated Corporate Governance Report 2023

Consolidated 2023

Corporate Governance Report

Consolidated Corporate Governance Report 2023

Commitment to the Austrian Code of Corporate Governance	4
Executive Board	6
Supervisory Board	8
Measures to promote women	11
Diversity concept	12
External evaluation in accordance with C rule no. 62	14

				Frequentis Group
4		Commitment to the Austrian Code of Corporate Governance		Corporate Governance Report 2023

Commitment to the Austrian Code of

Corporate Governance

Frequentis is committed to accountable management of the company geared to creating sustainable, long-term value. In keeping with this, Frequentis AG supports the Austrian Code of Corporate Governance, which aims to strengthen the confidence of national and international investors in the Austrian capital market by increasing transparency and establishing uniform principles of good corporate management.

The Austrian Code of Corporate Governance published by the Austrian Working Group for Corporate Governance is generally recognised. The applicable version is publicly available at www.corporate- governance.at and comprises three categories of rules:

• L rules (legal requirements), which are based on mandatory legal requirements;
• C rules (comply or explain), which have to be followed; to be in compliance with the Code, any deviation has to be explained and the reasons stated; and
• R rules (recommendations) since these are recommendations, non-compliance does not require either disclosure or reasons.

Corporate Governance Declaration

Frequentis AG complies with all mandatory L rules and - with the exception of the deviations set forth below - all C rules set out in the Austrian Code of Corporate Governance in the version dated January 2023:

Rule 2

• Under article 5.1.2 of the articles of association of Frequentis AG, the holder of registered share no. 1 with restricted transferability, Mr. Johannes Bardach, is authorised to appoint one third of the maximum number of shareholder representatives on the Supervisory Board (right to appoint Supervisory Board members under Section 88 of the Austrian Companies Act [AktG]). In this respect, the principle of "one share - one vote" is not fulfilled. The company benefits from the commitment, knowledge, and experience of the Supervisory Board members appointed by the majority shareholder, Mr. Johannes Bardach. In all other respects, share no. 1 has the same rights (especially voting and profit-sharing rights) as all other shares. An agreement on the election of a person nominated by B&C Holding Österreich GmbH ("BCHÖ") as a member of the Supervisory Board of Frequentis AG has been concluded between Frequentis Group Holding GmbH and BCHÖ.

Frequentis Group
Corporate Governance Report 2023	Commitment to the Austrian Code of Corporate Governance	5

Rule 27

• Further, in the reporting period long-term variable remuneration components were only provided for the Chairman of the Executive Board, because he bears primary responsibility for the long-term corporate strategy.

Rule 39

• The Audit Committee and the Committee for Executive Board Issues do not meet the requirements of C rule no. 39 of the Austrian Code of Corporate Governance as only one of the two shareholder representatives on these committees can be regarded as independent. The two shareholder representatives who are not deemed to be independent are Mr. Johannes Bardach (Committee for Executive Board Issues) and Mr. Reinhold Daxecker (Audit Committee). They have extensive knowledge of the relevant fields and, above all, the Frequentis Group. This is of material importance for the work of these committees, so their appointment represents added value for the committees.

Rule 53

• The Supervisory Board does not fulfil C rule no. 53 as only three of the six shareholder representatives elected by the Annual General Meeting or delegated by the shareholders on the basis of the articles of association are considered to be independent. The shareholder representatives who are not deemed to be independent are Mr. Johannes Bardach (Chairman of the Supervisory Board), Mr. Reinhold Daxecker (member of the Supervisory Board) and Mrs. Sylvia Bardach (member of the Supervisory Board). However, each of these members has extensive expertise that is of material relevance to the work of the Supervisory Board and, above all, a very precise knowledge of the Frequentis Group, so their appointment represents added value for the Supervisory Board.

				Frequentis Group
6		Executive Board		Corporate Governance Report 2023

Executive Board

Members of the Executive Board

In 2023, the Executive Board of Frequentis AG comprised the following members:

Name		Date of	End of current	Supervisory Board
(Year of birth)	Function	initial appointment	term of office	or similar offices 1
Norbert Haslacher2	Chairman of the	1 April 2015 (member	15 April 2028	None
(1970)	Executive Board	of the Executive Board)
	(CEO)	16 April 2018 (Chairman)
Monika Haselbacher2	Member of the	1 January 2023	31 December 2027	None
(1969)	Executive Board
	(COO)
Hermann Mattanovich	Member of the	1 January 2009	31 December 2024	None
(1960)	Executive Board
	(CTO)
Peter Skerlan	Member of the	16 April 2021	15 April 2026	None
(1968)	Executive Board
	(CFO)

1

2

Seats on supervisory boards or comparable offices at domestic and foreign companies that are not included in the consolidated financial statements

In view of the similarity between the surnames of Mr. Haslacher and Ms. Haselbacher, attention is explicitly drawn to the fact that they are not related.

Norbert Haslacher has been a member of the Executive Board of Frequentis AG since April 2015, originally with responsibility for Sales & Marketing. He was appointed CEO in April 2018.

