Varta : Corporate Governance Declaration / Declaration of Conformity 2022

Corporate Governance Statement

Corporate Governance Statement pursuant to Section 289f, 315d of the German Commercial Code (HGB)

dated April 28, 2023

Declaration on the German Corporate Governance Code (DCGK) pursuant to Section 161 of the German

Stock Corporation Act (AktG)

The Executive Board and Supervisory Board declare:

The recommendations of the "Government Commission on the German Corporate Governance Code" as amended on 16 December 2019 (DCGK 2020) and published by the Federal Ministry of Justice in the official section of the Federal Gazette on 28 April 2022 (DCGK 2022) have been complied with in the period since the last Declaration of Conformity dated 29 March 2022, with the exception of the following clauses for the reasons stated therein.

Composition of the Executive Board (Recommendation B.1)

If new appointments are to be made to the Executive Board, the Supervisory Board will always keep the issue of diversity in mind, including female and diverse candidates, but the decisive factors are the education, experience and competence of the candidates.

Age limit for members of the Executive Board (Recommendation B.5)

In view of the age of the incumbent members of the Executive Board, VARTA AG has so far not set an age limit for Executive Board members. The Supervisory Board of VARTA AG is considering setting an age limit in the future.

Independence of members of the Supervisory Board (Recommendation C.10 Sentence 1)

Due to the indirect business relations with VARTA AG or the VARTA AG Group, the Chairman of the Supervisory Board, who is also Chairman of the HR Committee, cannot be regarded as independent of the Company and the Executive Board according to the indicators in recommendation C7. The Supervisory Board has no doubt that the Chairman of the Supervisory Board and of the HR Committee is exclusively oriented towards the best interests of the company in his Supervisory Board activities.

Determination of the amount of variable remuneration components (Recommendations G.6 and G.10 sentence 1)

The Supervisory Board has decided to split the variable compensation amounts equally between short-term incentive and long-term incentive. From an incentive point of view, the Supervisory Board currently considers

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an equal weighting of the short-term incentive and the long-term incentive to be appropriate in the interests of sustainable corporate development.

Ellwangen, April 2023

Executive Board and Supervisory Board

VARTA AG

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Corporate Governance Report in accordance with Principle 23 of the German Corporate Governance Code

Corporate governance stands for responsible, transparent corporate management and control geared to long-term value creation.

We are convinced that good corporate governance is an essential basis for sustainable corporate success, which strengthens the confidence of our shareholders, business partners, employees and the financial markets in the Company. The VARTA AG Group has adopted a Code of Conduct, which was updated in 2022. This code defines behavioural guidelines as minimum standards that are binding for all employees of the VARTA AG Group worldwide. The complete Code of Conduct is available on the VARTA AG website at: https://www.varta-ag.com/fileadmin/varta_ag/publications/VARTA_Verhaltenskodex_de.pdf

Dual Management System

As an internationally active stock corporation with its registered office in Ellwangen, Germany, VARTA AG is subject, among other things, to the provisions of German stock corporation law. A fundamental principle of German stock corporation law is the dual management system, which assigns the management of the company to the Executive Board and the advice and supervision of the Executive Board to the Supervisory Board. These two bodies are strictly separated from each other, both in terms of their members and their competencies. However, both bodies work closely together in the best interests of the Company.

Composition and Functioning of the Executive Board

As at 31 December 2022 the Executive Board of VARTA AG, Ellwangen (Jagst) consisted of four members: Herbert Schein (CEO), Armin Hessenberger (CFO), Rainer Hald (CTO) and Dr Markus Hackstein. Herbert Schein resigned his post on the Executive Board with effect from 31 December 2022. Dr Hackstein was appointed as Spokesperson for the Executive Board in September 2022.

The members of the Executive Board are jointly responsible for the management of the Company.

No member of the Executive Board holds more than two supervisory board mandates or chairs supervisory boards of listed companies outside the Group or supervisory bodies of companies outside the Group with comparable requirements. The Executive Board manages the Company on its own responsibility, determines the strategic direction of the Company, agrees this with the Supervisory Board and ensures its implementation. In addition, it determines the corporate goals and shapes corporate policy and the Group's organisation. It also ensures appropriate and effective internal control and risk management, which also covers sustainability-related objectives, and compliance with statutory provisions and internal company guidelines. It is bound by the interests of the company and is guided by the goal of sustainably increasing the value of the company. In doing so, the Executive Board takes into account not only long-term economic goals but also ecological and social objectives.

Without prejudice to the overall responsibility of the Executive Board, the individual members manage the business areas assigned to them by the schedule of responsibilities on their own responsibility. There are no Executive Board committees. The Chairman of the Board of Management or Spokesperson for the Executive Board is responsible in particular for corporate development and for coordinating the business areas. The members of the Executive Board inform each other about all major developments in their business areas and coordinate all interdepartmental measures. Further details on cooperation within the Executive Board are set out in the Rules of Procedure for the Executive Board and the schedule of responsibilities. In particular, they also contain rules on meetings and resolutions and on cooperation with the Supervisory Board.

