CORPORATE GOVERNANCE OF PHILIPS

BYS.Mamatha Himabindu

Philips

It’s a dutch diversified company head quartered in Amsterdam

primary divisions focused in the areas of Healthcare, Consumer Lifestyle and Lighting.

Frans van Houten

Chief Executive Officer

Chairman of the Board of Management and the Executive Committee

Philips Believe in

We’re on a mission to improve the lives of billions through

meaningful innovation Philips Excellence shows us how we

go from good to

great!

Our culture is defined

by doing the right thing

Management

Executive Committee

CEO

Managers

Board of Management is accountable for the actions and decisions of the Executive Committee

Follows two-tier corporate structure

Board of Management is accountable for its performance to a separate and independent Supervisory Board

Disclosure of Securities Transactions

members of the Supervisory Board are only allowed to trade in Philips securities

Members of the Executive Committee hold shares in Philips for the purpose of long-term investment

Committee Purpose

Committee’s purpose is to ensure that the Company implements and maintains internal procedures

review material developments and advise on the Company’s disclosure obligations on a timely basis

Committee Membership

The Committee shall consist of representatives of

Corporate Control,

Corporate Legal Department,

Corporate Communications and

Investor Relations

and any other according to the need and changes

Committee Structure and Operations

The Board of Management shall designate one member of the Committee as its Chairperson and one member of the Committee as its Secretary

The Committee shall meet as often as necessary to discharge its duties

If any member of the Committee is absent from a meeting of the Committee, the remaining members shall have the power to take any action necessary

Remuneration

Committee ensures that a competitive remuneration package for Board-level executive talent is maintained.

benchmarked with other multinational companies operating in global markets

The Annual Incentive criteria are the financial indicators of the Company: net

income, cash flow and comparable sales growth, and

team targets

The on-target Annual Incentive percentage is set at 60% of base salary for members of the Board of Management

80% of the base salary for the President/CEO

Annual Incentive achievable is 120% of the annual base salary and for the President/CEO 160% of the annual base salary

Supervisory Board

The Supervisory Board, in the two-tier corporate structure and independent body from the Board of Management

The Supervisory Board supervises the policies of the executive management and the general course of affairs of Philips and advises the executive management

General Meeting of Shareholders is held at least once a year to discuss the

Annual Report, includes the report of the Board of Management, the annual financial statements with explanatory notes thereto and additional information required by law

Meetings are convened by public notice, via the Company’s website or other electronic means of communication

Sustainability

Group Strategic Focus

Eco-vision

Social and Environmental Approach

Ethical Code

Protect confidentiality of information

Avoid conflicts of interest

Select suppliers that comply with ethical standards

Report any concerns regarding compliance with the Philips Procurement Code

Thank You