Responsibilities: Strategy, Global Sales, Strategic Business Units, Corporate Communications & Marketing, Investor Relations, New Business Development & Invest4Tech, New Market Solutions, Partnerships and M&A.

Norbert Haslacher studied business economics at St. Gallen Business School and has more than two decades' experience of technology solutions, services, and consulting, including as managing director responsible for Austria and Eastern Europe at the US IT company CSC and, before that, as a consultant at Coopers & Lybrand Consulting.

Monika Haselbacher has been a member of the Executive Board of Frequentis AG and Chief Operating Officer (COO) since 1 January 2023.

Responsibilities: Project Management & PMO, Customer Services, Health Safety Environment (HSE) Management, Group Governance, Processes & Efficiency, Quality Management, Safety Management, Group Management.

Monika Haselbacher studied communications engineering at Vienna University of Technology and has worked for Frequentis since 1998 in various management positions in different departments and Group companies. She was also responsible for the implementation of complex customer projects.

Frequentis Group
Corporate Governance Report 2023	Executive Board	7

Peter Skerlan has been Chief Financial Officer (CFO) of Frequentis AG since 16 April 2021. Mr. Skerlan is also the administrative managing director of the following Frequentis Group company: Frequentis Invest4Tech GmbH.

Responsibilities: Finance, Human Resources, IT, Legal, Facility Management, Environment, Social & Governance (ESG), Internal Audit & Compliance.

Peter Skerlan studied corporate management at Vienna University of Applied Sciences and business administration and accounting at the University of London. He joined Frequentis in 1999 as a business area controller. From 2006, Peter Skerlan was Vice President Finance with overall responsibility for financial performance and processes in the Frequentis Group.

Hermann Mattanovich has been a member of the Executive Board of Frequentis AG since January 2009. In the reporting period, his function was Chief Technology Officer (CTO). In addition, Mr. Mattanovich is managing director of the following Frequentis Group companies: Frequentis Czech Republic s.r.o., PDTS GmbH, Mission Embedded GmbH.

Responsibilities: Technology Management, Production & Logistics, Procurement, Product

Management, Security.

Hermann Mattanovich studied electrical engineering at Vienna University of Technology and started his career as a technical consultant for companies such as Philips, Elin, VOEST, and Frequentis. He also worked as a lecturer at Vienna University of Technology. In 1988, he co-founded PDTS, a software development company that was later taken over by Frequentis. In addition, between 1999 and 2004 he was responsible for the TETRA development portfolio at Frequentis.

				Frequentis Group
8		Supervisory Board		Corporate Governance Report 2023

Supervisory Board

Members and independence of the Supervisory Board

In 2023, the Supervisory Board of Frequentis AG comprised the following members:

Name		Date of initial	End of current	Supervisory Board
(Year of birth)	Function	appointment	term of office	or similar offices1
Johannes Bardach	Chairman of the	16 April 2018	Indefinite (member	None
(1952)	Supervisory Board		delegated pursuant to
	(shareholder		article 5.1.2 of the
	representative)		articles of association)
Karl Michael Millauer Deputy	17 July 20072	Until the Annual	None
(1958)	Chairman		General Meeting in
	(shareholder		2025
	representative)
Boris Nemsic	Member of the	17 July 20072	Until the Annual	None
(1957)	Supervisory Board		General Meeting in
	(shareholder		2025
	representative)
Reinhold Daxecker	Member of the	16 April 2018	Indefinite (member	None
(1970)	Supervisory Board		delegated pursuant to
	(shareholder		article 5.1.2 of the
	representative)		articles of association)
Petra Preining	Member of the	20 September 2019	Until the Annual	None
(1973)	Supervisory Board		General Meeting in
	(shareholder		2024
	representative)
Sylvia Bardach	Member of the	20 May 2021	Until the Annual	None
(1962)	Supervisory Board		General Meeting in
	(shareholder		2026
	representative)
Gabriele Schedl	Member of the	1 January 2015	Indefinite (delegated	None
(1968)	Supervisory Board		pursuant to Section
	(employee representative)		110 ArbVG)
Reinhard Steidl	Member of the	20 September 2019	Indefinite (delegated	None
(1962)	Supervisory Board		pursuant to Section
	(employee representative)		110 ArbVG)
Stefan Hackethal	Member of the	1 September 2022	Indefinite (delegated	None
(1961)	Supervisory Board		pursuant to Section
	(employee representative)		110 ArbVG)

1. Supervisory Board or similar offices at publicly listed Austrian or foreign companies
2. Previously a member of the Supervisory Board of Frequentis GmbH (from 2002), which became Frequentis AG on 17 July 2007

The Supervisory Board's criteria for independence are based on the "Guidelines for Independence" set out in the Austrian Code of Corporate Governance, which specify - among other things - that a Supervisory Board member shall not have served as member of the Executive Board or as a management-level staff member at the company in the past five years. Mr. Bardach was Chairman of the Executive Board of Frequentis AG before being appointed to the Supervisory Board in April 2018. Mr. Daxecker held a management position at Frequentis AG before being appointed to the Supervisory Board in April 2018. Prior to her election to the Supervisory Board in May 2021, Mrs. Bardach was a member of the Executive Board of Frequentis AG. Mr. and Mrs. Bardach and Mr. Daxecker are therefore deemed not to be independent, so C rule no. 53 of the Austrian Code of Corporate Governance is not fulfilled (see ↗ Corporate Governance Declaration in this report). The other members of the Supervisory Board (shareholder representatives) are independent of the

Frequentis Group
Corporate Governance Report 2023	Supervisory Board	9

company and the members of its governance bodies. Moreover, Mr. Millauer and Mr. Nemsic are independent members of the Supervisory Board; neither hold more than 10% of the company's shares or represent the interests of such shares.