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At the Supervisory Board meetings, the Executive Board reports in writing and orally on the agenda items and draft resolutions and answers the questions put by individual Supervisory Board members.

The CEO and CFO are in regular contact with the Chairman of the Supervisory Board and the Chairman of the Audit Committee to discuss the key aspects of the Company's strategy, planning and corporate development, as well as risk management and compliance issues.

In view of the age of the incumbent members of the Executive Board, VARTA AG has so far not set an age limit for Executive Board members. For the reasons stated in the Declaration of Conformity, the Supervisory Board has not yet defined a diversity concept for the Executive Board.

Composition and Functioning of the Supervisory Board

In accordance with the Articles of Association, the Supervisory Board of VARTA AG consists of six members. However, at present, there are only five members. Prof. Dr Werner Tillmetz resigned his post as a member of the Supervisory Board with effect from 31 October 2022. The term of office of the remaining Supervisory Board members will expire at the end of the Annual General Meeting in 2026. The specific composition of the Supervisory Board and its chairmanship can be found in the Supervisory Board report.

The Supervisory Board has set targets for its composition which, in accordance with the Declaration of Conformity, take into account the recommendations of the German Corporate Governance Code. These objectives also include the competence profile for the entire body and the diversity concept pursued by the Supervisory Board for its composition. By the latter, the Supervisory Board understands an appropriate participation of both genders, a sufficient consideration of different professional and international experiences as well as ensuring the affiliation of members with many years of professional experience.

The members of the Supervisory Board as a whole have the knowledge, skills and professional experience required to perform their duties properly. They are familiar in their entirety with the sector in which the Company operates. As they also have extensive knowledge of different professional fields and many years of international experience, they bring a broad range of skills, experience and diversity to their Supervisory Board activities. In the opinion of the Supervisory Board, members Martin Ohneberg, Dr Michael Pistauer, Sven Quandt and Dr Harald Sommerer fulfil the requirement of independence. The Supervisory Board considers the number of four independent shareholder representatives on the Supervisory Board to be appropriate. Members of our Supervisory Board do not perform any board functions or advisory duties for significant competitors of the Company. Compliance with the age limit of generally 75 years at the time of election was taken into account in the appointment process, with the exception of one case.

The diagram below gives an overview of the current status of Supervisory Board member qualifications:

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Know-How

Sektoral

Funktional

D.3 DCGK

(Batterie / Energiespeicher -) Technik

Forschung und Entwicklung

Business Development

Finance

CEO / Management / Bereichsleitung

Compliance / Rechtswesen

Personalwesen

Buchhaltung / Rechnungsprüfung

Marketing

Digitalisierung

ESG

Rechnungslegung

Abschlussprüfung

Michael

Ja

JA

Tojner

Harald

Ja

Ja

Sommerer

Sven

Nein

Nein

Quandt

Martin

Nein

Nein

Ohneberg

Michael

Ja

Ja

Pistauer

Kernkompetenz

Sekundärkompetenz

Tertiär/ keine offensichtliche Kompetenz

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Key:	- core competency	Sektoral	- sector
Kernkompetenz
Secundärkompetenz	- secondary competency	Funktional	- functions
Tertiär/keine offensichtliche Kompetenz	- tertiary/no obvious competency	Know-how	- expertise

(Battery/energy storage) Technology // R&D // Business development // Finance // CEO/Management // Compliance/Law // HR // Accounting/Auditing // Marketing // Digitisation // ESG // Invoicing // Auditing

The basis of every Supervisory Board activity is the personal qualification of Supervisory Board members. For this reason, other important criteria are also taken into account in proposals of candidates for election. As in the past, attention will be paid to personality, integrity and sufficient diversity in terms of specialist and industry knowledge as well as special experience, e.g., in the fields of accounting or auditing.

The Supervisory Board monitors and advises the Executive Board on the management of the Company. It is informed by the Executive Board regularly, promptly and comprehensively on the business development, planning and the risk position of the Company, including compliance and agrees corporate strategy and its implementation with the Executive Board. The Supervisory Board examines and approves the annual financial statements of VARTA AG and the VARTA AG Group, taking into account the auditor's reports, and examines and resolves on the proposal of the Executive Board for the appropriation of the net profit. Furthermore, it decides on the resolution proposals to be submitted to the Annual General Meeting by the Supervisory Board. Certain transactions and measures of the Executive Board of fundamental importance require the prior approval of the Supervisory Board or a committee of the Supervisory Board.

The Supervisory Board is also responsible for appointing and dismissing members of the Executive Board. When appointing members of the Executive Board, the Supervisory Board ensures that the composition of the Executive Board is the best possible for the Company. Experience and industry knowledge as well as professional and personal qualifications play an important role in this. The HR Committee submits proposals

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