BAE Systems 95 Annual Report 2017 The Remuneration Committee’s year January May November Committee Committee Committee London, UK Farnborough, Hampshire, UK New Milton, Hampshire, UK – Agreed 2017 objectives for executive – Considered institutional investor – Reviewed level of executive directors’ directors and Executive Committee shareholder updates. and Executive Committee members’ members. – Approved remuneration package for new shareholdings relative to the Minimum – Reviewed feedback from shareholder or existing Executive Committee members. Shareholding Requirement. consultation on 2017 Directors’ – Reviewed dilution levels and share usage remuneration policy renewal. September under Employee Share Plans. – Reviewed Remuneration Committee – Approved operation of Group All-Employee terms of reference. Committee Free Share Plans. Farnborough, Hampshire, UK – Considered high level remuneration market February – Agreed basis for 2017 annual remuneration practice findings. review including elimination of share options – Approved remuneration package for new Committee for UK executive directors. or existing Executive Committee members. London, UK – Received update on progress against – Reviewed outline of 2017 Annual – Determined 2016 bonuses against Annual Incentive Plan objectives for remuneration report. performance for executive directors executive directors and Executive and Executive Committee members Committee members. December for payment in March 2017. – Received update on performance conditions – Approved 2016 Group All-Employee for Long-Term Incentive awards. Committee Free Share Plans payments. – Approved remuneration package for new London, UK – Determined vesting outcome for or existing executive director or Executive – Reviewed and set salaries and bonus 2014 Long-Term Incentive awards. Committee members. opportunity levels for executive directors – Approved 2017 Long-Term Incentive – Received details of recent pay review and Executive Committee members. awards and associated performance exercise for key senior executives. – Proposed and set 2018 Annual Incentive targets for executive directors and targets. Executive Committee members. – Approved modifying the mix of Long-Term Incentives for US executive director. – Reviewed feedback from shareholder consultation on 2017 remuneration review and policy renewal. – Approved 2016 Annual remuneration report. Remuneration Committee timeline January February May September November December Committee Committee Committee Committee Committee Committee