Apart from the disclosures in the notes to the consolidated financial statements for 2023 ↗ Note 36 Information on business relations with related parties, there were no business transactions in 2023 requiring approval pursuant to Section 95 (5) subsection 5 line 12 of the Austrian Companies Act or L rule no. 48 of the Austrian Code of Corporate Governance.

Working procedures of the Executive Board and the Supervisory Board and its committees

The Executive Board conducts the business of Frequentis AG in accordance with the law, the articles of association, and the rules of procedure issued by the Supervisory Board (the allocation of business responsibilities can be seen from the previous section of this report ↗ Members of the Executive Board). The rules of procedure govern, in particular, reporting to and collaboration with the Supervisory Board and contain an extensive list of business activities that require the consent of the Supervisory Board. The Executive Board holds regular meetings at which it discusses and decides on strategic and operational issues and on other matters of significance for the Frequentis Group or individual parts of the Frequentis Group which fall within the remit of the Executive Board. In addition, the members of the Executive Board constantly share information with each other and with the responsible managers and experts in the relevant field.

The Executive Board constantly maintains close contact with the Supervisory Board and, in particular, its Chairman, especially on strategic and other fundamental matters relating to the Frequentis Group's business policy. In addition, the Executive Board reports extensively at least once a quarter to the Supervisory Board on the business performance and situation of the Frequentis Group.

The Supervisory Board advises and oversees the management of the company by the Executive Board. It held four meetings in 2023. Except for one employee representative, who was excused from attending one meeting of the Supervisory Board, all members took part in all Supervisory Board meetings in the reporting period. The computed attendance rate was therefore around 97% (2022: around 98%). At its meetings, the Supervisory Board openly discussed with the Executive Board the strategic focus, business development, and situation of the Frequentis Group. It also examined in detail the key projects and individual measures and business activities requiring its consent.

In conformance with the statutory requirements and the corresponding rules of the Austrian Code of Corporate Governance, the Supervisory Board has set up the following committees:

Committee	Members
Audit Committee	Karl Michael Millauer (Chairman/financial expert)
	Reinhold Daxecker
	Gabriele Schedl
Committee for	Johannes Bardach (Chairman)
Executive Board Issues	Boris Nemsic
Special Committee on	Karl Michael Millauer (Chairman)
Commerzialbank Mattersburg	Petra Preining
	Reinhard Steidl

				Frequentis Group
10		Supervisory Board		Corporate Governance Report 2023

The Audit Committee has been established in accordance with the provisions of Section 92 (4a) of the Austrian Companies Act. It is responsible, in particular, for the audit and for preparations for adoption of the annual financial statements for the company and the consolidated financial statements, the management report, the corporate governance report, and the proposal for the distribution of the profit. It also puts forward a proposal for election of the auditor for the resolution of the Annual General Meeting. In addition, the Audit Committee performs the preliminary examination of the non- financial report. The Audit Committee held three meetings in 2023. In addition to all committee members, the auditor also attended these meetings.

The Committee for Executive Board Issues deals, on the one hand, with matters relating to the relationship between the company and members of the Executive Board, especially the content and conclusion of employment contracts, and on the other hand, with all aspects of succession planning for the Executive Board and the Supervisory Board. Therefore, it combines the typical agendas of a remuneration committee and a nomination committee ("identical committee" as defined in C rule no. 43 of the Austrian Code of Corporate Governance). The Committee for Executive Board Issues held two meetings in 2023. All members attended both meetings.

The Special Committee on Commerzialbank Mattersburg was set up by the Supervisory Board to oversee the investigation and appraisal of the internal processes and responsibilities relating to the Commerzialbank Mattersburg case in 2020 and the accompanying revision of the relevant processes and regulations. At present, this special committee is focusing on overseeing the measures being taken to reclaim the company's deposits at Commerzialbank Mattersburg and the related assertion of claims against Commerzialbank Mattersburg and third parties. The committee held two meetings in 2023; all members took part in both meetings.

As already outlined, neither the Audit Committee nor the Committee for Executive Board Issues meets the requirements of C rule no. 39 of the Austrian Code of Corporate Governance, because in each case only one of the two shareholder representatives on the committee can be regarded as independent (see ↗ Members and independence of the Supervisory Board and ↗ Corporate Governance Declaration in this report). Mr. Bardach and Mr. Daxecker both have extensive knowledge of the relevant fields and, above all, the Frequentis Group. This is of material importance for the work of these committees, so their appointment as committee members represents added value for the committees.