Remuneration system of Universal-Investment-Gesellschaft mbH

(As of May 2017)

Universal-Investment-Gesellschaft mbH (hereinafter, "Universal-Investment") is subject to the applicable regulatory provisions governing the establishment of remuneration systems for capital management companies. Universal-Investment has set out the detailed arrangements in remuneration guidelines, the aim of which is to ensure a sustainable system of remuneration, while preventing misplaced incentives for taking immoderate risks. The remuneration system of Universal-Investment is checked by a remuneration committee for adequacy and compliance with all legal provisions at least once a year. It covers fixed and variable remuneration aspects. The calculation of the variable remuneration encompasses the company's earnings situation, the organisational unit's achievement of its goals and the employee's personal performance. The most important of the goals set during the personal assessment are sustainable business development and protection of the company from excessive risks. Above all, no incentives to take excessive risks should be created. The purpose of the remuneration system should be to control the company's operational risk components, as well as to enhance the efficiency and quality of the work and product through clearly structured processes, automation and specific responsibilities. The variable remuneration elements in particular are therefore not coupled to the performance of the investment assets managed by Universal-Investment.

Establishing ranges for the entire target remuneration also ensures that there is no significant dependence on the receipt of variable remuneration and that the relationship between the fixed and variable remuneration is appropriate. Both the executive board and the supervisory board have the final say in the allocation of variable remuneration. You can see the members of the executive board and the chairman of the supervisory board of Universal-Investment at the following link . The remuneration committee responsible for defining and monitoring the remuneration system consists of the chairman of the supervisory board and representatives of the management board,  the Human Resources Department, the Risk Controlling Department, Portfolio Management Department and Compliance.

In addition to the remuneration elements mentioned above, employees of Universal-Investment can obtain voluntary employer benefits-in-kind.

Special regulations apply for the executive board of Universal-Investment and employees whose activities have a considerable impact on the company's overall risk profile and the investment assets managed by it (risk takers). Employees who may have a decisive impact on the risk and corporate policy of Universal-Investment have been identified as risk takers. The variable remuneration for these risk-affected employees is paid out in arrears over several years. A mandatory portion of at least 40% of the variable remuneration is deferred over a period of at least three years. During this period, the deferred portion of the remuneration is risk-based, and so it can be reduced in the event of negative profit contributions by the employee or by Universal-Investment. At the end of each year of the qualifying period, the relevant deferred share of the remuneration falls due and is paid out on the respective payment date.